Floor Statements

I will not consume it all.

I appreciate that.

Mr. President, I have a couple of points. I very much appreciate the efforts of the Senator from Florida in the amendment he has offered. He clearly is trying to address a problem that is very acute in this country, which is job loss. He is also attempting to address it in a way a good number of Senators and a good number of people think is a way to do it, and that is by making the cost of employment to an employer less expensive.

In our country, it is regrettable, but we have come to the point where very often payroll taxes are the greatest expense an employee has. They pay more in payroll taxes, because the employer's half is imputed to the employee, than income taxes.

We have to work hard to try to find ways so the cost of employment to employers is a little less expensive than at present. The Senator from Florida is trying to address that.

I might say, though, his amendment strikes over 60 percent of the bill. This is a large bill. We don't have many tax bills that come around.

I remember years ago we used to have a tax bill at the end of the year. Senator Long was then chairman of the Finance Committee. He would wait until the end of the year. There would be a lot of provisions and there would be a good tax bill. I don't think that is going to happen this year. This is becoming the major bill, and the reason for that is very clear.

There was no World Trade Organization back 20 years ago. Times have changed so much. But the World Trade Organization has ruled that our tax regime, which gives our American companies that export a bit of a break, is illegal. Other countries have their tax regimes which give their companies breaks for their exports, and they are legal. But we set up ours in a way that, regrettably, does not pass muster with the

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 President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I ask consent all pending amendments be set aside so the Senator from Colorado can be recognized for the purpose of offering an amendment, and I also ask consent that the amendment of the Senator from South Carolina, Mr. Hollings, also be the next amendment to be in order.

I have no problem with that. That is my understanding.

Will the Senator yield me an additional 5 minutes?

Mr. President, I have a couple more points about the Graham amendment.

It is advisable the Senate not adopt the amendment. His amendment would do two things. Basically, it strikes the deduction for domestic manufacturing and also strikes most of the international tax reform provisions. These are very important changes that will help Americans compete internationally.

As I mentioned, the international provisions in the bill that would be stricken by the Senator's amendment are designed to reduce double taxation of American companies. We want to do as much as we can to reduce double taxation of American companies.

Let me give an example. Under current law, an American corporation would have to pay more to borrow money to build a factory than foreign corporations would have to pay, even if the factory is in the United States. This is because of the way we treat interest expenses and so- called interest allocation. Essentially, we are changing the interest allocation provision so that a U.S. company with assets overseas is not penalized, so long as the borrowing is proportionate to the assets in each of the countries, which is now not the case. That is, right now, American companies are penalized even if all their borrowing in the United States is proportionate to worldwide borrowing. That is just not fair. It is something other country's companies do not have to put up with. That is one example of how our Tax Code currently puts American companies at a disadvantage compared to other countries.

The JOBS bill fixes a lot of these problems so Americans can compete on a level playing field, and it brings the Tax Code in compliance for the intent to avoid double taxation.

I say to my good friend from Florida and to my colleagues in the Senate, this is not the time, in my judgment, for that amendment. It has not been explored, debated, or brought up in committee. It is a huge change to a very thought through bill. It should not be approved at this time.

I take a couple of minutes while we have the time to talk about some of the international provisions generally in the JOBS bill. Let me state again why I think these provisions are good policy and they help American companies.

I will mention again the interest allocation provision. It is perhaps the most significant provision in the international tax title, both in terms of cost and the number of companies it would help. The interest allocation provision is one of the many in the JOBS bill that deals with foreign tax credits. Our foreign tax credit system is designed to prevent taxpayers from paying tax twice on the same income. When an American company earns money in France, the French tax that income and the United States also taxes that income. That is two levels of tax on the same income. The total tax could be, say, 75 percent or more. Without adjustments such as the foreign tax credit which is in current U.S. law, these two levels of taxation would make U.S. companies completely uncompetitive abroad. There is no question about that.

Foreign tax credits, however, get the company back to a single level tax and make competition possible. Our foreign tax credit rules are not perfect and double taxation still sometimes occurs.

A prime example is the interest allocation provisions in the foreign tax credit rules.

Let me give you an example. Take an American company that pays $100 in foreign taxes and $100 in U.S. taxes on that same income. That American company would generally claim a $100 foreign tax credit to get back down to a single layer of tax. But if that American company happened to take out a loan in the United States to finance a project here in the United States, it might be limited to an $80 or $90 foreign tax credit--not because it paid any less in foreign taxes, but because we treat it as if it were able to deduct some of the interest on that U.S. loan to reduce its taxable foreign income, even though it could not do so. That is not right.

The rules are complicated, but the effect is plain. If an American company wants to borrow money and build a plant in the United States, it faces an uphill battle. It will pay higher interest expenses than a comparable foreign company. Our interest allocation rules in current law are making it easier for its foreign competitors to build that plant. But our bill fixes that, and it fixes other problems with our foreign tax credit rules.

For example, companies that pay the alternative minimum tax--the so- called AMT--currently face limits on the use of the AMT with respect to foreign tax credits. Unlike non-alternative minimum tax taxpayers, they are subjected to an artificial, completely arbitrary cap on the use of their foreign tax credits. It is 90. Arbitrarily limiting their foreign tax credits just makes these AMT taxpayers pay double. The current AMT provisions essentially, in many cases, result in double taxation. The JOBS bill fixes that, too.

The JOBS bill also makes it less likely that a company's foreign tax credits will expire unused. It is another problem: The foreign tax credits expire unused, and then the U.S. company could often be placed, in effect, in a position where it is subjected to double taxation.

Currently, unused foreign tax credits can be carried over for 5 years. The original purpose of this carry-forward rule was to prevent taxpayers from suffering double taxation because of timing differences between U.S. and foreign tax laws. That purpose is not being served by our current law. Any new tax laws in foreign countries have made the problem worse for American companies. The JOBS bill extends the carryforward to limit the double taxation that occurs upon the expiration of foreign tax credits; that is, we are making it less likely that a U.S. company will be subjected to double taxation.

Each of these provisions simply corrects features of our international tax laws that frustrate the original purpose of those laws. Again, the original purpose was to avoid double taxation. The JOBS bill puts us back on track with the original intent of our international tax system.

So, as we all know, the international provisions are a lot more complicated than I have even begun to allude to, but, very briefly, those are some of the provisions in the bill. They are corrections in the bill. They reduce double taxation, or eliminate it in many instances. It helps American companies compete with foreign companies. That means it is much more likely they will be able to keep jobs in the United States if they are able to compete more effectively.

Mr. President, for that reason, I urge we do not adopt this amendment.

I suggest the absence of a quorum, on behalf of the Senator from Iowa.

I move to lay that motion on the table.

The motion to lay on the table was agreed to.

Amendment No. 3112

Mr. President, I yield back whatever time I can yield back. I also suggest the absence of a quorum.

I ask unanimous consent that this be a 10-minute vote.

Madam President, will the Senator hold back for a second before making that request?

I thank the Senator.

Madam President, this is a good bill on which we have made a lot of progress. There are a lot of good amendments yet outstanding. It is amazing how much is in this bill that is so positive.

I say to my colleagues on both sides of the aisle, it is important for us to go the extra mile, to see if there is a way to compromise. I will say that again: both sides of the aisle.

Here we have the amendment offered by the Senator from Washington, and we are kind of at a little bump in the road. But this can be resolved. This is resolvable. I hope very much we are not in a situation where backs stiffen up and people dig their heels in the ground and pride becomes the overriding emotion. Rather, we are very close to resolving a very important issue. So I ask that cooler heads prevail over the evening, to sleep on it, and tomorrow morning--and/or tonight--find a way to resolve this issue; otherwise, people could see the Senate not at its best. There is an opportunity, a real opportunity, for Senators to show they can work together on both sides of the aisle on very important matters.

We know none of us can have everything. We also know for things that are important and worthwhile, generally it takes some give-and-take and compromise. We are almost there.

I thank the Senators for how far we have come thus far, and I urge us to work together to find a solution to these remaining amendments so we can get the bill passed very quickly.

I yield the floor.

Mr. President, I rise today with great pride to honor a group of distinguished Montanans. Alyson Mike and Thomas Andres, Montana's 2004 Milken Educator Award recipients deserve recognition for their outstanding work and service to our State and to the children they teach every day.

Public service is the most noble thing a person can do. Whether it is service to one's church, community or government, there is nothing more honorable. Alyson and Thomas are at the top of a lengthy list of quality teachers in Montana to stand among their fellow American teachers to receive this national award.

The Milken Educator Award provides public recognition and a $25,000 honorarium to teachers, principals and other educators who have a proven record of excellence in education. Alyson, a natural science teacher at East Valley Middle School, and Thomas, a science teacher at St. Labre Catholic Indian School, both have strong records of excellence. In fact, I was recently honored to recognize Alyson as Montana's 2004 Teacher of the Year.

In Montana, there is little difference between our schools and our communities. This award highlights the great quality of teachers we have in Montana and spotlights the good things happening in our schools.

Alyson and Thomas are two of Montana's high quality teachers that are helping to shape our State's future. They are creating an environment that encourages learning, instilling a curiosity and a desire to learn--all of which will produce a more educated workforce. A better educated work force will spur job creation and translate into a stronger economy with more good-paying jobs. The best way to ensure Montana's future is through a well-educated work force.

We in Montana are very fortunate to be able to claim teachers like Alyson Mike and Thomas Andres as our very own. They are playing a vital role in our State's future. I commend Alyson and Thomas for all they have done and I am confident they will continue to serve their students well.

I would also like to recognize Polson High School as Montana's 2004 winner of the `We the People' Competition. By winning the State competition, nineteen of our State's brightest government students and their teacher qualified to represent Montana in the National Civics Competition on the United States Constitution.

The names of the 19 students who are receiving this honor are as follows: Charlie Cooper, Chance Dupuis, Sky Fredrickson, Ashley Gilchrist, Kasey Harwood, Rosanna Ho, Chad Hunsucker, Bonnie Klein, Brandon McCurdy, Kdee Meidinger, Zach Morrow, Candace Myers, Andrew Ofstad, Kiel Rafter, Chris Rossmith, Kai Smith, Kate Taylor, and Christine Woidtke.

Pat Danley is the teacher whose expertise, guidance, and encouragement that helped these students receive this honor. Pat Danley is a veteran government and political science teacher at Polson High School. I commend Pat on his ability to prepare these students for this competition.

These students have demonstrated a strong understanding of the U.S. Constitution and the Bill of Rights. Here in Congress, I think we can all recognize the value of fostering civic competence and responsibility. These students are Montana's future leaders, and I am proud to recognize their accomplishment.

Mr. President, I ask unanimous consent that the pending amendment be set aside so that the Senator from North Dakota may offer his amendment.

Reserving the right to object, and I will not, before he leaves the floor, I thank the Senator from North Dakota. He has been helpful and constructive in getting amendments lined up. I spoke to the cosponsor of the amendment a short time ago, and she will, this afternoon, join the Senator. I thank the Senator for his cooperation.

I have no objection.

Mr. President, I yield 5 minutes to the Senator from North Dakota.

Mr. President, I yield to Senator Gregg.

That is the understanding.

Mr. President, I ask unanimous consent that the pending amendments be temporarily set aside so the Senator from New Hampshire may offer an amendment; and after he has spoken on his amendment, the amendments will be temporarily set aside so that Senator Graham may offer an amendment.

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

Mr. President, I yield 3 minutes to the Senator from Florida.

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

Mr. President, I yield 10 minutes to the Senator from Massachusetts, with the understanding that I will work to get more time for him. For the time being, I yield him 10 minutes.

Mr. President, I yield the remainder of my time to the Senator from Massachusetts.

The Senator has 5 minutes on this side and 5 minutes on the majority side, a total of 10.

Mr. President, we will find it.

There is no time to yield. There is a consent agreement.

Mr. President, how much is remaining?

No.

Reserving the right to object--of course I will not--I thank all Senators for going the extra mile to help work out this agreement. We are taking steps. We are proceeding. I think we will get this bill passed this year.

Mr. President, I ask unanimous consent that the Wyden amendment be modified with the text I send to the desk.

Mr. President, according to the agreement, I think that will be good. That is fine.

Mr. President, will the Senator yield for a question?

Isn't it true that under this basic law and also this amendment, benefits only accrue prospectively; that is, no benefits accrue retroactively? That is, the only retroactive application is as to whether somebody qualifies, but the actual benefits only accrue prospectively. So it is not accurate to say there is a lump sum that is paid to a worker because of past employment.

That is correct. But, again, the payments--that is, the trade adjustment assistance payments--would only be prospective.

That is for persons, after today, for example, talking about service employees, who are out of a job on account of trade.

So it is true there is no lump sum payment.

Mr. President, might I ask how much time is left on both sides?

Mr. President, I ask unanimous consent that both sides be given an additional 3 minutes on this amendment.

Mr. President, if we go into a quorum call, I ask unanimous consent that the time be divided proportionately.

Mr. President, I will use my time.

Mr. President, the point is this. It is quite simple. We in America are faced with immense competitive pressure worldwide. We are concerned about a lot of jobs being lost in America. Some are being lost within America; some are being lost in other countries. It is an offshore issue. It is a big question in America.

There are a lot of Senators here who are trying to address this question but who are trying not to vote for so-called protectionist amendments; that is, amendments which say a company cannot do this or that. I agree with that sentiment. But I also think--and I daresay that most Senators would agree with this next point--that we should do something for our employees who lose their jobs through no fault of their own.

We already have a very small program called trade adjustment assistance for manufacturing industry jobs that are lost on account of trade. We do not provide for service industry workers who lose their jobs on account of trade. Service jobs are lost by a larger margin than in the past simply because so much information in America

is now being digitized and because of the advance of broadband telecommunications. So a lot of service industry jobs--analyzing programs, reading x rays, and other jobs--go overseas from American companies. Orders come over at the speed of light and the product goes back at the speed of light.

What we are saying is this is a constructive, positive response by the Congress to deal with and help those people who lose their jobs on account of trade. It is not a massive program as has been described. Only about 150,000 people qualify today for TAA. Only 5 percent of American workers use it. We are saying just expand it to the service industry. That is not a big expansion. A very small percentage is going to be able to use it.

It has not been pointed out by the other side that you have to be enrolled in a retraining program to use these benefits. The key is to have enough of a benefit so people don't just run off and who want to go into retraining to avoid taking a McDonald's job or some minuscule minimum wage job.

I urge my colleagues to put this in the context of what is really going on and not get sidetracked by a lot of arguments that get down in the weeds but which really don't address the larger issue, which is that this is the one opportunity--and it is very minuscule--to help American workers who lose their jobs, and not only manufacturing but service industry jobs. It is a positive, constructive response; it is not a protectionist response.

I urge my colleagues to support this one chance we have this year.

Mr. President, I ask my good friend from Virginia, since he has such a good amendment, is the Senator prepared to go to a vote in favor of this amendment? This Senator is inclined to vote for the amendment, and I encourage all of my colleagues to vote for the amendment. Because we are going to accept this amendment, I wonder if the Senator could agree to a voice vote on his amendment so we can get to the spouses' dinner more quickly.

I thank the Senator.

Mr. President, I move to reconsider the vote.

Mr. President, there is another point that I would like to discuss with the chairman for the record, regarding a form of restitution that is often authorized for rebates in the case of regulated utility providers whose rates to consumers are regulated. Due to a change of circumstances or other factors, the rates that were charged for a particular period may be determined to be greater than should have been charged if all relevant factors had been known and properly accounted for. Due to the large number of customers and the relatively small amounts involved, the regulatory authority frequently permits the utility to adjust rates to provide compensatory rebates for all current customers. This avoids, for example, tracing former occupants of an address served by the utility or otherwise tracing former customers for relatively small amounts. It is my understanding that this type of procedure would qualify as restitution because substantially all the payments are directed to the actual parties that overpaid.

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

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

Mr. President, we have once again had a productive day. I thank all Senators. We adopted several amendments. First is the overtime amendment, an issue which has occupied the Senate for some good amount of time. The Senate also adopted the amendment of the Senator from Maine, Ms. Collins, her manufacturing jobs credit amendment. The Senate has also addressed the trade adjustment assistance amendment.

We have a number of major amendments pending. In the morning, we hope to have debate on Senator Dorgan's runaway plant amendment which is already pending. Senator Graham of Florida has an amendment already offered, as well as Senator Breaux's repatriation amendment. We hope to vote early in the afternoon on all those pending amendments.

I suggest the absence of a quorum.

Mr. President, I ask unanimous consent that Sara Hagigh of Senator Lieberman's office be granted the privilege of the floor during consideration of the JOBS bill.

Mr. President, the battle to enact this bill has certainly--thankfully--not been compared to a war. But I do believe we can now say this bill is at least what Prime Minister Winston Churchill is reputed to have said after the British victory at El Alamein, when he said: ``[I]t is, perhaps, the end of the beginning.''

Perhaps we may even say what Talleyrand said after the Russian victory at Borodino, when he said: ``It is the beginning of the end.''

In either case, I believe by obtaining an exclusive list of amendments--that is, Senators already agreeing to a finite list--we have a victory. We may now say we can work to the end of this bill. And well we should, because we still have not won the battle to create jobs here in America.

I refer you to this chart I have in the Chamber. Yes, the economy did turn in one good month of job growth in March. The American economy created a net of 308,000 new jobs. But as this chart shows, one good month does not a recovery make. On this chart, the green bars are the months of job creation, and the red bars are the months of job loss. As the chart shows, March was, indeed, a strong month for job growth with more than 300,000 new jobs. But March was the only month in the last 4 years where there was that much job growth.

In contrast, during the 8 years of the Clinton administration, the economy turned in 25 months with more than 300,000 net new jobs per month. The economy as a whole still has a long way to go before it is creating jobs at that level.

Anyone who has talked to people trying to get a good job knows the job market remains soft. In March, for example, a record 354,000 jobless workers exhausted their regular State unemployment benefits without qualifying for any additional Federal unemployment assistance. To reduce the ranks of the unemployed, the economy will need to sustain strong job creation.

Look at the next chart. This chart shows the number of private sector jobs in the American economy, incorporating the latest numbers. It shows the private sector still has 2.7 million fewer jobs than it had in December of the year 2000. As shown on this chart, here we are in December of 2000, and you can see that is where the private sector jobs peaked. The chart clearly shows the number has declined significantly to the current date, a loss of, I think, about 3 million jobs on a net basis.

This next chart shows manufacturing remains in a slump. The manufacturing sector has lost more than 3 million jobs since July of 2000. I might say, I can also see this state of affairs in my home State of Montana. In Montana, for example, wood products companies provide nearly 37 percent of our manufacturing jobs--over a third. But a decade ago, those jobs made up 47 percent of our manufacturing. That is almost one-half of all manufacturing jobs. Employment in wood products dropped almost 5 percent last year alone.

This final chart shows the number of jobs in American manufacturing remains at the lowest level in more than a half a century. A half a century ago--the level shown here on the chart--was roughly 14 million jobs, a little bit more than 14 million jobs, the same as it is today. Just to repeat that: The number of jobs in American manufacturing remains at the lowest level in more than half a century. That is a strong statement. So we continue to need to act on the legislation before us.

More importantly, I must say, I have heard from folks in my State of Montana who tell the reason why we need to act on this bill. Let me give you an example of some of their frustration.

Keni from Hamilton, MT, wrote:

All our good jobs are being sent overseas to a cheaper

labor market, and we're fed bovine manure . . . [about] all

the great jobs [our American economy is] creating.

Then there is Christopher, who was laid off in February of 2003. Christopher writes:

Many of those individuals [with jobs] have to do two or

three other people's jobs in order to keep their own.

Now listen to Kay. Kay wrote that the economy ``bring[s] no new business[es] to speak of in[to] Montana that pay any kind of decent wage, keeping the poor, poor. When is it going to end?''

We have to end the loss of good jobs. We need to do what we can to help create good manufacturing jobs here in America. That is what this legislation before us is about.

We have conducted a number of battles on this bill. The Senate has conducted four rollcall votes on this bill.

The Senate has adopted 11 amendments: from tax shelters, major provisions to close loopholes, to the R&D tax credit, which is very popular and needed by American industry; to government jobs offshore, discouraging jobs from going offshore, to expiring provisions; that is, the provisions in the Code which have expired or are about to expire and need to be continued; to accelerating the manufacturing tax credit, an amendment offered by Senator Stabenow which improved the manufacturing deduction of the bill; and we added in an amendment to the energy tax provisions, the tax provisions that passed the Finance Committee dealing with energy production.

At this point we have an exclusive list of additional amendments. Senators have preserved their rights and listed 83 amendments on that list. Fifty of those listed amendments preserve the rights of Senators in the majority, while 33 preserve the rights of Senators in the minority. Of the total of 83 amendments, Senators have listed 36 simply with the word ``relevant'' or similar language. Although we might expect Senators to offer some of these amendments, experience tells us that an overwhelming majority of those amendments, listed merely as ``relevant,'' will probably be dropped from the list. Of the remaining 47 amendments, I believe Senators will modify many of them so the Senate may agree to them without rollcall votes.

Realistically, I expect that probably fewer than 20 of the amendments on that list will require rollcall votes. Nearly all Senators from this side of the aisle, those with amendments on the list, have indicated to this Senator that they would be willing to abide by short time agreements, none more than 1 hour equally divided, so this exercise need not take much time.

We have now been on the bill, counting today, on 9 separate days over the course of 4 separate weeks. I hope we can now stay on this bill until its completion. I believe the Senate can now complete the bill over the course of a matter of days.

What the preacher said in Ecclesiastes applies to this bill:

Better is the end of a thing than the beginning thereof.

I look forward to working with my colleagues to the end of this bill.

I yield the floor.

Mr. President, the Senator from Maine and the Senator from Oregon would each like to offer an amendment. I would like to get them in a queue for consideration after the Harkin amendment. I have cleared this with the majority manager.

I ask unanimous consent that the pending Harkin amendment be temporarily laid aside so that Senator Collins may offer an amendment; that after she has been able to do so and speak to her amendment the Collins amendment be temporarily laid aside, and that Senator Wyden be recognized to offer his amendment.

Mr. President, I thank my friend from Oregon. He has worked very hard on this issue. It is, frankly, a very bright spot in this whole bill. That is, it is a major way to help people who need help. It has been worked out very aggressively and thoroughly by an awful lot of Senators.

The real leader is the Senator from Oregon, Mr. Wyden. He has done a wonderful job talking with lots of different Senators and working out the different points of view to come together with this amendment.

Mr. President, I see Senator Coleman of Minnesota on the floor. I want to say how much I deeply appreciate all the effort he has undertaken on behalf of the pending amendment. He is one of the two or three who worked mightily to get this amendment in shape. I want the people in Minnesota and our Senators to know how much he has done. I am very honored to have been a part of his team in working with him as he has crafted and offered this amendment we are now debating.

I thank the Senator.

Mr. President, first, I thank, again, my good friends from Minnesota and Oregon, Senators Coleman and Wyden, for their very strong work on this amendment. I support this very strongly for a special reason. I have the privilege of representing the State of Montana. About 20 years ago, Montana lost a lot of copper miners and smelter workers. Why? Because of foreign competition. At the time it was probably employment overseas--in Chile, for example--and, in addition, it was the subsidized smelter operations north of the border in Canada. These folks worked very hard, and it affected the lives of a lot of these men, and sometimes women, who held these jobs for a few generations. We had created trade adjustment assistance for these workers.

I can tell you a lot of people who lost their jobs on account of trade were able to get some retraining, get a lifeline thrown to them because they had no place else to go. Many of them were 45, 50, 55 years old. They didn't know what to do. There were no other jobs around. Those were good-paying jobs, very good-paying jobs. We had TAA. I remember that I had to do battle with the Department of Labor to get the Montanans who were laid off; in this case, they were smelter workers. Finally, we got a little relief from the Department of Labor at the time when trade adjustment assistance was granted--not in very large measure, but it was granted to smelter workers particularly in Montana. You could see it was just enough to keep them from being totally despondent. Those were the early days of TAA. The retraining provisions really didn't work terribly well. But based upon my experience with TAA in Montana, I see the great need for training.

Now, clearly, the need for retraining workers who lose their jobs on account of trade is even greater than it was back then. It is much greater now for a few reasons. No. 1, the United States is much more engaged in a global economy. We are so interrelated worldwide. It is much more likely, therefore, that the actions taken by a headquarters in Tokyo, or in any other country around the world, has a direct affect on workers in the United States, and vice versa. American global companies, or multinational companies, have to compete vigorously in order to stay in existence. It is a very competitive world.

Other countries have very aggressive ways to help their companies. We know many of them are subsidized in ways that are not available in the United States. Other companies are helped by their host countries. In many ways, American companies are not helped by America. It is basically because we have much more of a free enterprise system. Our Founding Fathers came over from England years ago and wanted freedom and independence--``go West young man,'' and sending a man to the Moon. We are an entrepreneurial country. We like freedom. We like doing things more on our own. It is probably one of the main reasons the United States has become such a great country. That is why we are, in some respects, the biggest and strongest and wealthiest country in the world.

Global competition has been very good for the United States. I think that is probably because we are a little more entrepreneurial. We try a little harder and we are probably a little more creative. It is because of the nature of what it is to be an American. At

the same time, clearly, the jobs in America are in greater jeopardy as a consequence than they were 20 or 30 years ago. It is because of this competition. You will also find that a category of jobs is in greater jeopardy today, and those are service industry jobs. Why? Because of the unbelievable advances in technology, particularly communications technology. Information is now digitized. We have much more broadband capability worldwide. So a lot of services, whether financial services, medical services, or many kinds of services, can be sent by wire or by speed of light anyplace in the world. People around the world are taking advantage of that. They are training people maybe at a lower wage, so the American jobs that otherwise were here can go overseas, and vice versa. All countries are finding that their employees are losing jobs on account of trade. All the major countries are finding that. Germany is finding that, as are France, Japan, and others.

We are also finding that we are all losing jobs due to outsourcing, offshoring. In effect, jobs are going overseas. But on a net effect, we are still creating many more jobs than we are losing.

Having said all that, the purpose of this amendment is to address one part of the competitiveness problem. That is, what do we do about the people who lose jobs through no fault of their own? Clearly, we should come up with something. The answer in this bill is trade adjustment assistance. It is expanding the current trade adjustment assistance program that applies only to manufacturing workers to also service industry workers who lose their jobs. We have heard some describe some additional provisions of this trade adjustment assistance amendment. It is attractive in some cases and has good health benefits. That is important, too, because the current trade adjustment assistance hasn't been working terribly well. One reason is because the health provisions don't work well. The lingo is the ``uptake,'' or whatever it is. What it comes down to is, how many people who theoretically qualify for health insurance benefits under trade adjustment assistance actually take them? The answer is a very low percentage, 2 or 3 percent. It is because there are so many bureaucratic hurdles, procedural hurdles, and it is so difficult.

We made a lot of changes in this bill so that more people who lose their jobs on account of trade also are able to get not only retrained, but get health insurance benefits, where they pay 25 percent and the Government will pay the rest for a certain period of time. As we all know, when you lose your job, you often lose your health insurance. If you lose your health insurance, it is a double whammy. Not only have you lost your job, but you cannot pay the medical bills.

This throws in a lifeline and helps people who lose jobs on account of trade. As has been stated, it is totally bipartisan. We are working on both sides of the aisle. Why is it bipartisan? It is because it is that important, it makes that much common sense, and it is very much the right thing to do. I am very proud to be associated and working with the Senator from Oregon and the Senator from Minnesota. I thank them very much for their good effort.

Mr. President, might I ask my friend a question? Is it also true that other Senators have contributed to portions of this legislation, such as Senator Bingaman who added a provision with respect to trade adjustment assistance on communities; is that not correct?

Might I also ask a question of my good friend from Minnesota? This amendment adds new dollars for retraining. Doesn't the Senator agree that the new jobs in the future are going to have to be, for want of a better expression, smarter jobs; that is, even someone who repairs automobiles today has to understand computers? You do not just have a wrench and a screwdriver these days to build and repair cars; you have to learn computer skills, maybe programming skills. Isn't it true, if we are going to compete in the world, that we have to spend a lot of time and effort on retraining because of the additional needs in the future, and that is another reason for supporting this amendment?

Mr. President, we have made good progress today. The Senate has had good debate on the Harkin overtime amendment, finally. Senator Collins has proposed an amendment on manufacturing jobs credit. Senator Wyden and Senator Coleman have offered their amendment on trade adjustment assistance. I am hopeful the Senate will be able to vote in relation to these amendments tomorrow afternoon.

We are also looking forward to Senators Dorgan and Mikulski having an opportunity to offer their amendment on runaway plants tomorrow. Thereafter, we hope to continue to work through other amendments as they become available. We hope to continue to make good progress with amendments and completion of this bill on a fairly timely basis.

Again, I thank my colleagues very much for the work we have done today. We are off to a very good start.

I just feel that we are going to make our way through this bill this week. At least that is my hope. I thank my colleagues.

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

Mr. President, I ask unanimous consent that the following fellows and interns be granted the privilege of the floor during consideration of the JOBS bill: Steve Beasley, Diana Birkett, Leopold Brandenburg, Simon Chabel, Jodi George, Scott Landes, Pascal Niedermann, David Schwartz, Matt Stokes, and Trace Taxton.

Mr. President, I support the Internet Tax Freedom Act. This bill represents a reasonable compromise. We should enact it.

A tremendous amount of work went into this bill. I commend the Commerce Committee for its effort to resolve some of these complex issues. In particular, I commend Chairman McCain and Senator Hollings for working to bring parties together and develop a common-sense bill.

Last fall, the Senate entered an order recognizing that the Commerce and Finance Committees share jurisdiction over this bill. That order granted sequential referral of this bill to the Finance Committee after the Commerce Committee acted. We inherited a host of unresolved issues. And, after thorough examination--and in consultation with members of the Finance Committee--we decided to allow the bill to be discharged without a markup.

Let me briefly explain what this compromise bill does. Importantly, the bill extends the moratorium for 4 years. Some argue that this is too long, and others believe that the tax moratorium should be permanent. Four years represents a reasonable compromise. Four years will allow us to revisit unresolved issues in the future.

Next, the bill allows States to continue tax telecommunications if they decide they want to. The bill makes clear that when phone lines are carried over the Internet in the future using Voice Over Internet Protocol technology, States will still be able to assess telecommunications taxes on that service. I know several Senators had concerns about protecting their States' ability to tax phone service, and this bill meets their concerns.

Finally, the bill provides a soft landing for States that have been grandfathered under the 1998 act. The 1998 act allows certain States, who taxed Internet access prior to 1998, to continue to do so. It is time to make the Internet Tax Freedom Act national policy. The Internet is a national treasure, and a pillar of interstate commerce. In future legislation we should phase out the grandfather clause and allow us to move this national policy forward, without leaving any State behind.

This does not mean that I believe the bill is perfect. But it is a good bill. And it should move forward.

But before I agreed to support this bill, I made sure of two things: One, this bill would not harm Montana's businesses and citizens; and two, this bill would bring jobs and economic growth to Montana.

First, this bill will not harm Montana. It accommodates Montana's special needs in Universal Service and emergency 911 services.

This bill does not jeopardize the Universal Service program. Universal Service helps Montana rural telephone companies to provide telephone access to rural areas. Universal Service is extremely important to Montana.

Rural America stands on the edge of a digital revolution. Technology will move us to places about which we can only dream. But we must preserve the networks that will provide us that opportunity.

The telecommunications network in Montana is among the best in the country. Over 140 communities have DSL. We have 95 videoconferencing sites spread throughout the state. The Universal Service Fund helped build this network.

In addition, this bill would not harm Montana because it helps maintain emergency communications through the federal enhanced 911 program, or E-911.

E-911 allows police, fire, and emergency workers automatically to locate those who call 911. In Montana, where open space can go on for miles, this technology can mean the difference between life and death.

Many State and local governments have diverted 911 funds to other uses--away from development of an 911 network. This bill ensures that those providers that use the 911 network continue to pay for it.

We need to ensure funding of this extremely important program. I appreciate the efforts of Chairman McCain and Senator Hollings to ensure that 911 is protected.

Second, this bill will bring good jobs to Montana. Companies like Internet Montana--an Internet service provider headquartered in Bozeman--provide Internet access to thousands of subscribers in Montana and neighboring States.

Keeping Internet access tax-free helps businesses like these grow. Keeping Internet access tax-free breaks down costly barriers. This keeps jobs in Montana.

The next 5 years will bring change in the technology and the market for Internet access. Technological advances will blur the very definitions of Internet service and use. These changes will affect how we access the Internet, and how much we pay for doing so. These changes pose challenges for writing legislation.

This bill represents an attempt to balance the interests of those who want to make sure that the Internet remains taxfree, with those who are concerned that if we try to define Internet access, we may erode State and local tax coffers.

As technology changes, we will need to watch this delicate balance. I look forward to working with my colleagues to ensure that this legislation lives up to its promise.

Mr. President, next week the Senate will consider a trade adjustment assistance amendment introduced by my colleagues Senators Wyden and Coleman. I am a co-sponsor of this amendment, which is offered on the JOBS bill, to which we will be returning next week.

I also want to acknowledge Senators Rockefeller and Bingaman, who have worked hard to produce a strong amendment.

This amendment is the right thing to do. And now is the right time to do it.

The JOBS bill is about creating jobs and about keeping existing jobs in America. But we all know that--no matter how strong we make this JOBS bill--some workers may still see their jobs move overseas.

Since 1962, trade adjustment assistance--what we call ``TAA''--has provided retraining, income support, and other benefits so that workers who lose their jobs due to trade can make a new start.

The rationale for TAA is simple. When our government pursues trade liberalization, we create benefits for the economy as a whole. But there is always some dislocation from trade.

As President Kennedy said, ``those injured by . . . trade competition should not be required to bear the full brunt of the impact.'' ``There is an obligation,'' he said, for the federal government ``to render assistance to those who suffer as a result of national trade policy.'' We meet that obligation through TAA.

The TAA program has not been static over time. Several times, Congress has revised the program to meet new economic realities.

Most recently, in the Trade Act of 2002, Congress completed an important overhaul and expansion of the TAA program. I am very proud to have played a leading role in passing this landmark legislation.

But I am also the first to admit that our work is not done. Economic realities continue to change, and TAA must continue to change with them.

I am co-sponsoring the Wyden/Coleman amendment, because it makes common sense changes that help TAA keep up with the times.

Most importantly, the amendment extends TAA to service workers. Right now, we only give TAA benefits to workers who make things. That means American workers in the service sector cannot access this program.

But today, more than 80 percent of non-farm U.S. jobs are in the service sector. And the market for many services is becoming just as global as the market for manufactured goods.

Trade in services is a net plus for the U.S. economy. In fact, the service sector generated a trade surplus of nearly $74 billion in 2001.

Just as we have seen with trade in manufactured goods, however, trade in services will inevitably cost some workers their jobs.

Indeed, there have been some well-publicized examples in the papers. Examples abound of service-sector jobs--even high tech service jobs-- relocating overseas. Software design. Technical support. Accounting and tax preparation services. Radiology.

Over the past 3 years, somewhere between a quarter and a half million service jobs have moved to other mainly low-wage countries.

This trend has hit home in my State of Montana. Recently, a large technical support call center closed in Kalispell. At least 550 Montanans lost their jobs while jobs were created in Canada and India.

Another Montana employer laid off workers doing medical billing and data management. Those workers applied for TAA and were turned down-- not because the layoff wasn't trade related, but simply because they are service workers.

That's not right. Extending TAA to cover service workers is a simple matter of equity. When a factory relocates to another country, those workers can apply for TAA. When a call center moves to another country, those workers are not eligible for TAA. But they should be.

This amendment also makes some modest changes to eligibility rules to make it more user-friendly for workers. It removes some of the steps that workers have to take to meet the tests for shifts in production, alternative TAA, and to qualify for the health insurance tax credit. And it makes the health insurance options available to TAA recipients more affordable.

The amendment provides for better data collection and reporting. That way Congress and the public will have a better idea who is using TAA benefits and how participants are faring in the job market.

The amendment also helps trade-impacted communities to better plan their economic redevelopment and job creation strategies. That way workers who complete TAA retraining have a better chance of finding jobs in their communities.

Hard-working American workers deserve this safety net. Despite what some opponents of TAA suggest, no worker would choose to lose his job so he can qualify for TAA. These benefits will always be second best to a job. But they can really make a difference in helping workers make a new start.

It is also critical to note that TAA can make an important difference in public attitudes. Surveys show that most Americans feel a lot more comfortable with globalization, offshoring, and trade when they know they will get help if their jobs are threatened.

That's why 66 percent of Americans responding to a recent poll agreed with the following statement: ``I favor free trade, and I believe that it is necessary for the government to have programs to help workers who lose their jobs.''

The world is changing and TAA must keep up with the times. This amendment will help our government to keep its promise to the American people to make trade work for everyone.

I commend my colleagues Senator Wyden and Senator Coleman for offering this amendment. I look forward to voting on it next week.

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

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

Mr. President, I wish to mark the passing of an outstanding public servant, former member of the Senate community, former staffer to Senators, and former staffer for the Senate Finance Committee--Paul Offner.

Born in Bennington, VT, Paul spent part of his childhood in Florence, Italy. He earned a bachelor's degree from Amherst College, a master's degree from Princeton University's Woodrow Wilson School of Public and International Affairs, and a doctorate in economics from Princeton.

After this outstanding education, Paul began his career in public service with the U.S. Senate, serving as a legislative assistant to Senator Gaylord Nelson of Wisconsin.

Paul had caught the political bug. He decided to run for office himself, seeking to represent the people of La Crosse, Wisconsin, in the State legislature. That showed that Paul didn't

shrink from tough odds, as he ran as a Democrat in La Crosse, a city that had not elected a Democrat for quite some time. Paul proved a natural campaigner. He had a great slogan: ``Vote once. Vote Offner.''

Winning that election, Paul served in the Wisconsin State legislature, and then in the Wisconsin Senate. He established himself as an expert on the challenging area of health care and health insurance.

In the early 1980s, Paul ran for Lieutenant Governor and for Congress, but those elections did not work out for him. Fortunately for us, he stuck to his career in public service nonetheless.

In 1990, Paul returned to work for the U.S. Senate, serving as senior legislative assistant for health and human services for Senator Daniel Patrick Moynihan of New York. Staff for Senator Moynihan recall that from their very first meeting, Senator Moynihan regarded the staffer with the Princeton doctorate as a colleague.

Paul became one of the leading national voices in welfare and health policy. After President Clinton won the 1992 Presidential election, Paul coordinated the Clinton transition team's welfare reform policies.

When Senator Moynihan became chairman of the Finance Committee, Paul became the committee's chief health and welfare counselor. Having served as chairman and ranking minority member of the Finance Committee, I know that Paul's position was a demanding one. Paul handled it well during the important year when Congress enacted President Clinton's first budget, in 1993. That budget set the pattern that led to 8 years of economic growth and the creation of more than 20 million new jobs.

Paul served with the Clinton White House Health Care Task Force, which tried to extend health benefits to millions of uninsured Americans. The task force did not succeed then, but they fought an important fight. We will need to revisit that important task again, before long.

During the debate on welfare reform in the mid-1990s, Paul contributed a series of prominent articles. He influenced the national debate.

When the Republicans took control of the Senate with the 1994 election, Mayor Marion Barry asked him to become the commissioner of health care finance for Washington, DC. One need not be a critic of Washington to know that when Paul took on the job of running Medicaid for the District of Columbia, he took on as thankless and difficult a task as there is. And he did it well.

He went on to work at Georgetown University and the Urban Institute. In recent years, he focused on the situation of young Black men in America, arguing that society needs to make a greater effort to improve their chances of making it.

It tells you something about Paul that while he was working hard at high-powered Capitol Hill jobs, he also served as a dedicated tutor to school kids in the District. He was a volunteer tutor for the Friends of Tyler School, a public elementary school not far from the Capitol building in Southeast Washington, DC.

People will tell you that Paul had a tremendous intellect, a caring heart, and a quick wit. He was the kind of person who went through the policy wars enough to be a skeptic, but was still in there pitching, trying to make things better.

``He believed in public service,'' said Molly Collins Offner, his wife of 8 years. ``Accomplishing good and making the world better was key for him,'' she said.

The noblest human endeavor is to serve our fellow man. It can be service to church, to community, to family, to spouse, to children. Paul Offner served.

Members of the House and the Senate who serve also get the benefit and gratification of seeing their names in newspapers and their faces on TV. But dedicated professionals such as Paul work very hard behind the scenes, often with little or no recognition. I recognize the central role that Paul Offner played.

Paul passed away last week, and was remembered this past weekend at a Mass of Christian Burial not far from here on Capitol Hill. He will be remembered by his wife Molly Collins Offner, daughter Mary Shu Yu Offner, and sister Antoinette Gerry. But he will also be remembered by a thankful U.S. Senate community. And for years to come, he will be thanked by millions of Americans whose lives will have been made better for his having lived, but who never knew his name.

Mr. President, will the Senator yield? I am curious as to how long the Senator will be speaking.

I thank the Senator.

I rise today to say I most regretfully oppose the motion to invoke cloture on the motion to proceed to the bill. I do not think we are quite ready. I do not think we are ready to tackle this important and complex legislation at this time.

This is a bill that would end for decades the rights of individual citizens to seek justice and compensation for their injuries in a court of law. That is not something we should act on too quickly; that is, before we have a complete understanding of what it is that we are doing and how it will impact asbestos victims, businesses, insurers over the long run.

Senators Hatch, Leahy, and Specter, though, and many others, have worked very hard on this bill. Because of their efforts, we have come closer to a final compromise than I think anyone would have believed possible early last year. That is why I am puzzled, frankly, that we feel the need to rush to the floor to finish this bill before we have exhausted all opportunities to come to a compromise on the outstanding and very tough issues. Negotiations have yielded significant progress in certain areas. I believe there is no reason to believe that continued negotiations will not yield even more progress.

Being in the Senate, I have learned if one sticks to it and with it, one can find ways to work out solutions to very difficult problems.

My primary concern, though, has always been protecting the people of Libby, MT, in any asbestos legislation that Congress considers. I know I do not need to go into the details of the Libby tragedy because my colleagues have heard them many times, but I will emphasize that their situation for me, and for them especially, is unique. An entire town was poisoned with asbestos for decades by W.R. Grace, a company that lied to its workers, lied to the community about the deadly dust which it was exposing its workers to, lied to the families, and lied to the whole community. Hundreds of people have already died or become very sick, and hundreds more will likely follow.

I have pledged to the people of Libby that I will do everything in my power to help them make their community whole again, to make sure their long-term health care needs are met. The health care costs associated with treating asbestos-related diseases are crippling to families who do not have health care and are uninsurable and to a community that is struggling to get its economy back on track. Simple, routine procedures to help a person breathe more easily can cost at least $30,000.

The Libby dust, or fiber, is also unique. The Libby fiber is especially vicious. It is made up of what is called tremolite, a special kind of asbestos, and other similar fibers, fibers that doctors and scientists are now only beginning to realize are more deadly than ordinary asbestos.

Not only is it more likely to cause asbestos-related diseases, it often causes disease to progress more rapidly than traditional asbestos-related disease. Libby asbestos disease also looks different. It is hard to identify and hard to detect on x rays and CAT scans, much harder than traditional asbestos-related disease. That is why I was so concerned about Libby at the beginning of this debate.

Because Libby is unique in terms of the type and duration of asbestos exposure, the manner in which asbestos disease manifests itself in Libby, and the fact that an entire community was affected, it was clear that the medical and exposure criteria in the bill would unfairly exclude most of the population of Libby. That would pile injustice on top of injustice on these people, and I could not accept that.

Senators Hatch and Leahy worked very closely with me and my staff, and I want to thank them for the very important provisions in the bill that would exempt people in Libby from both the exposure and the medical criteria in S. 2290. This was a huge step forward.

However, as we moved past these larger issues for the Libby victims, new concerns arose about the level of compensation that would be awarded to a Libby claimant. I was concerned that the administrator of the trust had absolute discretion to determine that a panel of medical experts was wrong, and that a Libby claimant was not that sick and was not entitled to the level of compensation they truly deserved.

I was also concerned that the compensation levels were tied directly to the medical criteria in the bill, medical criteria that we had already determined just would not work for the Libby victims. This raised the possibility that the Libby victims would not be fairly compensated.

Senator Hatch and I have spoken about this concern and we have tried to work out an acceptable way to address it. Again, I thank Senator Hatch for the concern he has always shown for my constituents and I thank him for the effort he has undertaken.

However, this important concern has yet to be addressed in S. 2290. I have heard from people in Libby that they would rather we not proceed to this bill until we find a way to solve this outstanding uncertainty in the bill. I know they also share some of the concerns of my colleagues about other factors of the bill and whether it will indeed be workable and solvent over the long term. This is obviously important to me and to the people of Libby.

I believe that asbestos legislation is very important. I believe that Congress should complete work on an asbestos bill this year. It is important to the victims, many of whom are not being fairly compensated because the system is overloaded and so many companies have filed for bankruptcy. That is one of the reasons I will continue to work hard to protect Libby in asbestos legislation.

The people of Libby face a very uncertain future right now, depending on what happens with the Grace bankruptcy proceedings. I believe that if we get the Libby provisions right in the asbestos bill, they stand a far better chance of receiving fair compensation under an asbestos trust than they would through the Grace bankruptcy.

A bill is also immensely important to the business community that is seeking some level of certainty about what their future asbestos liabilities will be. Providing them with that business certainty, while at the same time providing the victims with equal certainty that they will be fairly and promptly compensated for their asbestos exposure and disease, should be our goal.

We are very close to achieving that goal, thanks to the efforts of many different players in this debate. Let's go back to the negotiating table and see how far we can get before we take this very complex bill to the floor for amendment and debate, a process that will not allow us to be as considerate and thoughtful as we should be with this issue.

For the sake of the people of Libby, and ensuring that they receive the highest degree of justice and certainty that they deserve, I must oppose the motion to invoke cloture on the motion to proceed to S. 2290. I pledge to continue to work together with my colleagues to find an acceptable compromise as soon as possible. I also state, if we can work out this Libby language, then I will be for the bill. I very much hope that happens.

I yield the floor.

Mr. President, I rise today with great pride to honor Montana's 2004 Teacher of the Year Award winner, Alyson Mike. Alyson overcame a lengthy list of quality teachers in Montana to secure this award. It is an honor to recognize her outstanding contribution to Montana.

Alyson represents the type of teacher Montana has come to expect from its teaching community. She is an educator who meets the highest standards of professional excellence. Alyson is a student's teacher. She delivers to each and every one of her students without expectation of reward.

Alyson teaches middle school science at East Valley Middle School in Helena, MT, my home town. Sadly, like so many other rural communities, Helena has struggled economically in recent years. In this community, bake sales, garage sales, and silent auctions have become the norm, simply to raise funds for the school. But this has not stopped Alyson and members of the community from making sure the students receive what they need to succeed.

Like so many Montana teachers, Alyson takes a hands-on approach to ensure her students have access to a variety of materials and equipment. In Alyson's mind, there are no limits to what her students can accomplish.

Alyson earned her National Board Certification and has become a State leader in Montana's professional development. She is a leader to her students and encourages other teachers to make a difference in student's lives. Alyson's extensive background and knowledge in science, proven teaching strategies, and great sense of humor make her a Montana treasure.

We in Montana are very fortunate to be able to claim a teacher like Alyson Mike as our very own. She is a fabulous representative of the very best of public education in Montana and across our Nation.

Mr. President, in the next week, millions of Americans will do their duty, obey the law, and complete their income tax returns. Although this is clearly one of our citizens' least favorite annual rituals, most taxpayers will do what's right and provide their share of funding to keep our national government running.

But while these honest Americans are doing their part, a number of others are trying to get by without doing theirs. And that's what I would like to talk about this afternoon.

Some call it the ``tax gap''--the difference between the amount of taxes that taxpayers actually owe to the Federal Government and the amount of taxes that taxpayers actually pay to the Federal Government.

This is not about raising taxes. This is about enforcing the tax laws on the books. This is about collecting the taxes that are owed to the Treasury under the existing Tax Code.

While most Americans, with quiet patriotism, file their tax returns and pay their taxes on time, too many do not. There are a number of ways that these folks try to skirt the law: Some don't file their returns. Others understate their incomes. Still others take excessive or illegal deductions. And there are those who claim fictitious refunds.

Unfortunately, there is a growing perception among honest taxpayers that a large number of people are cheating the tax collector--and getting away with it. The IRS Oversight Board Annual Survey on Taxpayer Attitudes reported that the proportion of Americans who ``completely agree' that it is all Americans' civic duty to pay their fair share of taxes has steadily declined.

In 1999, 81 percent of Americans agreed that it's their duty to pay taxes. In 2002, only 72 agreed with that statement. And last year, that group fell to just 68 percent of the population.

This trend is very distributing, but it is also very clear. More and more people believe that cheating is acceptable.

As if this public attitude were not disturbing enough, the growing lack of taxpayer compliance jeopardizes the voluntary tax system on which our government depends. American taxpayers who voluntarily pay their fair share of the country's revenue will not support a tax system that tolerates widespread cheating.

Taxpayers expect their Government to ensure that all pay their fair share. Not one dime more, but not one dime less. The millions of honest taxpayers deserve no less.

The National Taxpayer Advocate estimated that the tax gap for 2001 was $311 billion. But this is based on 16-year-old data from 1988. There is every likelihood that the tax gap is significantly higher. It certainly isn't less.

For the taxable years 2001 to 2003, the cumulative tax gap exceeded a trillion dollars. In other words, if all individuals and corporations fully paid all of their taxes due for the past 3 years, the IRS could collect an additional $1 trillion.

This huge level of unpaid taxes is harmful to law-abiding Americans and to the economy as a whole. Just as retail stores raise prices for honest shoppers after they lose merchandise due to shoplifting, honest taxpayers pay more to cover those who aren't paying their share.

In terms of the economy, each dollar in unpaid taxes increases the deficit by a dollar. The administration predicts that the deficit will be cut in half in the next 5 years. But since the administration took office, the cumulative IRS tax gap has exceeded $1 trillion. Let me say that again: $1 trillion. This is enough to help shore up Social Security, pay for the war in Iraq, ensure that no child is left behind, fix the highways and extend unemployment insurance.

Currently, the overall taxpayer noncompliance rate is 15 percent and growing. The plain fact is that voluntary compliance has been and remains the backbone of our tax system. Our primary mission must be to maintain and enhance the health of that system by encouraging and facilitating voluntary compliance with our tax laws. A 1-percent point swing in voluntary compliance will increase, or decrease, revenues each year by more than $20 billion.

Our Federal budget has gone from one of the greatest surpluses in its history to the highest deficit ever known--$478 billion--close to half a trillion dollars in the current fiscal year.

Now more than ever we need a plan of action to close the IRS tax gap. I propose the following:

First, let's make it easier for people to pay their taxes. Our Federal Tax Code and accompanying regulations are more than 54,000 pages long. They are too complex, confusing, and costly to comply with. In addition to making the code simpler for individual taxpayers, simplification would reduce opportunities for dishonesty. Tax shelters develop because sections of the lengthy code are manipulated to achieve unwarranted tax benefits.

That is why I support a broadly based blue ribbon commission that would recommend simplifications for our income tax system that we could act on.

Second, we need better data on noncompliance. To fix a problem, you have to know the facts. I support the National Research Program that would allow us to have a more accurate estimate of the IRS tax gap and should help IRS identify where they should target their enforcement efforts.

Third, the IRS needs to do a better job enforcing our current tax laws. And that may take Congress passing legislation forcing them to take stronger action. Bills such as the good Government tax administration bill would improve efficiency and strengthen safeguards in IRS collection cases. And in

the JOBS bill--which I am optimistic we will pass in the very near future--we have included antitax shelter legislation that will make sure transactions are done for legitimate business reasons and not solely for tax benefits.

We have also included provisions that would impose stiffer penalties on any taxpayers who engage in shelter transactions. It is also time to crack down on expatriation practices, corporate inversions, SILOs, abuses in the charitable area, Enron-related tax shelters, and offshore abusive tax schemes. And we should devote more resources to IRS enforcement. Dollars spent there will bring in several times as much in additional revenue raised.

And last, but certainly not least, we need to set a goal, a benchmark of where we are going on tax compliance. Today, I proposed that we reach at least a 90 percent tax compliance rate by the end of the decade. By 2010, at least 90 percent of Americans should be filing their taxes and paying their dues. It is not too much to ask. Now, it will not be easy, but that does not mean that it cannot be done. I know we can achieve it through the methods I just outlined.

With the growing deficit and the upcoming retirement of the baby boom generation, increasing tax compliance is more important than ever. And it is also one of the easiest ways to raise more revenue for our Nation. We are not talking about raising taxes--we are simply asking all Americans to pay their fair share as citizens of this great Nation. By reaching a 90-percent compliance rate, we would raise at least $100 billion more each year. This funding would go a long way toward strengthening Social Security or helping our classrooms or paying down the deficit.

April 15 is just around the corner. I encourage every citizen to do what is right, to stand up for your country and make your contribution. Here in Congress, we will keep working to make it easier for our honest taxpayers to comply and to make it harder for those dishonest folks to cheat the system. Together, we will seal the tax gap and help the economy.