Floor Statements

Mr. President, there is objection.

Mr. President, I want to make one brief comment to the leader.

I have no additional comment to make to the leader. I can pose it as a question, but I do not really need to. The leader is aware that there is no intention on the Republican side to filibuster this bill. I concur in his remarks about the bipartisanship that resulted in both of the bills passing today.

There is one matter that needs to be resolved, as I understand it, with respect to this technical corrections bill, which does need to be dealt with, as the chairman of the committee noted. As far as I know, that is the only matter. There could be others, but I know of no intention on the part of anybody on our side of the aisle to raise extraneous matters to use the bill for any other purpose but to complete action on the bill. I am aware of the same matter that the majority leader is right now as the only matter that exists on our side. So there is no intention on our side of the aisle to filibuster the bill.

Sure.

I wonder if I might interrupt the Senator to ask a couple of questions.

I think the Senator from South Carolina makes an exceedingly important point here, and that is that our theory, which was that the Muslim world itself had to reject this virulent, militant Islamist approach, which is manifested in the terrorism of al-Qaida; that until the Muslim world itself turned on those militants, those terrorists, it would be difficult for the West itself to actually defeat terrorism. It could pose a defensive posture, but it would not be defeated. What the Senator from South Carolina has said is what we are now seeing, as a result of the American support for the Iraqi people: A, a unification of the Iraqi people and, B, importantly, a rejection of this militant Islamist terrorism to the point that they are now joining in the fight and have something invested in that in terms of their country.

The question I want to ask has to do with how all of this relates to American security. Yesterday, Senator Warner asked both General Petraeus and Ambassador Crocker whether, as a result of the success of the surge--and a key point that the Senator from South Carolina made, that now the Iraqi Muslim population was itself fighting to excise this cancer from the region--whether this fact does translate into America being safer. I wonder if the Senator could comment on both General Petraeus's response to that and Ambassador Crocker's response, and the Senator's own extensive experience and what his comments on that would be.

Mr. President, that is an extremely important question because there is a lot of rhetoric about this war. The question is, What is the action line here, what can Congress do? Actually, it is a question of what Congress must do.

As I understand it, looking at General Petraeus's testimony, he was very adamant that Congress needed to pass the supplemental appropriations bill that will actually fund the troops in the field. This money was requested over a year ago. It represents a little over $100 billion.

According to his testimony, it is critical not only to the military needs but also he importantly talked about the Commander's Emergency Response Program, the State Department's Quick Response Fund, and the USAID programs.

The Senator from South Carolina was talking a moment ago about this two-part process, not only the political reconciliation but the economic reconstruction of the country.

General Petraeus himself, who clearly wants to get the troops funded, noted the interrelationship of the funding to help reconstruct the country, as well as to support the troops.

We are very soon going to be in a situation, according to Secretary Gates, where the Armed Forces are going to have to allow money to be borrowed from their regular operational accounts to fund the operations in Iraq and Afghanistan. He said the results of that would be a slowdown in training and equipping Iraqi forces, the halting of military operations and pay of defense personnel, and losing the ability to replace lost and damaged equipment by ongoing operations and, finally, that some operations simply would not be started because they will not know in advance that the funding will be there to complete the operation, something with which I am sure no operational commander in the field would want to live.

My understanding of his testimony is he very strongly urged the Congress to quickly pass the supplemental appropriations bill so the troops in the field can be funded and do the mission, after all, we have sent them to do.

Mr. President, I say to my colleague there are going to be efforts apparently to hold this war funding hostage to other funding requests. For example, one of our colleagues said we are going to look at the supplemental not only for the $190 billion for the war--by the way, that figure is incorrect; it is $102 billion--but also what we can do on this bill for summer jobs programs.

I submit it is important to fund the troops because we have sent them on a mission. They volunteered, and they deserve our support. We should not threaten to withhold that support unless there is also funding for other programs that have a far lower priority than the security of our troops and the security of the United States.

I will also add one other point. In reading from what General Petraeus said yesterday and focusing right down on the American people, it is clearly in our national interest, he said, to help Iraq prevent the resurgence of al-Qaida in the heart of the Arab world. Both he and Ambassador Crocker said it is worth it to the United States that the success there is making us safer here at home. That is what it all gets back to, when folks say we need to have supplemental funding on other programs. This is making us safer at home.

I will conclude. I want my colleague from Connecticut to comment for a moment, and the Senator from Tennessee also wanted a couple minutes at the end of our time. I assured him we would have a of couple minutes. We may have to ask for an extra minute or so.

The following Senators are necessarily absent: the Senator from Colorado (Mr. Allard) and the Senator from North Carolina (Mrs. Dole).

The following Senators are necessarily absent: The Senator from Colorado (Mr. Allard), the Senator from Utah (Mr. Bennett), the Senator from Kentucky (Mr. Bunning), the Senator from Mississippi (Mr. Cochran), the Senator from Texas (Mr. Cornyn), the Senator from Wyoming (Mr. Enzi), the Senator from Utah (Mr. Hatch), the Senator from Oklahoma (Mr. Inhofe), the Senator from Arizona (Mr. McCain), and the Senator from Pennsylvania (Mr. Specter).

Further, if present and voting the Senator from Texas (Mr. Cornyn) and the Senator from Utah (Mr. Hatch) would have voted ``yea.'' The Senator from Kentucky (Mr. Bunning) would have voted ``nay.''

The following Senators are necessarily absent: The Senator from Colorado (Mr. Allard), the Senator from Utah (Mr. Bennett), the Senator from Kentucky (Mr. Bunning), the Senator from Texas (Mr. Cornyn), the Senator from Wyoming (Mr. Enzi), the Senator from Utah (Mr. Hatch), the Senator from Oklahoma (Mr. Inhofe), the Senator from Arizona (Mr. McCain), and the Senator from Pennsylvania (Mr. Specter).

Further, if present and voting, the Senator from Utah (Mr. Hatch) would have voted ``yea.'' The Senator from Kentucky (Mr. Bunning) would have voted ``nay.''

The following Senators are necessarily absent: the Senator from Georgia (Mr. Chambliss) and the Senator from Arizona (Mr. McCain).

The following Senators are necessarily absent: the Senator from Missouri (Mr. Bond) and the Senator from Arizona (Mr. McCain).

Will the leader yield for a question?

Madam President, I served in the House of Representatives with the Senator from Illinois as well. This isn't the first time he has done something unheard of. I was in the minority in the House of Representatives and on a particular vote--I don't know how many were on the floor, but probably about a dozen altogether--Dick Durbin was in the chair as Presiding Officer. He called the vote--a voice vote. It was supposed to be ``the ayes have it,'' but there were a bunch of Republicans on the floor and, in full-throated voice, we said ``no.'' I think one timid soul said ``aye.'' The Presiding Officer said: ``The nos appear to have it, the nos do have it.'' He called the vote, but not the way his side of the aisle wanted it called. Of course, about 10 minutes later, the appropriate number of people were on the floor and the vote was reversed. So this is not the first time the Senator from Illinois has done something unusual and in a way to move the process along and be fair in it. I always have appreciated that.

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

Mr. President, I ask unanimous consent that the pending amendment be laid aside for the purpose of my offering an amendment.

Mr. President, I ask that amendment No. 4407 be called up. I believe it is at the desk.

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

Mr. President, this amendment is actually very simple, and I think it will be another one of the things that we can do to help promote home ownership and the transfer of property to make it less expensive for people and, frankly, to advance a policy that we should have advanced a long time ago.

Most people know under current law they can exclude $250,000--for a married couple it is $500,000--from the capital gains when they sell their principal residence. In other words, even though you may make $250,000 on the value of your home when you sell it, that is excluded from the capital gains that would otherwise have to be paid.

You are limited by some requirements. You have to live in the home for 2 years. You have to own and occupy the home in 2 of the previous 5 years from the sale. But you are able to exclude from the capital gains $250,000. The problem is, as we found out with the alternative minimum tax, inflation can drive the value of this exclusion down.

So what this amendment does, simply, is index the exclusion for inflation. It is very simple. I cannot imagine it would be controversial. What this would do, of course, is to preserve the value of this deduction that we have all taken advantage of for the future and thereby encourage individuals to purchase a new home. Of course, much of what we are trying to do in this legislation is encourage home ownership but, more than that, encourage people to purchase homes or be able to transact the sale and purchase of a home.

There is another point I want to make, and it is important because some people have been caught in an innocent situation with regard to the foreclosures we are concerned about. People do not buy homes, for the most part, to make money. Now, it is true there were speculators in this red hot housing market and, obviously, we are in no mood to bail out speculators. But most people buy a home to raise their family, and they live in the home.

This exclusion, of course, requires they live in the home for 2 years out of 5 years before the sale. So we are not

talking about the situation where brokers would buy a home and then wait a couple months and flip it and sell it and make a big profit. This is for legitimate folks who bought a home to live in and have their family live in it and then sold it.

A large portion of a capital gain on a home is now inflation. That is the hard reality of it. I do not think any of my colleagues believe it should be subject to taxation. Unfortunately, inflation now is around 4 percent. It is growing faster than that. Therefore, for the future I think this is an important amendment as well.

So this amendment protects homeowners from unexpected changes in family status, employment, and health. It would help elderly taxpayers who sell their home and choose to move into less expensive housing during their retirement. Frequently, there is a capital gain on their longtime residence, and it would help them avoid having to pay a capital gains tax.

It clearly simplifies tax administration and record keeping. It would provide people with a much easier situation for acquiring a home.

Mr. President, there are some additional arguments that I could make. Let me cite a couple statistics. Then I am hoping I can perhaps engage some of my colleagues in a discussion to see if there would actually be a need to vote on this amendment or whether we could agree to it.

Let me cite a couple statistics. Usually we do not like to get into this much detail, but I think in this case it makes sense. We have seen housing prices now fall from what some call their bubble highs--the value that was driven up so dramatically, and now it has fallen. Alan Greenspan famously called it the froth in the housing market.

But housing prices are still much higher than they were in 1997. I think about my State. I think about the Senator from California, her State, and those States where property values appreciated, but a lot of that appreciation is now due to inflation.

Here are a couple of interesting stats: The median single-family home price in 1997 was $146,000. A decade later, in 2007, the median home price was $247,200--over $100,000 more in just 10 years. The median home price in California 10 years ago was $186,500, roughly. In February of 2008 it was $409,240--in other words, an increase of $222,750.

So, very clearly, there is a huge inflation factor going into the value of these homes, and we are going to have to pay capital gains tax on that above the $250,000 level if we do not index that amount for inflation.

So I could go on. I think it is so simple. It is a proposition that I would assume would have support from both sides of the aisle. There is nothing political about this, of course, and it would certainly help a lot of our homeowners at a time when we are searching for ways to do exactly that.

So I would pause at this point to see if anyone has any objection or questions about it. I will yield the floor otherwise. But I would love the opportunity to get into a discussion about it and see if there is any concern on anybody's part about it.

I appreciate that.

Mr. President, I appreciate that. We have an estimated cost, but perhaps we should wait until my colleagues get here. I will be happy to discuss that aspect of it as well.

With that, if there is no further discussion, then I will be happy to yield the floor. But I certainly hope my colleagues will take a look at this amendment and join me in supporting this amendment for the benefit of homeowners all over the United States of America.

Mr. President, I yield the floor.

Mr. President, reserving the right to object, but I will not object, it is my understanding it would be the intention of the majority leader that immediately following the prayer and pledge and the opening of the session, we would begin the votes, that there would not be a long period of leader time taken in speaking by the leaders; is that correct?

I appreciate that very much. I do not object, therefore.

Mr. President, with respect to Murray-Schumer amendment No. 4397, I make a point of order that the amendment violates section 201(a) of S. Con. Res. 21 of the 110th Congress.

The following Senators are necessarily absent: the Senator from Kentucky (Mr. Bunning), the Senator from Idaho (Mr. Crapo), the Senator from New Mexico (Mr. Domenici), and the Senator from Arizona (Mr. McCain).

Further, if present and voting, the Senator from Kentucky (Mr. Bunning) would have voted ``no.''

Mr. President, under section 904, I move to waive the Budget Act, and I will ask for the yeas and nays after the presentation by Senator Baucus and myself.

Mr. President, this amendment is very simple. We all know that for individuals, there is a $250,000 exclusion from capital gain when you sell your owner-occupied property. For a couple, it is $500,000. But just like the AMT, it is not indexed for inflation. This amendment indexes that for inflation. That is all it does.

Now, to my colleague saying that home values are going down, here are two statistics. I will cite one for the Nation and one for one State. Ten years ago, the median family priced home was $146,000. Today, it is $247,000. That is $100,000. In California, the median price 10 years ago was $186,000, roughly. It was $409,000 in February of this year, an increase of $222,000. The reality is that inflation has caused a tremendous increase in the value of homes, and when they are sold, people are going to have to pay the capital gains tax above $250,000.

Could we have order?

Well, Mr. President, might I ask unanimous consent for 15 seconds to make the point that the cost of this is $2.1 billion over 5 years, not the number the chairman indicated.

Ten years.

Mr. President, I thought the yeas and nays had been ordered, but I ask for the yeas and nays.

The following Senators are necessarily absent: the Senator from Kentucky (Mr. Bunning), the Senator from Idaho (Mr. Crapo), the Senator from New Mexico (Mr. Domenici), and the Senator from Arizona (Mr. McCain).

Further, if present and voting, the Senator from Kentucky (Mr. Bunning) would have voted ``yes.''

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

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

Mr. President, I ask unanimous consent that I may speak for such time as I might consume.

Mr. President, in the Senate, we are surrounded by history. The same can be said of the Capitol itself and, of course, of Washington, DC. It is very humbling to think that when we travel around the Nation's Capital, we are following the paths that many great statesmen walked before us.

Reflecting on our past can be a source of great pleasure, and it can lead to great insight. Learning about the lives of great Americans--the grand accomplishments and humanizing habits--is both entertaining and educational. Indeed, it is emblazoned in the rotunda in the Library of Congress that ``History is the biography of great men.'' The accomplishments of great Americans give us heights to which to aspire, and their failures give us guidance for our own pursuits.

Unfortunately, the pleasure of knowing history escapes many younger Americans. Study after study has shown that our students lack even a rudimentary knowledge of American history.

The most recent National Assessment of Education Progress found that elementary, middle, and high school students fall short in terms of what they know about U.S. history. According to the NAEP, the Nation's report card, roughly a third of fourth graders and eighth graders fall below what is deemed a ``basic'' level of proficiency in U.S. history. Our high schoolers fare much worse. More than half of 12th graders fall below the ``basic level.''

The news does not improve as students move on to college. Older students fare poorly as well, even those who attend what are considered our top universities and colleges. A recent survey of college freshmen and seniors revealed that many students are ignorant of what many of us consider basic facts of American history. For instance, only 47 percent of freshmen knew that Yorktown brought the Revolutionary War to an end. Seniors did even worse--only 45 percent knew. Another example: 42 percent of college freshmen could not identify on a multiple-choice test the 25-year period during which Abraham Lincoln was elected President. And another: 15 percent of seniors did not know that the Declaration of Independence denotes the inalienable rights of life, liberty, and the pursuit of happiness.

The results are disappointing, to say the least. They reveal that younger Americans have a poor concept of what is necessary for good citizenship. What is the basis for the social compact of Americans? Many younger Americans do not know that our Government was founded on principles and values of innate equality and liberty. We have known about these deficiencies for a long time. Yet very little progress has occurred. This must change if American voters are to be able to evaluate candidates and issues on the basis of American principles and values.

It was 13 years ago that the Senate debated the national illiteracy of U.S. history. At that time, the Senate was considering controversial national U.S. history standards. These standards were flawed, neglecting important individuals, ideas, and events for the sake

of politically correct subjects. As poor as the standards were, they did respond to what many recognized as a serious and legitimate problem: the Nation's children were not learning U.S. history.

As Senator Slade Gorton noted during that debate:

The founding truths of this country may have been self-

evident to the Founders, but as studies have demonstrated

again and again, they are not genetically transmitted.

Studies have continued to demonstrate just that.

So what to do about it? Most of what we learn about our country we learn in school, but today's curricula does little to interest our students. So says former Secretary of Education William Bennett. In an article in National Review last year, he wrote:

It's not our children's fault. . . .Many of our history

books are either too tendentious--disseminating a one-sided,

politically correct view of history of the greatest nation

that ever existed; or, worse, they are boring--providing a

watered down, anemic version of a people who have fought wars

at home and abroad for the purposes of liberty and equality,

conquered deadly diseases, and placed men on the moon.

Today's textbooks, say scholars like Bennett, do not relate the drama of our Nation, they are lifeless and boring, and they shy away from conveying the uniqueness and the extraordinary nature of America. Ours is a very special Nation based on what our Founders called ``truths.'' Is it conceivable that our unprecedented freedom, success, and leadership is influenced by these truths and the governmental structures designed to reflect them? You would not know it from some histories.

I believe our students would be well served by reading texts such as ``A Patriot's History of the United States.'' I like the way the authors of this book describe their approach to writing a volume of American history. They say:

We remain convinced that if the story of America's past is

told fairly, the result cannot be anything but a deepened

patriotism, a sense of awe at the obstacles overcome, the

passion invested, the blood and tears spilled, and the nation

that was built.

That is the spirit we should convey to our children. And it does not have to be politically correct--just fair. Of course, American history cannot ignore the bad, but it also should not neglect individuals, ideas, and events that inspire.

My colleague, Senator Lieberman, had it right in 1995. He said:

We do not need sanitized history that only celebrates our

triumphs. . . .But we also do not need to give our children a

warped and negative view of Western civilization, of American

civilization, of the accomplishments, the extraordinary

accomplishments and contributions of both.

Why is this important today? First, to quote my colleague from Connecticut again:

History is important. We learn from it. It tells us who we

are, and from our sense of who we are, we help determine who

we will be by our actions.

It is especially important in an election year, where knowledge of the past can help us evaluate events and candidates of today.

It is imperative that in these times Americans understand who we are as Americans. Americans must comprehend the principles and values on which this country was built because we are engaged in a great ideological confrontation with people who are dedicated to destroying us--a confrontation that will be arduous and difficult. The terrorist conflict in which we are engaged is one of values and principles, and future generations cannot act on these values if they are ignorant of American history.

When citizens begin to grow ignorant of who they are, one of the first symptoms is a loss of willpower. Learning about our past tells us who we are, and with that knowledge we are equipped to face the challenges and fight the wars we face today and in the future. Indeed, if future generations do not appreciate what we have--why it is so precious, why it needs defending--they will not do the hard things necessary to defend it.

In a speech to Harvard University's graduating class of 1978, Alexander Solzhenitsyn confronted the West's weak confrontation of communism.

It is probably worth noting here another item in the survey of college students I mentioned earlier. That survey found that about a quarter of freshmen were unable to complete this sentence correctly: ``The major powers at odds with each other in the 'Cold War' were the United States and [blank].'' A quarter of the students could not come up with the name--Soviet Union--and it was a multiple-choice quiz.

Solzhenitsyn's speech is particularly instructive even as we face a different ideological threat today. He warned:

No weapons, no matter how powerful, can help the West until

it overcomes its loss of willpower.

Some of the debates we have been having in the Senate raise the question of whether we are there again.

Thirty years after Solzhenitsyn, we need to summon willpower for this new conflict. We are engaged in a struggle against a radical ideology whose adherents want to eradicate us. The enemy we are fighting hates us because of our values and our principles, the origins of which are unknown to many young Americans. But a lack of willpower has inhibited our struggle against these global terrorists.

Last year, the Senate spent many hours debating whether to withdraw from Iraq before we had completed our mission. We have spent too much time arguing over terrorists' civil rights. Solzhenitsyn, in fact, presaged our current debate in 1978 when he observed:

When a government starts an earnest fight against

terrorism, public opinion immediately accuses it of violating

the terrorist's civil rights.

Such accusations are a sign of a lack of will to defeat an implacable enemy.

This brings me to a final figure, another Soviet dissident and another witness to the destructive power of dangerous ideologies, like Solzhenitsyn. These are both men who understand the necessity of willpower in the face of evil.

A couple of years ago, writing in the journal ``The New Criterion,'' Roger Kimball, in his essay ``After the suicide of the West,'' discussed the insights of the Polish philosopher Leszek Kolakowski, who lived both through the fascism of the Nazis and the communism of the Soviet Empire. He was also active in the Polish Solidarity movement. Kimball paraphrases Kolakowski and illuminates why knowledge of our history is so key for the maintenance of our willpower. Kimball writes:

Kolakowski is surely right that our liberal, pluralistic

democracy depends for its survival not only on the continued

existence of its institutions, but also ``on belief in their

value and a widespread will to defend them.''

One can surely question whether the next generation of Americans really believes in the value of our institutions. After all, what is it they have to base their judgment on when they know very little about the institutions themselves?

A few years ago, in 2003, the Library of Congress recognized Kolakowski for his intellectual achievements. After receiving his award, he made a speech in which he passionately explained why history is so important and why it is an important matter for discussion.

He said:

Historical knowledge is crucial to each of us: to

schoolchildren and students, to young and to old. We must

absorb history as our own, with all its horrors and

monstrosities, as well as its beauty and splendor, its

cruelties and persecutions, as well as all the magnificent

works of the human mind and hand; we must do this if we are

to know our proper place in the universe, to know who we are

and how we should act.

And he goes on:

One might ask what is the point of repeating these

banalities? The answer is that it is important to keep on

repeating them again and again, because these are banalities

we often find it convenient to forget; and if we forget them

and they fall into oblivion, we will be condemning our

culture, that is to say ourselves, to ultimate and

irrevocable ruin.

Studies of our young people's knowledge of history confirm the wisdom of this observation and raise questions about the risk to our history of falling into oblivion.

``Thankfully, historical amnesia still has a cure,'' Secretary Bill Bennett reminds us. ``Let us begin the regimen now.''

We need a cure, because as long as we suffer from this amnesia, we will be fighting two wars: a war against our enemies who wish to do us harm and a war against our will, the loss of which will let them.

The fate of future generations depends on how we answer the enemy's challenge today. To do that, we must

clearly understand the values and principles that make us who we are. The truth is no one will fight long, either literally or figuratively, for values and principles he doesn't understand.

Americans must know what is worth fighting for, must maintain the willpower to do it, and must apply the lessons of our past to our current threats. So we must find a way to help students understand the values and the principles upon which our Nation is founded. The solution begins at a fundamental level of learning and education. Our students need textbooks that capture the life of history--Bill Bennett suggests a national contest for better history textbooks--and draw young people to the study of our Nation's story.

The solution, however, must go beyond changes to curriculum. As a nation, we must learn to embrace our history again and discard the politically correct, relativistic version of our history that has persisted for far too long. We must act now to preserve for future generations what we know to be so important. Let us get about the job.

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

Mr. President, we need to defeat this amendment. This is not the usual AMT fix we are used to. This actually repeals rates of the AMT that were put into effect in 1993. The reality is we are not going to increase taxes in order to pay for the relief that would be provided to taxpayers here. This points out the difference between the Specter amendment, which we will deal with next, and the Conrad amendment.

I urge my colleagues to support the Specter amendment because it is the real deal. It is the real way we will deal with AMT, rather than the phony way that is presented by a mere indication that we will find revenues somewhere to offset against this tax cut. The question the majority would have to answer is: What taxes are you going to raise in order to pay for this rate reduction for the people who would otherwise pay the AMT?

There is certainly no suggestion that there is a spending cut in the offing. Therefore, what taxes would be raised to pay for this?

The following Senator is necessarily absent: the Senator from Texas (Mr. Cornyn).

Mr. President, the question here is whether we are serious about estate tax reform. We went through the exercise last year and passed it in the budget, and we didn't do anything. We are going to repeat that same thing this year unless we commit ourselves to actually passing a bill, saying we are going to raise taxes--because I am sure we are not going to reduce spending--and that is akin to saying it is not going to happen. Once again, we would be passing an amendment we know we are not going to act on. We need to be accountable to the American people and pass something in the budget that we know we are going to do, with real legislation.

I urge my colleagues to vote against this amendment and to vote for the next amendment, which is the real vote in favor of estate tax return.

Mr. President, last year this amendment received 56 votes, Democratic and Republican votes. It was then in the form of a motion to instruct conferees, but the provisions are the same.

This is the amendment on the estate tax that has a top rate not to exceed 35 percent, and it has a $5 million exemption for each spouse, for a total of $10 million.

This amendment is endorsed by small business groups such as the NFIB and by other pro-estate tax reform groups.

I hope my colleagues will agree it is a way to send a very strong signal through the budget process that we are serious about reforming the estate tax this year.

I urge my colleagues to support the amendment.

Mr. President, I appreciate my colleague's comments. The question is what taxes are we going to raise in order to provide tax relief. I don't think it is realistic that we are going to raise taxes, and I certainly don't expect we will reduce spending. If we are serious about it, we need to send a signal through this amendment if we want to reform the estate tax.

Mr. President, I ask for the yeas and nays.

Mr. President, the time of the vote has expired.

Mr. President, parliamentary inquiry: Once the Presiding Officer has announced the clerks will tally the vote, is the vote not concluded?

Mr. President, might I inquire as to whether any of the persons who have cast a vote since the Presiding Officer made that comment have changed their vote? The reality is they cast their vote after the time for voting expired by at least 4 minutes.

Parliamentary inquiry.

Parliamentary inquiry for the benefit of the Senators who are here.

Mr. President, if we are within two or three votes of a tie vote, is it going to be the rule that the Chair will leave the time for voting open by at least 4 minutes, as was just explained?

My second question is, Given the fact that the time was closed and Senator Cornyn was not given the opportunity to vote earlier, what would the Chair's opinion be with respect to having a revote on that?

I had a parliamentary inquiry, but I will be happy to always have the majority leader comment on whatever.

I am sorry, Mr. President, I am perhaps confused because I have two questions.

The first was, since the time for voting had clearly expired by at least 4 minutes and the vote was within two or three of being tied and the majority leader said it was the case that Members could continue to change their votes or vote if it was a close vote, whether we had now established a precedent for the remainder of the day that if we are within two or three of a tie vote, even though we are 4 minutes beyond the time for voting, that the Chair would then, according to this precedent, allow people to change their vote or cast a vote?

Mr. President, if I could just address this question to the majority leader. That is exactly the question I had. Since we announced the 10 minutes, in the last vote we went over by about 5 minutes. We need to be consistent and our Members need to know what the rules are going to be. We made an exception here.

My inquiry to the Chair is whether, as a result of that exception, which did change the result of the vote, that the precedent would now be that we actually would have up to 15 minutes to cast votes.

Mr. President, one final question. I think I need to address this to the Chair as a purely parliamentary inquiry; that is, once the clerk's tally has been requested by the Presiding Officer, is the vote closed or not, except for Members who might wish to change their vote?

The following Senator is necessarily absent: the Senator from Louisiana (Mr. Vitter).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

Mr. President, the problem is we are in the game here, spending the same dollar three or four times, it appears. Under the Sanders amendment, it is paid for by raising taxes another $32.5 billion, ostensibly from the rich; that is to say, by raising taxes on people who make over $1 million a year. Here is the problem with that. The budget on the floor already assumes the expiration of the current tax rates; that is to say, the rates on the highest level go from 35 to 39.6, and that money is spent. If you took all the top-rate income, you would come up with $25 billion a year, not even enough to meet what is here, and that money has already been spent.

The reality is somewhere or other, somehow, more taxes would have to be raised. I don't think the American people want to do that, particularly in the current environment.

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senators are necessarily absent: the Senator from Nebraska (Mr. Hagel) and the Senator from Arizona (Mr. McCain).

The following Senators are necessarily absent: the Senator from Arizona (Mr. McCain) and the Senator from Nebraska (Mr. Hagel).

The following Senators are necessarily absent: the Senator from Arizona (Mr. McCain) and the Senator from Nebraska (Mr. Hagel).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Arizona (Mr. McCain).

The following Senator is necessarily absent: the Senator from Mississippi (Mr. Cochran).

Mr. President, I thank the chairman for his courtesy.

One of the questions we are most frequently asked is, are we, for sure, going to do the tax extenders--the R&D tax credit, the sales tax deduction, the $250 teacher deduction, and the tuition deduction. These already expired at the end of last year, and there are three more that will expire at the end of this year. We need to provide a definitive answer--yes, we are going to do the extenders package.

Now, the budget accommodates generally expiring tax provisions.

While we are getting order, Mr. President, this amendment, I gather, had not been technically called up, amendment No. 4348.

I ask unanimous consent that the reading be dispensed with.

Mr. President, just to conclude, the budget says expiring provisions are accommodated, but I don't think the Senate is going to raise $50 billion in new taxes to pay for these, to pay permanently for 1 or 2 years of these extenders. In fact, in recent times, more often than not, we have extended these tax provisions without offsets. In fact, this was done when the Democratic Party was in control of this Chamber, of this body, in the year 2002.

So what this amendment does is it simply explicitly extends all of these expiring tax provisions, which would expire at the end of this year and that have already expired, and it would not be required to have a permanent increase in taxes in order to accommodate that extension.

Mr. President, is there any time remaining on my side?

Mr. President, I oppose this amendment. The reason is very simple. The provisions are essentially the same as the amendment I offered earlier and will be offering again with the 5 and $5 million exempted amount and not to exceed 35 percent rate. There are minor differences. The bottom line is that the bulk of it, all but $22 billion, is not paid for with any explicit taxes. The question has to be, what tax are you going to raise permanently in order to offset the cost of this estate tax relief? It is not real if we are not willing to answer that question. You can't say there is going to be an amorphous fund out there that somehow or other we are going to raise some taxes for. We all know it is not going to happen that way. The question is, are we serious about tax relief for estates?

The reason the NFIB and other groups support the approach I have taken is they know it is an exercise in futility if all we do is say we are going

to pay for it with a tax increase, when, in fact, everybody knows we are not going to raise taxes permanently for estate tax relief.

Mr. President, do we need to call up amendment No. 4372 first?

If so, I ask unanimous consent to call up amendment No. 4372.

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

Mr. President, this is a revote of a vote we had earlier in the day. If you supported the estate tax reform then, obviously you would want to do it now.

I appreciate the last vote. This is a better approach. This is an approach which is supported by groups such as the NFIB, which asked us--we only have 1 year to go before the estate tax is totally repealed. In the year 2010, there is no more estate tax, and then the year after that, it comes roaring back with a rate of 60 percent and an exemption of $1 million.

Clearly, we have to provide some certainty. The only way to do that is to adopt a rate not to exceed 35 percent, an exempted amount of $5 million per spouse, and to ensure that we can actually get it done this year, not require that we find some permanent tax to increase in order to offset it. If that is what we are asking for, we know it won't happen, the outside groups know it won't happen, and they know this budget exercise then is a game rather than a serious attempt to reform the estate tax.

Mr. President, I ask for the yeas and nays.

The following Senator is necessarily absent: the Senator from Nevada (Mr. Ensign).

The following Senator is necessarily absent: the Senator from New Mexico (Mr. Domenici).

The following Senator is necessarily absent: the Senator from New Mexico (Mr. Domenici).

The following Senator is necessarily absent: the Senator from New Mexico (Mr. Domenici).

The following Senator is necessarily absent: the Senator from New Mexico (Mr. Domenici).

The following Senators are necessarily absent: the Senator from Missouri (Mr. Bond), the Senator from New Mexico (Mr. Domenici), and the Senator from Arizona (Mr. McCain).

The following Senators are necessarily absent: the Senator from Missouri (Mr. Bond), the Senator from New Mexico (Mr. Domenici), and the Senator from Arizona (Mr. McCain).

Mr. President, I rise today to call attention to the reauthorization of the President's Emergency Plan for AIDS Relief, also known as PEPFAR.

The program authorized in 2003 provided $15 billion over 5 years to the cause of AIDS relief in parts of the world ravaged by that disease. PEPFAR was a demonstration of the American people's desire to help those in need.

The 2003 legislation was also a demonstration of the American people's desire that their generosity not be wasted, as they have seen before with so many other aid programs. To that end, the legislation required that the lion's share of the funds be devoted to treatment of patients in need.

It encouraged accountability and transparency and it funded programs that could demonstrate results, such as the requirement that one third of prevention funds be spent on abstinence education programs--a decision that has kept countless persons from getting infected with HIV since 2003.

It is therefore mind boggling to me that recent reauthorization proposals the bill passed by the House Foreign Affairs Committee last week and the bill scheduled for mark up by the Senate Foreign Relations Committee today--would take such giant steps backward.

The bill originally introduced in the House would have eliminated the conscience clause, which protects humanitarian and medical professionals involved in these programs from having to participate in prevention and treatment methods that they find morally or religiously objectionable. Wisely, this provision was kept in the bill passed by the House committee, though it is substantially watered down--to the point of being nonbinding--in the Senate Foreign Relations Committee bill.

The original House bill struck the requirement that organizations that receive PEPFAR grants be opposed to prostitution and sex trafficking. That these commonsense provisions were even in danger of being dropped in the reauthorization of PEPFAR is sadly telling. It appears the Senate Foreign Relations Committee chose not to challenge such an unimpeachable provision of law.

And, unlike the majority on the House Foreign Affairs Committee, which backed down from including many troubling provisions on abortion and family planning demanded by far left groups, it appears the Senate Committee bill would pander to the so-called ``family planning'' agenda.

I am also deeply troubled that both the House Foreign Affairs Committee and Senate Foreign Relations Committee reauthorization proposals remove the requirement that at least fifty-five percent of the funds in the program be spent on treatment of AIDS patients. This provision was an important check on bureaucratic wastefulness and ``make work'' and it must be preserved.

Additionally, the requirement that thirty-three percent of PEPFAR prevention funds be spent on abstinence education, removed by the majority in last year's omnibus appropriations process, has not been restored in either of these two reauthorization proposals. In fact, all that remains in the tatters of that requirement in either of these bills is something only a bureaucrat could love: in the event a future AIDS coordinator chooses to ignore abstinence education, a report must be sent to Congress.

What is more, both of these reauthorization proposals include provisions that appear to undermine protections for intellectual property, the same protections that are necessary to ensure that innovation and research into life-saving medications continue.

While I am sure the sponsors of these two proposals are well-meaning, they further increase support for TB and malaria programs, even though the U.S. is already the largest contributor to TB and malaria programs through the Global Fund. Sadly, the Global Fund has become synonymous with graft and multilateral bureaucratic waste in many countries. We should not be duplicating those existing programs. We owe it to the American taxpayer, and those people suffering from these dreaded diseases, to fix the problems that abound in the Global Fund.

Lastly, but most significantly, both reauthorization proposals more than triple the expenditure for PEPFAR--something we simply cannot afford. PEPFAR 2003 authorized $15 billion over 5 years for emergency AIDS relief. Not satisfied with a mere doubling of this program as requested, both of these proposals would provide $50 billion over 5 years.

As I have noted already, the American people are a generous people. Our annual foreign aid budget reflects this generosity. However, this ability to give is not limitless.

Need I remind my colleagues, our economy is in distress. The presidential candidates on the other side are calling for a Federal Government bailout of homeowners facing foreclosure: with $50 billion, we could provide 235,157 homeowners with such a bailout.

Moreover, Congress just passed, and the president just signed, a program to provide Americans with checks intended to stimulate the economy. While I have doubts that this plan will succeed, I note that with this $50 billion, 157 million tax filers could be given rebate checks of $318.47.

Alternatively, with $50 billion, we could ``fully fund'' both No Child Left Behind and the Individuals with Disabilities Education Act at their authorized levels for one year.

Congress is beginning the annual budget cycle and we are daily confronted with requests for more and more federal spending. Already, key leaders in the budget process are threatening that if they don't get their way on domestic spending, they will add their spending to the forthcoming but overdue War Supplemental or will short circuit the budget process with a continuing resolution or yet another omnibus. Agreeing to this massive increase is not the way to discipline what is already shaping up to be a budget train wreck.

Governing is about choosing. By agreeing to this increase to $50 billion, neither the House nor Senate committees are governing. They are taking the easy course of action: spending.

I supported the President's Emergency Plan for AIDS Relief in 2003. I could reluctantly support doubling that amount over the next five years. But adding another $20 billion on top of that is too much.

We cannot lose sight of the sacrifices of millions of Americans who work hard and pay the taxes that support these programs. $50 billion is too much.

I cannot support a bill that so dramatically spends beyond what we can afford and so wantonly ignores accountability and transparency tools that safeguard the generosity of the American people.

This legislation can still be salvaged.

Yesterday, I cosponsored legislation with the Senator from Oklahoma, Dr. Coburn, and the Senator from North Carolina, Mr. Burr, that sets some key principles that must be a part of the reauthorization.

Earlier today, I introduced a bill that would prohibit the extension of PEPFAR funds away from their core purpose, helping the neediest countries. This legislation must also be a part of the reauthorization of PEPFAR.

I support the PEPFAR program and I believe that it is worth passage if funded at a responsible authorization level with at least the kind of commonsense policy, accountability, and transparency provided in the 2003 bill.

Mr. President, I rise today to call attention to the reauthorization of the President's Emergency Plan for AIDS Relief, also known as PEPFAR.

The program authorized in 2003 provided $15 billion over 5 years to the cause of AIDS relief in parts of the world ravaged by that disease. PEPFAR was a demonstration of the American people's desire to help those in need.

The 2003 legislation was also a demonstration of the American people's desire that their generosity not be wasted, as they have seen before with so many other aid programs. To that end, the legislation required that the lion's share of the funds be devoted to treatment of patients in need.

It encouraged accountability and transparency and it funded programs that could demonstrate results, such as the requirement that one third of prevention funds be spent on abstinence education programs--a decision that has kept countless persons from getting infected with HIV since 2003.

It is therefore mind boggling to me that recent reauthorization proposals the bill passed by the House Foreign Affairs Committee last week and the bill scheduled for mark up by the Senate Foreign Relations Committee today--would take such giant steps backward.

The bill originally introduced in the House would have eliminated the conscience clause, which protects humanitarian and medical professionals involved in these programs from having to participate in prevention and treatment methods that they find morally or religiously objectionable. Wisely, this provision was kept in the bill passed by the House committee, though it is substantially watered down--to the point of being nonbinding--in the Senate Foreign Relations Committee bill.

The original House bill struck the requirement that organizations that receive PEPFAR grants be opposed to prostitution and sex trafficking. That these commonsense provisions were even in danger of being dropped in the reauthorization of PEPFAR is sadly telling. It appears the Senate Foreign Relations Committee chose not to challenge such an unimpeachable provision of law.

And, unlike the majority on the House Foreign Affairs Committee, which backed down from including many troubling provisions on abortion and family planning demanded by far left groups, it appears the Senate Committee bill would pander to the so-called ``family planning'' agenda.

I am also deeply troubled that both the House Foreign Affairs Committee and Senate Foreign Relations Committee reauthorization proposals remove the requirement that at least fifty-five percent of the funds in the program be spent on treatment of AIDS patients. This provision was an important check on bureaucratic wastefulness and ``make work'' and it must be preserved.

Additionally, the requirement that thirty-three percent of PEPFAR prevention funds be spent on abstinence education, removed by the majority in last year's omnibus appropriations process, has not been restored in either of these two reauthorization proposals. In fact, all that remains in the tatters of that requirement in either of these bills is something only a bureaucrat could love: in the event a future AIDS coordinator chooses to ignore abstinence education, a report must be sent to Congress.

What is more, both of these reauthorization proposals include provisions that appear to undermine protections for intellectual property, the same protections that are necessary to ensure that innovation and research into life-saving medications continue.

While I am sure the sponsors of these two proposals are well-meaning, they further increase support for TB and malaria programs, even though the U.S. is already the largest contributor to TB and malaria programs through the Global Fund. Sadly, the Global Fund has become synonymous with graft and multilateral bureaucratic waste in many countries. We should not be duplicating those existing programs. We owe it to the American taxpayer, and those people suffering from these dreaded diseases, to fix the problems that abound in the Global Fund.

Lastly, but most significantly, both reauthorization proposals more than triple the expenditure for PEPFAR--something we simply cannot afford. PEPFAR 2003 authorized $15 billion over 5 years for emergency AIDS relief. Not satisfied with a mere doubling of this program as requested, both of these proposals would provide $50 billion over 5 years.

As I have noted already, the American people are a generous people. Our annual foreign aid budget reflects this generosity. However, this ability to give is not limitless.

Need I remind my colleagues, our economy is in distress. The presidential candidates on the other side are calling for a Federal Government bailout of homeowners facing foreclosure: with $50 billion, we could provide 235,157 homeowners with such a bailout.

Moreover, Congress just passed, and the president just signed, a program to provide Americans with checks intended to stimulate the economy. While I have doubts that this plan will succeed, I note that with this $50 billion, 157 million tax filers could be given rebate checks of $318.47.

Alternatively, with $50 billion, we could ``fully fund'' both No Child Left Behind and the Individuals with Disabilities Education Act at their authorized levels for one year.

Congress is beginning the annual budget cycle and we are daily confronted with requests for more and more federal spending. Already, key leaders in the budget process are threatening that if they don't get their way on domestic spending, they will add their spending to the forthcoming but overdue War Supplemental or will short circuit the budget process with a continuing resolution or yet another omnibus. Agreeing to this massive increase is not the way to discipline what is already shaping up to be a budget train wreck.

Governing is about choosing. By agreeing to this increase to $50 billion, neither the House nor Senate committees are governing. They are taking the easy course of action: spending.

I supported the President's Emergency Plan for AIDS Relief in 2003. I could reluctantly support doubling that amount over the next five years. But adding another $20 billion on top of that is too much.

We cannot lose sight of the sacrifices of millions of Americans who work hard and pay the taxes that support these programs. $50 billion is too much.

I cannot support a bill that so dramatically spends beyond what we can afford and so wantonly ignores accountability and transparency tools that safeguard the generosity of the American people.

This legislation can still be salvaged.

Yesterday, I cosponsored legislation with the Senator from Oklahoma, Dr. Coburn, and the Senator from North Carolina, Mr. Burr, that sets some key principles that must be a part of the reauthorization.

Earlier today, I introduced a bill that would prohibit the extension of PEPFAR funds away from their core purpose, helping the neediest countries. This legislation must also be a part of the reauthorization of PEPFAR.

I support the PEPFAR program and I believe that it is worth passage if funded at a responsible authorization level with at least the kind of commonsense policy, accountability, and transparency provided in the 2003 bill.

I have an amendment I would like to send to the desk and ask that it be read.

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

Mr. President, this amendment is a reprise of what we did last year in offering to reform the estate tax, sometimes referred to as the death tax.

Now, in the budget itself, and in an amendment that has been offered by the other side, there is a provision to allow the death tax to be changed from the current law to a top rate of 45 percent and an exempted amount of $3.5 million, and there are some other features. My amendment, as with the proposal that had significant support last year, would reduce that top rate to no higher than 35 percent so that if you had more than one rate, at least the top rate could not exceed 35 percent, and both of the two spouses would have a $5 million exempted amount before the estate tax would kick in.

In addition, this provides for a step-up in the basis of the property. It would enable the estate tax to be paid over the current period of time, and the amounts of money in the exempted amount, or unified credit of the estate gift tax, would be indexed for inflation.

Now, the reason for my amendment is, I think most agree even in this body, either allowing the estate tax to continue under current law-- getting up to a high rate of 55 percent and an exempted amount of either $2 million or $1 million, probably $1 million--or the proposal of the Democratic chairman of the committee would result in a continued unfair burden on primarily America's small businesses and farms, but, in any event, anyone subject to the potential liability of estate tax for which there is a tremendous amount of money spent in attempting to get around the obligations of the tax or to plan against its eventual required payments.

As a result, we look for ways to further reform the estate tax so that burden would be limited to only a few estates--the very highest estates--and that most people without a huge estate would not have the burden of trying to plan around it--to buy expensive insurance and hire lawyers and accountants and estate planners and the like.

The object, in other words, is not simply to limit the estate tax liability but provide some certainty in the Tax Code so that most people realize, as their homes have gotten more valuable simply because of the increased value with inflation, and as their businesses have accumulated some capital wealth even though it may not be disposable in the sense of liquid income, they are not going to have to worry that their estate is going to be subject to a tax and so they are not going to have to worry about spending this money to deal with the tax.

That is why we need to increase the total for a couple that would be exempted from the tax to $10 million and provide that the upper rate, if that rate kicks in, could be no higher than 35 percent. Above that, you are going to find people feeling that they have to try to prepare for or to get around the payment of the tax. And the irony is, Mr. President, those we are most concerned about really don't have the assets to try to spend a lot of money, whereas those who have enormous wealth can hire all the accountants, estate planners, and lawyers they want and buy insurance so that the ultimate impact of the tax does not hit them.

Last year, when we proposed this same proposal of the 35-percent highest rate or an amount of $5 million exempted for both spouses in a motion to instruct conferees, 56 Senators, obviously both Democrats and Republicans, voted for that motion to instruct. Now, it was never carried out, but I think it demonstrates the will of this body that we want to have some reform that is more realistic and that exempts more estates from the payment of the tax and the consideration of the tax.

According to the Joint Tax Committee, in the tax year 2011, 131,000 estates alone will be subject to the estate tax--131,000. Mr. President, that is too much of a burden on too many people in this country who are not extremely wealthy. By 2015, that number goes up to 177,000 estates. The advantage of my amendment is that it would protect approximately 119,200 family businesses and family farms from the estate tax each year. It would dramatically reduce the number of estates that have to worry about paying the tax.

If we fail to act, in other words, about 131,000 families and family businesses and farms will be subjected to the tax in the year 2011 and thereafter. Under our proposal, we would, according to the Joint Committee on Taxation, reduce the impact of the tax so that only 11,800 estates would be required to file estate tax returns each year, if the exemption is set at $5 million each. So, that is a huge change. It is necessary to protect the folks I think everybody in this body would like to protect from having to worry about the estate tax.

Now, it is interesting that when public opinion surveys ask people what they think about the tax, almost uniformly the results come back that the majority of Americans believe the estate tax is unfair and it ought to be eliminated. I remember a Gallup poll, now 3 or 4 years old, that said 60 percent of Americans believed it should be repealed. That is my preference, to repeal it. We haven't been able to get enough votes in this body to repeal it, but that is where the American people think it should be.

Interestingly, there was a survey conducted after the last Presidential election, and people who supported both Senator Kerry and President Bush were asked what they thought about the estate tax. The interesting thing is that while 70-some percent of the people who voted said they thought the tax should be repealed, roughly 80-some percent of the people who voted for President Bush thought it should be repealed and 60-some percent of the people who voted for Senator Kerry thought it should be repealed.

So this is not a partisan matter among the American people. They believe, whether they supported Senator Kerry or President Bush in the last Presidential election, that the estate tax should be repealed. I daresay surveys even now, to this time, demonstrate the American public opinion remains the same. The interesting thing is even those who understand they will never be subject to the tax because their incomes are simply not such that they will accumulate the wealth necessary to have to worry about the tax believe the tax to be unfair and believe it should be repealed.

But even if you leave aside the issue of the morality of the tax and people's understanding that it is not a fair tax, it hits people at the absolute worst time--when a loved one in their family has passed away and they are having to consider whether pieces of the business or farm may have to be sold off to pay the tax--they recognize that, at a minimum, it should be reformed and that is all we are trying to do.

For years, we have been trying to get a reform that basically accomplishes two objectives: It would increase the amount of the estate that is exempt from the tax so you don't have to worry about filing forms or having to try to plan around it; and for those who would still be subject to the tax above that amount, it would at least put a lid on it at a maximum of 35 percent.

Now, again, the numbers in the current law, if we don't do anything, go up to 55 percent. And under the proposal of the chairman of the committee on the other side of the aisle, that would be reduced to 45 percent. That is still way too high, and the exempted amount would be $1 million, which is way too low. Because of inflation today, there are a lot of homes that have a value of over $1 million, especially in places such as California, New York, and some other places. So, clearly, an amendment along the lines that I will be introducing to make room in the budget for this kind of reform is necessary.

I would like to make just about three other quick points.

Last year, even though the budget could accommodate estate tax reform, the majority did not bring a bill to the Senate. And despite my best efforts, it wasn't possible to get anybody to allow consideration of a bill to reform the estate tax. As a result, in the Finance Committee at the end of last year, I asked that the chairman hold hearings and seek to have a markup this spring so we could actually pass a bill and not simply deal with it in the budget that we pass each year.

The American people need to understand what is really going on. Each year we pass a budget that, theoretically, allows for a reform of the estate

tax, but then we don't do anything about it. And the budget itself isn't law. The budget is merely a goal, a blueprint of where we want to go for the year. If you don't follow it up with a bill, you haven't done anything. But Members here pat themselves on the back and go back home and tell their constituents that they voted to cut the estate tax. Oh, that is wonderful, people say. But it is never followed up with an actual bill.

So the chairman of the Finance Committee said: Well, he would have the goal of marking up a bill this spring. He has since advised me he has no plans whatsoever for a real bill on estate tax, and said: It won't happen.

It is going to be in the budget. His amendment will provide for an estate tax reform in the budget, but he has advised that he has no plans to allow that to happen, to make it, in reality, a bill that would pass and become law. So all of this is an exercise in show, with apparently no real intent to follow through and provide relief for America's families and small businesses and farms and the like.

What I would like to do, Mr. President, with my amendment, is not only demonstrate in the budget that this is the level that we want to set it, at a $5 million exempted amount per spouse and no higher than a 35-percent rate, but also ensure that the rules of the budget enable us to consider the bill during the year and not have it subject to some point of order that would enable people on the other side to say: Gee, we wish we could do it, but we just can't do it under the budget rules.

My amendment will make it possible to consider such an amendment, and I serve notice on my colleagues that I intend to try to bring it up. We are not going to sweep this under the rug year after year. If we are honest with the American people about putting it in the budget, we ought to be honest about bringing it to the floor for a vote so that we can actually pass a bill, send it to the President, and get this job done.

It is interesting that compared to other countries the United States is one of the worst in terms of the amount of money it takes from estates. The rate in the Democratic version would be 45 percent. The average around the world is 13 percent. There are a lot of countries that don't have an estate tax, and they understand why.

The irony is, I had to leave a hearing of the Finance Committee just now, Mr. President, where an individual was testifying about countries such as Canada, Australia, New Zealand, and places such as that, where people have decided it is not a good idea to have an estate tax, and it has been repealed in many of these countries. The United States should take a leaf out the book of some of these countries that have found it is inimical to their development and their ability to compete with other countries.

We know it is not good in terms of savings. The irony is that a lot of my colleagues are concerned about reducing the fact that our savings rate in this country is too low and are concerned about the fact that as a result we have to end up borrowing from countries such as China, for example. Yet having a big estate tax is exactly what is allowing that to happen because it discourages savings. If you save the money, you are just going to get taxed on it when you die, so why not just spend it?

Incidentally, the Treasury Department estimates the estate tax reduces the amount of money that we contribute to charity. Treasury estimates that the estate tax reduces bequests by about 14 percent. Individuals are either choosing to save less or rely heavily on estate planning which, of course, is a deadweight loss to the economy unless you are in the insurance business, in which case you think it is a real nifty idea because people have to buy insurance against the estate tax obligation that they otherwise would have.

Finally, it is an irony that the amount of money the Treasury collects--something over 1 percent of our revenue comes from the estate tax--is actually an equivalent amount of money to what is spent by people to try to avoid paying the estate tax. So, in effect, the money is paid twice. People buy insurance, they hire accountants and lawyers, and they try to find ways to get around the payment of the estate tax, and the amount of money that costs each year is almost exactly the same as what we pay in the estate tax to the Federal Government. This was according to a study by Henry Aaron and Alicia Munnell who are economists who have made this point over and over.

The other interesting aspect of the cost of the estate tax is the amount of money it costs to try to plan around it. If you are a closely held business, the estate planning is estimated to range anywhere from $5,000 to $1 million. Again, if you are a lawyer or estate planner or you are selling insurance, that is probably a great thing. But it is not great for the people who have to pay the money, and it is not the best use of the money for the economy. The IRS estimates it takes 38 hours to complete the form, which is form 706. You may have an obligation, you may not, but you still have to fill out the form. The tax preparation fees can range from $5,000 to $50,000, and 52 percent of the estates that filed a return were required to incur a sizable legal and accounting expense and other expenses even though they owed no tax. Bear in mind, over half of the people who have to file the forms end up with no obligation.

What we should do is have a tax that is predictable and clear with a large enough amount exempted so you know whether you are going to have to file the form. Hopefully, you would realize you don't have to file it because we have adopted the reforms I am talking about. We would go from something over 130,000 filers down to something over 11,000 filers. You would be catching the people with the big estates, those people who can really afford to pay the estate tax, but you would not be requiring everybody else to have to engage in this expensive planning and have the potential of having to pay part of the tax.

Again, the summary numbers to remember are, under the amendment that will be filed--or has been filed, I gather--it would freeze the rates where they will be at the end of 2011, at 45 percent. That is only 10 percent less than the top rate of 55 percent under the previous law. And it will provide an exempted amount of $3.5 million. Far more estates will be caught in the estate tax trap with the amount at that level than they will be if both spouses subject to the tax have $5 million exempted as part of the unified gift and estate tax credit.

I hope as with last year when 56 of our colleagues, both Democrats and Republicans, supported instructing conferees to include in the budget the precise proposal on estate tax reform that I have identified, we will get that kind of support out of this budget as well.

The last thing I want to say is, I think it would be better for the debate and discussion if we had followed past practices and actually offered amendments and had debate on those amendments and then voted on those amendments. Instead, what is happening this year is the majority is not allowing any votes on any amendments until tomorrow, when we get into what we affectionately refer to around here as the vote-athon, when every 10 or 12 minutes we have a vote after 1 minute of discussion of the amendment, 1 or 2 minutes. I think it is 30 seconds per side, 1 minute equally divided. Great debate. Great debate.

We have time to talk about these things now, but what you can't do is offer an amendment, have a vote on it, and know whether you have won or lost so you can determine what you want to do next. If you win, then you don't have to do two or three other amendments. If you lose, you may have to do those amendments. But we are not going to do that because the majority decided it would like to put pressure on the Members of this body to offer fewer amendments because they will have to all be voted on on Thursday and, of course, everybody knows the Easter recess begins as soon as we finish our business. So there is great pressure to offer fewer amendments, to hurry up and get out of town, rather than, in my view, spending the time necessary to do the people's business.

One of the first things we ought to be willing to do is do what is necessary to both debate and vote on an estate tax reform that would be meaningful for literally hundreds of thousands of American citizens.

I will. I will conclude saying, I hope my colleagues will in a bipartisan way, as they did last year, support the proposal I have just laid down. And while we will be doing it on Thursday, I gather, they will be able to listen to a little of the debate if they are listening now.

I am happy to yield.

Mr. President, I appreciate that. In suggesting another reason for this, I do not think I am wrong in that, but I do acknowledge that certainly what the chairman of the Budget Committee has said is true. I appreciate his acknowledgment of our courtesy with respect to Senator Byrd. I know the Democratic side would do the same thing. That was done on a previous occasion last year as well. It is one of the better traditions of the Senate.

It is also true probably this is not the first time this year because, for the first time in the history of the United States, I am informed, two Senators will be running against each other for the Presidency so that there may be other occasions where, when there are very close votes, our schedule may to some extent need to accommodate their schedules. Of course, as Members of this body they need to be here to do business as well, but we understand that is not always possible. If we could adhere to a slightly more set schedule that might be possible, but since we don't and it is almost impossible to have that kind of schedule, that issue is one that has to be accommodated, and I appreciate what the chairman said.

I do hope the trend we have seen from 2 years ago to last year to this year of not having votes early on during the week that we consider the budget, but bunching them all at the end, a process which I don't think anybody in this body really likes, would not continue; that certainly the reason the chairman indicated will not pertain next year and that we can revert to the practice next year that we have traditionally followed, which is to try to have debate on amendments, votes, and then debate and then votes, and so on, hopefully, thereby minimizing the number of votes that we consider in this so-called vote- athon that, as I said, nobody in this body likes very much.

Than this year.

I ask the chairman to yield for a question. The additional $45 billion, would you have an estimate as to--well, first, what policy in the estate tax would be attached to that? And if it is to add to the exempted amount, what would that take the exempted amount up to?

Mr. President, if I might further, I had understood an amendment such as this might be offered. My understanding was it would accommodate both an increase in the exempted amount to $5 million per spouse, and I also believe to reduce the rate further from 45 down to 35, which would make it identical to my amendment. I might be wrong on that. If you can ask the author of the amendment here if that is true, it would conform it to the levels set in the amendment I have laid down as well.

I wonder, as long as I have interrupted the chairman, if I might make one or two other points.

Will the Senator yield?

I think it would be fair to let me answer.

Mr. President, I would be happy to have the ranking member of the committee make a comment. But I wish to correct some of the facts. I can do that either on the Senator's time or on our time.

Mr. President, I appreciate the fact that the chairman of the Budget Committee and the majority whip have done some extrapolation from the number of people who die and two-tenths of a percent of this and that and, therefore, they have come up with a number. Why don't I quote the actual numbers according to the Joint Tax Committee. These are the officials numbers we deal with every year when calculating the effect of our legislation. According to the Joint Committee on Taxation, if my amendment were to be adopted, 11,800 estates each year would be required to file at the exempted levels that are set forth in my amendment. If we fail to act, 131,000 families, not 7,000--family businesses, farms and so on--will be subjected to the death tax each year, starting in the year 2011.

The point is, these are not individuals. These are families or businesses with a lot more people affected by the tax than the number of filers. The filer represents all the members of the family or the employer of a company. That may be 50 or 60 or 200 people who may be out of a job. But that is how many will be subjected to filing this, 131,000.

You might make fun of this and say it is a small percentage of the number of people in the United States. If you are unfortunate enough to die and your heirs have to deal with this problem, it is a very real problem to every single one of them. Over a 10-year period, obviously, you are talking about way more than a million people. You may say that is not a significant enough number to worry about, but it is enough. We worry about a few people who suffer from all kinds of things that we try to deal with. If you have a million Americans over a 10-year period subjected to an unfair tax, it is a problem we ought to address and not just make fun of the fact that it is only a million instead of 50 or 60,000. So let's get the numbers right. You can argue, if it is only 131,000 people, should we be worried about it. I say yes, somebody on the other side might say no, but at least let's get the numbers right.

Yes.

That is correct, on the motion to instruct conferees, 56 Democrats and Republicans voted for this identical proposal.

That is correct. The rate would be reduced from 55 percent, if we don't do anything, to 35. I believe the majority proposal is 45. This would make the top rate no higher than 35 percent.

The answer is yes. If I could expand on that with a true story, some friends of my wife and mine in Phoenix had a printing business. The head of the household came out from New York in the late 1940s and from

scratch built this business which, at the time he died, employed about 200 people. They didn't take a great deal of money home because in this business, you have to plow all your profits back into buying the very latest laser printers and all the other equipment to keep it competitive. But they did all right as a family, well enough to be a major giver in the community. That is how we became friends with them because they were contributing to charities significant amounts, probably more than they could afford, boys and girls clubs and a variety of other charities. They were great contributors to the community, both in terms of their business, the people they employed, what they did, and how they supported the community. He died. When he died, his family found that despite the fact that they had spent millions on insurance and other ways to try to plan for his eventual death and the estate planning, in order to pay the tax, they had to sell the business. They did, and they got enough money to pay the tax. The company that bought it, to my knowledge, never contributed a dime to any charity in Arizona. It eventually closed the operation. So all the people who worked there no longer had a job, no contribution to the community. The family literally had to sell the business to pay the tax. While they were well off in terms of the average American, they were exactly the kind of people you want in your community to provide employment. That is the real story.

We can make fun by saying: Well, it is only 131,000 each year in that category. But these are real families who are contributors to the economy and to our communities, and we ought to give them a break. Most people, even though they know they are not subjected to the tax, still, when you ask them the questions in public opinion surveys, say they know it is not fair. They like families such as the one I mentioned and would like to see this tax either reformed or repealed.

If I may respond, as an expert in the Tax Code, the Senator from New Hampshire knows the technical name of the doctrine which applies in this case, except we have made an exception in the case of death. If you are robbed or if your house burns down and you collect insurance to pay for that unanticipated loss--not an economic activity; you didn't decide to invest and get a return on the investment when your house burned down--that is something you did not anticipate. It is noneconomic. The Tax Code treats that in a very good way for people, as one would expect. You get the insurance on it. You are not taxed on all that as income.

This is the third. Of the three areas that apply here of noneconomic activity with a tax consequence, this is the only place where we don't give people a break for these unanticipated activities, these noneconomic activities such as death. No, you do get taxed. And, yes, the Senator from North Dakota is absolutely correct. The dead person is not the person----

Mr. President, if I may conclude, I am answering a question of the Senator from New Hampshire.

My train of thought with regard to the answer to the question was interrupted.

As a matter of tax policy, I will answer my colleague, we can differ about the kind of taxes that should apply to economic activity, but we do agree that is the kind of activity that should be taxed, if it is on a sale, if it is on income, if it is on a return such as capital gains or dividends. But where the American people draw the line is with regard to death. I recall now the final point I wished to make. It is true the dead person doesn't pay the tax, but the people who are left to deal with his affairs at the worst time in their life do have to deal with this. What we are suggesting is, we ought to make it a little bit easier on these folks and not impose the kind of penalties that the current Tax Code, if it reverts to this because we don't act, goes to the 55 percent tax rate. I am talking about 131,000. According to the Joint Tax Committee, the number by the year 2015 will be 177,000. So this keeps increasing with respect to the number of estates each year that will have to be concerned about the tax.

It is actually not quite that. It is $5 million. The way this is written, if one spouse, let's say, the person who is not running the business, dies first, you can plan so you can get most of the effect of $10 million in the unified credit between the estate and the gift tax, but it is actually a $5 million exempted amount. So, for example, if a single person owns a business, it is only $5 million. It is not the amount that would relate to a couple of $10 million.

Of course.

I believe that is exactly the case. By the year 2015, it would be 177,000 estates.

Mr. President, I would say to the chairman he is correct. I cannot verify the number 7,000 the chairman is

talking about, but I can verify the number I am talking about. The Joint Committee on Taxation projects that 11,800 estates would be required to file estate tax returns each year. So that is a correct statement.

Of course, the additional point I made earlier was that not everybody knows exactly what their liability is and, therefore, you have about 10 times as many people who have to end up filling out the forms, going to the expense of anywhere between $5,000 and $1 million to complete the forms, the 38 hours it takes to do it, only to find some of them do have a tax liability at the end of the day. Some of them do not. The fact that you may not be subject to the tax does not diminish the fact that you will be obligated to spend the money to file a return and do all the work to try to figure out that, in fact, you don't owe the tax.

Mr. President, if I might respond with one final point, when you got to calculating how many--the lucky 7,000, and all that--I think there was some extrapolation going on, and I think the chairman is right, we should stick to the numbers from Joint Tax. That way at least we know exactly what we are talking about.

Mr. President, I thought I would like to respond to Senator Salazar while he is here, and I ask unanimous consent to have my time taken off the Republican side.

Mr. President, let me speak for just a few minutes in response to my colleague from Colorado because earlier today I offered an amendment which, as I gather, it would accomplish essentially the same thing as the amendment of the Senator from Colorado.

My amendment explicitly would provide in the budget an accommodation for an exempted amount of $5 million per spouse, for a total of $10 million, as part of the unified gift and estate tax exemption, and a top rate not to exceed 35 percent. As I understand it, the amendment of the Senator from Colorado would accommodate that same relief. I noted that with my amendment we also ensured that the $5 million per person exempted amount was indexed for inflation. We provide a step up in basis, the existing period of time to pay the tax. I presume, or I would gather, that those same items are included in the Senator's amendment, but he can respond to that.

I guess my point is that we have a difference between the amendment I have offered and the amendment of the Senator from Colorado. There is one difference between them, and that is this: Last year, we passed a similar amendment to the budget. No legislation was ever brought forward. Last year, the 10-percent tax bracket renewal or extension was passed unanimously, I believe, as part of the budget. The chairman of the Finance Committee never brought forth legislation to deal with that. He has advised me this year there will be no action on the death tax. We are going to have hearings, but there is not going to be any action on the Senate floor. I suspect that one of the reasons is because of the way he has approached it, the way the Senator from Colorado has approached it, which is to put the Government before the taxpayers; to say that before we can do any of this, we have to make sure the Government is made whole, which means we have to find a way to ``pay for'' the tax. That is the language that has been used. We have to ``pay for'' the tax.

I ask, why should the American taxpayers have to pay for a reduction in their own taxes, if you start with the premise that the American worker earns money, and we want the American family to keep as much money as possible in their own pockets so they can provide for the needs of their families? Also, in this time of economic downturn, we even decided we would try to put more money in their pockets, urging them to spend it as a way to try to stimulate the economy. I would think we would start from the premise that the money belongs to the taxpayers, and we want to allow taxpayers to keep as much of that money as possible.

If we are going to do taxes on one side, then we ought to hold them harmless; that is to say, if we believe their tax liability is too much or that a particular tax is wrong, as we believe that the estate tax is, that it is in desperate need of, if not repeal, at least significant reform, that the point is to reduce that estate tax burden and not to reduce it with one hand and then require a tax increase to ``pay for'' it on the other hand. How have you helped the American taxpayer if you say: We will reduce your taxes over here, but in order to keep the Government whole, we need to somehow make up the revenue for the Government because it matters more than you do, and therefore we are going to have to raise taxes on you someplace else in order to ``pay for'' this tax relief. We don't do that when we pass a farm bill around here.

The baseline for the farm bill, what we spent this year, is something just under $600 billion. If we spent the same amount of money on the farm bill next year, we would not have to ``pay for'' any of that. We would only have to ``pay for'' an increase. Yet if we are going to extend an existing tax rate, say, the 10-percent bracket of the amendment of the Senator from Colorado, the idea is somehow we have to pay for that, even though it is exactly the same bracket it is today. If we are going to extend the capital gains rate or the dividends rate or any other marginal rates, keep them exactly the same as they are today, why should we have to raise taxes permanently someplace else in order to ``pay for'' that? You only get to that conclusion if you think the Federal Government is more important than taxpayers.

Well, the way our country was founded is based on, ``We, the people.'' We created the Government. The Government is supposed to serve us, not the other way around. So you don't start from the premise that somehow, the Government has an amount of money today and no matter what happens, no matter how much we want to provide tax relief for people, the Government still has to have the same amount of money. So if we are going to provide tax relief for people, somehow we have to make up the money that we give back to the people.

If you want to provide tax relief for people, the whole idea is that they don't have to pay for it in some other way. They get to keep the money. We trust them to spend it. That is the fundamental difference I have with the amendment of the Senator from Colorado.

If the terms with respect to the amount exempted and the rate is the same--and I presume it would be--the question is, are we ever going to act on it?

My amendment will be acted on this year one way or another. We are not just going to pass it in the budget as we have in the past. This isn't just going to be a show exercise where we all vote on the budget to cut taxes, but the cuts never really materialize. Why don't they ever materialize? Because the majority doesn't bring a bill to the Senate floor and try to get the bill passed. If the bill doesn't pass, the President doesn't sign it, and there is no tax relief.

The budget is merely like the family budget. It is a goal. It is a blueprint. It is something you want to try to follow if at all possible. Yet when we pass tax relief in the budget, we are not really passing tax relief. We are just saying: This is something we would like to do. We would like to accommodate this in the budget. But if you never follow through with any action, what have you done except to fool the American people, make them think you are going to reduce taxes but you never, ever get around to actually doing it.

My amendment will be brought to the Senate floor. It doesn't have to put the Government first. We don't have to pay for it by increasing the taxes on you over here so we can cut your taxes here.

Now, my colleagues can either vote for it or against it, but we are going to get a vote on the floor of the Senate on reform for the death tax, and it will be very much along the lines of the amendment I introduced and the Senator from Colorado introduced. It will have a $5 million exemption per person, a step-up in basis for the property. It will be indexed to inflation, and it will either have one rate or two, but the top rate will not exceed 35 percent.

The difference will be we will either give tax relief to people or we won't. If we give tax relief to people, we are not going to then have to ``pay for'' it in order to keep the Federal Government whole. Government gets about a little over 1 percent of its revenues from the estate tax. This reform would still allow a huge amount of revenue to come in because there are still a lot of estates that will pay that 35 percent rate on amounts above $5 million or $10 million.

What it will do is take about 130,000 people who otherwise would have to file an estate tax return off of the rolls. They would not have to worry about it. They are the smaller businesses, the smaller farms--not the big estates but the smaller ones--that have to pay anywhere from $5,000 to $1 million to just plan around the eventuality of death, which, unfortunately, comes to all of us. So they buy insurance. They hire lawyers and accountants, and they pay a lot of money. In fact, in the aggregate, Americans pay as much money to avoid paying the tax as they pay to the Federal Government in the tax itself.

What we want to do is to get most of those people off of the rolls so they don't have to worry about it.

I certainly agree with my colleague from Colorado when he said the first principle should be certainty. We should know--especially with the death tax there should be some certainty. Well, you don't have any certainty if you don't know whether you are going to have to pay the tax. Unfortunately, the way it is right now, the way it is under the budget that has been brought before us is, you have at least 130,000 people who are going to have to file a return.

You don't know how many are going to have to actually pay the tax. What our amendment does is reduce that number to a little over 11,000, so that people don't have to spend a lot of money hiring lawyers and accountants and buying insurance on the off chance they are going to have to pay for it; nor do they have to expend large amounts of money in tax preparation--38 hours, on average, per tax form filed.

We don't want people to have to pay that amount of money. That is why we hope to get the number of filers down to something like 11,000. Then if they have to pay the tax, so be it. But the majority of Americans would be spared the tax.

Yes.

Mr. President, I am happy to respond to my colleague. The debate now is not how to pay for a $10 trillion debt. We have a deficit of around $400 billion. We need to focus on not increasing the debt by increasing the amount of the deficit more than we have to. I share the Senator's goal for that.

There are three fundamental ways you can reduce the deficit. You can reduce spending--and I am going to pick two out of the three. First, you can reduce spending. I will vote for that. I have a good record around here on trying to reduce spending. Yet there isn't anything in this budget that reduces spending.

If we have a cost, the automatic action under the budget is to increase taxes, which is the second way you can do it. I reject that for the reasons I have pointed out. You don't help people by cutting their taxes here and raising their taxes over there. At best, you have created a neutral situation.

The third way, of course, is to ensure that our economic policies are progrowth policies. We don't have too much in the way of regulation, too much in the way of taxation, that the Government basically tries to get out of the way of our economy so it can grow, produce jobs, create more wealth and, with that wealth, by the way, pay more taxes, which is a good thing. One of the reasons why we are collecting today in Federal revenues above the 40-year average in tax collections, with our Federal tax policy--we are collecting roughly 18.8 percent of GDP, more than the 40-year average. The reason is we have a growing economy, although it is slowing right now, to be sure. But because that economy has been robust, even at slightly lower tax rates, we are paying more in taxes, tax revenue, because the economy has grown. So the textbook answer to my friend is you can reduce the deficit, and ultimately the debt, in one of three ways: reduce spending, increasing taxes--though it has diminishing returns; if you do it too much, you don't get revenue, you can promote economic growth and you can bring the debt down.

The last point. My colleague pointed out we were having hearings in the Finance Committee this morning and one of the witnesses there, as mentioned by my colleague, talked about what countries such as Canada, New Zealand, and Australia are doing. Do you know what they are doing? They are repealing their estate taxes. Why would they be repealing their estate taxes? This gets to the third way you make money. You grow. What happened in Australia is they found toward the end of life people with any means were moving to New Zealand, because they didn't have an estate tax. They wanted to keep them in Australia, so they decided, for competitive reasons, that they would eliminate the estate tax. So they stayed in Australia rather than moving to New Zealand. Canada and others are doing the same thing.

Our rate, now at 43 percent, which would be locked in by the budget, is far above the worldwide average, which is an 18-percent rate. A lot of countries don't have an estate tax. My answer is that our better response is, if we are not going to repeal the estate tax, reform it in a way that doesn't inhibit economic growth and enables us to compete, enables our economy to produce revenue, even at a slightly lower tax rate because, at the end of the day, that will do us all more good than trying to do what my colleague would do--raise taxes as the way to pay for a tax reduction. To me, that doesn't make the kind of sense I would want to be associated with in promoting legislation.

Let me simply yield the floor so my colleague can respond and not have to pose a question in order to make the point.