[Congressional Record Volume 141, Number 63 (Wednesday, April 5, 1995)]
[Senate]
[Pages S5162-S5164]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                       THE CONTRACT WITH AMERICA

  Mr. HARKIN. Mr. President, I listened to the statement made by the 
Senators from New Mexico and South Dakota and others about character. I 
do not know all the aspects of this resolution, I just know some of the 
things I have heard here on the floor, but I kept hearing reference 
made to values and we have to start teaching values to our young 
people.
  I agree with that. I think our young people ought to learn values. 
But, you know, perhaps we ought to look at ourselves first as teachers. 
Perhaps we ought to start looking at the Congress of the United States. 
What values are we sending out to the American people? What are the 
young people of America--what kind of values are they getting from the 
U.S. Government? That is what I want to speak about this morning, the 
Contract With America. Its 100 days are up this week, and I want to 
talk about that Contract With America.
  Now, I think I want to talk about it in the context of values and 
character, because the values that are being sent across America from 
the Government of the United States is simply this: If you have it made 
and you have a lot of money, the Government is there to help you and 
make you more comfortable. If you do not and you are at the bottom rung 
of the ladder, forget it. You are out in the cold.
  Values? You want to talk about a resolution dealing with values? Let 
us talk about the Contract With America and what values it represents. 
With any contract you have to ask, who benefits and who loses? Who wins 
and who loses on a contract? The answer now is crystal clear. The 
winners are the billionaires, the super wealthy, the special interest 
Washington lobbyists. They get the credit card. They have the night out 
on the town. They go to the fancy restaurant. The losers are the hard-
working middle-class, children, students, pregnant women, the elderly, 
the disabled. They get to pick up the bill for the superwealthy. I know 
that may sound like rhetoric, but the facts are there. Let us look at 
it. Let us not just get caught up in rhetoric, let us look at the 
facts.
  Here is a chart that we had drawn just to show what is happening in 
my State of Iowa under the Contract With America, Mr. Gingrich's 
contract, the Republicans' contract. Here we are. Two percent of the 
Iowa population has an income of $100,000 or more. They get 50 percent 
of the benefits under the contract. And 86 percent of Iowans have 
incomes of $50,000 or less. They only get 20 percent of the benefits.
  One more time. If you are in the upper income bracket, 2 percent of 
the Iowans making over $100,000 a year, you get 50 percent of all the 
benefits in the Contract With America. If you are a hard-working, 
average Iowan making less than $50,000, you will only get 20 percent of 
the benefits.
  Values? You want to talk about values? Let us talk about values. That 
is the message that is being sent out around America today: If you are 
on the top of the heap, the Government is there to help you and make 
you even more comfortable, give you more tax breaks. You want to talk 
about values, let us talk about values.
  Then we just had a recent example of really giving it to the 
superwealthy, the so-called Benedict Arnold amendment. Senator Bradley 
tried to close a loophole in the law. The House would not hear of it 
and they knocked it out. We heard a lot of debate on the floor about 
that last week. Imagine this, what the House Republican leadership has 
said is that if you make a billion dollars in America and you get all 
these capital assets and then you renounce your citizenship, you get a 
big tax windfall. You do not have to pay a lot of these taxes. You can 
still live in America 4 months out of the year, you can live on the 
French Riviera 4 months out of the year, you can live in South America 
4 months out of the year, you can jet all around the year but you do 
not have to pay your taxes and you can still own your property and 
stuff in America. That is why I call it the Benedict Arnold approach, 
the Benedict Arnold amendment. You can turn your back on the country 
that made you rich.
  What the Contract With America says is, hey, we are going to give you 
a big tax break, the Benedict Arnold approach. The middle class has to 
pick it up.
  Students. What is happening with students? Under the Contract With 
America, 94,000 students will pay more for their college loans. That is 
a tax on students. No one is talking about it. We are taxing students 
in America as much as $3,150 in additional cost to each student if they 
require payment of interest while in school and we do not have the 
grace period before they get a job.
  You know, old Newt Gingrich and I have a little bit in common. We 
went to college on the National Defense Educational Loans. I went to a 
window in the school, got the money, borrowed the money, went to 
college, but I went to the military after college. Mr. Gingrich did 
not.
  The PRESIDING OFFICER. The Senator's 5 minutes has expired.
  Mr. HARKIN. Mr. President, I ask unanimous consent for an additional 
5 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator has an additional 5 minutes.
  Mr. HARKIN. Mr. President, I spent 5 years in the military. Mr. 
Gingrich did not. That is all right. So I did not have to pay it back 
then. So then I went to law school and I did not still have to pay it 
back. It was after I finished law school that I started to pay back the 
loan, and the interest started at that point in time. I think that is 
what Mr. Gingrich said he did, too. He just did not go to the military, 
but he had the same benefit. But he is saying what was good for me is 
not good for you. He wants to close that now. He said, ``Students, as 
soon as you start borrowing money you have to pay interest on it right 
away.'' That is a tax on students any way you cut it. I am saying it 
was good for me and it ought to be good for 
[[Page S5163]] other students, too. I think we ought to invest in 
students and not shut the door. So what they are doing is they are 
wiping out opportunities for our kids to go to college.
  Now they want to take away the Corporation for Public Broadcasting. 
They want to zero that out. You know, you could make arguments on that. 
I happen to think public broadcasting is a benefit here in America. 
There is good programming, good intellectual programming, good 
stimulation for our kids from ``Sesame Street'' and ``Barney'' and 
everything else. They want to pull the plug on that. But they want to 
continue to spend about $300 million a year for Radio Free Europe.
  One more time. They want to cut public broadcasting in America, the 
Contract With America, but they turn around and want to have public 
broadcasting in Europe called Radio Free Europe. If you want to start a 
radio station in Europe, FM, AM, TV, go right ahead. You can go to 
Bulgaria, Romania, Lithuania, Latvia, Ukraine --if you want to start a 
radio station, they will let you, no restrictions. We have this Radio 
Free Europe now, almost $300 million a year. Guess what, they are 
broadcasting on shortwave. Who listens to shortwave? People there are 
listening to FM and AM and television. They are getting satellite TV. 
They are watching CNN and we are pumping $300 million a year into 
shortwave broadcasting on Radio Free Europe. The Contract With America 
says we will keep that up but we will cut public broadcasting in 
America.
  If that makes sense, please someone explain it to me. Europe is free, 
the borders are down. Whatever value Radio Free Europe had when the 
Iron Curtain was up, that certainly is gone now, and we ought to bring 
that money home and put it in public broadcasting here.
  So, again, who wins and who loses on the contract? Big business and 
their special interest lobbyists have been invited into the committee 
rooms to write the laws that will benefit them. There are articles in 
the paper about every week, every Thursday, Republicans in the House 
sit down with all the corporate lobbyists, high-powered lobbyists, not 
only to write the legislation but to plan out how they are going to get 
it passed.
  I saw a headline in the paper a few weeks ago where Newt Gingrich 
said they were going to end business as usual when they took over. They 
did. They ended business as usual. But they did not tell us they were 
going to bring in big business as usual, because that is what is 
running us now--not business as usual; big business as usual.
  The last thing that I want to point out is that a few years ago--this 
is where this whole thing breaks down. You talk about values. A few 
years ago Senator Leahy and I were instrumental in putting in 
competitive bidding in the Women, Infants, and Children Program to 
mandate that infant formula companies had to enter into competitive 
bids to supply the States with infant formula. Before that they did not 
do that. We got it through. As a result millions more women, infants, 
and children are getting infant formula, healthy food, to guide a good 
start in life at no extra cost to the taxpayer because we have 
competitive bidding. Just last year, for example, the average monthly 
rebate to my State of Iowa was $630,000 a month because of competitive 
bidding.
  The Contract With America wants to take that away and put it back in 
the States, and do not require competitive bidding.
  I ask unanimous consent to have printed at this point in the Record 
the article from the Wall Street Journal outlining how four giant 
pharmaceutical companies can make over $1 billion a year in windfalls 
if they do away with competitive bidding.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

   Four Drug Firms Could Gain $1 Billion Under GOP Nutrition-Program 
                                Revision

                           (By Hilary Stout)

       Washington.--Four pharmaceutical companies stand to gain as 
     much as a billion dollars under a Republican bill that 
     overhauls federal nutrition programs for children and 
     pregnant women.
       The companies sell infant formula to the Women, Infants and 
     Children (WIC) program, a federal initiative that provides 
     formula as well as milk, beans, rice and other nutritious 
     foods to poor children and to pregnant and breast-feeding 
     women. Since 1989 the companies have been required by law to 
     enter into a competitive bidding process in order to sell 
     formula to WIC, resulting in rebates to the government that 
     are expected to reach $1.1 billion this year.
       A bill that cleared the House Economic and Educational 
     Opportunities Committee on a party-line vote last week would 
     turn the WIC program over to states in the form of a ``block 
     grant,'' and with it repeal the cost-containment competitive-
     bidding measure. An amendment to restore it was defeated by 
     the committee. The legislation now moves to the House floor 
     for consideration.
       The four companies, the only domestic makers of infant 
     formula--Ross Laboratories, a unit of Abbott Laboratories; 
     Mead Johnson, a unit of Bristol-Myers Squibb Co.; Wyeth-
     Ayerst, a unit of American Home Products Corp.; and Carnation 
     Co., a U.S. subsidiary of the Swiss conglomerate Nestle SA--
     fought the competitive-bidding measure fiercely when it came 
     before Congress in the late 1980s. Until then, they were 
     collecting retail prices for the infant formula they sold to 
     WIC.
       Sen. Patrick Leahy of Vermont, the senior Democrat on the 
     Senate Agriculture Committee and the lawmaker who led the 
     effort to enact the cost-containment measures, threatened to 
     filibuster the bill yesterday if it reaches the Senate. ``It 
     is really obscene,'' Sen. Leahy said. ``The most conservative 
     of people should, if being truthful, like the competitive 
     bidding. . . . It's just rank hypocrisy.''
       If the bill reaches the Senate floor, Sen. Leahy continued, 
     ``I've spent 20 years building bipartisan coalitions and 
     working on nutrition programs. If it's necessary to discuss 
     my whole 20 years' worth of experience in real time, I'll do 
     it.''
       In 1993, the latest year for which figures are available, 
     the WIC program spend $1.46 billion on infant formula but 
     received $935 million in rebates. That cut the overall cost 
     of providing formula to $525 million, nearly a two-thirds 
     reduction. Moreover, the states, which administer the 
     program, were allowed to use the rebates to add more people 
     to the WIC program.
       The action on WIC comes as a liberal-leaning research 
     group, the Center on Budget and Policy Priorities, released a 
     study questioning the continuing effectiveness of some of the 
     infant-formula rebates. The center's analysis found that in 
     the last year, despite the cost-containment requirements, the 
     cost of infant formula purchased through WIC has almost 
     doubled in many states.
       Since last March, the study said, 17 state WIC program have 
     signed rebate contracts with at least one of the major 
     formula manufacturers. Under those agreements, the average 
     net cost of a 13-ounce can of concentrated infant formula was 
     60 cents, compared with a 32-cent average price under rebate 
     contracts signed during the previous 15 months, the study 
     said.
       The Federal Trade Commission has been investigating the 
     infant formula makers' rebate and pricing practices, and at 
     least one state, Florida, has filed suit against the 
     manufacturers.

  Mr. HARKIN. Mr. President, again, who wins and who loses? Kids lose, 
low-income women who rely on the WIC Program lose, and our States are 
going to lose because they will not get rebates. Students are losing. 
Working families are losing. But, if you are on the top of the heap 
economically, this ``contract'' is for you.
  So it is not a Contract With America. This is a contract with 
corporate America. This is a contract with big business America. This 
is the contract with wealthy Americans. But it is not a contract for 
the average man and woman in America.
  So, again this resolution, I guess, is probably all right about 
American values. But I believe that we ought to be looking at ourselves 
and the kind of value signals we send with this Contract With America.
  The PRESIDING OFFICER. Under the previous order, the Democratic 
leader, or his designee, is now recognized to speak for up 30 minutes.
  The Senator from North Dakota [Mr. Dorgan] is the designee and will 
be able to speak up to 20 minutes.
  Mr. DORGAN. Mr. President, it is 30 minutes. Is that correct?
  The PRESIDING OFFICER. Leadership has 30 minutes but it is the 
Chair's understanding that you were designated 20 minutes of the 30 
minutes.
  Mr. DORGAN. I yield 7 minutes to the Senator from West Virginia, 
Senator Rockefeller.
  Mr. ROCKEFELLER. I thank my colleague.
  The PRESIDING OFFICER. The Senator from West Virginia is recognized.
  Mr. ROCKEFELLER. I thank my colleague, and I thank the Chair.
  Mr. President, I try not to say I am shocked very often. I try to 
reserve it for when I really am. Today, I really am shocked. On Friday, 
we actually watched Senators, led by Majority 
[[Page S5164]] Leader Bob Dole, think they need to retaliate against 
the simple idea coming from this side of the aisle--that cutting 
Government spending does not mean waging an assault on education and 
our children.
  I am speaking of the amendment from the Democratic leader.
  With our pro-education amendment, we are asking every Senator to 
think very hard about what's right and where our true values should 
lead us. This amendment gives every Senator a chance, before it is too 
late, to leave politics at the door and to cast a vote for the basic 
principle that education and children must not be the victim of this 
Senate.
  The citizens of this country expect us to make choices. With the 
rescissions bill before us, we are coming up with the funds to pay off 
recent costs for natural disasters and other emergencies. The bill also 
cuts a range of Government programs to reduce the Federal deficit even 
more. Both are essential steps.
  But, Mr. President, reducing the deficit and taking care of natural 
disasters do not mean that this Senate has to rob the schools, the 
children, and the spirit of the Nation. Any fourth or fifth grade 
teacher would give this bill a D at best for being that dumb.
  The amendment offered by the Democratic leader is our chance to make 
this bill a lot more worthy of passage. I urge every Senator, on both 
sides of the aisle, to resist the urge to be too stubborn or too 
partisan to vote for this amendment. It is never too late to improve 
ourselves or our work. It is always a good idea to think about the 
consequences of our actions.
  We face one of the clearest choices imaginable between the amendment 
offered by the Republican leader and the one offered by the Democratic 
leader. The Republican choice is to cut education even more, and to 
kill off national service completely.
  The Democratic amendment says protect our schools, protect the 
children, keep national service alive.
  Vote for the Daschle amendment, and you are voting to continue 
supporting what Americans say over and over and over again they 
support, and care deeply about:
  Help for elementary and secondary schools trying to give the best 
education possible for children from hard-pressed families; the Goals 
2000 effort to raise academic standards in over a thousand schools; the 
funding for schools to teach children and teenagers about the dangers 
of drugs and alcohol; Head Start, and its special role in getting 
children off on the right foot; the training that's taking place all 
over the country to help high school graduates who aren't yet planning 
to attend college, but need that extra boost to make it in the 
workplace; and last but not least, the country's new and exciting 
national service program, that has inspired and excited thousands and 
thousands of young people to serve their communities with the promise 
of a college scholarship to follow.
  Mr. President, vote against the Daschle amendment, and you are 
snuffing out a flame of hope for children and families in every town, 
city, and schoolhouse in this country. This is not rhetoric. These are 
not abstract numbers. We are not talking about throwing a few 
bureaucrats out of work or closing some government offices. We are 
talking about a bill that wants to yank $1.3 billion away from 
education and children and national service.
  This amendment says put the $1.3 billion back into our schools, back 
into drug education, back into national service, back into getting 
teenagers ready for the demands of adulthood.
  As Chairman of the National Commission on Children, I have traveled 
to many of the States of my colleagues. To San Antonio, TX, where I saw 
a principal of a school use Head Start funds and title I funds to cause 
children to giggle and parents to smile as learning took place in every 
classroom. Vote against this amendment, and dim the lights in that 
school in San Antonio. We visited Kansas City, MO, where law officers 
and parents told us with fear and frustration about the drugs on the 
streets and in the schoolyards. Vote against this amendment, and start 
surrendering to the drug traffickers. We went to Minnesota where 
corporate executives told us about their desperate need to get young 
workers with better reading and math skills. Vote against this 
amendment,
 and tell those employers to start thinking about locating in countries 
were education is more valued.

  Then, there's my own State of West Virginia. Where families and 
communities face incredible odds every day. Where children are what 
counts, and education is the key. Where the programs covered in this 
amendment make the difference. Where schools depend on these funds to 
have a math teacher or a drug education class or a schoolwide campaign 
to get grades up. There are not a lot of wealthy families in West 
Virginia. But wealth is not supposed to determine whether a child 
becomes a scientist or a professor or even a Senator. Education is. 
That is the American promise. That is the American dream. Vote against 
this amendment, and start snuffing out that promise, that dream.
  I can hardly believe that national service is on the firing line of 
this bill, already mowed down by the House Republican leaders. Should 
the President really apologize or hide the fact that he is proud of 
helping to reignite the flame for national service? For the idea that 
we can promote rights and responsibilities? A program that is already 
the story of thousands of AmeriCorps members, working in housing 
projects, shelters, classrooms, health clinics, neighborhoods--for a 
minimum amount of money to live on, and a college scholarship as a 
reward for service.
  AmeriCorps is taking hold in West Virginia. Young people and older 
participants are helping a mobile health van to bring primary health 
care, like checkups and shots, to children in rural areas. they are 
working at domestic violence shelters where women and children seek 
refuge from this terrible danger in too many homes.
  National service is the idea that led me to West Virginia, and 
changed my life forever.
  Vote for this amendment, and national service stays alive in our 
communities. Vote against this amendment, and let the American people 
know that we are giving up on this idea once again. Let us wait another 
30 years to celebrate service with college scholarships and stipends.
  When I joined the Senate, one of my very first bills was the one that 
helped create the drug education program threatened in this bill. The 
police officers, the teachers, and the parents of West Virginia led me 
to push for this special help. As a result, police officers are now in 
classrooms, telling children about what it is like in prison. Peer 
groups have developed in countless schools to make it clear that drugs 
are not cool, whatsoever.
  If we are serious about values, where is the logic in going after 
something as basic as drug education? What signal does that send? It 
makes no sense.
  Mr. President, I heard the Republican leader bemoan the effort from 
this side of the aisle to fight for kids. I am sorry if that's slowing 
this bill down. I am especially sorry to see it cause a cruel 
counterpunch in the form of a Republican-led amendment, instead of the 
admission that we should take a breath, and remember just how much the 
citizens of this country support and care about education and children.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. ROCKEFELLER. I thank the Presiding Officer and I yield the floor.
  Mr. DORGAN. Mr. President, the Senator from Wyoming wishes to speak 
in morning business for 7 minutes. I would be happy to accommodate him, 
providing that it does not come out of our time and we retain the 
balance of our time following his presentation.
  Mr. SIMPSON. May I suggest that order take place.
  The PRESIDING OFFICER. Before the Senator from Wyoming speaks, the 
Chair would inform the Senator from North Dakota that the Chair was in 
error. The Senator was allotted 30 minutes, not 20. The Senator has 22 
minutes remaining.
  Mr. SIMPSON. I yield 2 minutes of my time to my friend from Nebraska, 
Senator Kerrey.
  The PRESIDING OFFICER. The Senator from Nebraska [Mr. Kerrey] is 
recognized for 2 minutes.




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