[Congressional Record Volume 141, Number 87 (Wednesday, May 24, 1995)]
[Senate]
[Pages S7351-S7371]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                                 RECESS

  The VICE PRESIDENT. Under the previous order, the Senate will stand 
in recess until 5 p.m.
  Whereupon, at 4:19 p.m., the Senate recessed until 5 p.m.; whereupon, 
the Senate reassembled when called to order by the Presiding Officer 
(Mr. Jeffords).
  The PRESIDING OFFICER. The majority manager of the bill is 
recognized.


                           Amendment No. 1158

  Mr. EXON. Mr. President, on behalf of Senators Boxer, Murray, 
Lautenberg, and Feinstein, I send an amendment to the desk and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Nebraska [Mr. Exon], for Mrs. Boxer, for 
     herself, Mrs. Murray, Mr. Lautenberg, and Mrs. Feinstein, 
     proposes an amendment numbered 1158.

  Mr. EXON. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       At the appropriate place add the following: ``It is the 
     sense of Congress that no Member of Congress may use campaign 
     funds to defend against sexual harassment lawsuits.''

  Mr. EXON. Mr. President, this a sense of the Congress that no Member 
of Congress may use campaign funds to defend against sexual harassment 
lawsuits.
  Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  Mr. DOMENICI. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DOMENICI. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOMENICI. Are we prepared to vote?
  Mr. EXON. We are prepared for the vote. I asked for the yeas and 
nays.
  The PRESIDING OFFICER. The yeas and nays have been ordered.
  Mr. DOMENICI. Mr. President, I move to lay the amendment on the 
table.
  Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.


         Vote On Motion To Lay On The Table Amendment No. 1158

  The PRESIDING OFFICER. The question is on agreeing to the motion to 
lay on the table amendment No. 1158.
  The clerk will call the roll.
  The legislative clerk called the roll.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
who desire to vote?
  The result was announced--yeas 1, nays 99, as follows:
                      [Rollcall Vote No. 196 Leg.]

                                YEAS--1

       
     Packwood
       

                                NAYS--99

     Abraham
     Akaka
     Ashcroft
     Baucus
     Bennett
     Biden
     Bingaman
     Bond
     Boxer
     Bradley
     Breaux
     Brown
     Bryan
     Bumpers
     Burns
     Byrd
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Conrad
     Coverdell
     Craig
     D'Amato
     Daschle
     DeWine
     Dodd
     Dole
     Domenici
     Dorgan
     Exon
     Faircloth
     Feingold
     Feinstein
     Ford
     Frist
     Glenn
     Gorton
     Graham
     Gramm
     Grams
     Grassley
     Gregg
     Harkin
     Hatch
     Hatfield
     Heflin
     Helms
     Hollings
     Hutchison
     Inhofe
     Inouye
     Jeffords
     Johnston
     Kassebaum
     Kempthorne
     Kennedy
     Kerrey
     Kerry
     Kohl
     Kyl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Mikulski
     Moseley-Braun
     Moynihan
     Murkowski
     Murray
     Nickles
     Nunn
     Pell
     Pressler
     Pryor
     Reid
     Robb
     Rockefeller
     Roth
     Santorum
     Sarbanes
     Shelby
     Simon
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner
     Wellstone
  So the motion to lay on the table the amendment (No. 1158) was 
rejected.
                Amendment No. 1159 to Amendment No. 1158

  Mr. DOLE addressed the Chair.
  The PRESIDING OFFICER. The majority leader is recognized.
  Mr. DOLE. I send a second-degree amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Kansas [Mr. Dole] proposes an amendment 
     numbered 1159 to amendment No. 1158.

  The amendment is as follows:

       In the pending amendment strike all after the words ``It is 
     the sense-of-the-Congress'' and insert the following: ``That 
     no member of Congress or the executive branch may use 
     campaign funds or privately donated funds to defend against 
     sexual harassment lawsuits.''

  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  Mr. DOLE. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk called the roll.
  The result was announced--yeas 55, nays 45, as follows:
                      [Rollcall Vote No. 197 Leg.]

                                YEAS--55

     Abraham
     Ashcroft
     Bennett
     Bond
     Brown
     Burns
     Byrd
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Coverdell
     Craig
     D'Amato
     DeWine
     Dole
     Domenici
     Faircloth
     Frist
     Gorton
     Graham
     Gramm
     Grams
     Grassley
     Gregg
     Hatch
     Hatfield
     Helms
     Hutchison
     Inhofe
     Jeffords
     Kassebaum
     Kempthorne
     Kyl
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Murkowski
     Nickles
     Pressler
     Roth
     Santorum
     Shelby
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner

                                NAYS--45

     Akaka
     Baucus
     Biden
     Bingaman
     Boxer
     Bradley
     Breaux
     Bryan
     Bumpers
     Conrad
     Daschle
     Dodd
     Dorgan
     Exon
     Feingold
     Feinstein
     Ford
     Glenn
     Harkin
     Heflin
     Hollings
     Inouye
     Johnston
     Kennedy
     Kerrey
     Kerry
     Kohl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Nunn
     Packwood
     Pell
     Pryor
     Reid
     Robb
     Rockefeller
     Sarbanes
     Simon
     Wellstone
  So the amendment (No. 1159) was agreed to.
  Mr. DOLE. Mr. President, I move to reconsider the vote by which the 
amendment was agreed to.
  Mr. DOMENICI. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. BROWN. Parliamentary inquiry, Mr. President. Is it true that the 
unanimous consent agreement that we are operating under required any 
further amendments to be considered by this body--first-degree 
amendments--to be considered by this body to be presented to the 
managers of the bill by 5:15?
  The PRESIDING OFFICER. The Senator is correct.
  Mr. BROWN. Is it then true that because none of those amendments have 
[[Page S7352]] been delivered by 5:15, no further first-degree 
amendments are in order to the bill?
  Mr. President, I note that it is now 5:39 and that as of 5:15 none of 
the amendments had been presented.
  The PRESIDING OFFICER. The amendments were to be presented to the 
managers of the bill, not the clerk.
  Mr. BROWN. Do we have any indication that those amendments were 
indeed presented by 5:15?
  The PRESIDING OFFICER. The chair does not know what amendments have 
been submitted to either of the managers.
  Mr. EXON. You can get the word of the two managers, if that will 
suffice for the distinguished Senator from Colorado.
  Mr. BROWN. Mr. President, I do not mean to obstruct proceedings but I 
have been trying to get copies of amendments after 5:15. I have asked 
the managers, and they are still not available. If amendments are not 
made available, I intend to make a point of order against amendments 
offered from this point forward.


                     Amendment No. 1158, as amended

  The PRESIDING OFFICER. The pending measure is amendment No. 1158, as 
amended.
  Mr. BROWN. Parliamentary inquiry, Mr. President. Was this amendment 
presented to the managers prior to 5:15?
  Mr. EXON. Mr. President, it was.
  The PRESIDING OFFICER. The amendment was offered prior to 5:15.
  Mr. BROWN. I thank the Chair.
  The PRESIDING OFFICER. The question is on agreeing to amendment No. 
1158, as amended.
  The amendment (No. 1158), as amended, was agreed to.
  Mr. DOMENICI. Mr. President, I move to reconsider the vote.
  Mr. EXON. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. We have been very liberal regarding the time 
on votes. We were 5 minutes over on that last vote.
  I urge all Members to stay in the Chamber, or close to the Chamber, 
so we can get finished in a more orderly and quicker fashion.
  Mr. EXON. Is it in order to proceed now in a semi-orderly fashion 
with amendments that are properly of record?
  The PRESIDING OFFICER. Amendments are in order.


                           Amendment No. 1160

            (Purpose: To limit increases in the public debt)

  Mr. EXON. Mr. President, I send an amendment to the desk and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Nebraska [Mr. Exon] proposes an amendment 
     numbered 1160.

  Mr. EXON. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       On page 63, strike beginning with line 8, though page 65, 
     line 5, and insert the following: ``The Senate Committee on 
     Finance shall report changes in laws within its jurisdiction 
     that increase the statutory limit on the public debt to the 
     amount set forth for the public debt for fiscal year 1996 in 
     section 2(5), of this resolution.
       ``(8) Committee on Foreign Relations.--The Senate Committee 
     on Foreign Relations shall report changes in laws within its 
     jurisdiction that provide direct spending to reduce outlays 
     $0 in fiscal year 1996, $0 for the period of fiscal years 
     1996 through 2000, and $0 for the period of fiscal years 1996 
     through 2002.
       ``(9) Committee on Governmental Affairs.--The Senate 
     Committee on Governmental Affairs shall report changes in 
     laws within its jurisdiction that provide direct spending to 
     reduce outlays $118,000,000 in fiscal year 1996, 
     $3,023,000,000 for the period of fiscal years 1996 through 
     2000, and $6,871,000,000 for the period of fiscal years 1996 
     through 2002.
       ``(10) Committee on the Judiciary.--The Senate Committee on 
     the Judiciary shall report changes in laws within its 
     jurisdiction that provide direct spending to reduce outlays 
     $119,000,000 in fiscal year 1996, $923,000,000 for the period 
     of fiscal years 1996 through 2000, and $1,483,000,000 for the 
     period of fiscal years 1996 through 2002.
       ``(11) Committee on Labor and Human Resources.--The Senate 
     Committee on Labor and Human Resources shall report changes 
     in laws within its jurisdiction that provide direct spending 
     to reduce outlays $1,141,000,000 in fiscal year 1996, 
     $9,165,000,000 for the period of fiscal years 1996 through 
     2000, and $13,795,000,000 for the period of fiscal years 1996 
     through 2002.
       ``(12) Committee on Rules and Administration.--The Senate 
     Committee on Rules and Administration shall report changes in 
     laws within its jurisdiction that provide direct spending to 
     reduce outlays $2,000,000 in fiscal year 1996, $280,000,000 
     for the period of fiscal years 1996 through 2000, and 
     $319,000,000 for the period of fiscal years 1996 through 
     2002.
       ``(13) Committee on Veterans' Affairs.--The Senate 
     Committee on Veterans' Affairs shall report changes in laws 
     within its jurisdiction that provide direct spending to 
     reduce outlays $301,000,000 in fiscal year 1996, 
     $5,760,000,000 for the period of fiscal years 1996 through 
     2000, and $10,002,000,000 for the period of fiscal years 1996 
     through 2002.

             TITLE II--BUDGETARY RESTRAINTS AND RULEMAKING

     SEC. 200. LIMITING INCREASES IN THE STATUTORY LIMIT ON THE 
                   PUBLIC DEBT.

       (a) Reconciliation Directives With Respect to Public Debt 
     Limit.--
       (1) Budget resolution.--Any concurrent resolution on the 
     budget for a fiscal year that contains directives of the type 
     described in paragraph (1) or (2) of section 310(a) of the 
     Congressional Budget Act of 1974 for such fiscal year shall 
     also include a directive of the type described in paragraph 
     (3) of that subsection for that fiscal year.
       (2) Reconciliation.--Any change in the statutory limit on 
     the public debt that is
      recommended pursuant to a directive of the type described in 
     paragraph (3) of section 310(a) shall be included in the 
     reconciliation legislation reported pursuant to section 
     310(b) for that fiscal year.
       (b) Point of Order.--
       (1) In general.--
       (A) Notwithstanding any other rule of the Senate, except as 
     provided in subparagraph (B), it shall not be in order in the 
     Senate to consider any bill or joint resolution (or any 
     amendment thereto or conference report thereon) that 
     increases the statutory limit on the public debt during a 
     fiscal year above the level set forth as appropriate for such 
     fiscal year in the concurrent resolution on the budget for 
     such fiscal year agreed to under section 301 of the 
     Congressional Budget Act of 1974.
       (B) Subparagraph (A) shall not apply to any reconciliation 
     bill or reconciliation resolution reported pursuant to 
     section 310(b) of the Congressional Budget Act of 1974 during 
     any fiscal year (or any conference report thereon) that 
     contains a provision that--
       (i) increases the statutory limit on the public debt 
     pursuant to a directive of the type described in section 
     310(a)(3) of such Act; and
       (ii) becomes effective on or after the first day of the 
     following fiscal year.
       (2) Prohibition on striking proper debt limit changes.--
     Notwithstanding any other rule of the Senate, it shall not be 
     in order in the Senate to consider any amendment to a 
     reconciliation bill or resolution that would strike a 
     provision reported pursuant to a directive of the type 
     described in section 310(a)(3) of the Congressional Budget 
     Act of 1974.
       (3) Waivers.--This section may be waived or suspended in 
     the Senate by a roll call vote of a majority of the Members, 
     duly chosen and sworn.
       (c) Exercise of Rulemaking Powers.--The Senate adopts the 
     provisions of this title--
       (1) as an exercise of the rulemaking power of the Senate, 
     and as such they shall be considered as part of the rules of 
     the Senate, and such rules shall supersede other rules only 
     to the extent that they are inconsistent therewith; and
       (2) with full recognition of the constitutional right of 
     the Senate to change those rules (so far as they relate to 
     the Senate) at any time, in the same manner, and to the same 
     extent as in the case of any other rule of the Senate.

  Mr. EXON. Mr. President, this amendment is offered by myself. It 
creates a majority vote point of order against legislation which 
increases the public debt beyond that set forth in the budget 
resolution. It is something that we discussed in the committee.
  Mr. DOMENICI. Mr. President, the pending amendment is not germane to 
the provisions of the budget resolution pursuant to 305(b). I raise a 
point of order against the pending amendment.
  Mr. EXON. Mr. President, pursuant to section 904 of the Congressional 
Budget Act of 1974, I move to waive that act for the consideration of 
the pending amendment.
  I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays are ordered.


                 Vote on Motion to Waive the Budget Act

  The PRESIDING OFFICER. The question occurs on agreeing to the motion 
to waive the Budget Act.
  The clerk will call the roll.
  The bill clerk called the roll.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote? [[Page S7353]] 
  The yeas and nays resulted--yeas 40, nays 60, as follows:
                      [Rollcall Vote No. 198 Leg.]

                                YEAS--40

     Akaka
     Baucus
     Biden
     Boxer
     Bradley
     Breaux
     Bryan
     Bumpers
     Conrad
     Daschle
     Dorgan
     Exon
     Feingold
     Feinstein
     Ford
     Glenn
     Graham
     Harkin
     Heflin
     Hollings
     Inouye
     Johnston
     Kerrey
     Kerry
     Kohl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Pell
     Pryor
     Reid
     Robb
     Rockefeller
     Simon
     Wellstone

                                NAYS--60

     Abraham
     Ashcroft
     Bennett
     Bingaman
     Bond
     Brown
     Burns
     Byrd
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Coverdell
     Craig
     D'Amato
     DeWine
     Dodd
     Dole
     Domenici
     Faircloth
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hatch
     Hatfield
     Helms
     Hutchison
     Inhofe
     Jeffords
     Kassebaum
     Kempthorne
     Kennedy
     Kyl
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Murkowski
     Nickles
     Nunn
     Packwood
     Pressler
     Roth
     Santorum
     Sarbanes
     Shelby
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner
  The PRESIDING OFFICER. On this question, the yeas are 40, the nays 
are 60. Three-fifths of the Senators duly chosen and sworn not having 
voted in the affirmative, the motion is rejected.
  The point of order is sustained and the amendment falls.


                           Amendment No. 1161

  (Purpose: To restore funding to the AFDC and JOBS programs by using 
                    amounts set aside for a tax cut)

  Mr. EXON. Mr. President, I send an amendment to the desk and ask for 
its immediate consideration
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:
       The Senator from Nebraska [Mr. Exon] for Mr. Moynihan, 
     proposes an amendment numbered 1161.
  The amendment is as follows:

       On page 74, strike lines 12 through 24 and insert the 
     following: ``budget, the appropriate budgetary allocations, 
     aggregates, and levels shall be revised to reflect 
     $55,000,000,000 in budget authority and outlays of the 
     additional deficit reduction achieved as calculated under 
     subsection (c) for legislation that retains AFDC as a Federal 
     entitlement and restores budget authority and outlays for 
     other income security programs.
       ``(b) Revised Allocations and Aggregates.--Upon the 
     reporting of legislation pursuant to subsection (a), and 
     again upon the submission of a conference report on such 
     legislation (if a conference report is submitted), the Chair 
     of the Committee on the Budget of the Senate may submit to 
     the Senate appropriately revised allocations under sections 
     302(a) and 602(a) of the Congressional Budget Act of 1974, 
     budgetary aggregates, and levels under this resolution, 
     revised by an amount that does not exceed the additional 
     deficit reduction specified under subsection(d).''.

  Mr. EXON. Mr. President, Senator Moynihan has proposed this amendment 
which will enable Congress to improve our welfare system rather than 
dismantle it. Under the amendment, Aid to Families with Dependent 
Children will remain a Federal entitlement program.
  The amendment will, over 7 years, restore $55 billion to the income 
security programs, including Aid to Families with Dependent Children, 
supplemental security income and unemployment insurance under the 
jurisdiction of the Finance Committee.
  The amendment is deficit neutral. It is financed in part by the 
fiscal dividend that will accrue to the Federal Government if we 
balance the budget.
  Mr. DOMENICI. Mr. President, I might say to my friend, Senator Exon, 
I thought matters might get better after the last one, but they are 
getting worse. Maybe we will have to jointly look at some of these.
  I would just say from our side what this does is take $55 billion of 
the reserve fund that we have in contingency and it would spend it for 
an entitlement under AFDC.
  Mr. President, the pending amendment is not germane to the provisions 
of the budget resolution pursuant to 305(b) of the act. I raise a point 
of order against the pending amendment.
  Mr. EXON. Mr. President, pursuant to section 904 of the Congressional 
Budget Act of 1974, I move to waive the act for consideration of the 
pending amendment.
  Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.


                 Vote On Motion to Waive the Budget Act

  The PRESIDING OFFICER. The Senate is reminded this is a 9-minute 
vote. I intend to close the vote at 9 minutes.
  The question is on the motion to waive the Budget Act. The yeas and 
nays have been ordered.
  The clerk will call the roll.
  The legislative clerk called the roll.
  The yeas and nays resulted, yeas 41, nays 59, as follows:
                      [Rollcall Vote No. 199 Leg.]

                                YEAS--41

     Akaka
     Biden
     Bingaman
     Boxer
     Bradley
     Breaux
     Bryan
     Bumpers
     Conrad
     Daschle
     Dodd
     Dorgan
     Exon
     Feingold
     Feinstein
     Glenn
     Graham
     Harkin
     Heflin
     Hollings
     Inouye
     Johnston
     Kennedy
     Kerrey
     Kerry
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Pell
     Pryor
     Reid
     Robb
     Rockefeller
     Sarbanes
     Simon
     Wellstone

                                NAYS--59

     Abraham
     Ashcroft
     Baucus
     Bennett
     Bond
     Brown
     Burns
     Byrd
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Coverdell
     Craig
     D'Amato
     DeWine
     Dole
     Domenici
     Faircloth
     Ford
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hatch
     Hatfield
     Helms
     Hutchison
     Inhofe
     Jeffords
     Kassebaum
     Kempthorne
     Kohl
     Kyl
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Murkowski
     Nickles
     Nunn
     Packwood
     Pressler
     Roth
     Santorum
     Shelby
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner
  The PRESIDING OFFICER (Mr. Thompson). On this vote the yeas are 41, 
and the nays are 59. Three-fifths of the Senators duly chosen and sworn 
not having voted in the affirmative, the motion is rejected. The point 
of order is sustained, and the amendment falls.
  Mr. DOMENICI. Mr. President, I move to reconsider the vote by which 
the motion was rejected.
  Mr. EXON. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 1162

   (Purpose: To express the sense of the Senate on the importance of 
  research, technology, and trade promotion and trade law enforcement 
                               programs)

  Mr. EXON. Mr. President, I send an amendment to the desk and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Nebraska [Mr. Exon], for Mr. Bingaman, for 
     himself, Mr. Lieberman, Mr. Rockefeller, Mr. Biden, Mr. 
     Hollings, Mr. Byrd, Mr. Kerry, Mr. Dodd, and Mr. Pryor, 
     proposes an amendment numbered 1162.
  The amendment is as follows:

       At the end of the concurrent resolution, add the following:

     SEC.   . SENSE OF THE SENATE ON THE IMPORTANCE OF RESEARCH, 
                   TECHNOLOGY, AND TRADE PROMOTION AND TRADE LAW 
                   ENFORCEMENT PROGRAMS.

       (a) Findings.--The Senate finds that--
       (1) the public welfare, economy, and national security of 
     the United States have benefited enormously from the 
     investments the Federal Government has made over the past 
     fifty years in research, technology, and trade promotion and 
     trade law enforcement;
       (2) these investments are even more important at the dawn 
     of the twenty-first century in order to insure that future 
     generations of Americans can remain at the forefront of 
     exploring the endless scientific and technological frontier 
     in the face of ever greater challenges from abroad and 
     thereby maintain and improve their health, standard of 
     living, and national security; and
       (3) enforcement of United States trade laws and promotion 
     of United States exports, especially programs in support of 
     small and medium sized businesses, serve an invaluable 
     function in creating jobs, promoting national economic 
     growth, and allowing American workers and businesses to have 
     the resources to compete in an ever more competitive global 
     economy.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that, in the assumptions for the overall accounts, it is 
     assumed that--
       (1) in allocating discretionary spending in fiscal years 
     1996 through 2002 within the discretionary spending limits 
     established in section 201, the Committee on Appropriations 
     will make it a high priority to maintain the overall fiscal 
     year 1995 investment [[Page S7354]] level (without adjustment 
     for inflation) in research, technology and trade promotion, 
     and trade law enforcement programs; and
       (2) the conferees on the concurrent budget resolution will 
     not agree to any revenue reductions below current law unless 
     the discretionary spending limits established in the 
     conference report will permit the Committee on Appropriations 
     to achieve the goal established in paragraph (1).

  Mr. BINGAMAN. Mr. President, this amendment expresses the sense of 
the Senate that it should be a high priority to maintain the overall 
fiscal year 1995 investment level, without adjustment for inflation, in 
research, technology, trade promotion, and trade law enforcement 
programs over the next 7 years.
  The amendment further expresses the sense of the Senate that the 
conferees should not agree to any tax cuts below current law unless the 
discretionary spending limits in the conference report permit the 
achievement of the above goal.
  The GOP budget will reduce civilian research and technology programs 
to a four decade low as a percentage of GDP and Federal spending. By 
2002, Federal civilian research will be 0.26 percent of gross domestic 
product. The Bingaman amendment would effectively urge that this be 
raised to 0.31 percent of GDP.
  For comparison purposes in 1969, the last year we balanced the 
budget, civilian research was 0.76 percent of GDP. The lowest it ever 
was in the Reagan years was 0.38 percent of GDP in 1986. It is 
currently 0.46 percent of GDP. No one can claim that it is research 
that has caused our deficit. Quite the contrary. Almost every economist 
believes our investments in civilian research pay for themselves many 
times over in economic growth and the taxes that corporations pay on 
the fruits of our federally supported scientific enterprise.
  The governments of other industrialized nations, such as Japan and 
Germany, invest about six-tenths of 1 percent of GDP in civilian 
research. We are already below them, even if you include the Pentagon's 
dual-use basic and applied research investments. And we are pointing 
under the GOP budget to spending less than half of what our economic 
rivals spend.
  The cuts in Federal support of civilian research will not be made up 
by the private sector. The reason: they have an ever-shorter focus and 
an ever greater unwillingness to invest in long-term research projects, 
the benefits of which are uncertain and usually not capturable by a 
single firm.
  Every other nation is following the American model of the last half 
century. They are seeking to invest more, not less, in civilian 
research.
  Our model has succeeded. It put men on the Moon, revolutionized 
medicine, developed computers, communications, and
 advanced materials unimagined a half century ago. Vannevar Bush, the 
giant of the post-World War II generation, predicted just this in his 
monograph ``Science: the Endless Frontier'' that served as the basis of 
a social compact between government and the research community for the 
last half century.

  For the past half century, the Federal Government has acted on that 
vision to foster a science and technology enterprise in this country 
second to none. Government research funds have helped conquer diseases, 
win the cold war, and spur incredible advances in electronics, 
computers, molecular biology, communications, and materials science. 
These advances enrich our daily lives and are at the heart of our 
nation's status as an economic and military superpower.
  It is not an accident that American industries from aerospace to 
agriculture to pharmaceuticals in which the Federal Government has made 
substantial research investments enjoy world leadership.
  As we enter the 21st century, we can not afford a Luddite approach. 
The scientific and technogical frontier is still endless. We risk 
condemning our children and grandchildren to a less prosperous, less 
healthy, and less secure future if we follow the course in the budget 
resolution.
  The Bingaman amendment is intended to provoke a debate and to serve 
as a warning. It does not fix the problem. Even if its prescription is 
followed, we will still be spending half of what our rivals spend in 
2002. But it is a step in the right direction, a finger in a breaking 
dike.
  If action is not taken to deal with this, we will lose a generation 
of research and a generation of young researchers who will choose other 
professions. We will not be able to recover for years from this damage 
once the pendulum swings back in favor of Federal research investments 
as it will when the full damage of the GOP budget becomes clear.
  Almost a century ago in 1899 the head of the Patent Office, Charles 
Duell, proposed to close up shop because ``everything that can be 
invented has been invented.'' Luckily we did not follow such Know-
Nothing advice as we prepared for the 20th century. A half century 
later Vannevar Bush laid out his vision for the Federal role in science 
and technology.
  Now we face a choice again between these competing visions, Duell's 
and Bush's. We must reject the notion the endless frontier is over, 
that every invention has been made, and continue to commit to a 
brighter future for our children. We cannot afford to short-change 
research if the 21st century is to be an American century as the 20th 
century was.
  I ask unanimous consent that several newspaper articles be printed in 
the Record.
  There being no objection, the articles were ordered to be printed in 
the Record, as follows:
                [From the New York Times, May 22, 1995]

         G.O.P. Budget Cuts Would Fall Hard on Civilian Science


                         basic research at risk

  experts foresee a crippling of science establishment and layoffs at 
                              universities

                         (By William J. Broad)

       The glory days of the Federal science establishment may be 
     over, science leaders fear, as cuts proposed by Republicans 
     to wipe out the budget deficit fall hard on civilian 
     research.
       Under the cuts, annual appropriations for nonmilitary 
     research might drop to about $25 billion by 2000 from the 
     current level of $32 billion, for total reductions of $24 
     billion or more over the period.
       At risk is the type of Government-financed basic science 
     that has put men on the moon, explored the deep sea, unlocked 
     the atom, cured cancers, found the remains of lost 
     civilizations, tracked earthquake faults, and discovered the 
     chemistry of life, among other feats.
       Specific casualties of the cuts might include atom 
     smashers, new weather satellites, space probes and dozens of 
     large Federal laboratories that study everything from solar 
     power to violent storms.
       Republicans say their goal is to trim fat and corporate 
     welfare rather than cripple basic science, which economists 
     agree is a powerful engine for promoting economic growth and 
     high standards of living.
       Representative Robert S. Walker, a Republican of 
     Pennsylvania who is chairman of the House Science Committee, 
     said this month that the proposed budget would keep ``a 
     robust science policy while providing for the fundamental 
     science base we need to move forward.''
       But Democrats and private experts say the cuts would undo 
     the Federal science establishment, crippling parts of it 
     beyond repair.
       To be sure, science leaders in past budget battles, clearly 
     working in their own self-interest, have been known to 
     exaggerate how painful reductions might be. And some pain 
     might be averted as Democrats and Federal agencies fight the 
     cuts, or if President Clinton successfully vetoes spending 
     bills.
       Even so, the momentum for change is now so great that many 
     private experts, as well as Democrats, say Federal support of 
     civilian science is destined to weaken and shrink no matter 
     what, its budget declining by as much as a third if inflation 
     is taken into account. Such cuts portend wide changes in 
     American science and American life.
       ``Any sensible person knows you have to make prudent 
     investments to get ahead,'' Representative George E. Brown, 
     Jr., a Democrat of California and former chairman of the 
     House Science Committee, said in an interview last week. 
     ``But the Government doesn't. We're dominated by fools.''
       Agency heads, university officials and private experts say 
     the fabric of science is likely to fray widely as the 
     Republican juggernaut rolls forward
      and as the Clinton Administration makes its own cuts in an 
     attempt to regain lost political ground.
       ``Nationally, there's been a massive sticking of heads in 
     the sand, of not looking at the problem,'' said John Wiley, 
     provost at the University of Wisconsin in Madison, one of the 
     nation's top science schools. ``There's going to be a price 
     of pay.''
       Experts say the repercussions could include the abandoning 
     of much long-term environmental monitoring, the virtual end 
     of applied research to aid corporations, layoffs at colleges 
     and universities, and a flight of students from scientific 
     careers.
       ``We don't want to get so lost in the frenzy to balance the 
     budget that we throw babies [[Page S7355]] out with the bath 
     water,'' John H. Gibbons, President Clinton's science adviser 
     and director of the White House Office of Science and 
     Technology Policy, said in an interview.
       ``What ever the reduction is--a quarter or a third--it's 
     big, and it's a reversal of historical trends,'' he added, 
     referring to how Republican cuts would end years of budget 
     growth.
       ``There's no question that we have to be sharper with our 
     knives, to streamline the agencies,'' Dr. Gibbons said. ``But 
     if you take away a third, that's going to push us way down in 
     terms of international competition.''
       During the last four decades, the Federal Government has 
     spent nearly $1 trillion on civilian research and 
     development, laying the basis for a powerful wave of 
     prosperity that has touched most facets of American life. In 
     pushing back the frontiers of knowledge, the Federal money 
     has supported tens of thousands of scientists at universities 
     across the country and has financed the work that led to 
     scores of Nobel Prizes.
       Spending on nonmilitary science has grown fairly steadily 
     in the last decade. It peaked this year at $31.9 billion, 
     according to the National Science Foundation, a Federal 
     agency that finances much basic research at universities.
       The civilian science budget of the Federal government is 
     puny compared to the $100 billion that American industry is 
     putting into reseach and Development this year. Yet its 
     importance is greater than size alone suggests, for while 
     industry typically looks years ahead, aiming to please 
     shareholders, the Government often looks decades and 
     sometimes centuries ahead, pursuing fundamental issues of 
     understanding that may ultimately lead to wide social 
     benefits.
       Another difference is that industrial science is often 
     shrouded in secrecy. By contrast, Government-financed 
     civilian work is usually published openly so it can serve as 
     intellectual kindling for other social and commercial 
     endeavors.
       After their sweep in the midterm elections last November, 
     the Republicans devised a balanced-budget plan that went easy 
     on military research, currently about $40 billion a year, and 
     hard on civilian science, especially on Federal programs with 
     ties to industry. An aim of the Clinton Administration has 
     been to help high-technology industries better compete with 
     foreign rivals.
       House Republicans produced the most detailed plan for 
     science cuts, which was endorsed Thursday by the full House 
     as part of a comprehensive package to balance the budget by 
     2002. The Senate is debating a companion measure.
       Democrats of the House Science Committee portray the House 
     plan as an extensive cracking of the foundations of Federal 
     science. By their calculation, spending under the committee's 
     jurisdiction would fall by a
      total $24 billion from 1996 to 2000, relative to 1995 
     levels. If 3 percent annual inflation is assumed during 
     that period, the overall drop would be 34.7 percent in 
     terms of real purchasing power.
       The committee oversees most civilian science spending in 
     the Federal budget, with responsibility for $27.2 billion 
     this year. The exceptions are the National Institutes of 
     Health and the Agriculture and Interior Departments. The 
     latter's Geological Survey, which monitors water, hunts 
     minerals and makes maps, has been targeted for eventual 
     elimination by the Republicans. Its current budget is $571 
     million.
       The biggest cuts are slated for the Federal Government's 
     largest scientific agency, the National Aeronautics and Space 
     Administration. Among possible victims is tiny Pioneer 10, 
     now nearly six billion miles from Earth and still sending 
     back data more than two decades after it was launched.
       ``A lot more than Pioneer will go,'' NASA's Administrator, 
     Daniel S. Goldin, said in an interview.
       The Republicans would squeeze a series of planned 
     satellites for global climate monitoring, trimming the budget 
     by $2.7 billion, or about half, to the end of the decade. 
     Overall, the agency's annual budget would drop from $14.3 
     billion to $11 billion by 2000.
       On Friday, Mr. Goldin outlined a plan that would move 
     toward eventually turning over operation of the space 
     shuttles to private industry, something the Republicans have 
     called for. The NASA plan would also reduce the work force of 
     the agency and its contractors by about 25,000 people, 
     bringing it to 1961 levels.
       ``We're right at the edge,'' he said. ``The Republican cuts 
     would roughly double that, pushing about 20,000 people out 
     the door.''
       A similar tale comes from the National Oceanic and 
     Atmospheric Administration, whose parent, the Commerce 
     Department, has been targeted for elimination by the 
     Republicans. Among other things, NOAA runs weather 
     satellites, makes forecasts, tracks hurricanes and tornadoes, 
     probes the deep ocean and monitors fisheries.
       James D. Baker, NOAA's Administrator, said in an interview 
     that the agency was already losing 2,300 employees and that 
     the proposed Republican cuts would trim another 1,000 in 1996 
     alone. Its budget for that year would fall to $1.7 billion 
     from a current $2 billion, with deeper cuts in following 
     years.
       ``What we see coming is a real tragedy,'' he said. ``We'll 
     have to cut services and stop future investments on all kinds 
     of things.''
       NOAA runs 11 environmental research labs around the country 
     to study things like air quality, climate changes and severe 
     storms. Some labs would have to be cut back or closed down. 
     And proposed Republican cuts for 1996 would force the agency 
     to abandon plans for a new weather satellite.
       Ultimately, NOAA officials say, lives will be at risk if 
     weather forecasts decline in quality.
       ``We're a service agency,'' said Douglas K. Hall, NOAA's 
     Deputy Administrator. ``We have people on duty 24 hours a day 
     at the union's airports. They're critical to the safety of 
     millions of Americans.''
       More esoteric is the work of the Energy Department, which 
     studies new kinds of solar and geothermal energy production, 
     struggles to harness the nearly limitless power of nuclear 
     fusion, and probes the atom with big particle accelerators. 
     It also is conducting a costly cleanup of sites contaminated 
     by decades of nuclear weapons production.
       Its current budget is $17.5 billion. The Republicans would 
     cut that by a total of $7 billion over five years.
       The department says the cuts would trim 2,000 university 
     science jobs and 3,500 jobs from its sprawling system of 
     laboratories, would end the large fusion experiment at 
     Princeton University and would force the cancellation of one 
     of its atom-smasher projects. In addition, hundreds of 
     companies, universities and Federal laboratories that are 
     trying to improve energy efficiency would lose funds.
       One bright spot in the Republican proposal is the National 
     Science Foundation, whose current budget is $3.3 billion. The 
     Republicans would slightly boost basic research to
      match expected inflation but would squeeze the social 
     sciences, which include economics, anthropology, 
     psychology, sociology, geography and archeology.
       The National Institutes of Health, the nation's biomedical 
     research giant and a main patron of university research, 
     would also get some preferential treatment. Its $11.3 billion 
     budget would drop slightly in 1996 and then freeze. Even 
     without severe reductions, however, N.I.H. officials say 
     their programs would be devastated by inflation.
       For the nation's system of big research universities, said 
     Dr. Wiley of the University of Wisconsin, ``there's likely to 
     be a shakeout'' as the cuts hit home and universities shut 
     down programs.
       ``We'll probably emerge from the next 15 or 20 years with 
     far fewer universities that try to be comprehensive,'' he 
     said.
       Robert L. Park, a physicist at the University of Maryland 
     and a spokesman for the American Physical Society, the 
     nation's leading group of physicists, said the race between 
     Republicans and Democrats to make science cuts boded ill for 
     the future.
       ``Enormous promises have been made and it's hard to see how 
     they can back away from those,'' he said, referring to the 
     Republican promise to balance the budget.
       ``Social Security and most of Medicare is off the table,'' 
     he added. ``There's not much left in the discretionary 
     budget, except for science.''
                                                                    ____


                [From the New York Times, May 23, 1995]

                       Crippling American Science

       The budget plan passed by the House mounts an assault on 
     scientific research, science training and American research 
     universities that are the envy of the world. Blinded by 
     ideological fury at government, House Republicans seek to 
     abandon a crucial function of government, the provision of 
     public goods like research that are undersupplied by private 
     markets. Private companies will invest in research that is 
     likely to raise their profit, but they are unwilling to 
     invest in research whose benefits leak out to competitors. By 
     abandoning government's irreplaceable role, the House budget 
     would undermine America's technological base.
       The magnitude of the House-passed cuts is shocking. 
     Civilian research would fall over five years from about $32 
     billion to $25 billion, a 35 percent cut after accounting for 
     inflation. Medical research, other than for AIDS, would fall 
     by more than 25 percent. Robert Walker, chairman of the House 
     Science Committee, says the plan would protect basic science. 
     He dissembles. His budget would increase spending on research 
     by the National Science Foundation. But the small increases 
     would not keep pace with inflation, so the number of 
     university-based scholars, graduate students and research 
     projects that the N.S.F. supports would steadily fall. Indeed 
     the plan envisions wiping out support for social science 
     research.
       The House budget would continue to support the space 
     shuttle and space station, two costly hardware projects with 
     constituencies in key electoral states, but it would provide 
     little money for other aeronautical and space research. It 
     would cut several energy research programs by between 35 and 
     80 percent--eliminating thousands of university jobs--and 
     reduce research on high-speed rail and other transportation 
     projects. Republicans say their cuts eliminate only applied 
     research that business can undertake for itself, but they 
     propose slashing nearly every program in sight.
       Not all the research that Washington pays for makes sense. 
     Some university-based research can sound ridiculously 
     abstruse. But there is danger in indiscriminately chopping 
     research and undermining a system that has for decades 
     produced the best scientists and graduate programs in the 
     world. The sectors in which America has led the world--from 
     computers and software to agriculture and 
     [[Page S7356]] aircraft manufacturing--can trace their 
     success to heavy Federal support.
       Mr. Walker could have performed a valuable service by 
     carefully sifting through Federal programs to weed out those 
     that needlessly subsidize corporations for research and 
     development projects that they would undertake for 
     themselves. But massive cutting just to reach a balanced 
     budget quickly risks damaging important economic assets.
       The party that preaches cost-benefit analysis for Federal 
     agencies ought to practice what it preaches. Cutting the 
     science budget will save a few billion dollars a year in a $6 
     trillion economy. Knocking out innovative research can lead 
     to stagnant productivity and growth. By that calculation, the 
     House plan is an irresponsible gamble.
                                                                    ____

                [From the Washington Post, May 19, 1995]

   The GOP Needs a Bit More R&D On Its Science and Technology Policy

                          (By Michael Schrage)

       Charred, smoldering and in ruins: The budget bills pending 
     in Congress leave the Clinton administration's ambitious 
     science and technology agenda looking as if it were zapped by 
     one of those space-based X-ray lasers from the Strategic 
     Defense Initiative that never quite got built. The 
     destruction is near-total. Never have a sitting president's 
     programs promising new public-private partnerships for 
     innovation been so thoroughly extirpated so soon after 
     launch. The Commerce Department's Advanced Technology 
     Program--a $430 million-plus effort to turn the National 
     Institutes of Standards and Technology into a high-tech 
     venture capitalist--is toast. The Technology Reinvestment 
     Program, designed to encourage commercial participation in 
     defense technology development, is targeted for extinction.
       Even a $500 million ``national security'' initiative to 
     build flat-panel displays for the Pentagon now shrivels into 
     silicon scraps. Techno-``welfare'' for rich corporations with 
     billion-dollar research and development budgets of their own 
     is being slashed as rigorously and assiduously as welfare for 
     the poor.
       Of course, in the context of the biggest proposed budget 
     cuts in U.S. history, there's nothing special about the 
     dismantling of the Clinton science and technology apparat. 
     And why should there be? Everything else is getting cut.
       What's disturbingly different, however, is that while the 
     Republican majority cheerfully fuses ideas and ideology when 
     it takes on the nation's health care and welfare budgets, its 
     take on federal science and technology budgets seems oddly 
     disjointed. It looks decoupled not only from the marketplace, 
     but from the marketplace of ideas. The same politicians 
     championing the virtues of America's ``Third Wave'' future 
     prescribe federal science and technology policies that would 
     have been deemed simplistic during the country's agrarian 
     heyday.
       The reflexive anti-Washington, pro-market, neo-federalist 
     sentiment that so energizes the right obscures the essential 
     issues that need to be openly debated: What role should the 
     federal government play in supporting non-defense-related 
     research in science and technology? Further, how far should 
     the federal government go in defining regulations and 
     standards that promote innovation in the marketplace? The 
     Republicans insist that market forces are always the best 
     arbiter--but that obviously is not true.
       Let's make these conceptually flavored questions more 
     specific and provocative: Would an Internet--with its unique, 
     nonproprietary, flexible, expandable, multimedia 
     architecture--have been an inevitable byproduct of market 
     forces alone? Or did the federal government's active 
     participation play a valuable role in shaping a new kind of 
     medium?
       Did federal safety and fuel efficiency standards foisted on 
     the automobile and aerospace industries over the past 25 
     years promote technical innovation and customer satisfaction? 
     Or did the costs of consumers and the manufacturers clearly 
     outweigh the benefits?
       Was the agricultural extension service, created to
        promote the decentralized diffusion of agricultural 
     innovation among farmers and researchers, an appropriate 
     medium for a central government to support? What about the 
     Morrill Act, which funded the rise of land-grant colleges 
     and universities?
       Does a Centers for Disease Control and Prevention to 
     monitor the emergence of potentially dangerous viruses and 
     microorganisms make more sense as a federal or state 
     institution?
       The answer to any one of these questions speaks volumes 
     about why the proffered policy choice between ``centralized 
     government'' and ``market forces'' is a false one. In a 
     democracy, of course, the government is the marketplace and 
     vice versa.
       Instead of having the courage to deal with these kinds of 
     issues honestly and directly, we have legislators who prefer 
     to cast them into anachronistic vocabularies where it's okay 
     for government to fund ``basic'' and ``pure'' science but 
     ever so bad for taxpayers to sponsor anything that might be 
     ``commercial'' research and development.
       But traditional definitions of science and technology have 
     become dangerously obsolete. In key research fields, from 
     computer software to new materials to molecular biology, the 
     distinction between basic science and applied technology has 
     blurred into meaninglessness. The applied technology drives 
     the basic science every bit as much as the basic science 
     drives the applied technology.
       For example, finding the umpteenth gene marker in the human 
     genome is ``basic science.'' But building a machine that lets 
     biologists find gene markers 10 times faster is called 
     ``technology.'' Guess which gets funded? Is a data-
     compression algorithm that squeezes five video streams onto a 
     single copper wire by using a novel topological equation an 
     example of pure science or commercial technology? What if the 
     student who discovered that algorithm is doing his thesis 
     funded by the National Science Foundation but while working 
     at a Japanese electronics company?
       Just as it would be crazy to write banking legislation for 
     tomorrow that focused on passbook savings accounts, 
     legislators are kidding themselves if they believe they are 
     doing taxpayers a service by pretending that federally funded 
     science in the 1990s can be managed with the same vocabulary 
     it was in 1975. It can't.
       One of the biggest lies inside the Beltway is that ``you 
     can't beat something with nothing.'' Of course you can, as 
     long as you're writing the checks. Say this for the 
     Clintonistas: At least this administration presented a model 
     of how the federal government should ally and align itself 
     with industry to facilitate innovation in science and 
     technology.
       The new Republican majority has yet to present a coherent 
     proposal that explains what kinds of investments and returns 
     taxpayers have a right to expect from their federal R&D 
     dollars. It is a most glaring policy weakness from a group 
     that wants to push America into the future.
                                                                    ____

              [From the Wall Street Journal, May 22, 1995]

               Corporate Research: How Much Is It Worth?


             top labs shift research goals to fast payoffs

                            (By Gautam Naik)

       In the late 1980s, Bob Lucky had what he calls ``a great 
     fantasy.''
       As a research at AT&T Corp's. celebrated Bell Laboratories, 
     he was designing a silicon robot the size of a grain of sand. 
     Injected into the human body, it would act as a microsurgeon, 
     traveling to specific locations to fix problems.
       ``I was damn proud of the stuff we did. The benefits to 
     society could be tremendous,'' Mr. Lucky says. But AT&T 
     scrapped the research because it had no bearing on its main 
     business. Mr. Lucky, a 31-year veteran of Bell Labs, is now 
     at Bellcore.
       Chasing far-out notions has long been a hallmark of 
     industrial research in America. But some of the biggest U.S. 
     corporations have cut back sharply on research into ``basic 
     science''--the exploration of how nature works at a 
     fundamental level--to pursue short-term goals and to 
     commercialize products more quickly. Corporate labs, home to 
     75% of the nation's scientists and researchers, are replacing 
     a cherished culture of independence with a results-oriented 
     approach.
       In past decades, the devotion to basic research without 
     regard to boosting the bottom line spawned a steady stream of 
     breakthroughs, including the transistor, the solar cell and 
     the forerunner to today's laser--all at Bell Labs. Now, in 
     the 1990s, the cutbacks are taking a toll. Some disillusioned 
     scientists have fled to academia. Already, U.S. companies are 
     falling behind in advanced data-storage devices and 
     technology for oil exploration.
       Some experts worry the shift in an even greater threat to 
     the future. ``It's a short-term response aimed at keeping 
     stockholders happy. Without question this will hurt American 
     competitiveness,'' warns Albert Link, an economics professor 
     at the University of North Carolina at Greensboro.
       Companies counter that as competition intensifies and 
     technology accelerates,
      they must push harder to get more direct value out of their 
     research. ``We need to focus on customers' needs,'' says 
     Daniel Stanzione, who has hammered at that doctrine since 
     becoming president of Bell Labs in March. A former 
     president of AT&T's $6 billion public network equipment 
     division, he is the first hard-core business manager to 
     run the famed research arm.
       The National Science Foundation calculates that U.S. 
     companies' spending on basic research declined slightly to 
     $9.7 billion in 1993 and didn't rise last year. In a survey 
     by R&D magazine, half of all companies with ``research and 
     development'' budgets of $50 million or more plan to cut 
     spending this year, for a 3.5% decline overall (About 10% of 
     the R&D budget is typically devoted to basic research.)
       Those figures mask far more significant cuts in some areas. 
     Among U.S. makers of communications gear and electronics, 
     spending on basic research dropped 64% between 1988 and 1992 
     to $350 million. Even government-funded basic research at 
     universities and colleges, which has risen in the last five 
     years, is expected to fall slightly in 1995, according to the 
     National Science Foundation.
       International Business Machines Corp. has chopped $1.7 
     billion from its annual R&D budget since 1992, a 33% 
     reduction to $3.38 billion by last year. In the science-
     oriented research division, annual spending has fallen to 
     $450 million from $625 million in 1990. The staff of 
     scientists has been cut nearly 20% to 2,600; the number 
     pursuing basic research is down by half to 
     200. [[Page S7357]] 
       In the 1980s, IBM labs explored the subatomic mysteries of 
     neutrino particles. In the 1990s, an IBM lab perfected the 
     collapsible ``butterfly'' keyboard in just a year; it might 
     have taken seven years in the old days. Impressive, but 
     keyboards are hardly the stuff of high science.
       Bernard Meyerson, an IBM fellow and senior manager at the 
     IBM lab in Yorktown Heights, N.Y., says that despite the 
     reductions, ``core research was preserved.'' But he concedes 
     that cutting back is ``a dicey process'' because ``you won't 
     see the impact of funding cuts until it's too late.''
       Elsewhere the changes have been subtle but no less 
     significant. Xerox Corp.'s PARC lab, which invented laser 
     printing and on-screen icons, now gets detailed ``contracts'' 
     from the company's product divisions directing its research. 
     At General Electric Co., the portion of R&D spending devoted 
     to long-term projects is down to 15% from 30% in the 1980s.
       Such changes are sweeping Bell Labs, perhaps the most 
     famous lab in the world. AT&T still devotes 10% of its annual 
     $3 billion R&D budget to basic research, but ever bigger 
     chunks will be shifted away
      from physical science--the lab's traditional strength--to 
     information science, which is closely tied to AT&T's core 
     business. Bell Labs managers used to be promoted solely on 
     the basis of technical achievement. Now they must also 
     display business acumen.
       ``That wonderful culture at Bell Labs'' is disappearing, 
     laments Phillip Griffiths, director of the Institute for 
     Advanced Study in Princeton, N.J., one of the last 
     strongholds of purely theoretical research in the U.S.
       It is difficult to quantify what may be lost because of 
     such shifts. Fiber optics, for one, might have been delayed 
     for decades if not for fundamental discoveries made at Bell 
     Labs, GE and IBM. In the early 1960s, scientists stumbled on 
     a curious find: Gallium arsenide was a natural laser. When 
     they zapped an electrical current through it, it emitted an 
     intense beam of light, thus making practical the laser that 
     was first demonstrated by Hughes Aircraft in 1960. Scientists 
     realized this ``semiconductor injection laser'' could be 
     manipulated to transmit vast amounts of data at nearly the 
     speed of light.
       As many big U.S. companies are backing away, some foreign 
     concerns are pushing on. Major high-tech companies overseas 
     increased R&D spending 23% from 1988 to 1993, says Schonfeld 
     & Associates of Lincolnshire, Ill.
       At NEC Corp.'s Research Institute in Princeton, N.J., about 
     30 miles from Bell Labs' campus, scientists delve into 
     condensed matter physics, quantum mechanics and biology. 
     Joseph Giordmaine, a physicist, put in 28 years at Bell Labs 
     but bolted for Japan's NEC in 1988.
       Now, as a senior vice president, he presides over some 
     truly far-out projects. In one, a fly, its limbs affixed in 
     wax, is set before a TV screen flashing a series of images. A 
     delicate probe connects a single neuron in the fly's brain to 
     an instrument that measures how fast it registers the TV 
     images.
       The research may one day yield insights into how to design 
     a super-fast computer. ``Basic research means you have to be 
     able to take risks and accept failure,'' says Mr. Giordmaine.
       Greg Blonder, who invented the wristphone at Bell Labs, has 
     spent most of his career studying physical sciences and their 
     role in future technologies. In January, he switched to 
     ``human-centered engineering'' aimed at making AT&T products 
     more ``customer friendly.''
       He admits to nostalgia for bygone days. ``There's no thrill 
     equivalent to the feeling when you discover something late at 
     night, and you know that no one else in the universe knows 
     it,'' he says. ``I miss that.''
                                                                    ____

              [From the Wall Street Journal, May 22, 1995]

            Baby Bells Find It Hard to Put Price on Bellcore

                           (By Leslie Cauley)

       How do you value a company that has never turned a profit, 
     is prohibited from designing real products and has no 
     experience competing for customers?
       That question faces Bell Communications Research Co., the 
     jointly owned research arm of the seven regional Bell 
     telephone companies. The Bells have announced plans to sell 
     or spin off Bellcore by next year.
       The shedding of the company, familiarly called Bellcore, 
     comes at a time when even the most respected technology 
     giants are cutting corporate-research budgets. For the Baby 
     Bells' lab, that raises the question: Who would want it? ``I 
     have no idea,'' answers one Wall Street analyst. ``It isn't 
     commercially oriented, and it's been operated as a nonprofit 
     [entity] that hasn't been accountable to anyone in 
     particular. It's a seven-headed monster right now.''
       Bellcore came into being 11 years ago when the old AT&T 
     empire was dismantled, and the seven Baby Bells were spun 
     off. AT&T Corp. held on to the famed Bell Labs, inventor of 
     cellular technology, the transistor and the satellite. The 
     Bells got newly formed Bellcore.
       Despite its formal name, only about 10% of Bellcore's work 
     is devoted to outright research. And unlike Bell Labs, 
     Bellcore doesn't engage at all in the blue-sky realm of 
     ``pure,'' or basic, research.
       The bulk of Bellcore's work is in software programming and 
     consulting. Bellcore experts often are among the first in an 
     emergency, as in the terrorist bombing in Oklahoma City last 
     month. Bellcore software helps the Bells keep track of which 
     phone wires go where, no small feat considering the more than 
     150 million telephone lines in the U.S. It also handles such 
     tasks as assigning area codes and designing a phone system 
     aimed at surviving a nuclear attack.
       Some of the top engineers and network designers in the 
     world work at Bellcore. They have racked up more than 600 
     patents. For all the technical muscle, however, the lab has 
     never produced a single commercial product. It can't. 
     Bellcore is shackled by the terms of the AT&T breakup that 
     bar the Baby Bells from making equipment or offering long-
     distance service. It also can't design production-ready 
     prototypes or steer customers to particular brands of gear.
       Once freed from its seven owners, Bellcore would escape 
     these restraints. ``It's about time we were able to start 
     cashing in on what we know and what we have,'' says Alexander 
     Gelman, a Bellcore engineer who experiments with advances in 
     video conferencing.
       That's why the future is filled with exhilarating 
     possibilities--but also fraught with fear--for the 6,000 
     people who work at the lab's five sites in New Jersey. Some 
     senior Bell executives say Bellcore may have to get rid of 
     2,000 workers and install
      a new top tier of outsiders to gird for competition.
       Technical ability alone won't carry Bellcore in a 
     competitive environment, says Bud Wonsiewiez, vice president 
     of advanced technologies at U S West Inc., the Denver-based 
     Bell. ``Their challenge is to move from a monopoly culture to 
     a competitive culture, which is exactly the same challenge 
     the seven owners face,'' he says.
       Many Bellcore insiders acknowledge the risk and even seem 
     energized by it. ``If you're up the challenge it can be quite 
     exhilarating,'' says Rob Zieglar, a Bellcore wireless 
     specialist. ``If not, if can be paralyzing.'' (Some 
     colleagues, he says, are thinking of leaving,) He adds: 
     ``Given the chance, ideas are going to jump here. We're going 
     to be a player.''
       From all indications, they have the potential: Following a 
     major fire in a central switching site a few years ago, 
     Bellcore technicians came up with a fire sensor that could 
     detect a problem long before conventional sensors. Then they 
     had to load it up with clunky circuits to make sure it wasn't 
     manufacturable and didn't violate the ban on designing a 
     production-ready device.
       ``It's not that our people didn't know how'' to make a 
     commercial product, says George Heilmeier. Bellcore's 
     president and chief executive officer. ``They had to do it 
     that way.'' A manufacturer later refined Bellcore's prototype 
     to build a commercial sensor, Mr. Heilmeier says, leaving 
     Bellcore with some royalties, but little glory.
       ``We know our concepts are doable--we just have to wait for 
     the right time,'' adds Vincent Vecchio, a Bellcore network 
     specialist. Eric Addeo, a research manager, says operating 
     under the restrictions of the AT&T breakup pact ``was like 
     being in a dark room with the door cracked. Now the door is 
     opening.''
       But cutting loose from the Bells also means eventually 
     losing guaranteed financial support. The regional phone 
     companies supply more than 80% of Bellcore's $1 billion in 
     annual funding. Bellcore generated the other $200 million or 
     so from non-Bell clients last year, but that isn't nearly 
     enough to support its operations.
       The Bells are drafting multiyear contracts with Bellcore to 
     help attract outside investors, but most probably won't 
     commit to more than five years. ``The world is too 
     unpredictable to write contracts that go beyond'' that time 
     frame, says one senior Bell executive.
       Its technical expertise might make
        Bellcore an attractive acquisition for a maker of 
     telecommunications gear or perhaps a large ``systems 
     integrator'' that lashes together a client's computers and 
     phone systems. But the Baby Bells say they won't sell to a 
     direct competitor such as, say, AT&T they want Bellcore's 
     technology to remain within easy reach.
       That point is one of the few on which the Baby Bells have 
     been able to reach easy agreement these days. Bellcore's 
     mission has grown muddled as its owners have begun pursuing 
     divergent and sometimes colliding strategies.
       U S West last year acquired two cable systems in Atlanta, 
     home base of BellSouth Corp., with an eye toward offering 
     competitive local phone service. ``That had a sobering 
     influence'' on Bellcore's board, says U S West's Mr. 
     Wonsiewicz, who sits on the Bellcore board. He found himself 
     ``sitting around the table with BellSouth and others [who 
     were] asking, `When are you going to start offering telephone 
     service against us, Bud?' ''
       Yet to pursue even routine matters, Bellcore has been 
     required to win the unanimous approval of all seven Bells. 
     Asked if he'll miss anything once Bellcore is turned loose, 
     Mr. Heilmeier, the lab's CEO, doesn't miss a beat. ``Oh yes, 
     I'll miss those board meetings where we had to have a 7-0 
     vote on everything,'' he replies sarcastically. ``The tears 
     are welling up in my eyes now.''
                                                                    ____


                 [From the New York Time, May 22, 1995]

               Clinton's Aid To Industry Is G.O.P. Target


                Technology and Trade Programs Would End

                          (By David E. Sanger)

       Washington, May 22.--Buried among the Republicans' sharp 
     cost-cutting proposals to [[Page S7358]] balance the Federal 
     budget is the swift dismantling of two of the Clinton 
     Administration's most prominent economic innovations: the Use 
     of the Government to promote exports and the underwriting of 
     new technologies that corporate America considers too risky.
       During his Presidential campaign, Mr. Clinton briefly 
     called those strategies ``industrial policy,'' until 
     Republicans seized on the phrase as proof that Mr. Clinton 
     wanted the Government to meddle in the workings of the 
     market. Once in office, the White House dropped the 
     terminology but went ahead anyway with an aggressive program, 
     declaring that the United States needed to develop 
     partnerships with industry and use Government pressure to 
     promote exports, two skills that Japan and Germany turned in 
     to an art after World War II.
       The Republican budget proposals would bring many of those 
     efforts to a halt and drastically shrink others, from the 
     Energy Department to the Pentagon. The most sweeping cutback 
     proposal, the ``The Department of Commerce Dismantling Act,'' 
     is scheduled to be introduced on Tuesday by House 
     Republicans. The act would immediately terminate six of the 
     Cabinet department's offices and slice up the organization 
     that provides the skills for trade negotiations with Japan, 
     China and several other nations.
       Many of the functions of the Commerce Department's highest-
     profile organization, the International Trade Administration, 
     would be carved up or eliminated. It is unclear what would 
     happen to the economic ``war room'' that calls in 
     ambassadors, Cabinet secretaries and sometimes the President 
     to put pressure on foreign governments to buy American goods.
       Curiously, the White House has said almost nothing in 
     public about the attack on the core of its economic strategy, 
     partly for fear that it would detract from its warnings about 
     proposed cuts to Medicare and other popular social programs.
       ``Our global competitors are laughing at us,'' Secretary of 
     Commerce Ronald H. Brown said today in a telephone 
     conversation from Paris, where he is attending a meeting of 
     the organization for Economic Cooperation and Development. 
     ``Just at the moment when we've finally learned that there is 
     no way to win without a public-private partnership, without 
     getting the Government involved in promoting a nation's 
     exports, people are incredulous that Congress would be doing 
     this.
       ``The French are apoplectic that we have been so pro-active 
     and successful,'' Mr. Brown said, a reference to Washington's 
     role in winning a huge contract in Brazil last year over 
     French competition. ``And now they are delighted that we are 
     thinking about not doing it anymore.''
       The Republican theory is that the Commerce Department has 
     become a brazen example of ``corporate welfare,'' a term 
     coined by one of Mr. Clinton's Cabinet members and close 
     friends, Labor Secretary Robert B. Reich. To the White 
     House's horror, the phrase--which Mr. Reich has not repeated 
     since--has become a rallying call for the freshman class of 
     Republicans, who do not share their party's traditional 
     closeness or dependence on big business.
       ``There are 19 different departments in the Government that 
     deal with trade,'' said Representative Dick Chrysler, the 
     Michigan Republican who drafted the legislation to dismantle 
     the Commerce Department 92 years after its creation. ``They 
     could all be reduced to a single Department of Trade.''
       Another target of Mr. Chrysler's is the department's 
     Advanced Technology
      focused on the programs that most people understand,'' said 
     Hazel R. O'Leary, the Secretary of Energy, whose 
     department's budget would shrink by roughly $7 billion 
     over the next five years.
       ``It's a little early,'' said Laura D'Andrea Tyson, the 
     head of the National Economic Council, an office that was 
     created at the start of the Administration to give economics 
     equal weight with issues of national security. ``There should 
     be a good debate about the wisdom of this, but it is still 
     early in the budget process.''
       It may be early, but it seems clear that most of the trade 
     and technology promotion programs will be sharply reduced, if 
     they survive at all.
       As a result, the White House's reticence has not kept the 
     departments themselves from starting allout survival 
     campaigns. Capitol Hill these days is flooded with under 
     secretaries and assistant secretaries explaining and 
     justifying programs that have never before come under intense 
     scrutiny.
       Many of those programs were started under Republican 
     administrations. The theme of the presentations often boil 
     down to one argument: In an age of economic conflict, cutting 
     out political and economic support for industry is the 
     equivalent of unilateral disarmament.
      Program, which provides backing for technologies that small 
     companies--and some large ones--consider promising but too 
     risky to attempt. ``This has grown from $10 million in 
     1990 to $250 million in 1993, and now they want $750 
     million,'' Mr. Chrysler said. ``This is nothing other than 
     picking winners and losers.''
       Such arguments underscore the sharp difference in the way 
     technology and trade policy is dealt with in Washington and 
     in the capitals of its major economic competitors, where 
     trade is considered national security and ``picking winners 
     and losers'' is a phrase with no political resonance.
       In Japan and Germany, there is virtually no debate over 
     government programs to provide seed money for risky 
     technologies or to use the influence of top officials to win 
     contracts. It is taken as a given that such roles fall to the 
     central government, along with defending the nation's 
     territory and making foreign policy.
       In Japan, for example, officials will freely acknowledge 
     that more than 50 percent of the money committed to new 
     technologies will result in utter failure. But even a 20 
     percent success rate, they argue, should be considered a 
     success. No one would even attempt such an argument in 
     Washington.
       ``You can't go up on the Hill and talk about a 40 percent 
     success rate, even if that is a brilliant performance,'' Ms. 
     O'Leary said last week. ``People will say: `What? We are 
     throwing away 60 percent?'''
       Instead, Ms. O'Leary's department has been churning out 
     news releases about its industrial breakthroughs in energy 
     conservation. A giant sulfur lamp now hangs over the Energy 
     Department's entrance on Constitution Avenue, a single light 
     that replaces 250 bulbs. ``It was developed with $1 million 
     in Government money and much more in private funds,'' she 
     said. ``That is hardly a waste.''
       On the Hill, though, no one wants to talk about sulfur 
     lamps, unless they are designed to illuminate a balanced 
     budget. ``This is the tail-wagging-the-dog syndrome,'' Mr. 
     Chrysler said. ``If it is a good invention, let the private 
     sector invent it.''

  Mr. GLENN. Mr. President; I rise today to express my strong support 
for the amendment of my friend from New Mexico, Mr. Bingaman, which 
urges continued funding for Federal investments in research, 
technology, export promotion and trade law enforcement. I take strong 
exception to the position espoused by the Republican budget 
resolution--that technology research and trade promotion are not proper 
and appropriate functions of the Federal Government. They are, in fact, 
not only appropriate but vital to continued U.S. economic growth and 
competitiveness in today's global economy.
  I have long maintained that our Nation needs to be more, not less, 
cognizant of the crucial role technology plays in affecting our 
position in the world economy. Without it we would not enjoy the 
industrial and military strength we have today. Our Government has 
traditionally played a critical role in this area and I am convinced we 
must continue to invest prudently in research and technology 
development if we are to maintain our position in an increasingly 
competitive global economy. And with all due respect to my Republican 
friends, the private sector cannot and will not commit sufficient 
resources to make up for the cuts proposed by the Republican budget.
  Eroding and/or eliminating the Federal Government's role in 
scientific research and technology development is like eating our seed 
corn, short sighted and ill advised in the extreme.
  I would assign the same labels--short-sighted and wrong-headed--to 
the proposed elimination of Federal programs which promote U.S exports. 
Undeniably trade has become a major factor in the U.S. economy. 
According to the Trade Promotion Coordinating Committee, ``long-term 
forecasts of the U.S. economy put exports as the fastest growing 
component of GDP--increasing perhaps two and a half times faster than 
the overall economy.''
  As the 3rd largest exporter of manufactured goods among the 50 
States, Ohio has benefited greatly from, and has a vital economic stake 
in, robust international trade. We cannot turn a blind eye to the fact 
that all our major trade competitors spend considerably more than we do 
to push their products in overseas markets. Nevertheless, our 
relatively modest investments at the Federal level, prudently targeted 
and efficiently managed, effectively complement private sector 
marketing efforts and maintain our position is an increasingly 
competitive international economic environment. Because governments are 
major purchasers in most of the primary categories of U.S. exports, for 
example aerospace, power generation, transportation, and 
telecommunications, the government-to-government contacts are 
particularly useful and appropriate.
  The least we can and should do in the interest of future economic 
growth, jobs and prosperity is to maintain the current modest level of 
Federal investment in research, technology and trade promotion.
  Mr. PRYOR. Mr. President, I am proud to be a cosponsor of Senator 
Bingaman's amendment to protect funding for the important investments 
[[Page S7359]] that our Nation currently makes to help our businesses 
compete in the evolving global economy.
  Mr. President, as the cold war passes into our memories, a new type 
of global challenge to the health and welfare of America has emerged. 
It is an economic war that American businessmen and women are fighting 
in the US marketplace and in global markets against foreign competitors 
support and encouraged by their governments.
  As Commerce Secretary Ron Brown recently said, the budget before us 
today is tantamount to unilateral disarmament of the United States. It 
is the business equivalent of shutting down the Pentagon to save money 
in the middle of a world war.
  Mr. President, don't believe me or Secretary Brown. Believe the words 
of the customers, the American businesses on the front line of global 
competition.
  This morning's Arkansas Democrat-Gazette had a strong story in which 
businessmen were asked what they thought about the idea of eliminating 
trade and technology efforts at the Commerce Department. I ask that 
``Cutting out Commerce Finds Few Fans in Trade'' be placed in the 
Record following my statement and urge my colleagues to read it.
  The Vice Chairman of the Arkansas District Export Council, Dave 
Eldridge, said ``For a person who has been an international businessman 
for 30 years, I can tell you that (closing the Commerce Department) 
would be a serious mistake.''
  As businesspeople in Arkansas point out, at stake is no less than the 
future economic health of our Nation and our standing and power in the 
international community.
  At stake are American jobs threatened by tariffs or other 
restrictions on US products in foreign markets. At stake are American 
businesses, large and small, that must beat foreign competitors to the 
market with new and better products, cut costs and improve quality 
through better manufacturing technologies, and position themselves in 
the emerging overseas that will generate huge new consuming publics in 
the future.
  To help American businesses compete, the US Government has made 
modest but effective investments in export promotion, trade law 
enforcement, technology and research. All of these investments are 
under attack in this budget.


                                 trade
  Mr. President, one of the great success stories in our work to 
support US businesses overseas is the International Trade 
Administration (ITA) at the Commerce Department. During the first 2 
years of the Clinton administration, ITA advocacy of US business has 
boosted US exports by $23.6 billion, thereby creating over 300,000 
American jobs.
  Taxpayers invested roughly $500 million in the ITA and received a 
return of $23 billion in exports. That would pass anyone's cost-benefit 
test.
  ITA has helped to open foreign markets for American business and to 
enforce US trade laws that protect us against unfair competition.
  This budget resolution apparently would dissolve the ITA. Again, Mr. 
President, that is unilateral disarmament.


                               technology

  Helping American businesses stay at the cutting edge of new 
technologies is vital to long term competitiveness and that is exactly 
what the National Institute of Standards and Technology, or NIST, is in 
the business of doing. According to studies, 25 percent of America's 
economic growth since the end of World War II can be attributed to 
technology advances. NIST's primary mission is to bolster US 
competitiveness by advancing civilian technology by investing in long 
term, high-risk research and development.
  This formula for technology advancement is working. NIST leverages 
scarce resources, cost sharing, and risk sharing with industry and 
other government entities. It is maximizing returns to American 
businesses and minimizing costs to taxpayers.
  Another technology program that has proven itself is the Technology 
Reinvestment Project (TRP). TRP has worked to integrate our military 
and civilian technology sectors in a way that will strengthen our 
economy and military. TRP is another useful example of how partnerships 
between government and industry are useful in pooling Federal and non-
Federal resources toward a common goal.
  Mr. President, quite simply, we can not afford to cut TRP. For years 
the US military relied on its own separate technology sector and the 
American taxpayers were forced to pay the huge bills. If we want our 
military to deploy the most technologically advanced equipment at the 
lowest cost possible, we must tap into civilian markets more often. By 
doing so, everyone wins--the US military, the American taxpayer, 
businesses and our economy.
  These technology advancement efforts are under attack in this budget. 
Their demise would effectively mortgage our future competitiveness and 
economic health to buy short term budget savings.


                             manufacturing

  To help small and medium sized manufacturers put new technologies to 
work in global competition, this administration has opened 25 new 
manufacturing centers. These centers bring proven technology to our 
nation's 370,000 small and medium-sized manufacturers. The Centers have 
received rave reviews from their customers.
  Again, this successful investment in future jobs and economic growth 
is also under attack in this budget.
  In nations around the world, investments in technology and trade 
development are top budget priorities. Japan, Germany and others will 
be glad to hear that this budget resolution strips the United States of 
its most effective weapons for global economic competition.
  Mr. President, it is vitally important that we maintain funding for 
our investments in research, technology, and export promotion. The U.S. 
should be investing more in making our workers and our firms more 
competitive around the globe so that we can win the battle for markets 
and profits, as well as higher wages for our workers.
  The U.S. can no longer prevail in international economic competition 
based solely on its vast supply of capital and natural resources, or 
its large educated work force. The economic battles of today and 
tomorrow will be won by the firms that can employ the latest technology 
and the latest information to be the first to market, the highest 
quality competitor, and the most competitive in pricing. These battles 
will be won by firms that work in concert with their government to 
break down foreign trade barriers and open new channels into the mature 
and the emerging markets of the world.
  This amendment preserves the essential functions of trade promotion, 
technology, and research activities. This funding is critical to our 
nation's competitiveness. It is critical to the creation of quality 
jobs in the future. And it is critical to the survival of many American 
businesses and industries. I urge its adoption.
  The article referred to follows:
              Cutting Out Commerce Finds Few Fans In Trade

                            (By Randy Tardy)

       Arkansas international trade officials reacted strongly to 
     a Republican budget-cutting move Tuesday to abolish the U.S. 
     Department of Commerce and transfer its functions to other 
     agencies of government.
       A bill introduced in the House would terminate six Commerce 
     Department programs, including the Economic Development 
     Administration, the Minority Business Development Agency and 
     the Technology Administration, which promotes public-private 
     cooperation in new technology.
       The department's export-promoting International Trade 
     Administration would have its functions moved to other 
     agencies, including the State Department, which handled 
     export trade policies until 1980.
       ``For a person who has been an international businessman 
     for 30 years, I can tell you that would be a serious 
     mistake,'' said Dave Eldridge, vice chairman of the Arkansas 
     District Export Council and director of economic development 
     for Arkansas Power & Light Co.
       Eldridge served as moderator Tuesday for the 1995 World 
     Trade Conference on European markets featuring a trio of 
     Commerce Department officers representing four European 
     countries.
       ``If the United States is going to maintain its ability to 
     compete effectively in the world market, then we are going to 
     need a strong advocacy in Washington and throughout the 
     world,'' said Hartsell Wingfield, president of TCBY 
     International, the Little Rock-based frozen yogurt franchiser 
     with operations in 30 countries.
       That advocate is not Congress; ``it is the strong, 
     effective Commercial Service'' sector of the Commerce 
     Department's International [[Page S7360]] Trade 
     Administration, Wingfield told the conference luncheon in the 
     Excelsior Hotel.
       ``If we take a hands-off approach to international trade 
     from a political perspective,'' he said, ``we will lose our 
     edge as an international exporter, because other countries 
     are not taking a hands-off approach.''
       Joseph O'Brien, an international trade consultant and 
     president of the Arkansas World Trade Club, agreed. ``I've 
     had personal experience on behalf of Arkansas clients with 
     the Commercial Service guys stationed in Paris and Madrid and 
     Mexico City and Guatemala City,'' he said, ``and in every 
     case, they were enthusiastic and they tried hard. They really 
     made a big difference.''
       Putting the Commerce Department's international trade role 
     under the State Department would mean a different set of 
     priorities, O'Brien added. ``We really do need to export more 
     in this country, and this is the one way for small companies 
     to get help overseas. The big boys don't need it; the smaller 
     ones do.''
       Meanwhile, global trade competition is getting keener, and 
     some of the best potential European markets for Arkansas 
     exports may be in the least-known countries, the Commerce 
     Department's senior commercial officers told the world trade 
     conference.
       ``Italy is one of the least-known markets in the U.S.; it's 
     a marketplace people don't look at often,'' said Keith 
     Bovetti, minister counselor with the department's Commercial 
     Service in Italy.
       The country's ``close to a $1 trillion gross domestic 
     product has the fifth leading economy in the world, and major 
     privatization is going on there,'' he said, ``but there are 
     no shortcuts to being there on the spot to do business.''
       Spain and Portugal are also lesser-known economies, said 
     minister counselor Emilio Iodice, who is assigned to the two 
     countries.
       ``Spain is not just a land of bullfighters and flamenco 
     dancers,'' he said, ``it has a stable government and the 
     highest growth rate in Europe for the last 12 years.'' Spain 
     in 1994 had $6 billion in U.S. investment and, while that's 
     sizable, foreign investment there was greater, he said.
       Portugal, with one-fourth Spain's population, ``is a new 
     country, economically,'' Iodice said, noting increased 
     investments in foreign goods and services to help the country 
     become more competitive globally.

  Mr. EXON. Mr. President, let me be very brief and concise.
  This amendment by Senator Bingaman expresses the sense of the Senate 
regarding the importance of research, technology, trade promotion, and 
trade law enforcement programs all very important to America. This 
particular amendment is cosponsored by Senators Lieberman, Rockefeller, 
Biden, Hollings, Byrd, Kerry, Dodd, and Pryor.
  Mr. DOMENICI. Mr. President, this amendment says that the conferees 
have to keep spending limits at a certain level to accomplish the goals 
that the amendment contemplates, and there shall be no revenue 
reductions unless we do. Some of the goals are rather vague, and it is 
pretty difficult to know what we must do.
  It is with reluctance that I move to table the amendment, and I ask 
for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The question is on agreeing to the motion of 
the Senator from New Mexico [Mr. Domenici] to lay on the table the 
amendment of the Senator from New Mexico [Mr. Bingaman]. On this 
question, the yeas and nays have been ordered, and the clerk will call 
the roll.
  The bill clerk called the roll.
  The PRESIDING OFFICER Are there any other Senators in the Chamber who 
desire to vote?
  The result was announced--yeas 53, nays 47, as follows:
                      [Rollcall Vote No. 200 Leg.]

                                YEAS--53

     Abraham
     Ashcroft
     Bennett
     Bond
     Brown
     Burns
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Coverdell
     Craig
     D'Amato
     DeWine
     Dole
     Domenici
     Faircloth
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hatch
     Hatfield
     Helms
     Hutchison
     Inhofe
     Kassebaum
     Kempthorne
     Kyl
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Murkowski
     Nickles
     Packwood
     Pressler
     Roth
     Santorum
     Shelby
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner

                                NAYS--47

     Akaka
     Baucus
     Biden
     Bingaman
     Boxer
     Bradley
     Breaux
     Bryan
     Bumpers
     Byrd
     Conrad
     Daschle
     Dodd
     Dorgan
     Exon
     Feingold
     Feinstein
     Ford
     Glenn
     Graham
     Harkin
     Heflin
     Hollings
     Inouye
     Jeffords
     Johnston
     Kennedy
     Kerrey
     Kerry
     Kohl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Nunn
     Pell
     Pryor
     Reid
     Robb
     Rockefeller
     Sarbanes
     Simon
     Wellstone
  So the motion to lay on the table was agreed to.
  Mr. EXON. Mr. President, I move to reconsider the vote by which the 
motion was agreed to.
  Mr. DOMENICI. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 1163

  (Purpose: To protect children receiving health care insurance under 
                               Medicaid)

  Mr. EXON. Mr. President, on behalf of Senator Murray, I send an 
amendment to the desk and ask for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       The Senator from Nebraska [Mr. Exon], for Mrs. Murray, 
     proposes an amendment numbered 1163.

  Mr. EXON. Mr. President, I ask unanimous consent that the reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       On page 79, between lines 3 and 4, insert the following:

     SEC.   . PROHIBITION OF LEGISLATION THAT WOULD DEPRIVE 
                   CHILDREN OF THEIR HEALTH INSURANCE UNDER 
                   MEDICAID.

       (a) Point of Order.--It shall not be in order in the Senate 
     to consider any bill, resolution, amendment, motion, or 
     conference report that would cause children eligible to 
     receive benefits under Medicaid (whether currently or in the 
     future) to lose any of those benefits.
       (b) Waiver.--This section may be waived or suspended in the 
     Senate by a majority vote of the Members voting, a quorum 
     being present, or by the unanimous consent of the Senate.
       (c) Appeals.--Appeals in the Senate from the decisions of 
     the Chair relating to this section shall be limited to 1 
     hour, to be equally divided between and controlled by, the 
     appellant and the manager of the bill or resolution, as the 
     case may be. An affirmative vote of a majority of the Members 
     of the Senate, duly chosen and sworn, shall be required in 
     the Senate to sustain an appeal of the ruling of the Chair on 
     a point of order raised under this provision.
       (d) Congressional Budget Office Reports.--Whenever the 
     Director of the Congressional Budget Office prepares a report 
     pursuant to section 308 of the Congressional Budget Act of 
     1974 in connection with a bill, resolution, or conference 
     report that the Director believes would cause children 
     eligible to receive benefits under Medicaid (whether 
     currently or in the future) to lose any of those benefits, 
     the Director shall so state in that report and, to the extent 
     practicable, shall include an estimate of the number of 
     children eligible to receive benefits under Medicaid (whether 
     currently or in the future) who would lose any of those 
     benefits as a result of that legislation.
       (e) Estimates.--Solely for the purposes of enforcement of 
     this section in the Senate, the number of children eligible 
     to receive benefits under Medicaid shall be determined on the 
     basis of estimates made by the Committee on the Budget of the 
     Senate.

  Mr. EXON. Mr. President, a majority vote point of order against this 
legislation will cause children currently receiving health care 
insurance under Medicare to lose their insurance. What this does is 
simply requires a majority vote if such an event would take place.
  Mr. DOMENICI. Mr. President, this amendment is not germane to the 
budget resolution. It establishes another procedure on how the Senate 
should consider future Medicaid reform legislation. Because of that, I 
raise a point of order against the pending amendment.
  Mr. EXON. Mr. President, pursuant to section 904 of the Congressional 
Budget Act of 1974, I move to waive that act for consideration of the 
pending amendment.
  I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.


                 Vote on Motion to Waive the Budget Act

  The PRESIDING OFFICER. The question occurs on agreeing to the motion 
to waive the Congressional Budget Act. The yeas and nays have been 
ordered. The clerk will call the roll.
  The legislative clerk called the roll.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 45, nays 55, as follows:

[[Page S7361]]

                      [Rollcall Vote No. 201 Leg.]

                                YEAS--45

     Akaka
     Baucus
     Biden
     Bingaman
     Boxer
     Bradley
     Breaux
     Bryan
     Bumpers
     Chafee
     Conrad
     Daschle
     Dodd
     Dorgan
     Exon
     Feingold
     Feinstein
     Ford
     Glenn
     Graham
     Harkin
     Heflin
     Hollings
     Inouye
     Johnston
     Kennedy
     Kerrey
     Kerry
     Kohl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Pell
     Pryor
     Reid
     Robb
     Rockefeller
     Sarbanes
     Simon
     Wellstone

                                NAYS--55

     Abraham
     Ashcroft
     Bennett
     Bond
     Brown
     Burns
     Byrd
     Campbell
     Coats
     Cochran
     Cohen
     Coverdell
     Craig
     D'Amato
     DeWine
     Dole
     Domenici
     Faircloth
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hatch
     Hatfield
     Helms
     Hutchison
     Inhofe
     Jeffords
     Kassebaum
     Kempthorne
     Kyl
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Murkowski
     Nickles
     Nunn
     Packwood
     Pressler
     Roth
     Santorum
     Shelby
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner
  The PRESIDING OFFICER. On this question, the yeas are 45, the nays 
are 55. Three-fifths of the Senators duly chosen and sworn having not 
voted in the affirmative, the motion is rejected.
  The point of order is sustained and the amendment falls.


                           Amendment No. 1164

     (Purpose: To express the sense of the Senate that the Federal 
 Government has a financial responsibility to schools in our Nation's 
communities which are adversely affected by Federal activities and that 
 funding for such responsibilities should not be reduced or eliminated)

  Mr. EXON. Mr. President, I send an amendment to the desk and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Nebraska [Mr. Exon] for himself, and Mrs. 
     Murray, Mr. Daschle, Mr. Pressler, Mr. Akaka, Mrs. Hutchison, 
     Mr. Levin, Mr. Bingaman, Mr. Pell, Mr. Dorgan, Mr. Baucus, 
     Mr. Kerrey, and Mrs. Kassebaum proposes an amendment numbered 
     1164.

  The amendment is as follows:

       At the end of title III, insert the following:

     SEC.   . SENSE OF THE SENATE.

       (a) Findings.--The Senate finds as follows:
       (1) In order to fulfill its responsibility to communities 
     that were adversely affected by Federal activities, the 
     Congress established the Impact Aid program in 1950.
       (2) The Impact Aid program is intended to ease the burden 
     on local school districts for educating children who live on 
     Federal property. Since Federal property is exempt from local 
     property taxes, such districts are denied the primary source 
     of revenue used to finance elementary and secondary 
     education. Most Impact Aid payments are made for students 
     whose parents are in the uniformed services, or for students 
     who reside on Indian lands or in federally subsidized low-
     rent housing projects. Over 1,600 local educational agencies 
     enrolling over 17,000,000 children are provided assistance 
     under the Impact Aid program.
       (3) The Impact Aid program is one of the few Federal 
     education programs where funds are sent directly to the 
     school district. Such funds go directly into the general fund 
     and may be used as the local educational agency decides.
       (4) The Impact Aid program covers less than half of what it 
     costs to educate each federally connected student in some 
     school districts, requiring local school districts or States 
     to provide the remainder.
       (5) Added to the burden described in paragraph (4) is the 
     fact that some States do not rely upon an income tax for 
     State funding of education. In these cases, the loss of 
     property tax revenue makes State and local education funding 
     even more difficult to obtain.
       (6) Given the serious budget constraints facing State and 
     local governments it is critical that the Federal Government 
     continue to fulfill its responsibility to the federally 
     impact school districts in our Nation's States.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that in the assumptions for the overall accounts it is 
     assumed that--the Federal Government has a financial 
     responsibility to schools in our Nation's communities which 
     are adversely affected by Federal activities and that funding 
     for such responsibilities should not be reduced or 
     eliminated.

  Mr. EXON. This is sense of the Senate on impact aid, to recognize the 
fact that the Federal Government has a financial obligation to schools 
in our communities adversely affected by some of the proposed 
activities, and that we should not reduce or eliminate funding for 
these responsibilities.
  Mr. DOMENICI. Mr. President, I am prepared to accept the amendment if 
there will be no rollcall vote.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  The amendment (No. 1164) was agreed to.
  Mr. DOMENICI. I move to reconsider the vote by which the amendment 
was agreed to.
  Mr. EXON. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 1165

  (Purpose: To express the sense of the Senate regarding student loan 
                                 cuts)

  Mr. EXON. Mr. President, I send an amendment to the desk and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Nebraska [Mr. Exon] for Mr. Pell proposes 
     an amendment numbered 1165.
       At the end of title III, insert the following:

     SEC.   . STUDENT LOAN CUTS.

       (a) Findings.--The Senate finds that--
       (1) in the 20th century, educational increases in the 
     workforce accounted for 30 percent of the growth in our 
     Nation's wealth, and advances in knowledge accounted for 55 
     percent of such growth;
       (2) the Federal Government provides 75 percent of all 
     college financial aid;
       (3) the Federal student loan program was created to make 
     college accessible and affordable for the middle class;
       (4) increased fees and interest costs discourage college 
     participation by making higher education more expensive, and 
     more of a risk, for students and their families;
       (5) full-time students already work an average of 25 hours 
     per week, taking time away from their studies; and
       (6) student indebtedness is already increasing rapidly, and 
     any reduction of the in-school interest subsidy will increase 
     the indebtedness burden on students and families.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that the assumptions underlying the functional totals in this 
     resolution assume the Labor and Human Resources Committee, in 
     seeking to achieve mandatory savings, should not increase the 
     cost of borrowing for students participating in the Robert T. 
     Stafford Federal Student Loan Program.

  Mr. EXON. The Pell amendment expresses the sense of the Senate that 
the Labor and Human Resources Committee, in seeking to achieve 
mandatory savings, should not increase the cost of borrowing for 
students participating in the Robert T. Stafford Federal Student Loan 
Program.
  Mr. DOMENICI. Mr. President, who is the sponsor of that amendment?
  Mr. EXON. Senator Pell.
  Mr. DOMENICI. Could he change a couple of the words?
  Mr. EXON. I am advised we cannot accept this until we clear it with 
Senator Pell. I apologize to my friend. Can we lay this aside?
  Mr. DOMENICI. Pleased to do it. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. DOLE. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOLE. Mr. President, there will be one more vote tonight, and 
whatever it is, that will be the last vote.
  Then at 7 o'clock we will proceed to debate the rescission conference 
report, but that will not be voted on until tomorrow. The first vote 
tomorrow will be at 9 o'clock, if it is all right with the Democratic 
leader, on the conference report. Then we will start voting on 
amendments from 9 o'clock until some time late in the day, I assume.
  I would hope that some of my colleagues will take another look at 
their amendments and see if they really feel it is important.
  The point I want to make is I made a promise to the President we 
would try to do the counter--antiterrorism bill. I want to try to keep 
that promise. I do not know how we can do it if we spend all day 
tomorrow voting.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, might I say to the distinguished 
majority leader, I believe they are working diligently to try to cut 
back on the amendments. I thank him for urging that. We believe we can 
modify the Pell amendment and accept it.
  Mr. EXON. Would the Senator please state how he would like to have it 
amended? It has been agreed to and Senator Pell has authorized it. He 
is [[Page S7362]] right here. He has authorized me to agree to the 
changes you had suggested, Senator.
  Mr. DOMENICI. That is not the amendment.
  Mr. FORD. It is at the desk.
  Mr. EXON. Mr. President, we will temporarily set aside the Pell 
amendment.


                           Amendment No. 1166

 (Purpose: To repeal the ex-patriots billionaires tax loophole and put 
     the money into veterans programs to assist American patriots)

  Mr. EXON. Mr. President, I send an amendment to the desk and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Nebraska [Mr. Exon], for Mr. Lautenberg 
     for himself, Mr. Rockefeller, Mrs. Murray, Mr. Harkin, Mr. 
     Wellstone, Mr. Reid, Mr. Daschle, and Ms. Mikulski proposes 
     an amendment numbered 1166.

  Mr. EXON. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       On page 3, line 10, increase the amount by $47,000,000.
       On page 3, line 11, increase the amount by $144,000,000.
       On page 3, line 12, increase the amount by $197,000,000.
       On page 3, line 13, increase the amount by $257,000,000.
       On page 3, line 14, increase the amount by $322,000,000.
       On page 3, line 15, increase the amount by $392,000,000.
       On page 3, line 16, increase the amount by $412,000,000.
       On page 3, line 20, increase the amount by $47,000,000.
       On page 3, line 21, increase the amount by $144,000,000.
       On page 3, line 22, increase the amount by $197,000,000.
       On page 3, line 23, increase the amount by $257,000,000.
       On page 3, line 24, increase the amount by $322,000,000.
       On page 3, line 25, increase the amount by $392,000,000.
       On page 4, line 1, increase the amount by $412,000,000.
       On page 4, line 18, increase the amount by $47,000,000.
       On page 4, line 19, increase the amount by $144,000,000.
       On page 4, line 20, increase the amount by $197,000,000.
       On page 4, line 21, increase the amount by $257,000,000.
       On page 4, line 22, increase the amount by $322,000,000.
       On page 4, line 23, increase the amount by $392,000,000.
       On page 4, line 24, increase the amount by $412,000,000.
       On page 5, line 4, increase the amount by $47,000,000.
       On page 5, line 5, increase the amount by $144,000,000.
       On page 5, line 6, increase the amount by $197,000,000.
       On page 5, line 7, increase the amount by $257,000,000.
       On page 5, line 8, increase the amount by $322,000,000.
       On page 5, line 9, increase the amount by $392,000,000.
       On page 5, line 10, increase the amount by $412,000,000.
       On page 5, line 17, increase the amount by $47,000,000.
       On page 5, line 18, increase the amount by $144,000,000.
       On page 5, line 19, increase the amount by $197,000,000.
       On page 5, line 20, increase the amount by $257,000,000.
       On page 5, line 21, increase the amount by $322,000,000.
       On page 5, line 22, increase the amount by $392,000,000.
       On page 5, line 23, increase the amount by $412,000,000.
       On page 6, line 16, increase the amount by $47,000,000.
       On page 6, line 17, increase the amount by $144,000,000.
       On page 6, line 18, increase the amount by $197,000,000.
       On page 6, line 19, increase the amount by $257,000,000.
       On page 6, line 20, increase the amount by $322,000,000.
       On page 6, line 21, increase the amount by $392,000,000.
       On page 6, line 22, increase the amount by $412,000,000.
       On page 43, line 24, increase the amount by $47,000,000.
       On page 43, line 25, increase the amount by $47,000,000.
       On page 44, line 7, increase the amount by $144,000,000.
       On page 44, line 8, increase the amount by $144,000,000.
       On page 44, line 15, increase the amount by $197,000,000.
       On page 44, line 16, increase the amount by $197,000,000.
       On page 44, line 23, increase the amount by $257,000,000.
       On page 44, line 24, increase the amount by $257,000,000.
       On page 45, line 7, increase the amount by $322,000,000.
       On page 45, line 8, increase the amount by $322,000,000.
       On page 45, line 15, increase the amount by $392,000,000.
       On page 45, line 16, increase the amount by $392,000,000.
       On page 45, line 23, increase the amount by $412,000,000.
       On page 45, line 24, increase the amount by $412,000,000.
       On page 64, line 24, decrease the amount by $47,000,000.
       On page 64, line 25, decrease the amount by $967,000,000.
       On page 65, line 2, decrease the amount by $1,771,000,000.

  Mrs. MURRAY. Mr. President, I am a proud cosponsor of the amendment 
offered by my colleagues, Senators Lautenberg and Rockefeller, to 
restore funding to veterans' programs by closing the ex-patriots tax 
loophole.
  This provision, which allows billionaires to renounce their 
citizenship to avoid paying taxes, has been quite popular this year. On 
two occasions, the Senate has resoundingly supported changing this tax 
loophole. Unfortunately, final legislation to close this loophole has 
not yet passed. Today we have an important opportunity to close this 
unfair loophole once and for all and to help those individuals who must 
now face personal battles each and every day because they sacrificed 
for their country.
  The Lautenberg-Rockefeller amendment provides that money saved from 
repealing this tax loophole will be used to restore funds for critical 
veterans' programs. These individuals have been unfairly and 
continually targeted as a means to help balance the budget. During the 
balanced budget amendment debate earlier this year, I supported an 
amendment by Senator Rockefeller that exempted current veterans' 
benefits from cuts. That amendment failed 33 to 62, signaling the 
intent to further cut the benefits of these individuals.
  This budget resolution seeks to cut $15.4 billion in funding for 
veterans' programs through 2002. This will result in denying care to 
almost 1 million veterans, and closing the equivalent of 35 of its 
hospitals. Clearly, this is not an effective or responsible way to care 
for the needs of our Nation's veterans. We should be working on ways to 
improve care for veterans, not diminish it.
  Mr. President, I understand the need to make difficult choices about 
which programs to cut in our push to balance the budget, and that 
certain sacrifices must be made. However, we must not lose sight of the 
promises made to those men and women who fought to help preserve 
democracy in our country and around the world. We cannot revoke the 
very care and benefits that were promised to these individuals when 
they put their lives on the line and served their country.
  As the daughter of a disabled veteran, I understand the toll 
debilitating diseases take on a family. I understand the value of the 
VA health system and the critical research being done to help improve 
patient care. This amendment seeks to right a serious wrong. It will 
help restore funding for veterans programs that provide medical care 
and medical research for the true patriots of this country, and stop an 
egregious abuse of a tax loophole by those individuals who wish to be 
ex-patriots.
  I strongly urge my colleagues to support this amendment and help 
maintain the promises made to the veterans of this country.
  Mr. DASCHLE. Mr. President, this year marks the 50th anniversary of 
the end of the Second World War and the 20th anniversary of the end of 
the Vietnam war. It is a sad irony that at the same time we honor the 
brave men and women who served so valiantly in these two wars, Senate 
Republicans are seeking to cut funding for veterans' programs.
  I support a balanced budget, and I want to work with my Republican 
colleagues to get there. However, we can get to a balanced budget 
without damaging veterans' programs. To do otherwise says that the 
sacrifices of those who were ready to risk their lives can be cheaply 
bought and easily forgotten. It says that solemn promises by Government 
to those who have risked all in the service of Government can be 
casually disregarded. [[Page S7363]] 
  The Republican budget resolution would slice almost $16 billion from 
veterans' programs over the next 7 years. Part of this savings would 
come from freezing VA medical care at the fiscal year 1995 level for 
the next 7 years. This would be a drastic blow to a system that is 
already sorely underfunded. It will affect every VA health care 
facility at the same time resources will be withdrawn from Medicare and 
Medicaid, leading to additional pressures on the VA system.
  The budget resolution also proposes to phase out VA construction by 
1999. According to the Disabled American Veterans, that would lead to 
the cancellation of 215 projects needed to meet current health care 
delivery standards. Clearly, this ill-advised move would jeopardize the 
quality of veterans' care across the country.
  At the same time it cuts funding for needed veterans' programs, this 
budget resolution does nothing to prevent billionaires living abroad 
from renouncing their U.S. citizenship solely to avoid U.S. taxes on 
their fortunes. Although relatively few individuals choose expatriation 
for this purpose, the resulting revenue loss to the U.S. Treasury is 
significant. Specifically, closing this tax loophole would raise $3.6 
billion in the first 5 years from an estimated two dozen individuals.
  The Lautenberg-Rockfeller amendment addresses both of these 
shortcomings in the current budget resolution. Simply, the amendment 
would deny huge tax benefits to ex-patriots and use that savings to 
restore some of the funding being taken from the VA.
  As this important amendment illustrates, we don't have to sacrifice 
the goal of a balanced budget to correct what's wrong with this budget 
resolution. We need only correct the badly unbalanced priorities it 
establishes.
  Mr. EXON. Mr. President, this amendment I am offering on behalf of 
Senator Lautenberg is called the ex-patriots amendment. This amendment 
would close the loophole that allows billionaires and others to avoid 
Federal taxes by renouncing their citizenship, and would apply the 
savings for restoring funding for the veterans programs.


                Amendment No. 1167 to Amendment No. 1166

 (Purpose: To repeal the ``Ex-Patriots'' loophole and use the money to 
            eliminate the Social Security earnings penalty)

  Mr. DOMENICI. Mr. President, I send a second-degree amendment to the 
desk for Senator McCain and ask for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from New Mexico [Mr. Domenici], for Mr. McCain 
     and Mr. Brown, proposes an amendment numbered 1167 to 
     amendment 1166.

  Mr. DOMENICI. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       In lieu of the matter proposed, insert the following:
       On page 3, line 10, increase the amount by $0.
       On page 3, line 11, increase the amount by $0.
       On page 3, line 12, increase the amount by $0.
       On page 3, line 13, increase the amount by $0.
       On page 3, line 14, increase the amount by $0.
       On page 3, line 15, increase the amount by $0.
       On page 3, line 16, increase the amount by $0.
       On page 3, line 20, increase the amount by $0.
       On page 3, line 21, increase the amount by $0.
       On page 3, line 22, increase the amount by $0.
       On page 3, line 23, increase the amount by $0.
       On page 3, line 24, increase the amount by $0.
       On page 3, line 25, increase the amount by $0.
       On page 4, line 1, increase the amount by $0.
       On page 4, line 18, increase the amount by $0.
       On page 4, line 19, increase the amount by $0.
       On page 4, line 20, increase the amount by $0.
       On page 4, line 21, increase the amount by $0.
       On page 4, line 22, increase the amount by $0.
       On page 4, line 23, increase the amount by $0.
       On page 4, line 24, increase the amount by $0.
       On page 5, line 4, increase the amount by $0.
       On page 5, line 5, increase the amount by $0.
       On page 5, line 6, increase the amount by $0.
       On page 5, line 7, increase the amount by $0.
       On page 5, line 8, increase the amount by $0.
       On page 5, line 9, increase the amount by $0.
       On page 5, line 10, increase the amount by $0.
       On page 5, line 17, increase the amount by $0.
       On page 5, line 18, increase the amount by $0.
       On page 5, line 19, increase the amount by $0.
       On page 5, line 20, increase the amount by $0.
       On page 5, line 21, increase the amount by $0.
       On page 5, line 22, increase the amount by $0.
       On page 5, line 23, increase the amount by $0.
       On page 6, line 16, increase the amount by $0.
       On page 6, line 17, increase the amount by $0.
       On page 6, line 18, increase the amount by $0.
       On page 6, line 19, increase the amount by $0.
       On page 6, line 20, increase the amount by $0.
       On page 6, line 21, increase the amount by $0.
       On page 6, line 22, increase the amount by $0.
       On page 43, line 24, increase the amount by $0.
       On page 43, line 25, increase the amount by $0.
       On page 44, line 7, increase the amount by $0.
       On page 44, line 8, increase the amount by $0.
       On page 44, line 15, increase the amount by $0.
       On page 44, line 16, increase the amount by $0.
       On page 44, line 23, increase the amount by $0.
       On page 44, line 24, increase the amount by $0.
       On page 45, line 7, increase the amount by $0.
       On page 45, line 8, increase the amount by $0.
       On page 45, line 15, increase the amount by $0.
       On page 45, line 16, increase the amount by $0.
       On page 45, line 23, increase the amount by $0.
       On page 45, line 24, increase the amount by $0.
       On page 64, line 24, increase the amount by $0.
       On page 64, line 25, increase the amount by $0.
       On page 65, line 2, increase the amount by $0.
     SEC.   . SENSE OF THE SENATE.

       It is the Sense of the Senate that the assumptions 
     underlying the functional totals in this resolution include 
     that the increased revenues resulting from the revision of 
     the expatriate tax loophole should be used to eliminate the 
     earnings penalty imposed on low and middle income senior 
     citizens receiving social security.

  Mr. DOMENICI. This repeals the ex-patriots tax loophole and uses the 
money to eliminate the Social Security earnings penalty.
  Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.


            Vote On Amendment No. 1167 to Amendment No. 1166

  The PRESIDING OFFICER. The question is on agreeing to the amendment. 
The yeas and nays have been ordered.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  The result was announced, yeas 97, nays 3, as follows:
                      [Rollcall Vote No. 202 Leg.]

                                YEAS--97

     Abraham
     Akaka
     Ashcroft
     Baucus
     Bennett
     Biden
     Bingaman
     Bond
     Boxer
     Bradley
     Breaux
     Brown
     Bryan
     Bumpers
     Burns
     Byrd
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Conrad
     Coverdell
     Craig
     D'Amato
     Daschle
     DeWine
     Dodd
     Dole
     Domenici
     Dorgan
     Faircloth
     Feingold
     Feinstein
     Ford
     Frist
     Glenn
     Gorton
     Graham
     Gramm
     Grams
     Grassley
     Gregg
     Harkin
     Hatch
     Hatfield
     Heflin
     Helms
     Hollings
     Hutchison
     Inhofe
     Inouye
     Jeffords
     Johnston
     Kassebaum
     Kempthorne
     Kennedy
     Kerrey
     Kerry
     Kohl
     Kyl
     Lautenberg
     Leahy [[Page S7364]] 
     Levin
     Lieberman
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Moseley-Braun
     Murkowski
     Murray
     Nickles
     Nunn
     Packwood
     Pell
     Pressler
     Pryor
     Reid
     Robb
     Rockefeller
     Roth
     Santorum
     Sarbanes
     Shelby
     Simon
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner
     Wellstone

                                NAYS--3

     Exon
     Mikulski
     Moynihan
  So, the amendment (No. 1167) was agreed to.
  The PRESIDING OFFICER. The question now occurs on amendment No. 1166, 
as amended.
  So the amendment (No. 1166), as amended, was agreed to.


                    Amendment No. 1165, as modified

  Mr. DASCHLE. Mr. President, on behalf of Senator Pell, I send a 
modification of amendment No. 1165 to the desk and ask unanimous 
consent that the amendment be so modified, agreed to, and the motion to 
reconsider be laid on the table.
  Mr. DOLE. We have no objection.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment (No. 1165), as modified, is as follows:

       At the end of title III, insert the following:

     SEC.  . STUDENT LOAN CUTS.

       (a) Findings.--The Senate finds that--
       (1) in the 20th century, educational increases in the 
     workforce accounted for 30 percent of the growth in our 
     Nation's wealth, and advances in knowledge accounted for 55 
     percent of such growth;
       (2) the Federal Government provides 75 percent of all 
     college financial aid;
       (3) the Federal student loan program was created to make 
     college accessible and affordable for the middle class;
       (4) increased fees and interest costs discourage college 
     participation by making higher education more expensive, and 
     more of a risk, for students and their families;
       (5) full-time students already work an average of 25 hours 
     per week, taking time away from their studies; and
       (6) student indebtedness is already increasing rapidly, and 
     any reduction of the in-school interest subsidy will increase 
     the indebtedness burden on students and families.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that the assumptions underlying the functional totals in this 
     resolution assume the Labor and Human Resources Committee, in 
     seeking to achieve mandatory savings, should do their best to 
     not increase the cost of borrowing for students participating 
     in the Robert T. Stafford Federal Student Loan Program.
                           ALTERNATIVE BUDGET

  Mr. ROBB. Mr. President, I rise today as a supporter and original co-
sponsor of the amendment offered by my distinguished friend from North 
Dakota, which presents an alternative budget resolution to the 
committee-passed version before us.
  While both plans theoretically achieve balance by the year 2002, I 
believe our alterative is a better budget in many important ways.
  It is a better budget because it maximizes our future investments in 
our people, restoring partial funding in such critical areas as 
education, infrastructure, and research and development.
  It is a better budget because it eases the unprecedented cuts in our 
Federal health programs contained in the Republican budget, replacing 
$l00 billion in Medicare and $50 billion in Medicaid.
  It is a better budget because it restricts current tax loopholes for 
citizens who make more than $l40,000 a year, bringing greater and 
urgently needed equity to our current tax structure.
  And it is a better budget, Mr. President, because it does not 
designate the so-called economic dividend to an indefensible tax cut 
which may ultimately benefit our wealthiest citizens.
  I participated in efforts to craft this budget resolution, Mr. 
President, because I believe strongly that we Democrats cannot simply 
be against everything on the table. Rather, we have a profound 
obligation to be for something as well.
  While no document crafted by more than one Senator can make any 
Senator completely happy, I am comfortable that this budget brings much 
needed equity to our debate. It gives us a plan where revenues are on 
the table along with spending cuts, where critical investments in our 
people are preserved whenever possible, where our wealthiest do not 
benefit at the expense of our neediest, and, where--very importantly--
our Federal budget is balanced.
  Let me repeat that final point, Mr. President.
  We offer today a budget resolution that commits us to more deficit 
reduction than the Republican alternatives by the year 2002. In fact, 
the budget we propose reaches true balance without using the surplus in 
the Social Security trust fund by the year 2004. In this amendment, we 
call for the elimination of our deficit and we outline the budgets that 
get us there.
  This debate is not about whether or not we should have a balanced 
budget. This debate is how to balance it.
  While I believe the cuts in the Republican budget resolution may be 
unsustainable when committees try to implement them, the plan we offer 
today, Mr. President, is fair and defensible. It is about meeting our 
obligation to our children and our grandchildren in a manner that more 
responsibly protects the strength and security of their future.
  I urge my colleagues to support the very serious alternative 
resolution we bring before the Senate today, Mr. President, and I yield 
the floor.
                           amendment no. 1127

  Mr. BAUCUS. Mr. President, Senator Feingold's amendment would 
prohibit us from applying any savings above and beyond a balanced 
budget to tax cuts. The majority has estimated that those savings would 
be in the range of $170 billion over the next 7 years.
  I believe we should have used the estimated $170 billion in savings 
to reduce cuts imposed by Senate Concurrent Resolution 13 on Medicare, 
education, EITC and farm programs. As I noted in the statement I 
delivered to this body yesterday, those cuts are too severe and will 
hurt the elderly, young people looking to educate themselves, as well 
as the ordinary fellow trying to support grandparents and put his kids 
through college.
  Amendments which would have applied the $170 billion in savings to 
reduce the cuts did not pass.
  Today, we consider Senator Feingold's amendment which bars using the 
$170 billion savings for tax cuts and would instead apply it to create 
a budget surplus.
  Mr. President, I strongly support the need to bring our annual 
deficit to zero. I voted for the balanced budget amendment and would do 
so again.
  Yet, selective, focused tax cuts would be appropriate. Tax cuts that 
will specifically benefit the middle class taxpayers who find their 
expectations of a better future challenged or reduced from day to day 
and who are struggling to support aging parents and who want their 
children to have the benefit of a college education. At this early 
point in time, we should not rule out giving them a break.
  For that reason, Mr. President, I oppose the Feingold amendment.
  Mr. PELL. Mr. President, as the discussion on the budget resolution 
has progressed, it appears that there are fundamental and partisan 
differences on our spending priorities and programs. Some of these 
differences go to the heart of the Democratic and Republican approaches 
to governance, and call into question the Federal Government's role in 
society. Soon we may be dismantling the core components of a decades-
old social compact between the American government and people.
  Our social safety net--Medicare and Medicaid, education, support and 
assistance for our Nation's poor--is the priority one issue of our 
time. It is one of the most important functions of our Government, and 
it encompasses the matters about which the American people care most 
deeply. As critical as they are, however, this budget debate is about 
more than just our domestic spending priorities. The spending cuts in 
the budget plan are so wholesale and comprehensive that they will 
drastically curtail the U.S. ability to conduct diplomacy and advance 
our interests abroad.
  I would like to take a moment, Mr. President, to focus on the impact 
of the proposed spending cuts on foreign affairs--the so-called 150 
account. This budget will slash funding for U.S. foreign affairs 
agencies, personnel and assistance programs; virtually eliminate U.S. 
financial support for the United Nations; and shackle the ability of 
the United States to participate in U.N. peacekeeping missions.
  Even though it has yet to be adopted, the resolution already has had 
a debilitating impact on our foreign policy [[Page S7365]] agencies and 
programs. Last week the Senate Committee on Foreign Relations 
reported--on a straight party-line vote--foreign relations authorizing 
legislation that will cut spending for the Department of State and U.S. 
foreign policy programs by $3.5 billion during the next 4 years. 
Yesterday the Committee began to mark up foreign aid authorizing 
legislation, which if reported will have an equally devastating effect 
on our overseas assistance program.
  Together, these bills will abolish three major foreign affairs 
agencies--ACDA, USIA, and USAID. They will curtail U.S. participation 
in the United Nations Organization and support for U.N. peacekeeping. 
They will slash foreign aid spending and virtually eliminate U.S. 
support for multilateral lending institutions. They will arbitrarily 
prohibit U.S. participation in multilateral environmental organizations 
and adversely affect the implementation of critical environmental 
initiatives. The rush to cut spending is such that the Foreign 
Relations Committee bills will authorize spending at levels far below 
even what the budget resolution currently recommends--perhaps as much 
as $600 million.
  On its surface, I acknowledge that for some, this news will not be 
entirely disappointing. There are those who do not understand the value 
of spending money on foreign affairs
 programs, and most opinion polls place foreign aid near the bottom in 
terms of public support. At the same time, Americans want the United 
States to remain a prominent world power in the post-cold war era. The 
people understand this, and the times demand it. Our economic future 
lies in a global trading system; if we want to protect our national 
interests we must be active players in the international system.

  The problem, however, is that the scope and scale of the budget and 
spending proposals will force the United States to retreat into 
isolation. All of these initiatives are negative in tone; they dictate 
or suggest that we should not engage in certain activities. They do not 
offer affirmative policy prescriptions. In the post-cold war era, 
Republicans and Democrats should be working together to fashion a 
bipartisan strategy for U.S. foreign policy in the 21 century. Instead, 
we are wasting our time debating neo-isolationist proposals which, if 
adopted, will result in the United States becoming a feeble, second-
rate power. We will be unable to exert influence or work cooperatively 
with the international community to resolve conflicts, advance our 
interest, or promote democratic and free market principles.
  As written, the budget resolution would set us squarely down the road 
toward retrenchment and withdrawal. If we choose to go this route, we 
will do grave disservice to the next generation of Americans. At the 
end of World War II, we chose not to yield to the temptation of 
isolationism, and our country prospered as it never had before. I think 
we should have learned our lesson by now.
  Mr. PRESSLER. Mr. President, overall, I am supportive of this budget 
resolution. I believe it provides a sensible roadmap toward balancing 
the Federal budget over the next 7 years and I commend my colleagues on 
the Budget Committee for their efforts.
  However, there is one area of the budget resolution with which I 
disagree: the proposal to sell the Power Marketing Administrations. 
This sale would have a devastating effect on South Dakota's rural 
communities and small cities--and on people across the country.
  That is why I rise today to join my colleague from Montana in 
offering a sense-of-the-Senate to strike the Budget Committee's 
recommendation to sell the Western Area, Southwestern, and Southeastern 
Power Marketing Administrations--collectively known as the PMA's.
  Public power serves many functions in South Dakota. As a sparsely 
populated State, utilities are faced with the challenge of how to get 
affordable electricity into small cities and rural communities where 
there are less than two people per mile of transmission line. Public 
power provides the solution.
  In public power utilities, the only investors are the consumers. 
Revenues are reinvested in the community--in the form of taxes and 
services. And, the low cost of power is essential to encourage economic 
development in small cities and towns.
  Public power, purchased through the Western Area Power 
Administration, known as WAPA, costs South Dakotans an average
 of 2.5 cents less than the market rate. This allows revenue to be 
reinvested in additional transmission lines, and better service. The 
availability of hydropower from the Missouri River to rural 
cooperatives and municipals has helped to stabilize rates. With 7,758 
miles of transmission lines in the Pick-Sloan region, WAPA can serve 
133,100 South Dakotans--without charging them an arm and a leg.

  Public power has brought more than electricity to South Dakota. For 
example, Missouri Basin Municipal Power Agency, based in Sioux Falls, 
has embarked on a program offering incentives for planting trees. The 
goal is to plant at least one tree for each 112,500 meters in the 
agency's membership territory. In fact, Missouri Basin was recognized 
by the Department of Energy for outstanding participation in this 
Global Climate Change Program. I congratulate Tom Heller of Missouri 
Basin for this excellent community service program.
  Public power also brings new jobs to the communities it serves. In 
part due to the low cost of power from East River Electric, there are 
now three injection molding plants based in Madison, SD--creating 
snowmobile parts. Arctic Cat, PPD, and Falcon Plastics employ 
approximately 200 people in Madison.
  East River also is involved in other economic development activities. 
It provides classes to help the community attract businesses, and 
offers grants for feasibility studies associated with economic 
development projects. South Dakota clearly has benefitted from the work 
of Jeff Nelson, as the general manager of the East River Electric Power 
Cooperative.
  Public power is a South Dakota success story. It is the source of 
innovation, development, and community pride. I am sure the same is 
true in other small cities and rural communities across America. That 
is why I disagree with the Budget Committee's recommendation to sell 
WAPA and two other power marketing administrations. This is simply 
economic smoke and mirrors used to cover up a backdoor tax on rural and 
small city Americans.
  In essence, this would force South Dakotans--and public power 
consumers everywhere--to cover for the rest of America. Why? Because 
the sale of the PMA's could result in rate increases totaling more than 
$47 million.
  In addition, many of my colleagues claim that the sale of the PMA's 
would generate revenue for the Federal Government. Will it? Let us look 
at the facts.
  PMA's still owe almost $15 billion in principal. Also, more than $9 
billion in interest already has been paid to the Federal Government. By 
selling the PMA's, the Government would forfeit future interest 
payments.
  In fact, a recent report prepared by the Congressional Research 
Service demonstrates just how much money the PMA's are expected to 
contribute to the Federal Government. This year, WAPA is expected to 
pay back $225.1 million borrowed from the Federal Government. But WAPA 
will also return another $153.4 million to the Treasury. Given these 
figures, it is clear that this plan does not make good economic sense.
  As my colleagues know, this is not a new issue. I have been fighting 
the proposed sale of the PMA's ever since I came to Congress. In 1986, 
the Reagan administration made similar attempts to privatize the PMA's. 
I worked with many of you to pass a law to prevent the Department of 
Energy form pursuing any future plans to sell the PMA's, unless 
specifically authorized by Congress. As the debate over the sale of the 
PMA's rises again, it seems this law has been forgotten.
  Mr. President, once again, we are fighting to prove the worth of 
public power. Once again, we must demonstrate how necessary it is to 
the lives of rural and small city Americans. The people of South Dakota 
have stated their message loudly and clearly--through thousands of 
postcards, letters, and phone calls. South Dakotans such as Ron 
Holstein. Bob Martin, and Jeff Nelson have been leaders in their 
opposition to the proposed AMA sale and I appreciate their hard work.

[[Page S7366]]

  Public power is a solid investment for the Nation. Public power is 
one of the great success stogie of South Dakota. I urge all my 
colleagues to stand united behind this amendment to allow the continued 
existence of the public power, and the essential service it provides to 
the Americans who reside in small cities and rural communities. Now is 
not the time to mess with success.
  Mr. HATCH. Mr. President, I wanted to take a few moments to comment 
on the effect of the pending budget resolution on the Medicare Program.
  I believe history will indicate there is no one in this body who has 
risen to give a more vigorous defense against unwise Medicare 
reductions than I.
  Medicare is an important program. It provides needed, valuable, and 
indeed vital, services for millions of elderly and disabled Americans. 
Thirty-seven and one-half million to be exact.
  Our job is to ensure that beneficiaries have the services they need, 
that the services are of the highest quality possible, and that they 
are cost-efficient. We need to ensure that services are available in 
rural as well as urban areas. We need to make sure that we have a 
system which provides incentives for providers to deliver this high-
quality, cost-efficient care.
  In sum, on this, the 30th anniversary of Medicare's inception, we 
must do everything we can to preserve the program, not tear it apart.
  What is largely ignored, however, is the fact that absent any 
congressional action, Medicare will go bankrupt by 2002. In fact, it 
will run into the red by next year.
  My question is that: Is it the budget that threatens Medicare--or the 
very design of the program?
  The answer is clearly the latter, as most experts will concur.
  Let us look at the facts.
  First, Medicare is going bankrupt. The 1995 Annual Report of the 
Board of Trustees of the Federal Hospital Insurance Trust Fund, issued 
on April 3, indicate that the present financing schedule for the HI--
Hospital Insurance, or part A--program is sufficient to ensure the 
payment of benefits only over the next 7 years. The situation for 
physician payments under part B of Medicare, is only slightly more 
optimistic.
  Second, we cannot sustain the current growth rate of Medicare. Over 
the next 7 years, the period of this budget resolution, Medicare 
hospital benefits are projected to grow more than twice the rate of 
revenues.
  Mr. President, at this time, it takes about four covered workers to 
support the benefit payments to each enrollee on Medicare A. That ratio 
is declining quickly, so that the trustees have estimated by the middle 
of the next century, only two covered workers will support each 
enrollee. In fact, absent any legislative changes, that scenario won't 
come to pass, because Medicare will have been bankrupt long before 
then.
  According to the most recent estimates of Medicare spending--the 
March baseline issued by the Congressional Budget Office--in 1995, 
Medicare is expected to spend $181.2 billion--$113.6 billion in outlays 
for hospital costs, and $67.6 billion for physician and related costs.
  Ten years from now, however, total hospital outlays are expected to 
grow to $247 billion, and physician costs to $215.8 billion.
  These numbers are troublesome for two reasons. First of all, they 
show a level of spending which cannot be sustained. They indicate that 
spending for the Medicare Program is expected to increase over the next 
decade to almost half a trillion dollars, to $463.2 billion to be 
exact--more than double current levels.
  And second, they show the dramatic rise in spending for part B. This 
year, part B costs are roughly half of the amount for part A. In 10 
years, they are almost equal.
  Third, projected shortfalls in Medicare are astronomical. The 
Congressional Budget Office has estimated that it will take $345 
billion in additional revenues just to keep Medicare solvent over the 
next decade. This is $345 billion extra.
  The budget resolution assumes a $265-billion reduction in the rate of 
increase over the next 7 years, thus keeping the program solvent for 
that time period.
  Fourth, the budget resolution does not cut Medicare, it cuts its rate 
of growth. Under this budget resolution, Medicare spending will still 
exceed $1.65 trillion over the next 7 years. Medicare spending is 
projected to grow by 94 percent between fiscal years 1995 and 2002 
under this budget. Put another way, on average Medicare spending is 
projected to grow at nearly 10 percent annually, while private health 
spending will average less than 7 percent. Under the budget resolution, 
Medicare spending will still grow on average 7.1 percent per year.
  Fifth, to do nothing would be fiscally and morally irresponsible. As 
I have said, absent congressional action, Medicare will go bankrupt, 
pure and simple. But there is another compelling fact to consider. 
Total Medicare expenditures this fiscal year will account for 11.5 
percent of the entire Federal budget. Clearly this growth rate is 
unsustainable; it threatens both current and future beneficiaries.
  Sixth, there are no easy answers. I wish there were a simple answer 
to the Medicare conundrum.
  Two weeks ago, Stuart M. Butler, vice president and director of 
domestic policy studies for the Heritage Foundation, wrote a very 
compelling article entitled, ``The High Cost of Not Reforming 
Medicare.''
  Mr. Butler clearly and concisely outlined the choices available to 
the Congress. He wrote:

       There are only two choices available to the Congress:
       Choice #1: Do not change the way in which Medicare is run 
     by the government, and pay for future benefits by raising new 
     revenues through higher payroll and other taxes or by 
     diverting money from other programs. This means Medicare 
     survives only by draining money away from the rest of the 
     budget or by raising taxes.
       Choice #2: Change the way Medicare is run so that benefits 
     are delivered more efficiently, avoiding future tax increases 
     or a diversion of money from other programs. Making the 
     program more efficient would improve the quality of benefits 
     and the choices available to retirees while reducing the 
     double-digit rate of outlay increases. This
      would slow the depletion of the trust fund and stabilize the 
     program.

  As an illustration of the impact of choice No. 1, Mr. Butler noted 
that the Medicare Hospital Insurance Trust Fund could be put on a 
sound, permanent actuarial footing right now--by raising payroll taxes 
3.52 percent on top of the current 2.9-percent rate. The impact, 
however, would be enormous. A worker earning $45,000 would pay an 
additional $1,584 a year, obviously an unwise step which would not be 
acceptable to the Congress.
  Clearly, the better course of action is to improve the Medicare 
program, making it more efficient and cost conscious. This will not be 
an easy task. Indeed, it will be extremely difficult, perhaps the most 
difficult task that has faced the Congress in decades. But it must be 
done.
  In closing, Mr. President, I wish to make one final point.
  I do not wish to give the impression that I am diminishing the 
enormity of the task before us.
  I am extremely concerned about Medicare reductions of this magnitude.
  I could not vote for this budget if I thought that we were taking an 
action that would lead to the demise of Medicare. Medicare is a promise 
we made to our Nation's elderly and future elderly.
  On the contrary, after considerable study of this issue, I can come 
to no other conclusion than that taking no action will lead to the 
demise of Medicare.
  I believe it would be both fiscally and morally
   irresponsible to stand aside and propose no changes in Medicare, 
knowing all the while that a staunch adherence to the status quo would 
lead to bankruptcy of the program.

  Let me hasten to add that I will be monitoring this situation very, 
very carefully.
  Under the budget resolution, the Committee on Finance will now begin 
work to outline specific Medicare changes to meet the instructions 
contained in this bill.
  As a member of the Finance Committee, I intend to participate fully 
in those deliberations, to make certain that the changes we craft are 
as equitable and responsible as possible.
  It is not my intent that the changes we undertake drive providers out 
of business, force hospital net operating margins into the red, or 
deprive beneficiaries of needed services, although some changes will 
certainly have to be [[Page S7367]] made to save Medicare. We must face 
this situation realistically.
  If we find that these proposed changes have an adverse effect that 
affects patient health, whether in Utah or anywhere else in the Nation, 
I pledge to work closely with my colleagues to rectify the situation.
  Mr. President, I do not mean to downplay the gravity of the 
situation. Reductions of this magnitude, even though they are 
reductions in the rate of growth, are difficult for me--and I would 
venture to say for every Senator--to support. Such reductions will 
indeed have an impact.
  But, in the Senate, as in life, there are times when we have to do 
the right thing, even if it is also the hard thing. Members of the 
Senate and House simply must see beyond their next elections. We must 
force ourselves to look at the long term.
  The alternative--bankruptcy of the Medicare system--is unthinkable 
and must be avoided. If we fail in this task, the health care safety 
net that Medicare provides for millions of current seniors--not to 
mention those who are approaching senior status--will be lost.
  I appreciate that the Budget Committee's recommendations were adopted 
with considerable angst. I commend Senator Domenici and members of the 
committee for doing the right thing. We must all focus on solutions to 
this urgent national fiscal dilemma.
                 protecting america's influence abroad

  Mr. LEAHY. Mr. President, this budget resolution calls for 
elimination of the budget deficit. I support that goal, but there are 
many different ways to achieve it. I do not support the formula 
proposed by the Republicans. It will hurt the poorest people, and 
reward the wealthiest. There is no better example of the fundamental 
differences between Republicans and Democrats.
  Right now, I would like to focus on what the other side's proposed 
budget would do to Function 150, the part of the budget that finances 
programs to advance U.S. foreign policy.
  Function 150 is not a large item in the Federal budget. It amounts to 
only a little more than 1 percent of total Federal expenditures. It is 
only 8 percent of our budget for national defense.
  But it is vitally important to every man, woman, and child in this 
country. The United States is the world's only remaining superpower. We 
have an historic opportunity to influence global events, and to make 
sure that political and economic developments around the world are 
consistent with American interests.
  The momentum is already in the right direction. American investments 
over the past 40 years have paid off. Not only has the direct threat of 
Communist aggression disappeared. The end of confrontation between the 
two superpowers has also caused the world to refocus attention on the 
evils of dictatorship and abuse of human rights that persist in many 
places. And the collapse of centrally planned economic systems has 
discredited state ownership of the economy all around the world. For 
the first time in history, the trend is almost single-mindedly toward 
adopting the values that Americans hold dear--democracy, human rights, 
private property, open markets, competition.
  But it is much too early yet to relax our vigilance. The world 
remains an unpredictable, violent and unstable place. The United States 
still has a vital interest in leading the way towards peace and 
democracy and prosperity and away from conflict and instability.
  The military threat to America has receded, but it is more true today 
than ever that American prosperity is linked to conditions in the rest 
of the world. Millions of Americans jobs depend upon persuading other 
countries to open their borders to U.S. exports and helping them to 
raise their incomes so they can afford to buy those exports. Providing 
Americans clean air and clean water depends upon international action 
to protect the environment. Keeping Americans healthy depends on 
cooperative action to fight
 disease in other countries. Stemming the flow of illegal immigrants 
and refugees to the United States depends on advancing democracy and 
economic development in the countries from which the refugees are 
fleeing.

  For all that people complain about the U.S. Government wasting money 
overseas, Americans overwhelmingly reject isolationism. They want the 
President of the United States to continue to project American power 
and influence abroad.
  Maintaining a strong military provides underpinning for that exercise 
of leadership. But who wants us to have to risk shedding American 
blood? We need the President to conduct an aggressive, preventive 
foreign policy that will secure America's interests peacefully. This is 
where Function 150 is absolutely critical.
  It is Function 150 that provides the funding for the President to 
lead:
  It pays for the State Department and U.S. Embassies around the globe 
that maintain communication with foreign governments and pursue 
cooperation with them. It funds the diplomacy that just a few weeks ago 
secured the indefinite extension of the Nuclear Non-Proliferation 
Treaty, with the enormous promise it offers for reducing the threat of 
nuclear explosions.
  It funds U.S. contributions to the various international 
organizations that are the glue that holds our international economic 
system together:
  The United Nations which notwithstanding its weaknesses--weaknesses 
that stem primarily from the differences of its members--plays a 
critical role in focusing international attention on world problems and 
helping resolve them;
  The International Monetary Fund which brings governments together to 
protect the stability of the international monetary system; and
  The World Bank and regional development banks that mobilize capital 
to help the poorer countries develop economic policies that will 
produce equitable, sustainable economic growth.
  It funds America's bilateral assistance programs. These include 
programs for helping Rwandans fleeing from genocide; programs for 
containing the spread of AIDS and other deadly, infectious diseases; 
programs for assisting Russia to install democratic systems and 
privatize state-owned enterprises; programs for advancing the Middle 
East peace process.
  It funds the efforts of the Export Import Bank of the United States 
and other agencies to promote U.S. exports.
  The budget resolution envisions a $2.4 billion reduction in Function 
150 spending in the 1996 fiscal year, with additional reductions in 
subsequent years. This may not seem like much in a $1.5 trillion 
budget, but it amounts to over 12 percent of the current Function 150 
budget. Subtracting out accounts that cannot be reduced, it means cuts 
of over 30 percent in many of the remaining accounts. This is not 
streamlining, this is decapitation.
  Mr. President, quite simply, the cuts in Function 150 that the budget 
resolution contemplates would undermine the President's ability to 
protect American interests abroad by non-military means. Let me cite 
just a few examples:
  We would abandon efforts to promote political and economic reform in 
Russia and the other former centrally planned economies. Given the 
opportunity to help turn our worst enemy into a friend, the Republicans 
want us to shrug and turn our backs. I am not thrilled with everything 
Russia is doing. The destruction of Chechnya embodies the worst of old-
style Soviet heavy-handed repression. But there have been many 
astonishingly positive developments in Russia, Ukraine, and the other 
central and eastern European countries over the past couple of years 
too. Enhanced freedom of the press. Privatization of enterprise. 
Elections. Our aid is aimed at advancing reform. What folly for us not 
to seek to nurture what is good in the new Europe.
  We would virtually terminate efforts through the World Bank to 
promote economic reform and growth in the poorest countries of sub-
Saharan Africa and Asia. This is no trivial matter. If these countries, 
with their hundreds of millions of people, start to grow, they will 
offer vast new markets for employment-generating U.S. exports. If, on 
the other hand, they descend into fratricidal war and economic decay, 
they will produce ever-more-overwhelming flows of refugees and disease. 
Representing not just the United States but the entire world community, 
the World Bank and the other multilateral development banks are the 
most promising instrument for bringing change to these desperate 
countries. In the past few years, they have finally begun to record 
success in [[Page S7368]] producing broad-based growth in some of these 
countries. For less than $2 billion per year, the United States has the 
prospect of promoting the development of economies accounting for a 
third or more of the world's population. This is a sound investment. 
The Republican budget resolution would cancel that investment.
  We would slash spending on bilateral development assistance. This is 
assistance that is keyed directly to U.S. interests. We promote 
democracy and sustainable development in countries that are major 
sources of refugees and migrants. The Agency for
 International Development has taken decisive steps during the Clinton 
administration to bring its activities fully into sync with U.S. 
foreign policy priorities. It is grossly inaccurate to call its 
programs tax-dollar throw-aways, as some have said.

  Programs of special interest to many Senators, like aid to Eastern 
Europe and the Baltics, Cyprus and Ireland, and military aid to Greece 
and Turkey, would be eliminated. The Ex-Im Bank, Peace Corps, PL-480 
food aid, and educational exchanges would all be slashed.
  Of course, the United States cannot do any of this by itself. But no 
one is asking us to. The United States has already fallen to 21st among 
foreign aid donors in the percentage of national income that it devotes 
to development assistance. We aren't even the largest donor in terms of 
dollar amount anymore. Japan has now left us in the dust. The budget 
resolution would force us to withdraw from broad areas of development 
assistance entirely.
  When I became chairman of the Foreign Operation Subcommittee in 
fiscal year 1990, the Foreign Operations budget, which makes up two-
thirds of the Function 150 account, was $14.6 billion. During my 6 
years as chairman, we cut that budget by 6.5 percent--not even taking 
into account inflation--while the remainder of the discretionary 
spending in the Federal budget increased by 4.8 percent. Most of those 
cuts were in military aid. They were a calculated response to the end 
of the cold war. But that job is now pretty well done. Foreign aid 
today is substantially less than it was during the Reagan and Bush 
administrations.
  Mr. President, we must recognize that there is a limit to how far we 
can cut our budget for international affairs. Our allies are scratching 
their heads, wondering why the United States, with the opportunity to 
exercise influence in the world more cheaply than ever before, is 
turning its back and walking away. We are inviting whoever else wants 
to--friend or foe--to step into the vacuum and pursue their interests 
at our expense.
  Mr. ROTH. Mr. President, this is an historic moment--today we are 
closer than ever before to putting America's economic house in order. 
The last time Congress balanced the budget was 1969--more than a 
quarter-century ago. Since that time, and despite the will of the 
American people, Congress has been overdrawing the public checkbook 
year after year after year.
  Today the opportunity has come to put an end to out of control 
Federal spending--spending that has taken money from the private 
sector, the very sector that creates jobs and economic opportunity for 
all Americans, spending that gambles away our children's future--
spending that costs us jobs in the workplace and economic security in 
the home.
  For too long, Congress has faced the deficit dilemma like an errant 
alcoholic or perpetual dieter, with the words: We'll start tomorrow. 
Well, Mr. President, this is tomorrow, and the budget that Senator 
Domenici and others have crafted is the cure. It is the only cure.
  The President's budget proposals for next year offer clear evidence 
of the lack of political will to make the hard choices when it comes to 
cutting government spending. At first, his decision was not to fight 
for further deficit reduction this year. Now, because he sees what the 
House and Senate have done, he's revisited the issue, offering another 
watered-down proposal. It's kind of like the little boy who--wanting to 
bend the rules to benefit himself--holds his breath until he turns 
blue, then, realizing he can hold it no longer, tries to save face by 
renegotiating the rules of the game.
  This is no time for politics. The American people are crying out for 
a smaller, more efficient government. They are concerned about the 
trends that for too long have put the interests of big government 
before the interests of our families and job-creating private sector. 
They are irritated by the double standard that exists between how our 
families are required to balance their checkbooks and how government is 
allowed to continue spending despite its deficit accounts.
  It is clear, Mr. President. The time has come to heed the will of the 
people. It is our duty, not only to heed their will, but to act in 
their best interest. And that is what this budget is all about. It 
makes the hard choices, eliminating some 140 programs. It consolidates 
duplication and makes Federal programs run more efficiently, more 
effectively, placing many of the existing programs back in the States 
where they belong. The Republican budget also allows for a $175 billion 
reserve fund to finance tax cuts when the budget reaches balance.
  The budget holds Congress and the White House up as leaders--as 
examples in the effort to reduce government spending. Both the 
legislative and executive are required to reduce spending by 25 
percent. This budget protects Social Security and Medicare--vital 
programs to the well-being of millions of Americans, but programs that 
would be bankrupt within a few years without the provisions offered in 
this budget. And, Mr. President, this budget does not cut those 
programs; spending continues to increase. What this budget does is slow 
down the rate of increased spending to a level that will allow the 
programs to survive! It is that simple, and do not let anyone tell you 
otherwise.
  Social Security spending will increase from $334 billion to $482 
billion over the next 7 years. Medicare spending will increase at an 
average of 7.1 percent annually, rising from $178 billion this year to 
$283 billion by fiscal year 2002. This budget is the only workable 
answer on the table. President Clinton himself has warned about how 
these programs are going to be insolvent in the near future. Yet, he 
has offered no viable alternative.
  His most recent effort to counter the House and Senate budgets plan 
is little more than political twaddle. The Washington Post itself noted 
that this counter budget which we have yet to see is ironic in that 
just 3 months ago the President ``sent Congress a budget that increases 
the federal deficit.'' Mr. President, this is not a game. We are 
talking about real life, real jobs, real families and communities and 
the future of our children. Balancing the budget for our Nation is one 
of the most important steps we can take to ensure the economic 
opportunities for prosperity for our children and for our children's 
children.
  As a nation--and as individuals--we are morally bound to pass 
opportunity and security to the next generation. This is what the 
budget we are proposing today will help us do. As Thomas Paine has 
written, no government or group of people has the right to shackle 
succeeding generations with its obligations. Without this budget, 
children born today will have a tax burden of up to 84 percent of their 
lifetime earnings; without this budget, each child who owes $18,500 in 
his share of the national debt will find that obligation increasing to 
$23,000 in just 5 years. Without this budget, there will be no real and 
meaningful reduction in the size and overbearing power of the Federal 
Government.
  As chairman of the Senate Governmental Affairs Committee I have 
outlined a plan to reduce the Federal bureaucracy, eliminate outdated 
and wasteful government programs, and to strengthen government's 
ability to better serve the taxpayers.
  In January I kicked off a series of hearings on ``Government Reform: 
Building a Structure for the 21st Century.'' It is my belief that as we 
move into the 21st century, so should our Government. Innovative 
technologies should allow us to cut out many layers of management 
bureaucracy, and reduce Federal employment. Programmatic changes should 
also occur.
  Last month I released a report that asked the GAO to examine the 
current structure of the Federal Government. The GAO examined all 
budget and government functions and missions. They did not conduct in-
depth analysis, but [[Page S7369]] simply illustrated the complex web 
and conflicting missions under which agencies are currently operating.
  The GAO report confirms that our Federal behemoth must be reformed to 
meet the needs of all taxpayers for the 21st century. I am convinced 
that it is through a smaller, smarter government we will be able to 
serve Americans into the next century.
  Deficit spending cannot continue. We can no longer allow waste, 
inefficiency, and overbearing government to consume the potential of 
America's future. I am committed to spending restraint as we move to 
balance the budget by the year 2002. And I ask my colleagues--and all 
Americans--to support our efforts.
  Mr. COATS. Mr. President, I believe that the Senate's debate on the 
balanced budget amendment was a turning point in this session of 
Congress--perhaps a turning point in the economic affairs of our 
country. It was important, not for its disappointing final vote, but 
for the issues it clarified.
  During that debate, opponents of the balanced budget again and again 
challenged those of us supporting it. If you really want a balanced 
budget, propose one. One Member of this body put it like this: ``Let 
Senators get to work to show Americans we have the courage this 
amendment presumes that we lack.''
  This seemed like a good argument to many people--an argument against 
easy hypocrisy on the budget. Opponents of the balanced budget 
amendment pressed it as hard and as far as they could.
  They threw down a gauntlet before a watching Nation. This week, 
Republicans have picked it up. And those who made that challenge have 
fled from the field--proposing nothing constructive of their own. They 
revealed that their point in the balanced budget debate was not a 
conviction, but an alibi.
  For the first time since the 1960's, thanks to this Republican 7-year 
budget--offered both in the House and Senate, we can see our way clear 
to a balanced budget. After 40 years of wandering in the desert of 
deficit spending, we are finally destined for the promised land of 
balanced budgets.
  There is courage in this budget--courage we have not seen for 
decades, courage that makes this an historic moment. But, if we are 
honest, it is courage without alternatives. The status quo may be 
comfortable, but it is not sustainable. The road we are on may seem 
wide and easy, but it ends with a cliff, and the fall will be 
disastrous for our economy, disastrous for our people (including our 
seniors). Disastrous for our children, and for this Nation's future.
  The figures are familiar, but they have lost none of their power to 
shock. Our national debt currently stands at $4.8 trillion, which 
translates into $19,000 for every man, woman, and child in America. 
This figure will jump to $23,000 by 2002. If we ignore our budget 
crisis, a child born this year will pay $187,150 over their lifetime 
just in interest on the national debt.
  The argument for immediate change--immediate restraint--is simple. It 
is one of our highest moral traditions for parents to sacrifice for the 
sake of their children. It is the depth of selfishness to call on 
children to sacrifice for the sake of their parents. If we continue on 
our current path, we will violate a trust between generations, and earn 
the contempt of the future.
  There is no doubt that we need cuts in government to balance the 
budget. But there is one more reason as well. We need cuts in 
government because government itself is too large--too large in our 
economy, and too large in our lives. Even if the books were balanced, 
we would still need a sober reassessment of the Federal Government's 
role and reach.
  This is not a matter of money alone. We require cuts in government 
because endless, useless, duplicative programs should not be (to use a 
favorite term of the administration) ``Reinvented''--they should be 
terminated. Because we reject the vision of a passive Nation, where an 
arrogant government sets the rules. Because we want to return, not only 
to an affordable government, but to a limited government. And those 
limits will help unleash the unlimited potential of our economy and our 
people.
  Votes we make during this debate are likely to be some of the 
toughest we ever cast. But if we are honest, most of those votes would 
not be tough calls for most Americans. I have yet to meet a man or 
woman from my State who believes that reducing the rate of growth in 
government is anything but a minimal commitment to common sense.
  The changes made by this budget are bold, but not radical. They are 
ambitious, but not dangerous. This is a careful plan to meet a specific 
need.
  Under the Senate resolution, Government spending will rise from its 
current level of $1.355 trillion to $1.884 trillion in 2002. This is an 
increase of nearly 40 percent. To put this in perspective, a family 
currently making $45,000--if its income grew at the rate Government 
will grow under the Republican plan--would be making $63,000 in 2002. 
Surely a family could construct a budget to meet this higher level of 
spending. The Federal Government will be required, under the Republican 
plan, to do the same.
  There are honest disagreements about the merits and priorities of 
many of these reductions. I expect we will have a hard-fought debate.
  On Medicare, it was the President's own commission which concluded: 
``The Medicare Program is clearly unsustainable in its present form, we 
strongly recommend that the crisis presented by the financial condition 
of the Medicare trust funds be urgently addressed on a comprehensive 
basis.'' Reforming Medicare and slowing its growth is precisely what 
the administration itself proposed. ``We feel confident,'' said Hillary 
Clinton, ``that we can reduce the rate of increase in Medicare without 
undermining quality for Medicare recipients.'' Ira Magaziner added, 
``slowing the rate of growth actually benefits beneficiaries 
considerably because it slows the rate of growth of the premiums they 
have to pay.''
  Under this budget, Medicare will remain the fastest growing item in 
the Federal budget, increasing at an annual rate of 7.1 percent. 
Spending on Medicare alone will grow from $178 billion this year to 
$283 billion in 2002--an increase of 59 percent.
  As promised, Social Security will remain untouched. Spending will 
actually increase from the current annual total of $334 billion to $480 
billion in 2002. One of our central goals has been to protect the 
integrity of the Social Security system. Social Security benefits will 
be preserved.
  I firmly support this budget--but I have two concerns, which will 
eventually come to the center of our debate.
  Our Government has a budget deficit which cannot be sustained. But 
there is another deficit that concerns Americans as well--a deficit in 
the resources of families to care for their own. A deficit we have 
created by increased taxation over the years, an erosion in the 
personal exemption. Many families are in a permanent recession, 
directly caused by Government policies.
  We must understand, first, that a balanced budget and family-
oriented, growth-oriented tax relief are not mutually exclusive 
proposals. They are part of the same movement in America--a movement to 
limit our Government and empower our people. One idea implies and 
requires the other--when we reduce public spending, we should increase 
the resources of families to meet their own needs. That is a good 
investment, a sound investment. A dollar spent by families is far more 
useful than a dollar spent by Government.
  America can have a balanced budget and tax relief for families. No 
choice is necessary between them. One proposal in particular makes this 
clear. An amendment that will be offered by Senator Gramm slows the 
growth of spending to 3 percent rather than the 3.3 percent currently 
outlined in the resolution--allowing additional funds for tax cuts. 
Giving the American people back just 1.5 percent of total budget 
spending is not too much to ask.
  Senator Gramm's amendment embodies the provisions of the families 
first legislation that I introduced earlier this year with Senator Rod 
Grams. It proves that deficit reduction and tax relief can go hand-in-
hand. We have met the challenge of those who said it could not be done. 
Adding this provision to the budget resolution will prove to families 
all across the Nation that their concerns are a central element of 
budget reform.
  It is time to admit that when families fail, so does our society. 
Their financial crisis is as urgent and as important as any other 
priority in this 

[[Page S7370]]

debate. The Gramm amendment is a way for the Senate to prove it.
  Much of the opposition to tax relief seems to be based on a myth--a 
myth that tax cuts somehow cost the Government money. But Government 
produces nothing, and has no resources of its own to spend. Tax cuts 
are not a waste of Government funds. They are simply a method to allow 
Americans to keep their own money and care for themselves. They are a 
method to build working independence as an alternative to destructive 
government paternalism.
  My second concern relates to our level of defense spending. The 
Clinton budget is clearly inadequate to retain our long-term readiness 
and the quality of life of our troops. On this issue we are talking 
about the primary purpose of government--to defend our national 
interests without placing our soldiers at needless risk. We have seen 
disturbing evidence in the Armed Services Committee that the Clinton 
level of funding will leave our forces without all the tools, training 
and conditions to fulfill the roles we will ask of them.
  Many of us are struggling to recoup at least some of this shortfall. 
Senator Thurmond will be proposing an amendment to restore a portion of 
this funding. I hope the Senate will support it.
  Mr. President, we have come to the beginning of the end of deficit 
spending in America. We have come to this place because there is no 
alternative. Two decades of promises, two decades of rhetoric, budget 
proposals, budget deals, tax increases, unfulfilled promises on 
spending cuts, all these have failed. This is the best argument for a 
balanced budget amendment--defeated, for the moment, by just one vote. 
So we turn to this effort--the only effort--the only game in town.
  The President has abdicated his leadership on this most critical of 
all issues facing our Nation. Likewise, Democrats have offered no 
alternative of their own.
  So we have come to a time that is unique and historic--an authentic 
moment of decision. It is a moment to act worthy of our words and keep 
faith with the future.
               community development block grant program

  Mr. SARBANES. Mr. President, I rise in opposition to the Budget 
Committee's proposals with respect to the Community Block Grant [CDBG] 
program. The Budget Committee's report that accompanies the budget 
resolution recommends a 50 percent cut in the CDBG Program and calls 
for targeting CDBG funds to the most needy areas. I strongly oppose 
those. CDBG funds are a critical component of this Nation's efforts to 
revitalize its low- and moderate-income communities. CDBG is already 
well-targeted to distressed communities, and, more importantly, CDBG is 
well-targeted to low-income neighborhoods within those communities that 
receive the block grants.
  CDBG has been a major element of our Nation's housing and community 
development strategy for over 20 years. CDBG was signed into law in 
1974 by then President Gerald Ford. It is surprising to me that the 
Republican budget-cutters have targeted this program for inordinate 
cuts, because CDBG is an excellent example of the policy approaches 
that my colleagues on the other side of the aisle espouse. CDBG is a 
block grant. The program distributes its funds on a formula basis to 
State and local governments, and provides jurisdictions with 
flexibility on the use of the funds within broad national objectives. 
CDBG embodies the principle of developing responsibility and decision-
making to local governments. It allows local governments to tailor 
specific solutions to meet their specific community development needs.
  The need for these resources is vast. Too many of our Nation's 
communities still suffer. Vacant housing, closed plants, and empty 
shops are the visible manifestations of neighborhoods with persistent 
unemployment, broken families, and high crime rates. We know that 
revitalizing distressed communities requires a multi-faceted approach: 
successful strategies are using community-based organizations to 
deliver programs that simultaneously attack the physical blight while 
addressing the social service needs of the residents. With its built-in 
flexibility, CDBG allows local governments to implement comprehensive 
strategies that may, for example, combine the rehabilitation of the 
commercial strip, with the small business start-up loans, with the job 
training for local residents and the child care.
  The Budget Committee's notion of targeting CDBG should also be 
considered carefully. CDBG is already well-targeted. The formula for 
the program does a good job of distributing CDBG funds by need: 50 
percent of the program funds go to the 20 percent most distressed 
cities based on a distress ranking created by HUD. Only 5 percent of 
the funds go to the least distressed cities. Moreover, program data 
shows that 90 percent of the CDBG funds go to benefit low- and 
moderate-income households consistent with the national purpose of the 
program.
  In the past, proponents of targeting have proposed three types of 
approaches. Some have proposed to cut off formula grant funds to 
smaller communities, forcing these communities to compete for funds 
through the state-administered program. Others have proposed to 
eliminate grants to wealthier communities. And, still others would 
tighten the criteria HUD uses to measure program benefits.
  CDBG currently provides a direct formula grant to more than 900 urban 
counties, communities with populations above 50,000 people, and 
consortia of smaller communities. Allowing these communities to receive 
annual, reliable formula grants is extremely important from the 
perspective of the local jurisdiction's need to plan for the use of the 
funds and to pursue long-term strategies.
  In some wealthier jurisdictions, CDBG rules often provide the impetus 
for community development activities in low-income neighborhoods that 
would not otherwise occur--especially if the communities were entirely 
responsible for serving their poorer neighborhoods out of own-source 
revenues. CDBG's fundamental national objective of serving low- and 
moderate-income neighborhoods argues for a continued distribution of 
CDBG funds to all jurisdictions with these needs.
  Finally, it would be ironic if, by calling for targeting, the Budget 
Committee were proposing to tighten the criteria that govern how 
communities use the funds. Tighter targeting criteria would take away 
local discretion and flexibility, and, therefore, run counter to the 
philosophy of those who promote block grants. Moreover, forcing 
grantees to spend more of their funds to benefit poorer neighborhoods 
is not a rationale for a 50-percent cut in program funds. Indeed, the 
resource needs of our poorest communities are so vast, that if the 
program objective was based on only strict targeting to very poor 
neighborhoods, this would make the case for increased funding.
  I would argue that given the limited resources, preserving the 
current program targeting is desirable. States, counties, and cities 
may find that an optimal economic development strategy would be to use 
small amounts of CDBG assistance to leverage private investment in 
areas with other existing features attractive to investors. Grantees 
who have been losing population, may want to focus community 
development activities on stabilizing mixed income neighborhoods or in 
pursuing strategies to lure moderate-income households into low-income 
neighborhoods. These are local decisions and appropriate community 
development strategies.
  I oppose the Republicans proposed cut of 50 percent in CDBG Program 
funds because CDBG is making a difference in thousands of American 
communities. A recent evaluation of the CDBG Program by the Urban 
Institute concludes that ``. . . the program has made an important 
contribution to city community development, including demonstrated 
successes in achieving local neighborhood stabilization and 
revitalization objectives. It's fair to say that in almost every city, 
neighborhoods would have been worse off had the program never existed, 
and certainly, cities would not have embarked on the housing and 
redevelopment programs that now comprise a core function of municipal 
government. Further, CDBG-funded programs clearly benefit those for 
whom the program was intended--low- and moderate-income persons and 
neighborhoods--and does so by a substantially greater degree than the 
minimum required under law.'' [[Page S7371]] 
  Mr. President, CDBG has a proven track record. Our Nation's 
communities continue to need our support.
                       opposition to transit cuts

  Mr. SARBANES. Mr. President, I want to express my strong opposition 
to the Budget Committee's proposal to eliminate Federal mass transit 
operating subsidies.
  The report that accompanies the Senate Budget Resolution calls for 
eliminating mass transit operating subsidies. Simply stated, these cuts 
will have significant consequences for our Nation's communities by 
leading to increased fares, reductions in services, and losses in 
ridership. As a result, working people will find it more difficult and 
costly to get to their jobs, roadways will become more congested, and 
environmental quality will decline.
  Public transportation is a critical element of our economy. In 1990, 
8.8 billion American took transit trips; 7.5 million people ride public 
transportation every weekday. Of these trips 54.4 percent are trips to 
work. An additional 20 percent of the trips taken by transit riders are 
to get to school or to access medical services. Trips to work are 
especially important uses of transit systems in large urban areas; use 
of bus service by elderly households to get medical attention is the 
largest component of rides in smaller communities and rural areas.
  A high proportion of transit riders are low-income persons or 
minorities, 27.5 percent of the transit ridership has incomes below 
$15,000 compared to 16.9 percent in the general population. African-
American and Hispanic riders as a percentage of total ridership are 
more than two times the percentage of African-American and Hispanic 
individuals in the general population. However, the importance of 
transit for working people is underscored by statistics showing that 55 
percent of the riders have incomes between $15,000 and $50,000.
  For most transit systems, operating revenues are a combination of 
fares and federal and state money. Assuming no increases in state 
contributions, fares would, on average, have to increase 50 percent to 
make up for the loss of revenue. Cuts in operating subsidies will also 
have disparate impacts on smaller communities. Federal operating 
subsidies make up 21 percent of total operating revenues for transit 
systems in communities below 200,000 people compared to 13 percent on 
average for all transit systems. Fares would nearly have to double for 
these smaller systems. This assumes no cutbacks in services and no loss 
in ridership as a result of the fare increases.
  Many individuals faced either with increased fares or decreased 
service will either have to give up their employment or use their cars 
to get to work. According to an article by Neal R. Pierce in the 
National Journal on April 15 of this year, one study already puts the 
cost of traffic congestion at $100 billion a year in lost productivity. 
Fewer transit riders and more drivers will exacerbate this problem. 
More cars on the road and increased congestion will worsen air quality 
in metropolitan areas where environmental quality is already strained.
  I realize, Mr. President, that the Budget Resolution itself does not 
cut transit operating subsidies. Decisions with respect to the 
appropriate level of funding for operating subsidies are left up to the 
Appropriations Committee. However, I felt it was important to raise a 
voice in opposition to the recommendation in the Budget Committee's 
report at this time and to urge my colleagues to begin to focus on the 
many cost to our citizens that would occur if the Budget Committee's 
proposed cuts in transit operating subsidies were carried out.


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