Floor Statements

Mr. President, I rise to speak today about former Senator Jesse Helms, who passed away on July 4, 2008, at the age of 86. I knew Senator Helms well, and I am sure I am joined by many of my colleagues in saying that he will be missed.

Senator Helms was born in Monroe, NC, in 1921. His first full-time job was as a sportswriter for the Raleigh Times. After serving as a recruiter for the U.S. Navy during World War II, Senator Helms became the city news editor for the Times before moving on to do journalistic work in both radio and television. In 1960, he began working at the Capitol Broadcasting Company in Raleigh as the executive vice president, vice chairman of the board, and assistant CEO. He became famous in his home State for his daily CBC editorials, which featured his now-famous southern anecdotes occasionally laced with his sometimes provocative political views.

Prior to coming to the Senate, Senator Helms' only political experience consisted of two terms on the Raleigh City Council. However, in 1972, Senator Helms became the first Republican Senator elected from North Carolina in the 20th century, replacing the retiring Senator B. Everett Jordan.

During his three-decade tenure in the Senate, Jesse became known as one of the Chamber's staunchest conservatives. His refusal to compromise on his beliefs was the source of both his greatest strength as a legislator and, as I am sure some would argue, his greatest weakness. Indeed, I don't think there are any of us who served alongside Senator Helms who did not, at one time or another, find themselves in a disagreement with him.

However, while I didn't always agree with Jesse, I do have a number of fond personal memories of him.

For example, when I first came to the Senate in 1977, Senator Helms was nearing the end of his first term. About 3 months into that first session, still becoming acclimated to life in the Senate, I took a few moments to write down some of my early impressions of my fellow Senators. About Jesse, I wrote that he was ``one of the dearest people in the Senate,'' and that he had always treated me with kindness and respect. I also noticed that, despite having a reputation for being an unmovable conservative, he had a knowledge of parliamentary procedure and tactics that was virtually unmatched.

A couple years later, I witnessed this knowledge first-hand when Senator Helms and I found ourselves on the same side of the debate over what was being called a ``labor reform'' bill. Sadly, as I was working with a number of my colleagues to sustain a filibuster against this unabashedly radically liberal pro-union legislation, our friend Senator James Allen passed away. While we were all saddened by the loss of our dear friend, at the back of our minds we were worried that, without Senator Allen's mastery of Senate procedure, our efforts might fail. However, Senator Helms stepped up and provided much needed insight, helping us to block this harmful legislation. At one point during this debate, while many of us were worried about the strength of the filibuster, Senator Helms assured us, saying that we would keep the necessary Senators on the floor ``if they have to wear their pajamas and bedroom slippers.''

I believe we were all surprised during the latter part of Senator Helms' tenure when he coauthored the landmark 2002 legislation authorizing funds that were, at that time, unparalleled for international AIDS relief. Many of his colleagues, including myself, had sparred with Jesse over providing support for AIDS relief and research. But, in those last few months of his Senate career, I believe he showed the world that, while he wasn't always the most agreeable of politicians, he was a compassionate man who was committed to doing what he thought was right.

Mr. President, I want to extend my deepest sympathies to the Helms family. As I said, Jesse and I did not always agree on the issues before the Senate, but I can say, without reservation, that he was a dedicated public servant and dear friend to those of us who knew him well.

I thank my colleague and thank him for his leadership in this matter.

Back to the nuclear thing, I drove a hydrogen vehicle not too long ago. If we had these nuclear powerplants, we would have enough hydrogen. We could do it. The problem is we only have 9 million tons and we need 150 million tons just to start it.

But having raised the hybrid and plug-in hybrid issue, let me say Americans are looking to Congress to address our current energy crisis, and we should be pursuing every reasonable option to reducing our addiction to foreign oil.

The distinguished Senator from Tennessee may be aware that I was the sponsor of the CLEAR Act, which was signed into law as part of the Energy Policy Act of 2005 and as part of the transportation bill which passed the same year.

The CLEAR Act has been providing tax credits to consumers who purchase alternative fuel and advanced technology vehicles, including battery electric and hybrid cars. It has also been providing incentives for new alternative fuel stations and for the use of alternative fuels in vehicles.

Our transportation sector is 97 percent dependent on oil. I am all for oil. We certainly need more of it, but we also must find ways to diversify our transportation fuels.

I have heard some argue we must promote solar, wind, and geothermal as an answer to high gas prices. Well, obviously, cars and trucks don't run on electricity. It is going to take us a little while to get there.

But what if we changed that?

Why not use plug-ins to apply hydroelectric, solar, wind, geothermal, and nuclear to our transportation sector? Talk about adding diversity to our transportation fuels.

Immediately after the CLEAR Act was signed into law, I began working on legislation to promote plug-in hybrid vehicles. It was a bipartisan effort, and I received strong and early assistance from Senators Maria Cantwell and Barack Obama, of all persons. We introduced S. 1617, the FREEDOM Act, which would provide four strong tax incentives promoting plug-in hybrid vehicle purchases, and also the U.S. manufacture of these vehicles and their technologies.

I am pleased that the plug-in hybrid idea has remained bipartisan. I know that portions of the FREEDOM Act have been included in both the Republican and Democrat energy extenders bills.

I believe we will see the day when the electric grid becomes a significant new alternative transportation fuel. We should keep in mind that our electric grid is a domestic resource. You won't see our President flying to the Middle East begging the Saudis to send us more electrons. We can do it right here.

Electrons are not only domestic, but they are much cheaper and much cleaner than gasoline.

Best of all, the United States is well positioned to be the world leader in the development of plug-in hybrid vehicles. We have already seen the California-based Tesla Motors plug-in electric vehicle. Raser Technologies based in Utah, has developed a very powerful and efficient AC induction motor, and A123 Systems, based in Massachusetts, has developed a very advanced lithium

ion battery that has been configured specifically for electric-drive vehicles.

Also, General Motors will soon offer a plug-in hybrid Saturn vehicle, and that will be followed by the plug-in hybrid Volt. The Volt will be one of the most exciting vehicle innovations of our lifetimes. It will allow the average commuter to drive to work and back without using one drop of oil. Our friends on the other side will be delighted. The problem is we cannot do it right now. We have to have something to power our trucks, planes, trains, and cars. The volt will run entirely on electricity for up to 40 miles. For longer trips that exceed the range of the battery, the vehicle will switch into a very efficient hybrid vehicle. The U.S. is truly on the cutting-edge of technology in developing commercial, electron powered vehicles.

Mr. President, I am aware that my good friend Senator Alexander has also shown a great deal of leadership in promoting plug-in hybrids. And I would ask him if it isn't true that our Nation is in position to lead the world on the potential of shifting some of our transportation needs over to the electric grid? Perhaps we are not quite willing to lead it because it takes time to get that accomplished?

Can I mention to my colleague this little company, Raser Technologies in Utah, now has developed an electric motor, not very large, that has more thrust, more--I do not know what to call it, but more actual energy than the gas combustion engines.

They are about to put one of those motors on a pickup truck that will get, according to them, around 120 miles per gallon of gas. We can get there, but it is going to take us a number of years to get there.

In the immediate future, we have to find more oil so we quit sending $700 billion or more every year--and that is going to go up every year--overseas that does not do us very much good. Because that is all gone once it is gone. We should keep that money here so we can do all the things we need to do for the American people.

I cannot, for the life of me, understand why the other side will not get together with us and help us to put all these elements together and recognize it is going to take oil to get us over the next few years to where these wonderful things can explode. They are doable. We can do them now, except we cannot manufacture them fast enough or get the manufacturing lines up in a short period of time.

But if we can, it will be amazing. I remember when I got into the hybrid car business in the CLEAR Act. We found that hybrid cars could be driven on HOV-2 lanes during the rush hour. Automatically, they sold out. We knew just on that one little incentive, so we put incentives in to develop hybrid cars in the CLEAR Act, we have them in the Freedom Act as well, plus incentives for all kinds of other things. Frankly, they have worked amazingly well. But in the interim time, we are going to have to have oil. I hope we can find more and use less through these other mechanisms.

Mr. President, I sat and listened to this exchange, and it is

amazing to me after 32 years in the Senate that they want to bring up a bill and allow their bill and one substitute amendment that they know will fail, where there are components of that substitute amendment that they know will pass and will help us to find some oil and alleviate some of the pressures we have in this country.

I wish to address the legislation under consideration in the Senate today, the speculator bill.

Here we are, the Congress of the greatest Nation in the world, facing a national energy crisis, a crisis that affects every single American, the American economy, and America's place in the world, and this is the best we can do, this speculator bill? This is our answer, another proposal that will not produce one drop of oil or hardly any energy? It will not produce any energy. Frankly, I am embarrassed for this body and for the people we represent.

At some point, I wonder when the leaders of the Democratic Party will wake up and realize that blaming and taxing the energy industry does not equate to an energy policy. It is an anti-energy policy. Finding someone to blame is no substitute for finding more oil. And the answer to getting America to use less oil is not always more taxes and more mandates.

We are a country of addicts in that sense. The seeds of our addiction to foreign oil have been sown here by an anti-oil Congress. If Members of Congress are hunting for some of the blame, they are in luck because the blame begins and ends right here under the Capitol dome.

It is very clear that the most extreme environmental groups have an anti-oil agenda, and it is just as clear that the Democrats have adopted that agenda as their energy platform. It is a recipe for disaster, and America is reaping the whirlwind as a result.

Some are arguing for more solar, wind, and geothermal as an answer to high gas prices. I sponsored the current tax incentives for renewable electricity, and I hope my actions speak to my support for renewables. That is law now in the 2005 act. I know enough about energy to recognize trains, planes, automobiles, and ships do not run on electricity. They run on oil right now.

This first chart is solar, wind, and geothermal. They are not transportation fuels. Biofuels is still only 3 percent of transportation fuels, and yet that is the only other major alternative to oil at the present time. We rely on oil for 97 percent of our transportation needs, and the other 3 percent is made up mostly of biofuels, especially corn ethanol. I have strongly opposed the current ethanol mandate, but I have long supported free-market incentives for ethanol. In fact, I sponsored the CLEAR Act, as I mentioned, which is the current law giving tax incentives for E85 fuel and E85 infrastructure. We need as much ethanol as we can make, and I am all for it. But I also recognize that ethanol has so many inherent limitations that it will not be able to break us free from our dependence on foreign oil.

The fact is that we will have to tap into our Nation's gigantic resources of oil shale or we will remain addicted to foreign energy traffickers for the long haul. They are afraid to have a separate amendment up on oil shale because we should win that amendment. Anybody with brains would vote for it. There are 3 trillion barrels of oil in Colorado, Wyoming, and Utah, in oil shale, about 2 trillion of which is estimated recoverable--more oil than all the rest of the world combined. If we don't tap into those resources, we are going to remain addicted to foreign energy traffickers for the long haul.

When the Republicans controlled Congress in 2005, we passed a very bipartisan energy bill which promoted each of these very necessary unconventional oil resources, along with alternatives, renewables, and conservation. When the Democrats took over Congress, they immediately began dismantling every effort to develop oil from oil shale, oil sands, and coal-to-liquids even though they knew full well that we have more oil in those resources than all the rest of the world combined.

Chart 2 says world oil reserves are 1.6 trillion barrels. Recoverable U.S. oil shale is between 1 and 2 trillion barrels of oil.

In most cases, an addiction brings about financial ruin. Democrats in Congress have made a lot of noise about the tens of billions of dollars we spend each year on the war on terror, but apparently it does not bother them as much that our citizens send more than $700 billion every year to foreign governments to feed our addiction, some of which are not even friends; in fact, some of which are enemies. Congress's lamebrained anti-oil actions have put our people at the mercy of foreign governments that are smart enough to produce their own energy-- something we could do if they would open this bill to amendment. We are selling away our Nation's place in the world and funding the rise of our most aggressive competitors and even our enemies.

Of the major world oil shale resources, we hold 72 percent of the total. We can see Israel, Estonia, China, Australia, Morocco, Jordan, Brazil, United States, and the total world. Did you know, Mr. President, that China and Brazil have been smart enough to produce their own oil from oil shale for decades--China and Brazil--and that Estonia has produced oil from oil shale for over 90 years? We act as if we cannot do it. My gosh, of course, we can do it. Did you know the United States controls more than 70 percent of the world's known oil shale resources? Yet we are stopping its development because of their anti-oil agenda over there, and that is what is involved here, trying to cover it up with a so-called speculators bill that all of us will be glad to have in a final bill, but that does not produce one drop of oil to help our problems.

Is it because our industry cannot compete or is it unwilling to invest in oil shale production? They most definitely are willing, but the sad fact is that our own Government owns most of the oil shale in the United States and our own Government has said no because of these people over here.

The biggest argument I keep hearing against oil shale development is we cannot allow the Government to even establish rules for oil shale development because we just plain don't know enough about it yet. Think of Estonia: For 90 years, they have been producing oil from oil shale. Think of Brazil: For decades, they have been producing oil from oil shale. You think the greatest Nation in the world can't do it? We don't know how much water it will use; we don't know how much wildlife habitat it will use, they say; we don't know about the greenhouse gas footprint. Guess what. The Department of Energy has been studying oil shale for decades, and we have a pretty good idea about each of those questions.

Why do the Democrats say no to oil shale production? I hear some say they are concerned about water use. Let's take a look at water use compared to ethanol.

Mr. President, did you know oil shale uses less water than ethanol, no more than gasoline? Right now, corn does not rely on irrigation, for the most part. However, if we hope to increase ethanol's share of the fuel supply, we will have to move into drier areas that require irrigation.

Look at the water use. Ethanol takes 4 to 5 barrels of water and 1,000 barrels of water on irrigated lands. Oil shale, for the entire process--processing, upgrading, and land restoration--three barrels of water. A September 2007 article in Southwest Hydrology states that irrigated corn requires well over 700 barrels of water for each barrel of ethanol. A barrel of ethanol has about 30 percent less energy than a barrel of oil. In other words, to make just 1 oil-equivalent barrel of ethanol, it would take over 1,000 barrels of water. The Department of Energy reports that oil shale, for the entire process, including land restoration, would require just three barrels of water for every barrel of shale oil, about the same as gasoline.

Let's compare how much water it would take to make enough ethanol to produce 20 percent of our fuel with the amount of water it would take to produce the same amount of oil shale. Look at what it would take. Look at the red, ethanol. We can hardly see the red of the water required for oil shale. We would need about 64 cubic miles of water to produce that much ethanol and only .17 cubic miles of water to produce the same amount of oil shale.

It is time we stop confusing oil shale with Canadian oil sands. They require

completely different processes. Canadian oil sand production uses a lot of water and a lot of steam to produce oil from oil sands. With oil shale, you apply heat directly to the rock. The last thing you want in your process is water. They are very different, so let's stop pretending they are the same thing. And let's remember Estonia and Brazil. Isn't this country as good as them?

The other red herring often raised against oil shale is concern about land use and wildlife habitat. Mr. President, did you know that oil shale uses much less land than either ethanol or gasoline? One acre of corn produces 7 to 10 barrels of ethanol. One acre in the oil patch produces about 10,000 barrels of oil. One acre of oil shale produces between 100,000 and 1 million-plus barrels of shale oil. That is right, on average, 1 acre of oil shale will produce around 500,000 barrels of oil.

So those who are truly concerned about land use and wildlife habitat, let's look at how much land it would take to make enough ethanol for 20 percent of our fuel supply compared to the same amount of oil shale.

With regard to that green spot in the middle of this chart, it would take those five States to produce 20 percent of our energy needs from ethanol. Think about that. Producing 20 percent of our oil from oil shale would take the equivalent of the smallest county in Kansas being in production at one time, and as each oil shale acreage is used, it would be restored to nature, according to the very strict mining and gas laws already on the books. It is environmentally sound as well.

We are learning that land use is very important, and not just in terms of wildlife habitat and watershed protections. Scientists have determined that disturbing land for activities such as cultivating corn and switchgrass, or any other crop, releases a giant amount of CO2 into the atmosphere.

Look at this chart. Oil shale without carbon capture, 7 percent more than gasoline, but switchgrass for ethanol, including land use, is 50 percent more than gasoline. Greenhouse gas emissions for corn ethanol, including land use, is 93 percent more than gasoline. Oil shale is much more environmentally sound from the get-go.

Even taking into account that burning ethanol is an improvement over gasoline, the researchers discovered that when land disturbance is calculated, corn ethanol emits 93 percent more greenhouse gases than gasoline. Thank goodness for switchgrass, our new hope for the future of biofuels. The problem is that the same study calculates that switchgrass, even when grown on existing corn land, produces 60 percent more carbon emissions than gasoline. The Department of Energy calculates that oil shale production emits only 7 percent more greenhouse gases than gasoline, and that is without any carbon capture technology, which many in the industry plan to use.

Whether your concern is carbon emissions, water use, or wildlife habitat, oil shale is a better answer than ethanol. And when it comes to transportation fuels, ethanol is the only alternative of any real significance today. The fact is that I am for it, but let's not get confused on which one is more efficient and better. I am certainly not here to bash ethanol. I still believe we should produce as much as possible, but ethanol is the only current significant alternative to transportation fuels available today. It is important that we start dealing in realities around here and not just political puffery, is what we are hearing from the other side.

To be honest, when it comes to energy policy, it is like never-never land on Capitol Hill. On the one hand, we pass a giant mandate on top of giant incentives to produce ethanol, with all its limitations. On the other hand, we ban oil shale production which would give our people access to almost unlimited amounts of cheap energy. The oil shale industry is not asking for any mandates, environmental loopholes, or subsidies. They simply ask to have access to the Federal Government's vast oil shale resources.

I have no problem with debating the impact of speculation on oil prices. It is something we ought to be discussing. I have no problem with that. But it is not going to produce one drop of oil. It is no substitute for providing our people with the transportation fuels they need, and we will never accomplish that goal until we find more and use less.

Our goal as Republicans is to amend this bill so we can find more oil and use less of it so that we can solve our problems as we go into the future, where we get into not only hybrids but plug-in hybrids, electric motors, fuel-cell motors, hydrogen cars and, of course, nuclear, wind, solar, thermal, and geothermal. We have to do all of that. But until we can really move down that line, we have to have oil to run our transportation needs.

I yield the floor.

Mr. President, I rise today to join my colleague from Wisconsin, Senator Herb Kohl, in introducing a resolution to designate September 14-20, 2008, as National Polycystic Kidney Disease Awareness Week. Approximately 600,000 Americans and more than 12 million people worldwide suffer from polycystic kidney disease or PKD. Through this resolution, we hope to raise awareness of this disease that is relatively unknown but affects so many people.

PKD is one of the most common life-threatening genetic diseases impacting America today. According to the PKD Foundation, the disease afflicts more people than Down syndrome, cystic fibrosis, muscular dystrophy and sickle cell anemia combined.

The two major forms of PKD are autosomal dominant PKD--also called ``adult PKD'' because it customarily causes symptoms in adulthood--and autosomal recessive PKD, a rare form that usually causes symptoms in infancy and early childhood. Babies born with this latter type of PKD often do not live longer than the first month of life. About half of autosomal dominant PKD patients eventually develop kidney failure and require dialysis or a kidney transplant. PKD is the fourth leading cause of kidney failure, and it is the leading genetic cause of kidney failure.

PKD is characterized by the growth of fluid-filled cysts on the nephrons of the kidneys. A polycystic kidney can have thousands of these cysts growing on it. In time, the cysts separate from the nephrons and continue to enlarge--and the kidneys enlarge along with the cysts. A normal, healthy kidney is about the size of a fist; but, in fully developed cases of autosomal dominant PKD, a cyst-filled kidney can grow to the size of a football or larger and weigh as much as 20 to 30 pounds. This leads to decreased kidney function and kidney failure.

PKD also can cause cysts in the liver and problems in other organs, such as blood vessels in the brain and heart. High blood pressure is common and develops in most patients by age 20 or 30, and brain aneurysm is a common cause of death in PKD patients.

There is no cure for PKD, only minimal treatments such as medicine to control high blood pressure, or medicine and surgery to reduce pain, and antibiotics for infections. More severe cases of PKD require more intense treatment options such as dialysis for failing kidneys or a kidney transplant.

There may be no cure, but there is hope. According to the National Institute of Diabetes and Digestive and Kidney Diseases at the National Institutes of Health, scientists have begun to identify what triggers formation of PKD cysts. And advances in genetics have expanded understanding of the abnormal genes responsible for both

forms of PKD. Recent clinical studies of autosomal dominant PKD are exploring new imaging methods for tracking progression of cystic kidney disease. Today, magnetic resonance imaging, MRI, is helping scientists design better clinical trials for new treatments of adult PKD.

There is also hope in awareness and education, which offer patients opportunities to discuss and learn about their disease, provide more resources for research and treatment options for PKD, and lead to more events to heighten visibility and aid in fundraising. As I said earlier, not many people know about the disease, even in my home State of Utah where PKD rates are three times the national average.

To promote greater understanding of this destructive genetic disease, Senator Kohl and I have introduced this resolution to designate a National Polycystic Kidney Disease Awareness Week.

I urge my colleagues to support it.

Mr. President, on behalf of myself and my dear friend and colleague, Senator Lincoln, I rise today to introduce the Small Bank Tax Equity Act.

One of the many important duties of Congress is to ensure that the various laws that govern commerce in this Nation are working as efficiently as possible. This can be a significant challenge because of the rate of change and innovation occurring in our world today. Nevertheless, we need to be aware that changing circumstances can lead to obsolescence in our laws, which can have a limiting effect on economic growth and on our ability to compete in an ever-more challenging marketplace.

This is as true of our tax laws as it is with any other laws. We often speak of the many problems of the Internal Revenue Code, and most of them have to do with complexity and perceived unfairness. However, I believe that the issue of outdated or obsolete provisions that no longer reflect the realities of our changing world is also an obstacle that deserves our attention.

This is why I am pleased today to be introducing legislation that would reverse an outdated administrative rule and allow banks the flexibility to be structured in a much more tax-efficient manner. Under our bill, the Small Bank Tax Equity Act, banks that are organized as limited liability companies would be able to elect to be taxed on a flowthrough basis. Under this treatment, the bank's shareholders would be taxed each year on the bank's income, but the bank would not also be subject to a second layer of tax on that same income at the entity level.

A little history is in order here. Treasury Department regulations have long allowed limited liability companies to be classified for tax purposes as flowthrough entities. Under this classification, the company's owners are subject to tax on the company's income on a flow- through basis. This allows the very significant advantage of not being subject to the double taxation characteristic of corporations, as all banks are currently taxed.

Those same Treasury Department regulations specifically deny banks that are organized as limited liability companies the benefit of flow- through tax treatment, even though this favorable treatment is available to other types of businesses. While banks can organize as limited liability companies, for tax purposes, they are taxed as corporations.

It is important to note that at the time the Treasury Department issued these regulations, banking laws actually required all banks to be organized in the corporate form under state law in order to obtain federal deposit insurance. In fact, this requirement was cited in the regulations as the reason for the denial of flow-through tax treatment to banks that have federal deposit insurance.

However, this aspect of the banking laws has been changed. In 2003, the Federal Deposit Insurance Corporation FDIC, issued regulations permitting banks to be organized as limited liability companies and to qualify for federal deposit insurance.

Following this FDIC action, it was expected that the Treasury Department would likewise change its regulations to allow banks organized as LLCs to enjoy flowthrough tax treatment. However, despite the urging of several Members of Congress, including myself, Treasury has declined to make this change administratively. The continued denial of flow-through tax treatment of bank limited liability companies is, in my view, unjustified and anti-competitive. Moreover, it fails to bring the law up to date with current business practices.

In 1996, Congress amended the Subchapter S corporation rules, which provide flow-through tax treatment, to allow banks to be organized as S corporations. This change reflected Congress's belief that the S corporation election should be allowed for banks, just as it is allowed for other businesses meeting the qualifications for this important tax regime.

The legislation we are introducing today is based on exactly the same belief. The flow-through treatment that would be made available under the bill will give America's smaller banks, including the community banks on which we depend to provide funding to allow small businesses to expand and thrive, another option for organizing in the most efficient manner.

The changes we made in 1996 to Subchapter S to allow banks to elect flowthrough tax treatment was very well received by the banking community, and today there are thousands of S corporation banks throughout America. The Small Bank Tax Equity Act will mean that banks would be able to choose the limited liability company structure, which allows even greater flexibility in raising capital than does the S corporation form of entity. I expect that the election for flow-through tax treatment for LLCs allowed under this bill to be as well received as the election for S corporation status has been and that many smaller banks, especially newly-established ones, will avail themselves of this opportunity.

My home State of Utah in 2004 enacted laws allowing banks to be organized as limited liability companies. In light of the 2003 FDIC rule change that allowed LLC banks to qualify for federal deposit insurance, Utah enacted this legislation in order to facilitate the most efficient and flexible structure for small banks. Other states have passed, or are considering, similar laws. Many others would likely follow suit if the tax rules paralleled the deposit insurance treatment. However, the goals of these states in passing these laws will not be realized until the tax law is also updated to provide flowthrough tax treatment for banks that choose to operate in this form.

The following is a brief technical description of the Small Bank Tax Equity Act.

The Small Bank Tax Equity Act would provide qualifying banks with an election to be classified for tax purposes as a partnership or to be disregarded as a separate entity, in the case of a bank with only a single ownernlecting this classification would provide flow-through tax treatment to the electing bank. Under the bill, the election is available to State-chartered business entities that conduct banking activities, that have federal deposit insurance, and that are organized as limited liability companies. These are the banks that are excluded from flow-through treatment under the existing Treasury regulations that were written based on pre-2003 FDIC rules.

If a bank makes the election allowed under the Small Business Tax Equity Act before the end of a two taxable year transition period following enactment, the election would not subject the bank to immediate tax on any appreciation in its assets. Instead, the electing bank would be subject to special rules with respect to the taxation of gains and losses that are recognized during the ten-year period following the election. These special rules mirror the special rules that apply when an entity elects to convert to S corporation status.

These special rules would not apply, however, to an electing bank that had begun conducting banking activities after February 12, 2003, the date of the FDIC action allowing State-chartered banks organized as limited liability companies to obtain federal deposit insurance. These banks acted with the expectation that flow-through tax treatment would be available and should not be penalized for the delay in being able to obtain that treatment. Thus, under the Small Bank Tax Equity Act, making the election for flow-through treatment will not trigger any special tax consequences with respect to inherent gains or losses for these banks.

Small businesses are the backbone of the American economy. They are responsible for creating the most jobs in this Nation, particularly during economic slowdowns, such as we are experiencing now. Smaller banks are important for at least two reasons. They are small businesses themselves, and they serve other small businesses and provide them with the capital they need to grow and create jobs.

It is our duty to ensure that America's small businesses operate as efficiently as possible. This means that our tax laws need to be friendly and offer flexibility, rather than hidebound and obsolete, in order to encourage the kind of growth of which our small business sector is capable. This bill would take a very significant step in that direction, and I encourage our colleagues to support this legislation.

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

Mr. President, on behalf of myself and my dear friend and colleague, Senator Lincoln, I rise today to introduce the Small Bank Tax Equity Act.

One of the many important duties of Congress is to ensure that the various laws that govern commerce in this Nation are working as efficiently as possible. This can be a significant challenge because of the rate of change and innovation occurring in our world today. Nevertheless, we need to be aware that changing circumstances can lead to obsolescence in our laws, which can have a limiting effect on economic growth and on our ability to compete in an ever-more challenging marketplace.

This is as true of our tax laws as it is with any other laws. We often speak of the many problems of the Internal Revenue Code, and most of them have to do with complexity and perceived unfairness. However, I believe that the issue of outdated or obsolete provisions that no longer reflect the realities of our changing world is also an obstacle that deserves our attention.

This is why I am pleased today to be introducing legislation that would reverse an outdated administrative rule and allow banks the flexibility to be structured in a much more tax-efficient manner. Under our bill, the Small Bank Tax Equity Act, banks that are organized as limited liability companies would be able to elect to be taxed on a flowthrough basis. Under this treatment, the bank's shareholders would be taxed each year on the bank's income, but the bank would not also be subject to a second layer of tax on that same income at the entity level.

A little history is in order here. Treasury Department regulations have long allowed limited liability companies to be classified for tax purposes as flowthrough entities. Under this classification, the company's owners are subject to tax on the company's income on a flow- through basis. This allows the very significant advantage of not being subject to the double taxation characteristic of corporations, as all banks are currently taxed.

Those same Treasury Department regulations specifically deny banks that are organized as limited liability companies the benefit of flow- through tax treatment, even though this favorable treatment is available to other types of businesses. While banks can organize as limited liability companies, for tax purposes, they are taxed as corporations.

It is important to note that at the time the Treasury Department issued these regulations, banking laws actually required all banks to be organized in the corporate form under state law in order to obtain federal deposit insurance. In fact, this requirement was cited in the regulations as the reason for the denial of flow-through tax treatment to banks that have federal deposit insurance.

However, this aspect of the banking laws has been changed. In 2003, the Federal Deposit Insurance Corporation FDIC, issued regulations permitting banks to be organized as limited liability companies and to qualify for federal deposit insurance.

Following this FDIC action, it was expected that the Treasury Department would likewise change its regulations to allow banks organized as LLCs to enjoy flowthrough tax treatment. However, despite the urging of several Members of Congress, including myself, Treasury has declined to make this change administratively. The continued denial of flow-through tax treatment of bank limited liability companies is, in my view, unjustified and anti-competitive. Moreover, it fails to bring the law up to date with current business practices.

In 1996, Congress amended the Subchapter S corporation rules, which provide flow-through tax treatment, to allow banks to be organized as S corporations. This change reflected Congress's belief that the S corporation election should be allowed for banks, just as it is allowed for other businesses meeting the qualifications for this important tax regime.

The legislation we are introducing today is based on exactly the same belief. The flow-through treatment that would be made available under the bill will give America's smaller banks, including the community banks on which we depend to provide funding to allow small businesses to expand and thrive, another option for organizing in the most efficient manner.

The changes we made in 1996 to Subchapter S to allow banks to elect flowthrough tax treatment was very well received by the banking community, and today there are thousands of S corporation banks throughout America. The Small Bank Tax Equity Act will mean that banks would be able to choose the limited liability company structure, which allows even greater flexibility in raising capital than does the S corporation form of entity. I expect that the election for flow-through tax treatment for LLCs allowed under this bill to be as well received as the election for S corporation status has been and that many smaller banks, especially newly-established ones, will avail themselves of this opportunity.

My home State of Utah in 2004 enacted laws allowing banks to be organized as limited liability companies. In light of the 2003 FDIC rule change that allowed LLC banks to qualify for federal deposit insurance, Utah enacted this legislation in order to facilitate the most efficient and flexible structure for small banks. Other states have passed, or are considering, similar laws. Many others would likely follow suit if the tax rules paralleled the deposit insurance treatment. However, the goals of these states in passing these laws will not be realized until the tax law is also updated to provide flowthrough tax treatment for banks that choose to operate in this form.

The following is a brief technical description of the Small Bank Tax Equity Act.

The Small Bank Tax Equity Act would provide qualifying banks with an election to be classified for tax purposes as a partnership or to be disregarded as a separate entity, in the case of a bank with only a single ownernlecting this classification would provide flow-through tax treatment to the electing bank. Under the bill, the election is available to State-chartered business entities that conduct banking activities, that have federal deposit insurance, and that are organized as limited liability companies. These are the banks that are excluded from flow-through treatment under the existing Treasury regulations that were written based on pre-2003 FDIC rules.

If a bank makes the election allowed under the Small Business Tax Equity Act before the end of a two taxable year transition period following enactment, the election would not subject the bank to immediate tax on any appreciation in its assets. Instead, the electing bank would be subject to special rules with respect to the taxation of gains and losses that are recognized during the ten-year period following the election. These special rules mirror the special rules that apply when an entity elects to convert to S corporation status.

These special rules would not apply, however, to an electing bank that had begun conducting banking activities after February 12, 2003, the date of the FDIC action allowing State-chartered banks organized as limited liability companies to obtain federal deposit insurance. These banks acted with the expectation that flow-through tax treatment would be available and should not be penalized for the delay in being able to obtain that treatment. Thus, under the Small Bank Tax Equity Act, making the election for flow-through treatment will not trigger any special tax consequences with respect to inherent gains or losses for these banks.

Small businesses are the backbone of the American economy. They are responsible for creating the most jobs in this Nation, particularly during economic slowdowns, such as we are experiencing now. Smaller banks are important for at least two reasons. They are small businesses themselves, and they serve other small businesses and provide them with the capital they need to grow and create jobs.

It is our duty to ensure that America's small businesses operate as efficiently as possible. This means that our tax laws need to be friendly and offer flexibility, rather than hidebound and obsolete, in order to encourage the kind of growth of which our small business sector is capable. This bill would take a very significant step in that direction, and I encourage our colleagues to support this legislation.

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

Mr. President, it was Kierkegaard, a number of years ago, who said that venture causes anxiety, but not to venture is to lose one's self.

From the outset let me be crystal clear in voicing my strong opposition to all three pending amendments to H.R. 6304. But before I discuss these amendments, let me address a few things said on this floor yesterday. One of my colleagues said the Congress shouldn't ``jam this bill through.'' If working on a bill for over 440 days is jamming it through, then Webster's dictionary should prepare a new definition for the word. We also heard comments yesterday which were critical of the fact that not every Senator has been fully briefed on the activities of the intelligence community. I guess since this same argument didn't stick the first time it was offered back in December, more desperate attempts would be made. If at first you don't succeed, try, try again.

Memories are short around here, and we should appreciate that the very creation of the Intelligence Committee was controversial. The committee was created so a limited number of Members would have oversight of our intelligence agencies. During the 10 days of debate on the resolution creating this committee, numerous Senators openly worried about possible leaks in providing highly classified material to a large number of individuals. Here is what Senator Milton Young said in May of 1976:

It is my understanding that on this new committee, staff

would have access to the most sensitive information. Human

nature is such that when too many people have access to this

information, someone is bound to leak parts of it to an

ambitious and inquisitive press.

Also, in 1976, here is what another Senator said. This is Senator Walter Mondale on the need for a Senate Intelligence Committee on May 13, 1976:

We have the worst possible system for congressional

oversight of intelligence. Responsibility and authority are

fragmented in several cases; it is impossible to look at

intelligence as a whole; because authority and responsibility

are not welded together, we are incapable of dealing with

problems privately, and there is the inevitable temptation to

deal with them through leaks.

Thirty two years later, these statements contain points that are still vitally important to this discussion. Is this the system of oversight that we should go back to? Those that argue that we should not vote until every Member gets some sort of vague access are essentially saying that all 535 Members of Congress, plus hundreds of cleared staff, should be read into all highly classified programs whose jurisdiction is otherwise limited to the Intelligence Committees. If you want to guarantee future leaks, this would be a good approach.

This sort of logic begs the question: Why do we have the Intelligence Committee? The answer is obvious, and I urge my colleagues to remember the extensive efforts of our predecessors which created a committee with the authority to review these materials.

While the issue of civil liability protection for telecoms has been debated extensively over the last 9 months, the three final amendments before us all attempt to alter or remove the carefully crafted bipartisan civil liability provision. I agree with the comments from both sides of the aisle in opposition to these amendments.

The Bingaman amendment, for example, would needlessly delay the liability provision. I believe the amendment is unwise, as its purpose disregards the extensive work that Congress has already conducted on this issue. By my last count, Congress has conducted over 27 hearings on the TSP and FISA over the last few years.

Let there be no doubt; the IG review will not, and cannot, determine the legality of the terrorist surveillance program. Any suggestion that the review will do so is absolutely incorrect. Inspectors general are not qualified and lack jurisdiction to review the legality of intelligence programs. As further evidence of this obvious point, let's look at this quote by the DOJ inspector general on conducting legal analysis:

That's not our role as the Inspector General.

In addition, the IG review will not publicly reveal which companies elected to participate in this program, as that information remains highly classified. Simply put, attempts to alter the FISA compromise based on a misperception of the eventual IG review should be strongly rejected, and we should do so this morning.

Close inspection of the lawsuits against the telecoms reveals quite dubious claims. As has previously been stated, the plaintiffs persistently confuse speculative allegations and untested assertions for established facts.

It is very simple, Congress should not condone oversight through litigation.

The lawsuits seize on the President's brief comments about the existence of a limited program to go on a fishing expedition of NSA activities. But this is really worse than a fishing expedition; this is draining the Loch Ness to find a monster. Sometimes what you are looking for just doesn't exist.

Yet we consistently hear as justification for the apparent paranoia that some wiretaps were warrantless. But lest we forget, the fourth amendment does not proscribe warrantless searches, it proscribes unreasonable searches.

Here's a quick example from a few blocks from here: Waiting for warrantless searches at the National Archives; waiting to be served before viewing the fourth amendment itself. That is a warrantless search.

The fact is that the President created an early warning system to prevent future attacks; essentially a terrorist smoke detector. But rather than appreciate the protection it offered, critics rushed to pull out the batteries so that it could not work.

My feelings of admiration and respect for the companies who did their part to defend America are well known. As I have said in the past, any company who assisted us following the attacks of 9/11 deserves a round of applause and a helping hand, not a slap in the face and a kick to the gut.

When companies are asked to assist the intelligence community based on a program authorized by the President himself and based on assurances from the highest levels of government that the program has been determined to be lawful, they should be able to rely on those representations.

In the over 40 outstanding civil lawsuits, is there any proof that any litigant was specifically targeted by the government? Can any of the plaintiffs show that they are ``aggrieved persons'' under the definition of FISA? The answer to both questions is no. Rather, many of the lawsuits utilize the following logic: I have long distance service, so I am going to sue because I think you listened to my calls. Even though they have no proof; even though the government has more important things to do than listen to their random phone calls, they push on in their desire to justify their view of self-importance and irrational belief in government conspiracy. I don't want to bruise anyone's ego, but if al-Qaida is not on your speed dial the government is probably not interested in you.

The possible disclosure of classified materials from ongoing court proceedings is a grave threat to national security, and the very point of these lawsuits is to prove plaintiffs' claims by disclosing such classified information. Simply put, you do not tell your enemies how you track them. This is why the NSA and other government agencies will not say what they do, how they do it, or who they watch. Nor should they. To confirm or deny any of these activities, which are at the heart of the civil lawsuits, would harm national security. We should not discuss what our capabilities are.

If the identities of the companies are revealed and officially confirmed through litigation, they will face irreversible harm; harm in their business relations with foreign governments and companies, and possible physical harm to their employees both here and abroad, who are truly soft targets for attackers.

I have come to this floor on numerous occasions during the last year to discuss the issue of FISA modernization and am hopeful that the need to continue to do so will finally end tomorrow. I am confident that when the Congress considers this issue, we will finally send this vitally important legislation to the President to be signed into law.

I compliment the distinguished chairman and vice chairman of the committee, Senators Rockefeller and Bond. They have had to handle this matter through all kinds of vicissitudes and false logic. They have done an exceptionally good job. They and their staff have stood and tried to let America know what is involved.

The fact is, these two leaders have done a great job on this committee. They have previously passed bipartisan legislation overwhelmingly. This original Senate FISA modernization bill would have passed the House pretty much overwhelmingly, had it been brought up, and, of course, hopefully this version will be passed today without any of these three amendments which would cause a veto.

I thank those who vote for this bill and those who have been considerate enough to look at all the important arguments and support this legislation which is much needed, certainly much needed before August and should have been passed a long time ago.

I thank all those who have stood up on this bill.

I yield the floor.

Madam President, I rise to oppose cloture on the motion to proceed to H.R. 6331, the Medicare Improvements for Patients and Providers Act.

I am beginning to feel like the character from the movie ``Groundhog Day'' who wakes up every morning to the same day. Here we are again, having the same debate about the same Medicare bill that will not be signed into law.

I believe that our time would be better spent working on a bill to restore physician payments instead of having a partisan vote just to make some political points. It would be better to work in a bipartisan way. We could do it in 10 minutes, if we just sit down and do it. I know the distinguished chairman and ranking member could do it.

But it is obvious that some in this body would rather have a political battle and put Medicare beneficiaries and their doctors at risk.

In the last month, I stood on the Senate floor, not once, but twice emphasizing that I want to work on a bipartisan Medicare bill that will be signed into law. In fact, we had a bipartisan agreement in the Senate.

Unfortunately, Senate Democrats are still not permitting a vote on a compromise measure or even the Republican alternative.

The bipartisan compromise bill would have passed overwhelmingly, and this issue would be behind us.

And, quite frankly, H.R. 6331, essentially, the Baucus Medicare bill, contains many provisions that both sides strongly support.

It is troubling that only the Democrat Medicare bill is being given a vote on the Senate floor, especially when there is a Republican alternative that restores physician payments as well, especially since I believe Senators Baucus and Grassley would have worked it out long before now without all the hoopla and politicization.

In addition, when the Democrat Medicare bill failed to get cloture a few weeks ago, the minority leader asked for unanimous consent to pass a 31 day extension of the December Medicare law. The purpose of this extension was to prevent the Medicare physician cuts from going into effect until we were able to work out our differences.

But Senator Reid objected to this unanimous consent request for political reasons and told the Senate that

he wanted the Republicans who voted against cloture to feel the heat when they went home for the Fourth of July recess. I was a little shocked at that.

Fortunately, the Centers for Medicare and Medicaid Services, CMS, is delaying the Medicare reduction for physicians for 10 business days to give us more time. Unfortunately, we do not agree on one key issue--the Medicare Advantage Program. This program was created in the Medicare Modernization Act of 2003. I was on the conference committee and spent months working on Medicare Advantage.

Today, Medicare Advantage provides beneficiaries with many health care choices in addition to traditional Medicare.

Medicare Advantage plans are very similar to private health plans offered to those under 65 years of age. One out of five people in Medicare are on Medicare Advantage, and they love the program.

The Democrat Medicare bill includes reforms to the Medicare Advantage Program that are unacceptable to both the White House and many of us who support the Medicare Advantage Program.

Those of us who support Medicare Advantage feel that the provision in the Democrat Medicare bill will limit plan choices currently offered to beneficiaries.

Beneficiaries participating in the Medicare Advantage Program are happy with their health care coverage.

Every month, I receive hundreds of letters from my constituents telling me how much they like their Medicare Advantage plans.

Medicare Advantage is working across the country.

On the other hand, the Medicare+Choice program, which was the precursor to the Medicare Advantage Program, did not work very well, especially in rural areas.

That was because the Federal Government did not pay plans enough money to operate in rural areas.

The Utah Medicare+Choice plans left our State because plans could not function and they were losing money.

At that point, Utah Medicare beneficiaries only had one choice-- traditional Medicare. And once we start disassembling the Medicare Advantage Program, as some in this body want to do, I believe that health care choices for beneficiaries will diminish. Through the Medicare Modernization Act, we finally figured out how to provide choice to Medicare beneficiaries in both rural and urban areas and how to pay plans appropriately.

But my friends on the other side cannot leave a good thing alone and insist on making changes to a program that works well today and that 90 percent of beneficiaries in Medicare Advantage are satisfied with.

The Democrat Medicare bill, if signed into law, will no longer allow private fee-for-service plans to deem.

Deeming allows beneficiaries in private fee-for-service plans to see any Medicare provider.

Deeming has been important to those living in rural areas where it is difficult for network-based plans to persuade providers to contract with them. It is also helpful to employer groups which provide retiree health coverage to those living in rural areas across the country.

The elimination of deeming could take away health care coverage choices for Medicare beneficiaries living in rural States.

In addition, the elimination of deeming could cause some retirees to lose their health benefits because the retirement plan cannot establish networks in all 50 States.

According to America's Health Insurance Plans, known as AHIP, 21,000 Utah beneficiaries may be dropped from their current Medicare Advantage private fee-for-service plans if the provision to eliminate deeming becomes law.

In fact, AHIP believes that 1.7 million seniors across the country could lose their existing health coverage if H.R. 6331 becomes law.

A few weeks ago, I mentioned that one Utah employer has said that the elimination of deeming will force the company to stop offering health care coverage to almost 12,000 retirees, and that is probably the tip of the iceberg.

I fear that the impact of this provision could be devastating, especially to beneficiaries living in rural States.

We truly do not know the full effect of this policy and how it will affect Medicare beneficiaries across the country.

Therefore, I simply cannot support this policy and it is the main reason that I am going to vote against cloture.

Do not be fooled--the bill we are considering today will not be signed into law.

The President has said he will veto the bill and there will not be enough votes to override his veto. I suppose some on the other side think they have a great political advantage if he vetoes the bill and we can't override it. They can use that against Republicans.

This motion must be defeated for the third time. We should not have had to go to three votes.

Hopefully, my colleagues on the other side of the aisle will want to work with us on a bill that can be signed into law because it would be bipartisan.

We must move forward so Medicare beneficiaries will no longer worry about their doctors dropping out of the Medicare Program.

We must move forward so physicians participating in the Medicare Program will not be cut by 10.6 percent. I don't think anybody in this body believes that we will allow that cut to occur; certainly, I will not.

We must move forward because the American people are getting tired of a do-nothing Congress where Members are not able to work out their differences.

Why don't we put all our differences aside? We could solve this in 10 minutes without making it a political fiasco which is what it has become. I think in the end everybody would be better off. Certainly, seniors who are on Medicare Advantage would continue to be better off than they would be if this very partisan bill passes through this body and is vetoed by the President and that veto is sustained.

I yield the floor.

Mr. President, I rise to discuss a very important issue. First, I compliment the Senator from Texas. I agree with virtually everything he said. There are so many things we need to do around here, and we are not doing them.

I will discuss an issue that each day becomes more troubling to me and also to many businesses and individuals in my home State of Utah-- and I am sure yours as well--the fact that this Congress has not yet acted to extend the tax provisions that expired at the end of last year and those that are set to expire at the end of 2008. This failure to act is rapidly reaching a state of crisis in some industries, and our continuing inability to take care of this basic problem only reinforces the public's low opinion of this institution.

I believe that every member of this Senate recognizes the importance of the expired and expiring tax provisions. While there may be some items on the growing list of extenders that do not enjoy universal support, there are clearly plenty of votes to easily provide a majority or even a super-majority to pass them all, if it were not for the divisive question of offsetting the revenue loss.

The list includes some important items for individuals and businesses in every State. For families, there is the election to deduct State and local sales taxes, the deduction for higher education expenses, and the deduction for the out-of-pocket expenses of school teachers.

For businesses, expired or expiring provisions include those allowing faster depreciation write-offs for retail stores, restaurants, and other investment properties, a variety of important incentives that address our energy crisis, and the vital research credit, which I have championed here for many years.

The expiration of the energy provisions and the research credit are particularly troubling, for they signal the loss of economic growth and jobs at the worst possible time. As with many of my colleagues and their constituents, I have Utahns telling me that important research and energy-related projects are going to be cancelled if these provisions are not quickly extended.

Well, here we have a group of tax provisions that enjoys wide bipartisan support, and an economy that really needs to have access to these provisions at a time of slowdown and job loss. Many of my constituents do not get it. They are asking, why can't Congress just get it done? What is the problem?

The problem is, as we all recognize, that my colleagues on the other side insist on attaching to the bill tax-raising measures in order to offset the revenue loss of the expiring provisions. And most Senators on my side of the aisle believe that tax increases are unnecessary and, in fact, ill-advised and harmful to our economy, both today and in the future. Unfortunately, we appear to have reached an impasse on this point.

Contrary to what some proponents of offsets are saying about Republican motives in this matter, our stance is not about trying to protect a few wealthy hedge fund managers who are parking billions of dollars offshore in deferred compensation. Rather, we believe that this debate is about America's future prosperity.

Democrats are saying that in order to be fiscally responsible, taxes need to go up to pay for the loss in revenue from keeping these tax provisions in place. Their so-called ``pay-as-you-go'' or ``pay-go,'' rules call for all revenue losses to be matched with revenue increases, or spending decreases, from somewhere else. Forget spending decreases; it just means tax increases.

In theory, this sounds pretty good, and quite responsible. I am a strong believer in being fiscally responsible, and I am as loathe to pass on our huge national debt to our children as anyone in the history of the Congress.

The problem is that to most Democrats, the word PAYGO is nothing

more than a synonym for more taxes. We seldom, if ever, see the idea of reducing spending brought up by the other side as a way of offsetting the loss of revenue from extending these important tax provisions.

In fact, there is a major flaw in the Democrats' pay-go requirement that you never hear them mention. Pay-go applies only to the revenue loss from extending the tax cuts, but not to the revenue loss from extending spending programs that expire. You might never know it from listening to the debate around here, but it is not just tax provisions that expire. Extending both tax benefits and spending programs costs Federal revenue. Why should not both be offset?

However, the budget rules assume that the expiring spending provisions are automatically renewed as a matter of course, with absolutely no requirement that the lost revenue be offset. This mismatch in budget policy produces a huge bias toward bigger Government and more taxes--something my colleagues on the other side just love.

Some may well ask, why shouldn't we pay for the lost revenue from extending the expired and expiring tax provisions?

My answer to Utahns who ask me this question comes in three parts:

First, it is wrong to raise taxes on one group of taxpayers in order to prevent another group of taxpayers from suffering an increase in taxes. Democrats and Republicans alike have resoundingly agreed with this principle in connection with the alternative minimum tax. Both parties in both Houses last year overwhelmingly passed the so-called ``AMT patch'' without offsets, and it is widely expected that we will do the same thing again this year.

Second, it is wrong to offset temporary extensions of current law with permanent tax increases. The fact that this has been done year after year does not make this practice a sound one. In fact, using permanent tax increases to offset temporary extensions simply means that, in the long run, the extenders have been paid for again and again.

Finally, why should we increase taxes when we are already collecting more taxes as a percentage of gross domestic product than the historical average? Despite the large tax cuts passed by Congress and signed by the President in the early part of this decade, the amount of tax collected as compared to the size of the economy just keeps increasing; yet, the majority insists on expanding the Government's pocketbook even further. At a time when gas prices have increased by 10 cents over the past two weeks to a national average of $4.07 and home foreclosures are on the rise, I believe we need to put money back in the taxpayer's pockets, not take more out.

According to the other side, the pay-go rules require us to provide tax increases in order to keep the deficit from increasing. Time and again, however, the Democrats themselves admit that the pay-go rules are not practical. We all know that.

For example, it was not deemed necessary to offset the revenue loss of the economic stimulus package we passed early this year. We did not offset the package of tax benefits for military personnel that was recently enacted. And there has been a long internal debate on the other side about whether unemployment benefits need to be offset. It appears to me that the Democratic pay-go requirement is more a slogan of convenience than a bedrock principle.

Many in the business community are frustrated by our lack of action in extending the expired tax provisions. I understand and share this frustration with them. I have fought for years to improve, extend, and expand many of these provisions, such as the research credit.

However, I believe those in the business community who are encouraging us to simply go along with the flawed bill the House of Representatives has sent us are being very shortsighted. Many in the business lobbies have looked at the offsets in that bill and have said that since they do not affect them very much, that we should go ahead and approve them.

If we go along with these offsets to extend the expired provisions until the end of this year, what are we going to use to pay for next year's extension? Sure, the business community might be fine with these offsets now, but how long until we get to the offsets that really hit them hard? All of us, including the business community, need to take a longer view of this and examine the principles involved.

We cannot drive our economy into the ground in the name of false fiscal responsibility. Tax increases are not the prescription to what ails our economy, particularly during this downturn and especially when revenue is already higher than the historical average. Yes, we should pass the extenders, but let us not sacrifice jobs on the altar of a flawed pay-go requirement in the process.

The cost of living for Americans is becoming unbearable. In my home State of Utah, the average price of gas is $4.07, construction of new homes has ceased, and unemployment is on the rise. We should be spending less and lowering taxes, not holding back tax incentives that are vital to economic growth and job creation while raising taxes.

If my colleagues on the other side want to be fiscally responsible, then I am all for it. Let us work together to identify enough spending cuts to offset the cost of extenders. But if we cannot do that, let us not hold these important tax provisions hostage to a false sense of fiscal responsibility.

I notice the distinguished majority whip is here, so I will try to finish as quickly as I can.

I wish to say a few words about why I oppose the cloture motion on the motion to proceed on H.R. 6331, the Medicare Improvements for Patients and Providers Act. As I said last week when we were considering the cloture motion on the Baucus Medicare bill, my goal is to have bipartisan legislation signed into law by the President on July 1. Let me be clear, I wish to continue to work with my colleagues on the other side of the aisle in order to get this done. We were so close to an agreement in the Senate earlier in the week, but after the House voted on Tuesday, those discussions basically stopped, although we can put this together in 10 minutes if we work in a bipartisan way.

To be honest, the House Medicare bill, H.R. 6331, contains many provisions that both sides strongly support. These provisions include restoring Medicare reimbursement rates for physicians so their Medicare payments are not reduced by 10.6 percent on July 1.

Let me be clear, no one wants to cut Medicare reimbursements for doctors. We want Medicare beneficiaries to continue to have access to high-quality health care and the ability to see their own doctors.

There is not just one Medicare bill. The Baucus Medicare bill; the Grassley Medicare bill, which I cosponsored; and H.R. 6331 all include provisions to restore physician payments. All three bills include provisions on e-prescribing. Mandatory e-prescribing will significantly reduce medical errors, thus protecting beneficiaries.

Another issue that has overwhelming support is the delay of the competitive bidding program. I was a member of the House-Senate conference committee on the Medicare Modernization Act of 2003. Even back then, Senator Grassley and I expressed grave concerns about the inclusion of the Medicare competitive bidding program. I worried about the impact it would have on small durable medical equipment companies, particularly those in rural areas. I am still concerned because there are many unanswered questions about the bidding process and how the winning bids were selected. If we do not come to an agreement by July 1, this program will go into effect.

A related issue that is included in all three Medicare bills is the elimination of the clinical lab competitive bidding program. There was broad support to repeal the clinical lab competitive bidding program as well.

There are rural provisions included in all three bills that are very important to my home State of Utah, which has many rural areas.

These provisions improve payments for sole community hospitals, critical access hospitals, and increase ambulance reimbursement rates in both rural and urban areas.

All three bills include a policy to create a bundle payment system for end-stage renal disease, or ESRD, services

provided to kidney dialysis patients. They also provide positive composite rate updates for 2 years until the bundled payment system is created.

All three bills include Medicare reimbursement for six kidney disease education sessions.

All versions of the Medicare legislation also include an expansion of telehealth services to skilled nursing facilities, hospital-based renal dialysis, and mental health centers.

So as one can see, we agree on most all the issues. Unfortunately, there is one issue where we do not agree, and it is standing in the way of getting this legislation signed into law.

H.R. 6331, the House Medicare bill, and the Baucus Medicare bill, include provisions that would reform the Medicare Advantage Program in a way that is unacceptable to both the White House and many of us who support the Medicare Advantage Program and I believe 90 percent of the people who do support that program.

In 2003, I sat through hours of negotiations with administration officials, House Members, and Senate colleagues for days, weeks, and months, including Finance Committee Chairman Baucus, to create the Medicare Advantage Program to the Medicare Modernization Act of 2003. Let me remind my colleagues, before 2003, the Medicare Advantage Program, then known as Medicare+Choice, was not working very well, especially in rural parts of our country because the Medicare payments were too low. The Medicare+Choice plans serving Utah simply left because they were in the red. They were not making money and, as a result, Utah Medicare beneficiaries could only be covered by traditional Medicare.

Through the MMA, we finally figured out how to provide choice to Medicare beneficiaries in both rural and urban areas. Medicare beneficiaries in Utah now have a choice in Medicare coverage they did not have before the MMA was implemented.

The biggest difference between the bill before us today and the Grassley Medicare bill is the House Medicare bill, if signed into law, will no longer allow private fee-for-service plans to deem. You are probably asking: What on Earth is deeming? It is quite simple.

Deeming allows beneficiaries who have opted for private fee-for- service plans the ability to see any Medicare provider because these plans do not have to establish networks.

Private fee-for-service plans have provide coverage options to Medicare beneficiaries living in rural areas who previously did not have choice. In other words, the ability to deem has been especially important in rural areas, where it is difficult for network-based plans to persuade providers to contract with them and for employer groups that provide coverage for retirees living in areas across the country.

The elimination of deeming could be the elimination of health care coverage choices for beneficiaries living in rural areas.

It could also cause certain retirees to lose their health care coverage because employer health plans that provide coverage in all 50 States will cease to exist because they cannot establish networks.

My friends who support this bill will argue they are not cutting the Medicare Advantage Program by eliminating deeming. They also will try to say that the elimination of deeming will not have an impact on health care choices offered to beneficiaries living in rural areas.

I have already been told by one employer in Utah that this provision will force them to stop offering health care coverage to almost 12,000 retirees--12,000 retirees. I am worried it could hurt coverage for beneficiaries in rural areas as well. Quite honestly, we do not know the full impact of this specific policy.

Therefore, I simply cannot support a provision that eliminates deeming for private fee-for-service plans, and that is one of the reasons I am going to vote against cloture.

We must vote against cloture in order to ensure we can begin work on a bipartisan bill that will be signed by the President. We do not need to be wasting our time going back and forth on bills that do not have a chance of becoming law.

Trust me, this bill will not be signed into law because, while the take-it-or-leave-it attitude may work over in the House, it does not work in the Senate.

I urge my colleagues to vote against cloture so we may begin work on a bipartisan bill that will continue to protect choice of coverage for all beneficiaries--and I think that work would take all of 10 minutes-- including those living in urban and rural areas and those who are covered through an employer retirement plan.

This motion must be defeated so we can prove to Medicare beneficiaries, Medicare providers, and our House colleagues that bipartisanship is alive and well in the Senate and that we are willing to keep working on this bill until we get it right.

Madam President, Congress has been working on FISA modernization since April of 2007. That is over 425 days ago. It is simply amazing to me that it would take this long. As I have often said, the Constitution of the United States was written in about 115 days, and that included travel time on horseback for the Founding Fathers. We have spent plenty of time on this issue.

So why is it taking so long? Should this issue be controversial? I can only surmise that the delay is due to the ominous sounding terrorist surveillance program. That is the program where the President had the audacity to allow the intelligence community to listen to international communications where at least one person was suspected to be a member of al-Qaida--the same al-Qaida who killed nearly 3,000 innocent American civilians on September 11; the same al-Qaida who since that day has committed attacks in Istanbul, Algiers, Karachi, Islamabad, Casablanca, London, Madrid, Mombasa, the Gulf of Aden, Riyadh, Tunisia, Amman, and Bali; the same al-Qaida whose mission statement can be summed up in three words: ``Death to America.''

This is the group the President targeted. He wanted an early warning system to help prevent future attacks--a terrorist smoke detector, if you will. We often are reminded that we are fighting against an unconventional enemy, one that has asymmetrical advantages against us. Al-Qaida is not a nation state and adheres to no treaties or principles on the conduct of war. They wear no uniforms. They hide in peace-loving societies and deliberately conduct mass attacks against unarmed civilians. But we also have asymmetrical advantages.

As the most technologically sophisticated Nation in history, we have huge advantages that derive from this expertise. We are also--and I certainly see this as an asymmetrical advantage over the barbarism that is al-Qaida--a nation of laws. Finally, our surveillance laws are going to be modernized so we can continue to use our own technological superiority to help prevent future attacks against our public and the public of nations that have joined us in our fight to liquidate al- Qaida.

This is what the President was always intent on doing. So he initiated the terrorist surveillance program, and the administration provided appropriate briefings to the chairs and ranking members of the Senate and House Intelligence Committees and to the leaders of both parties in both Chambers. When a new Member of Congress assumed one of those positions, they were given a similar briefing.

Last year, the Senate Intelligence Committee and numerous staff conducted a full review of the terrorist surveillance program and found no wrongdoing.

So why has it taken us so long to get here, and what is the concern that has caused the delay; that the President listened to the international communications of al-Qaida after 9/11? No President would ever engage in this type of activity, except of course President Woodrow Wilson, who authorized interceptions of communications between Europe and the United States, and President Franklin Roosevelt, who in 1940 authorized interception of all communications into and out of the United States.

I guess the fourth amendment and the media's outrage were more flexible under Democratic Presidents. But let's leave these situations aside and continue to focus on the program one of my Democratic colleagues previously called ``one of the worst abuses of executive power in our history.''

With all due respect to my colleague, if listening to the international communications of al-Qaida is one of the biggest power grabs in the country's history, then our Nation has lived a charmed existence, worthy of envy throughout the world.

We should never forget the reasons for the creation of this program. It is no accident that America has not been attacked since September 11. Is it more than luck? Did al-Qaida take a hiatus from terrorist attacks? Given al-Qaida's numerous foreign attacks during this same timeframe, I think the answer is clearly no. So something must be working. Perhaps the terrorist surveillance program has played a role.

But what about warrantless wiretapping? That phrase certainly means something illegal, right? Not really. As often as that phrase is repeated, what does it really mean? Does warrantless wiretapping automatically mean unconstitutional? That is certainly what we are led to believe by the hand-wringing blatteroons of the day. But this is simply not true.

The fourth amendment does not proscribe warrantless searches or surveillance. It proscribes unreasonable searches or surveillance. For example, let's look at a few of the numerous warrantless searches that are performed every day: Waiting for warrantless searches at the U.S. Border Inspection Station. Look at that mess.

Look at this: Waiting for warrantless searches at the U.S. Supreme Court. It is done every day that the court is in session, and even when it isn't sometimes. Waiting for warrantless searches at the National Archives. In other words, waiting to be searched before viewing the fourth amendment. This happens every day. I see that there are members of the public in the gallery above. Every last one of them went through a warrantless search just to get into this building.

So the question becomes whether a warrantless search or surveillance of international communications involving al-Qaida is reasonable or, to put it another way, whether signals intelligence against a declared enemy of the United States is reasonable. In my opinion, and I think in the opinion of the vast majority of our body, it certainly is.

Let's also look at what the Foreign Intelligence Surveillance Court of Review, the highest court that has considered this issue, has said:

The Truong court, as did all the other courts to have

decided the issue, held that the President did have inherent

authority to conduct warrantless searches to obtain foreign

intelligence information. We take for granted that the

President does have that authority and, assuming that is so,

FISA could not encroach on the President's constitutional

power.

That is out of in re: Sealed, case 310 F3d, 717, the FISA Court of Review, 2002.

While the phrase ``warrantless wiretapping'' has been cited incessantly, there is another phrase mentioned nearly as often, and that is ``domestic spying.'' In order to better evaluate this phrase, let's look at what the President said in a December 17, 2005, radio address that described the TSP.

In the weeks following the terrorist attacks on our Nation,

I authorized the National Security Agency, consistent with

U.S. law and the Constitution, to intercept the international

communications of people with known links to al-Qaida and

related terrorist organizations. Before we intercept these

communications, the government must have information that

establishes a clear link to these terrorist networks.

I don't see anything in that statement about domestic spying. I thought the definition of the word ``domestic'' was pretty clear. If the program intercepted communications in which at least one party was overseas, not to mention a member of al-Qaida, then it seems fairly obvious that those calls were--and I will emphasize this--not domestic.

Is this a domestic call? A foreign terrorist calling a terrorist within the United States? I hardly think so. Is this really such a hard concept? The last time I flew overseas, I didn't fly on a domestic flight. I flew on an international flight. My last phone bill showed there is a big difference between domestic calls and international calls.

Domestic spying may sound catchy and mysterious, but it is a completely inaccurate, even misleading, way to describe the TSP terrorist surveillance program--or FISA modernization. Why don't we describe them as international spying, which is what they really are? Isn't that a more accurate description? But I imagine international spying wouldn't raise the same level of fear and distrust in our Government that some on the left try to foster.

So while I regret the political machination that has turned this seemingly straightforward issue on its head, I am hopeful the time for debate is finally over. Yet some have suggested Congress should not pass a bill modernizing FISA. Even after such a prolonged period and extensive debate on the issue, they would prefer that we do nothing.

We are now hearing about efforts to strike or amend the immunity provisions in the compromise bill so that Members may express their views.

Is this really necessary? Did the multiple times the Senate has considered and rejected similar efforts mean nothing?

Look at this: The Senate has affirmed telecom civil liability protection in six separate votes. On October 18, 2007, the Senate Intelligence Committee rejects the amendment to strike the immunity provisions 12 to 3. That was bipartisan, by the way. On November 15, 2007, the Senate Judiciary Committee rejects amendment to strike immunity provisions 12 to 7. Again, bipartisan. On 12/13/07, the Senate Judiciary Committee rejects stand-alone Government substitution bill 13 to 5. On January 24, 2008, the full Senate tables the Judiciary's substitute, which does not include immunity, 60 to 36. On February 12, 2008, the full Senate rejects the amendment to substitute the Government for telecoms 68 to 30. On February 12, 2008, the full Senate rejects amendment to strike immunity provisions 67 to 31.

The last time I saw that and looked at those numbers, those were all bipartisan votes. The civil liability provision in the Senate bill, which has been tweaked in this compromise, is supported by a bipartisan majority of the House and Senate, after all this hullabaloo.

In addition, let us not forget the opinions of the State attorneys general who previously wrote to Congress to express their support for civil liability protection.

Look at all the State attorneys general who endorse immunity. State attorney general of Wisconsin, the attorney general of Rhode Island, the attorney general of Oklahoma, the attorney general of Colorado, the attorney general of Florida, the attorney general of Alabama, the attorney general of Arkansas, the attorney general of Georgia, the attorney general of Kansas, the attorney general of my beloved home State of Utah, the attorney general of Texas, the attorney general of New Hampshire, the attorney general of Virginia, the attorney general of North Dakota, the attorney general of North Carolina, the attorney general of South Carolina, the attorney general of Pennsylvania, attorney general of South Dakota, attorney general of Nebraska, the attorney general of West Virginia, the attorney general of Washington.

These are all legal officers, by the way, attorneys general of those very States.

Another complaint that has been mentioned is that this bill does not have adequate oversight. We have heard allegations that:

the government can still sweep up and keep the

international communications of innocent Americans in the

U.S. with no connection to suspected terrorists, with very

few safeguards to protect against abuse of this power.

We have heard other allegations that this bill does not provide adequate protections for innocent Americans. Make no mistake. The role of the Federal judiciary into the realm of foreign intelligence gathering is greatly expanded by this legislation.

So when we hear the incessant claims that this legislation lacks meaningful review, I want people to be absolutely crystal clear on the staggering amount of oversight in this bill.

The Foreign Intelligence Surveillance Court was created by the 1978 FISA law for solely one purpose: This is Title 50 of the U.S. Code 1803(a): ``a court which shall have jurisdiction to hear applications for and grant orders approving electronic surveillance.''

Let's think about this. It is America in 1978. The Church Committee has published information about known abuses by the Government involving surveillance against American citizens. The public wanted action. So what did the 95th Congress do?

Did it create a Court with the authority to review and approve the intelligence community's foreign targeting techniques? No.

Did it create a Court with the ability to review and approve the techniques used to minimize incidental interceptions involving Americans? No.

Did it mandate the intelligence community to get a warrant when targeting United States persons overseas? No.

But the 110th Congress will mandate each and every one of those things by passing this bill.

For the first time, the FISC will review and approve targeting procedures to ensure that authorized acquisitions are limited to persons outside of the United States.

For the first time, the FISC will review and approve minimization techniques.

For the first time, the FISC will ensure that the foreign targeting procedures are consistent with the fourth amendment.

So given the staggering amount of oversight, there must be some sweeping new surveillance authority that would necessitate these changes, right? Wrong.

The ``broad new surveillance authority'' that we hear so much about is directed at one thing: the Government can target foreign citizens overseas after the FISC reviews and approves the targeting and minimization procedures. In layman's terms: the Government can listen to foreign citizens overseas to collect foreign intelligence information. That doesn't sound like broad sweeping authority to me. In fact, it is less authority than the Government had before.

Let me enumerate some of the many restrictions on this authority:

No. 1, the Government can't intentionally target any person known to be in the U.S.

No. 2, the Government can't intentionally target a person outside the U.S. if the purpose is to target a known person in the U.S.--reverse targeting.

No. 3, the Government can't acquire domestic communications in the

Mr. President, I will vote for all of the Judicial nominees before us today. I want to offer a few comments about one of them and also about the current state of the judicial confirmation process.

The Constitution gives authority to nominate and appoint judges to the President, not to the Senate.

The Senate's role is to check the President's power, to ensure that his nominees are not crooks, cronies, or corrupt.

Too often in relent years, however, Senators have tried to push our role beyond merely checking the President's power to actually highjacking the President's power.

That goes too far and undermines the separation of powers which is so critical to limit government power and to keep our system of government in balance.

For this reason, my perspective on the judicial confirmation process begins with substantial deference to the President, no matter which party occupies the While House or has the Senate majority.

For this reason, I have voted against and worked to eliminate filibusters used to defeat majority-supported judicial nominees.

And for this reason, I have voted against very few nominees during my 32 years in this body and on the Judiciary Committee.

From that perspective of deference, I then look at a nominee's judicial philosophy and qualifications.

Applying these criteria, my decision to support two of the nominees before us today, Raymond Kethledge to the Sixth Circuit and Stephen Murphy to the Eastern District of Michigan, was easy.

My decision to support Judge Helene White's nomination to the Sixth Circuit, however, was a much closer call.

Frankly, I have always believed that a President has the right to appoint judges who reflect his or her judicial philosophy.

I asked Judge White detailed questions designed to explore her judicial philosophy, her understanding of the proper role of Federal appellate judges in our system of government.

I want to share a few of her responses with my colleagues.

I asked Judge White to comment on the notion that judges must make decisions based on the law as enacted by the people and their elected representatives, even if they personally disagree with it.

Judge White agreed with this wholeheartedly, staying that judges ``should be prepared to have no constituency except the law.''

I realize this is straight out of civics 101, but there are many today who believe judges may twist and shape the Constitution and statutes into any form they please in order to achieve results they desire.

In fact, some ray colleagues on the other side of the aisle have said judges must take sides, that they must favor certain ideological interests and serve certain political constituencies.

I also asked Judge White whether judges may decide cases based on their personal views, sense of justice, empathy, or experience.

It would be difficult to come up with a more misguided and even dangerous role for unelected judges in our system of government, but some of my friends on the other side of the aisle have endorsed that approach.

To her credit, Judge White flatly rejected that activist view of a judge's role.

I wanted to share these thoughts with my colleagues because some have questioned whether Judge White is the kind of judge President Bush has said he would appoint.

She was, after all, first nominated to the Sixth Circuit by President Clinton whose nominees generally embraced a more activist judicial philosophy.

President Bush is the first, at least during my Senate tenure, to resubmit an appeals court nominee first offered by a President of the other party.

President Clinton certainly did not do that.

But the Constitution gives each President the authority to make that judgment and I have always believed that there is a high bar for the Senate to withhold its consent on the basis of judicial philosophy.

That perspective of deference and her answers to questions like the ones I described satisfy me on this point.

Let me turn to the question of qualifications.

The American Bar Associations rating of judicial nominees is more important for some than for others.

My friends on the other side have consistently said the ABA rating is the gold standard for evaluating judicial nominees.

I take that back.

They have called the ABA rating the gold standard until they want to obstruct nominees who have received even the highest rating.

Judge White's ABA rating in 2008 is higher than it is in 1997, when she was first nominated to the Sixth Circuit.

At that time, some members of the ABA evaluation committee thought she was not qualified at all.

This time, a majority of the evaluation committee found her well qualified and no one thought her unqualified.

It is a little surprising, however, that after 26 years as a State court judge, 15 of them on the appellate bench, Judge White still has not garnered a unanimous well qualified rating from the ABA.

In fact, Raymond Kethledge, the other Sixth Circuit nominee before us today, received a higher ABA rating than Judge White and he has no judicial experience at all.

Judge White has never litigated a case. She has never handled clients. She has virtually no experience with Federal law issues of any kind.

There have been serious concerns about her ability to manage her current docket, let alone the far busier and more complex docket she would face on the Federal bench.

Perhaps these dare some of the issues that kept the ABA evaluators from giving her the highest rating.

Unfortunately, Judge White did not distinguish herself in her hearing and offered the committee little to offset these and other concerns about her qualifications. The distinguished ranking member, Senator Specter, and others are detailing some of those concerns on the floor today.

Some of my friends on the other side have responded that this nomination has really been pending for 11 years and that we should somehow already know enough to fill in the blanks and resolve the doubts.

That is ridiculous.

I have served in this body and on the Judiciary Committee for 32 years. I know of no Senator who keeps tabs on the careers, accomplishments, and record of unconfirmed nominees from previous administrations on the off chance that they might some day be renominated.

We must evaluate each nominee on the current record developed through the current process.

And on the question of qualifications, that record satisfies but certainly does not excite me.

I respect the judgment of colleagues, especially on this side of the aisle, who look at these and other issues and conclude that they cannot support Judge White. Voting against a nominee of your own party is a significant step.

There are Senators on the other side who have served here even longer than I have who have never voted against a nominee of their party.

Each of us might make that judgment for ourselves and, though it is indeed a closer call than I would like, I will vote to confirm Judge White.

Before I conclude, I want to make a few observations about the judicial confirmation profess with regard to Judge White's nomination in particular and judicial nominations in general.

When I chaired the Judiciary Committee during the previous administration, Judge White's nomination did not receive a hearing because she lacked support from her home State Senator who served on the Judiciary Committee at the time.

Similarly, Sixth Circuit nominees of the current President, including Mr. Kethledge who is before us today, did not receive a hearing because they too lacked home State Senator support.

I am certainly glad that this issue has been resolve with our distinguished colleagues from Michigan so that these nominees can move forward.

But I remain baffled why my following that longstanding policy is today attacked as a so-called pocket filibuster while the current chairman following that policy is praised for an exercise in senatorial courtesy.

That is one of number of baffling and frustrating futures of the current judicial confirmation process.

There have been seven previous Congresses during my service here that included a presidential election year.

During an average of 313 days in session, 25 appeals court nominees received a hearing and 20 appeals court nominees were confirmed.

Using that as our benchmark, in the current 110th Congress, we are nearly

90 percent finished with our days in session but so far less than one- third as many appeals court nominees have received a hearing and only half as any have been confirmed.

It does not have to be this way, it has not been this way in the past.

I hope that when the nominees before us today ire confirmed, we will turn our attention to the others who are pending some for many months and even for years, and continue doing what the American people sent us here to do.

I yield the floor.

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

Mr. President, I rise to pay tribute to the service of Paul Clement, who recently stepped down as our Nation's 43rd Solicitor General.

Paul served in that office for more than 7 years, first as Principal Deputy to Solicitor General Ted Olson, then as Acting Solicitor General, and for three years as Solicitor General. He is a good man and an excellent lawyer who was a great Solicitor General.

Before speaking about Paul, let me first say a few words about the office in which he served.

Congress created the Department of Justice and the position of Solicitor General in 1870. Since then, the Solicitor General is the only Federal Government officer actually required by statute to be ``learned in the law.''

As Paul put it during his confirmation hearing in April 2005, the Solicitor General sits literally at the crossroads of the separation of powers. He is an executive branch official who defends the actions of the executive and legislative branches before the judicial branch.

Today, the Solicitor General represents the United States before the Supreme Court and manages the United States' participation in thousands of lower court cases. That means he must make decisions in individual cases with reference to past positions taken by the United States and vigilance about how current positions may affect the future.

Such a constant, and constantly changing, set of factors makes the Solicitor General's job something like the courtroom version of multi- dimensional chess.

Because of his special relationship with the Supreme Court, the Solicitor General is often referred to as the Tenth Justice. Because of its astounding breadth and depth of experience and expertise, the Solicitor General's office has been called the best law firm in America.

Paul Clement stands in a line of Solicitors General that includes some of the true giants in the law and in the service of our country.

They include many who also served on the federal bench such as Supreme Court Chief Justices William Howard Taft and Charles Evans Hughes; Associate Justices Stanley Reed, Robert Jackson, and Thurgood Marshall; and Circuit Judges Kenneth Starr, Wade McCree, and Walter Cummings.

They include some of America's most distinguished legal academics such as Walter Dellinger, the Maggs Professor of Law at Duke; the late Erwin Griswold, dean of Harvard Law School for 31 years; and the late Rex Lee, from my own State of Utah, who was the founding dean of the J. Reuben Clark School of Law at Brigham Young University.

Past Solicitors General also include those who would distinguish themselves in both the academic and judicial worlds such as Charles Fried, who has taught at Havard Law School since 1961 and served on the Supreme Judicial Court of Massachusetts; and Robert Bork, who was the Bickel Professor of Public Law at Yale and served on the U.S. Court of Appeals for the D.C. Circuit.

Like Paul Clement, current Chief Justice John Roberts served as Principal Deputy Solicitor General.

Paul deserves to stand among such legends.

A native of Cedarburg, WI, Paul graduated from the Cedarburg public schools and went on to receive a bachelor's degree summa cum laude from

the Georgetown University School of Foreign Service and a master's degree with distinction from Cambridge University.

He then gave Harvard Law School a try and, sure enough, graduated from there magna cum laude after serving as Supreme Court editor of the Harvard Law Review to boot.

With that record, it is not surprising that he had the opportunity to clerk for truly great judges such as Judge Laurence Silberman on the U.S. Court of Appeals for the D.C. Circuit, who recently received the Presidential Medal of Freedom, and Supreme Court Justice Antonin Scalia.

After a few years in private practice, Paul joined the United States Senate family as Chief Counsel of the Judiciary Subcommittee on the Constitution, Federalism, and Property Rights, chaired by our former colleague and former Attorney General John Ashcroft.

I chaired the Judiciary Committee at the time and remember Paul not only as a smart and hardworking lawyer but as a thoughtful, humble, and truly decent person.

It is easy to find someone with either professional talents or personal qualities, but a rare gift to have someone like Paul who has both.

After leaving the Senate, Paul returned to private practice and headed the appellate practice group of the distinguished law firm of King & Spalding before joining the Solicitor General's office. A far less impressive record spread over a lifetime would suffice for most, but Paul does not achieve the ripe old age of 42 until next week.

Three members of this body have been serving here since before Paul Clement was born. Why, the Senator from West Virginia, Mr. Byrd, was in his second term when young Paul came into the world.

The Senator from Paul's home State of Wisconsin, Mr. Feingold, my colleague on both the Judiciary and Intelligence Committees, introduced and praised Paul at his confirmation hearing. He noted that Paul would be the youngest Solicitor General in more than 50 years and one of the youngest in American history.

I do not want to belabor the point, but as I become a more seasoned citizen myself, I am impressed with how much some of these young people can accomplish.

Oh, I forgot one item on Paul's jam-packed resume. Last September, Paul squeezed in a full 24 hours of service as Acting Attorney General. Fittingly, that was on September 17, which is the anniversary of both the Constitution's signing and the confirmation of Paul's former boss Justice Scalia to the Supreme Court.

Paul has argued a total of 49 cases before the Supreme Court. I should perhaps say that he has so far argued 49 cases, as Paul may well return to the Supreme Court podium in the future. It is the tradition and commitment of the Solicitor General to defend acts of Congress if there is a reasonable argument to do so.

No one can turn a merely reasonable argument into a compelling argument better than Paul Clement. Many who have seen him argue remark that though he speaks without notes, he has an astounding command of the facts and the law in each case.

He has vigorously defended the legislation we have enacted on a wide range of issues, from the McCain-Feingold campaign finance law and the ban on partial-birth abortion to the Solomon Amendment and the Americans with Disabilities Act.

I would be surprised if any of my colleagues voted for every piece of legislation Paul has defended before the Supreme Court. I know I have not.

But in every case, Paul upheld the highest standards of his office by diligently defending the work of the legislative branch.

And while each Solicitor General faces unique challenges and special cases, Paul's tenure coincided with the war on terror that we continue to fight.

He has confronted not only novel, complex, and serious legal issues, but he has borne the burden of knowing that his efforts will dramatically affect American lives, and indeed the American way of life itself.

Paul's combination of experience allowed him to do some truly unique things as Solicitor General. When he earlier served on the Judiciary Committee staff, for example, Paul worked hard on the development and passage of the Religious Land Use and Institutionalized Persons Act.

I introduced that legislation after the Supreme Court struck down previous efforts to protect religious liberty. The Senate unanimously passed the bill.

Then in 2005, as Solicitor General, Paul defended the constitutionality of that law and the Supreme Court unanimously upheld it.

And in the case now before the Supreme Court regarding the District of Columbia's ban on firearm possession, Paul argued before the Justice for whom he clerked regarding the opinion of the Circuit Judge for whom he clerked.

Some who have compiled such an amazing resume have taken much longer to do so. Some who have done so quickly are, quite frankly, not nearly so decent and kind as Paul Clement.

He and his wife Alexandra have three wonderful children, Thomas Antonio, Theodore Gerald, otherwise known as Theo, and the youngest, Paul Gregory. The little one, called P.G., made his presence known at the opening of Paul's confirmation hearing. Youngsters are known to do that.

We all remember Chief Justice Roberts' son Jack doing the dance of joy when his father was sworn in at the White House. At his hearing, Paul noted that he and his wife had promised the boys Yugioh cards in what he said would be direct proportion to how well they behaved that morning. I thought the boys did quite well that day and hope they were duly rewarded.

I was also touched at that hearing when Paul talked about his wife and her role in supporting his work. He said: ``Every day that she allows me to practice law outside the home while she stays home with our three boys is a personal sacrifice and an indulgence of my interests, for which I am eternally grateful.''

I am not the only one to recognize Paul Clement as a very good man and a very good lawyer or to applaud his service to our country.

I ask unanimous consent to place in the Record following my remarks letters sent to me by former Solicitors General Ted Olson and Seth Waxman, the current Deputy Attorney General Mark Filip and his predecessor Paul McNulty, former Attorney General Edwin Meese, former Senator John Ashcroft, Judge Laurence Silberman, and Justice Antonin Scalia.

Madam President, on the campaign trail this election year one hears a lot about change and helping the middle class. But what do the professed ``change agents'' have in mind by change, and what would such changes mean for our economy and creating middle class jobs?

Pending legislation in Congress sponsored by the change agents would more closely conform America's labor and employment laws to the failed European model which has saddled the French and Germans with 30 years of higher unemployment, stagnant job growth, and lower productivity. French President Nicolas Sarkozy has said workplace regulations in France are ``unjust, discourage work and job creation,'' and ``fail to bring equal opportunity'' to the middle class. German Chancellor Angela Merkel has called for reform of Germany's labor regulations for the same reasons.

At a time when leaders in France and Germany are trying to reform their workplace laws and move closer to the U.S. system, do we really want to infect our country with European-style workplace regulations that could cost middle class jobs and curtail economic growth? Do we really want to become another France?

For more than 70 years, union representation elections in the workplace have been supervised by career employees at the National Labor Relations Board to ensure the elections are conducted fairly and privately. The deceptively misnamed Employee Free Choice Act pending in Congress would deny employers the ability to petition for private ballot elections among their employees to determine whether or not the employees, voting by secret ballot just as in political elections, desire to be represented by a labor union.

The bill would scrap our current system of private voting in secret ballot elections and replace it with a forced card check certification in which employees can be pressured by union organizers into signing union petitions, or union authorization cards at work, at home, in a bar or on the streets. Union leaders boast that this change would lead to millions of new union members, but at what cost to workplace democracy?

Even worse, the bill would turn over a business's financial competitiveness to federal Government-appointed arbitrators to set wages, pension and health care benefits, work hours and other terms and conditions of employment. If, after only 90 days of bargaining, the parties themselves have not agreed on the terms of an initial union contract, the bill would mandate interest arbitration through which a federally-appointed outside arbitrator would be vested with virtually unchecked authority to impose a contract binding for 2 years on the parties, without even a ratification vote among the employees to approve its terms. Such determinations imposed on the parties will be affected by the arbitrator's own economic or social theories, often without the benefit or understanding of practical, competitive economic forces.

Is that the change we need to help the middle class?

Consider further the misnamed RESPECT Act, sponsored by the same

professed change agents, which would impede private sector employers' ability to manage their operations through first-line supervisors. The bill would reclassify supervisors who assign or direct the work of others, and expose them to the same union contracts and work rules, union discipline, strikes and other work stoppages, as the employees they supervise, thereby creating the types of conflicts of interest that the 1947 Taft-Hartley Act wisely sought to avoid. The legislation should be renamed NO RESPECT, since it would deny supervisors the status and supervisory authority they worked hard to attain, as well as eliminating employers' right to expect the undivided loyalty of these supervisors as their agents in labor-management relations.

Other bills pending in Congress, all cosponsored by change agents on the campaign trail, would radicalize U.S. employment law, resulting in the type of European paralysis that has impeded middle class job creation and economic growth in France and other countries. These bills would, however, expand one industry where unfortunately the U.S. greatly outpaces Europe: the plaintiff trial bar, which has an unsurpassed world record of bringing lawsuits, many frivolous, against employers.

One bill would remove any time limits on the filing of pay discrimination claims against an employer, thus creating open-ended liability years. Another would provide unlimited employer liability for punitive damages by removing the caps on damage awards which were wisely set by the 1991 Civil Rights Act at $300,000 in exchange for amendments allowing jury trials for employment discrimination claims. Open-ended liability and unlimited damages: a plaintiff trial lawyer's dream.

A third bill would undermine congressional intent with regard to the Americans with Disabilities Act by classifying virtually any physical impairment as a disability for purposes of bringing claims and lawsuits against employers. I helped lead the fight for the Americans with Disabilities Act. The courageous pioneering members of the disability community responsible for passage of the legislation were not interested in protecting temporary illnesses such as the flu, or minor impairments which could be corrected by prescription eyeglasses or medication. Now, however, by preventing consideration of mitigating factors as an affirmative legal defense, and no longer requiring that the disability affect a major life activity such as working, the new legislation would treat such minor impairments as disabilities. The effect is to trivialize the law and promote frivolous lawsuits against employers. The problem with the bill's sophistry is that if everyone is considered legally disabled, even those with easily correctable impairments, then no one is truly protected.

Another pending bill is an unprecedented Federal mandate regulating an employer's decision-making. It is the closest thing to the type of workplace regulatory paralysis that has stymied the Europeans. In fact, it reportedly was modeled directly from European laws.

Any time an individual employee requests a change in work schedules, including when, how long, and where the employee is scheduled to work, the so-called Working Families Flexibility Act would require employers to meet with the employee within 14 days, and thereafter, within 14 days, to provide a detailed written decision with company information. The employer's written decision would have to include, among other things the identifiable cost of the change in a term or condition of employment requested in the application, including the costs of loss of productivity, of retraining or hiring employees, or of transferring employees from one facility to another facility, and the overall financial resources involved.

If the employee is dissatisfied with the employer's decision, the employee may request reconsideration and the employer must schedule another meeting, again within 14 days, with the employee accompanied by any designated representative. If the representative is unavailable, the meeting must be postponed. Thereafter, the employer must respond to the request for reconsideration in writing, stating sufficient grounds to justify the decision.

But that's not all. The employee may trigger a Federal investigation, which must be undertaken by the U.S. Department of Labor and a subsequent Federal administrative hearing to review the employer's decision. This could lead to Federal enforcement actions, monetary fines against the employer, Federal court injunctions and other legal orders for employment, reinstatement, promotion, back pay, and other changes in terms and conditions of employment.

How many times in a workweek does an employee ask a supervisor for a change in working hours or work schedule? For example, ``Hey, boss, I want to only work a 35 hour week'' or ``I want Fridays off in hunting season'' or ``I would prefer to work closer to home.'' If this European style, so-called right to request law were to be adopted in the United States, it would bog down the workplace with mandatory negotiation of potentially any decision affecting working hours, work schedules, or location of work with every individual employee--a union of one--and with the threat of federal investigations and legal actions.

Is that the type of change we want?

Labor leaders and their allies frequently point to Europe when they lobby for changes in U.S. labor and employment laws. But even a cursory look at comparative economic indicators shows that the adoption of a French or German-style labor regime actually reduces workers' job options and diminishes wages while bogging down economies and discouraging enterprise.

Flexibility is a key factor in the economic dynamism of the U.S. labor market. The ease with which employers can build and rebuild their workforces provides great flexibility in innovation and response to market changes. The United States is the easiest country in the entire world in which to employ labor, according to The World Bank, and the third best country in which to do business overall.

Meanwhile, U.S. labor productivity far outpaces that of France and Germany, and also Canada, Japan and the United Kingdom. The United States has not only been the most productive country in the world but has also grown in productivity at a greater rate than other developed nations. In 2006, U.S. productivity per employed person was nearly $65,000 compared to $49,000 for France and $43,000 in Germany.

The U.S. has been an engine of job creation for the past 35 years despite temporary recessions, gas shortages and even terrorist attacks. Compared to workers in most of Europe, U.S. workers have more job and career options, greater upward mobility, and employment growth.

Consider unemployment rates. France's jobless rate is Europe's highest. This chart shows unemployment rates for the past 15 years or so. Notice that the United State's highest unemployment rate--6.1 percent in 1994--doesn't come close to the lowest unemployment rates for France, which was 8.4 percent in 2001. For the past 15 years, the U.S. average unemployment rate was 5.1 percent, while France's was double that at 10 percent.

Looking at the past few years in France, nearly 70 percent of those unemployed have been looking for work for more than six months and nearly 45 percent of them were still looking for work after a year. In Germany, about 55 percent of the unemployed is out of work for at least that long.

In the United States, workers stand a better chance of getting another job and sooner. Less than 20 percent of those unemployed have been looking for a job for 6 months or longer, and only about 10 percent were looking for more than a year.

For centuries, people from all over the world have been drawn to the United States for economic opportunity. While the unions and some in Congress believe that European-style labor law is what is best for workers, leaders in France and Germany know better. They understand that regulatory economic rigidities that hold out the false hope of job security often limits workers' options for finding better opportunities, makes it harder for the unemployed to find work, and discourages entrepreneurs from creating new middle class jobs. Congress cannot mandate that employers create jobs, stay in business, or even that they do not conduct business elsewhere. But in the name of change, ostensibly to help the middle class, Congress can mandate

the types of harmful employment regulations that will reduce or even eliminate middle class jobs in the United States.

``Europeanization'' of U.S. labor and employment laws is not the type of change the middle class really needs.

I yield the floor.