[Congressional Record Volume 143, Number 10 (Thursday, January 30, 1997)]
[Senate]
[Pages S902-S903]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         ADDITIONAL STATEMENTS

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              THE CORPORATE SUBSIDY REFORM COMMISSION ACT

 Mr. THOMPSON. Mr. President, we introduced legislation earlier 
this week to establish a Corporate Subsidy Review, Reform, and 
Termination Commission. We know that many Americans believe that 
Government operates for the benefit of the few and the privileged. They 
believe the system does not operate fairly, and their lack of 
confidence in us affects our ability to enact the reforms and make the 
hard decisions which must be made if we are to get our country back on 
the right track again.
  Last Congress, we actively sought to reform many areas of Government 
spending--we reduced Government spending by $53 billion, reformed the 
welfare system, restructured farm supports, rewrote telecommunications 
law, reformed the Federal procurement system, and adopted major 
immigration reforms. We identified and reformed areas of Government 
spending which needed fundamental reform because they did not work as 
well as they should.
  As part of this process, a bipartisan group of Senators examined some 
programs whose primary beneficiaries are profit-making enterprises and 
proposed reforming 12 specific programs which are characterized by some 
element of corporate subsidization. We chose these examples to 
demonstrate that such programs exist in virtually every industry, from 
military construction, to energy production, to consumer product 
advertising. While all the sponsors were not uniformly enthusiastic 
about each of the 12 examples, we believed the package as a whole 
underscored an important point and demonstrated our willingness to 
examine Government spending in every area. This proposal was offered as 
an amendment to the reconciliation bill, and received the support of 
only one-fourth of the Senate. Clearly, this problem needed to be 
attacked in a different way.
  As a result, we introduced another bill last Congress which was 
reported favorably by the Committee on Governmental Affairs. It is that 
bill we introduced this week to create a Commission to fairly and 
independently review corporate subsidies and make recommendations to 
the President and the Congress for the retention, reform, or 
termination of such subsidies.
  Why establish a Commission and a new process to do what we could and 
should do directly?
  First, this Commission will do what we cannot do well: Make an 
overall informed assessment of all programs, on both the spending and 
revenue sides, at one time. Over the years, we have created an 
intricate, interwoven system of subsidies, taxes, and exemptions. For 
example, a Tennessee utility which would have been affected by the 
spending cuts we proposed last Congress pointed out to me that they in 
turn are competing against other energy providers who receive subsidies 
in the form of Federal tax exemptions.

  Second, our experience last Congress demonstrated that voting hit or 
miss on individual items is not going to be successful. One person's 
pork is another's prize. And no one wants to give up their prize 
program if there isn't shared sacrifice. With the commission approach, 
we will know that all programs have been examined and those which 
provide unjustified subsidies have been exposed.
  Third, the members of the Commission will be appointed specifically 
for this purpose by the President and the Congress. They will possess 
the expertise, authority and stature necessary to do the job.
  Fourth, the Commission's recommendations will not be buried in the 
corner of a Federal agency or a congressional committee. While the 
President and Congress will be able to propose amendments to or 
outright reject the Commission's recommendations, they must address 
them.
  S. 207 incorporates provisions to accommodate many of the concerns 
raised last Congress. This bill takes special note of the Federal 
Government's role in the area of international trade. In establishing 
the Commission's review of Federal subsidies, it is not our intent to 
unduly disadvantage U.S. business interests as they compete in the 
international marketplace. We recognize that foreign governments 
frequently subsidize business interests in their own countries. 
Eliminating a particular program or subsidy might make sense in a 
purely domestic context, but such action could place a U.S. company at 
a severe disadvantage when competing with a foreign company which has 
the benefit of a subsidy from its government. A U.S. Government subsidy 
may have been instituted in order to offset a similar subsidy to 
foreign competitors by foreign governments, with the intent of leveling 
the playing field for U.S. industry. To eliminate such a subsidy not 
only affects the direct U.S. business interests in global competition, 
but also reduces the leverage of the U.S. Government in trade 
negotiations. Having matched a foreign government subsidy, the U.S. 
Government may call for negotiations to end mutually the practice. We 
recognize the importance of those issues and have included provisions 
to address carefully the Federal Government's role in international 
trade.
  Mr. President, we must require no less of profit-making enterprises 
than

[[Page S903]]

we ask of all Americans. It is a matter of fairness and shared 
sacrifice. At a time when the national debate is focused on getting 
control of the budget, now and in the future, we cannot afford to 
provide inappropriate corporate subsidies which undermine our efforts 
and which distort the free market. Perhaps most importantly, enactment 
of this legislation will demonstrate that Congress and the executive 
branch are serious about addressing and correcting a system which the 
American public as a whole sees as benefiting the few with access and 
influence, rather than serving the general public good.

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