[Congressional Record Volume 144, Number 40 (Wednesday, April 1, 1998)]
[Senate]
[Pages S2890-S2928]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




CONGRESSIONAL BUDGET FOR THE UNITED STATES GOVERNMENT FOR FISCAL YEARS 
                    1999, 2000, 2001, 2002, AND 2003

  The Senate continued with the consideration of the concurrent 
resolution.


                    Amendment No. 2213, as modified

  Mr. BOND. Mr. President, I am advised by the Budget Committee staff 
that we have to make a modification in the terminology of the sense-of-
the-Senate language, and I ask unanimous consent that the amendment be 
modified, under the last subsection (b), to say, ``It is the sense of 
the Senate that''--at that point include the following--``the levels in 
this resolution assume that''.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment (No. 2213), as modified, is as follows:
       Insert on page 53, after line 22, the following new 
     section, to be renumbered, accordingly:

     ``SEC. 317. SENSE OF THE SENATE TO MAINTAIN FULL FUNDING FOR 
                   THE SECTION 202 ELDERLY HOUSING PROGRAM.

       ``(a) Findings.--The Senate finds the following--
       ``(1) The Section 202 Elderly Housing program is the most 
     important housing program for elderly, low-income Americans, 
     providing both affordable low-income housing and supportive 
     services designed to meet the special needs of the elderly.
       ``(2) Since 1959, the Section 202 Elderly housing program 
     has funded some 5,400 elderly housing projects with over 
     330,000 housing units, with the current average tenant in 
     Section 202 housing being a frail, older woman in her 
     seventies, living alone with an income of less than $10,000 
     per year.
       ``(3) The combination of affordable housing and supportive 
     services under the Section 202 Elderly Housing program is 
     critical to promoting independent living, self-sufficiency, 
     and dignity for the elderly while delaying more costly 
     institutional care.
       ``(4) There are over 1.4 million elderly Americans 
     currently identified as having ``worst case housing needs'' 
     and in need of affordable housing.
       ``(5) There are 33 million Americans aged 65 and over, some 
     13 percent of all Americans. The number of elderly Americans 
     is anticipated to grow to over 69 million by the year 2030, 
     which would be some 20 percent of all Americans, and continue 
     to increase to almost 80 million by 2050.
       ``(6) The President's Budget Request for fiscal year 1999 
     proposes reducing funding for the Section 202 Elderly Housing 
     program from the fiscal year 1998 level of $645,000,000 to 
     $109,000,000 is fiscal year 1999. This represents a reduction 
     of over 83 percent in funding, which will result in reducing 
     the construction of Section 202 housing units from some 6,000 
     units in fiscal year 1998 to only 1,500 units in fiscal year 
     1999.
       ``(7) The full funding of the Section 202 Elderly Housing 
     program as an independent federal housing program is an 
     investment in our elderly citizens as well as our Nation.
       ``(b) Sense of the Senate.--It is the Senate that the 
     levels in this resolution assume that the Section 202 Elderly 
     Housing program, as provided under section 202 of the Housing 
     Act of 1959, as amended, shall be funded in fiscal years 
     1999, 2000, 2001, 2002, and 2003 at not less than the fiscal 
     year 1998 funding level of $645,000,000.''.

  Mr. BOND. Mr. President, I thank the Chair, yield the floor, and 
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. KERREY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 2214

(Purpose: To express the Sense of the Senate on the need for long-term 
                          entitlement reforms)

  Mr. KERREY. 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. Kerrey] proposes an 
     amendment numbered 2214.

  Mr. KERREY. 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:
       Sec.   . Sense of the Senate supporting long-term 
     entitlement reforms.
       (a) The Senate finds that the resolution assumes the 
     following--
       (1) entitlement spending has risen dramatically over the 
     last thirty-five years.
       (2) in 1963, mandatory spending (i.e. entitlement spending 
     and interest on the debt) made up 30 percent of the budget, 
     this figure rose to 45 percent by 1973, to 56 percent by 1983 
     and to 61 percent by 1993.
       (3) mandatory spending is expected to make up 68 percent of 
     the federal budget in 1998.
       (4) absent changes, that spending is expected to take up 
     over 70 percent of the federal budget shortly after the year 
     2000 and 74 percent of the budget by the year 2008.
       (5) if no action is taken, mandatory spending will consume 
     100 percent of the budget by the year 2030.
       (3) this mandatory spending will continue to crowd out 
     spending for the traditional ``discretionary'' functions of 
     government like clean air and water, a strong national 
     defense, parks and recreation, education, our transportation 
     system, law enforcement, research and development and other 
     infrastructure spending.
       (4) taking significant steps sooner rather than later to 
     reform entitlement spending will not only boost economic 
     growth in this country, it will also prevent the need for 
     drastic tax and spending decisions in the next century.
       (b) Sense of the Senate.--It is the Sense of the Senate 
     that that levels in this budget resolution assume that--
       (1) Congress and the President should work to enact 
     structural reforms in entitlement spending in 1998 and beyond 
     which sufficiently restrain the growth of mandatory spending 
     in order to keep the budget in balance over the long term, 
     extend the solvency of the Social Security and Medicare Trust 
     Funds, avoid crowding out funding for basic government 
     functions and that every effort should be made to hold 
     mandatory spending to no more than seventy percent of the 
     budget.

  Mr. KERREY. Mr. President, for the first time in a quarter century 
this budget resolution is being debated in an environment, where rather 
than talking about getting rid of the deficit, we are able to talk with 
great enthusiasm about what to do with the surplus. We are talking 
about tax cuts and various spending programs. There is no question that 
the recovery of the economy of the United States of America--deficit 
reduction efforts in the past in combination with tremendous changes on 
the part of entrepreneurs and businesses and individuals out there--has 
produced the best economic scene I have seen in my entire lifetime, 
with increases in productivity, growth in the number of jobs, and a 
reduction in welfare rolls. You have to look long and hard to find bad 
economic news out there.
  In 1990, this Congress debated a deficit reduction act that was 
largely a result of President Bush's leadership. We put in place at 
that time the mechanism that we still use today. It has caps on 
spending that we, for the most part, have lived within. It is that 
discipline that is required by the law, it seems to me, that requires 
every time somebody wants to do a new program, they have to find a way 
to pay for it. You just cannot come down here and throw new spending on 
a budget or new tax cuts on a budget without having an offset 
someplace. It is that discipline,

[[Page S2891]]

coupled with the 1993 act and the 1997 act, that I think the American 
people appreciate very much. It has produced enormous benefits for the 
American economy.
  But we are now in a state where, unfortunately, rather than merely 
talking about the easy things, we now need to start facing some very 
difficult problems that are occurring inside the budget itself. One of 
the things I find comforting in life is when things don't change. The 
most impressive force of all in that regard is gravity. It has an 
increasing impact upon me, my body, and my ability to move and so 
forth. It stays constant. I am impressed with it.
  One of the things that stayed constant over the last 30 or 40 years, 
indeed a bit longer than that, is that the percent of the entire GDP 
that we in Washington, DC, use for a variety of spending programs has 
stayed relatively constant--in the 19 to 20 percent range. This does 
not go all the way back to the years of the 1940s when, during the war, 
we went up above that 20 percent mark; but in the 1940s, most of that 
spending was for plant, for equipment, increases in the productivity of 
this Nation. Indeed, many have cited that as a principal reason the 
United States of America came out of the Great Depression, the 
significant investments that occurred during those war years. So you 
see that 20 percent figure stayed relatively constant over that lengthy 
period of time.
  This resolution that I have offered up requires us, the Congress, 
with a sense-of-the-Senate resolution, to look out in the future more 
than the 10-year budget window that we currently do. You may say why, 
Mr. President. The reason is that if you look out for 10 years, from 
1998 to 2008, that takes you just before the baby boom generation 
begins to retire. You look out to 2008 and life looks relatively good. 
It doesn't look very difficult. It looks like we ought to be able to 
manage relatively easily, and the reason it looks like it is going to 
be relatively easy is that the number of the Americans over age 65 
grows relatively steadily, from about 34 million to about 39 million in 
2008. But, from 2010 to 2030, the number of people over age 65 grows by 
30 million. The number of retirees will increase by 25 million while 
the number of workers only increases 4 million.
  What happens during that period of time is that the mandatory 
programs--that is the red, or the entitlement spending; and the yellow 
is the net interest, the interest on the national debt--they continue 
to grow until they completely displace the entire Federal budget, until 
it is 100 percent of the budget at that point. Indeed, in the year 
2027, 100 percent of the budget will be mandatory spending programs.
  This is a trend. I heard some--perhaps most notably former Secretary 
of Labor Robert Reich, who is on from time to time--criticizing this 
evaluation, saying there are going to be increases in productivity or 
immigration or other things that are going to take care of it. But it 
has not taken care of it yet.

  In 1963, John Kennedy went to Rice University. He gave a speech in 
the summer of 1963 in which he said that we were going to put a man on 
the Moon. Why? He said not because it is easy but because it is hard.
  In 1963, 70 percent of this budget was discretionary and only 30 
percent of the budget was mandatory. In 1973, it had grown to 45 
percent mandatory; in 1983, 56 percent mandatory; in 1993, 61 percent 
mandatory. And in this budget, 68 percent of the budget is mandatory 
and 32 percent of the budget is discretionary.
  Even over the next 10 years, the amount that is available for 
discretionary--and we allow it actually in the second 5 years to grow 
at the rate of inflation, which is not likely unless we are going to 
bust the caps in the second 5 years--at the end of that 10-year period, 
the amount available for discretionary spending will be approximately 
26 percent.
  I ask any of my colleagues what that 26 percent figure means. If you 
budget it this year and say we are going to give the Appropriations 
Committee 26 percent of available revenue to appropriate, that will 
force approximately $115 billion in spending cuts.
  What is happening is that we are seeing our capacity to build our 
Nation's defenses, I say to the distinguished occupant of the Chair, 
who has talked about how our military is being spread pretty thin--it 
is spread pretty thin right now. We debate from time to time new things 
we want our military to do. Both our military and intelligence efforts 
are stretched substantially thin at the moment. But that is not the 
only area in discretionary spending where people come to the floor and 
would like to spend more money, whether it is on education, on health 
care, or the environment, or NASA, or Veterans Administration. On all 
these things, they may come down and say, ``We have to fight the battle 
against crime, we need more people on our border, we a stronger law 
enforcement effort.'' All of these Federal efforts come out of 
discretionary spending.
  Unless we as a Congress begin to understand these trends and the fact 
that they are not going to go away, it is not likely we are going to do 
anything about it. I observe the reason we are not doing anything about 
it, the reason we are not debating it on this floor, is we only have a 
10-year view.
  The law says to take a look at 10 years--what does it look like in 10 
years? Life looks pretty good. It looks like we can handle it. I 
challenge anybody to construct a discretionary budget with only 26 
percent available revenue. Unless we believe this Congress is going to 
raise taxes beyond the 20 percent mark--which I don't think it either 
will or should--what we are faced with, even at 26 percent, is, it 
seems to me, the unlikelihood of being able to construct a budget with 
that relatively small amount.
  Unless we look out to 30 years instead of 10 years, we do not see 
this crisis coming, we do not see the problem coming.
  So what do we do? We do nothing. We do not even debate it or talk 
about it. Most of us have seen the movie ``Titanic.'' In the movie, 
people were on the bow, standing watch for icebergs, and they did not 
have binoculars. It is very much like us. We do not have binoculars 
either. We can see 10 years, but we cannot see 30. As a consequence, we 
do not see the iceberg that is out there in the form and shape of the 
baby-boom generation which, from 2010 to 2030, will convert 100 percent 
of the available money we will tax and collect from the American 
people--100 percent of that budget is going to go to mandatory 
programs.
  There is a price, a big price, for delay, and the price will be paid 
by the baby-boom generation, who will find themselves saying suddenly, 
``Oh, my gosh, I have two choices: Either I take substantial cuts in my 
current benefits or my kids have a tax increase'' that raises their 
taxes beyond what is, I think, by any standard, a reasonable level. We 
will see demands on this system, in short, Mr. President, that are 
going to put us in a position where we are going to have to ask current 
beneficiaries, if we do not make reasonable adjustments today, to pay a 
rather substantial price.

  I know the distinguished Senator from New Mexico has talked about 
this an awful lot. In fact, he can blame himself for me caring about 
entitlements. It was he and Senator Nunn who used to traipse down here 
once a year and offer amendments. The first time the Senator from New 
Mexico offered an amendment to control entitlement spending, I voted 
against it. The second year, the light bulb went on, and I said, ``Oh, 
my gosh, this guy from New Mexico might have something right.'' And, 
indeed, he persuaded me the second year, and I voted with him.
  In 1994, Senator Jack Danforth and I chaired a commission for an 
entire year looking at the problems of entitlements, and I have not 
been the same since. I annoy people; I frustrate people. They can ask 
me what do I think about the weather, do I think Nebraska is going to 
have a good football team, and as soon as I talk about the weather and 
our great football team, I find myself immediately talking about the 
problem of mandatory spending and what it is going to do to our 
capacity to say that we are securing the blessings of liberty for 
ourselves and posterity.
  We are squandering, it seems to me, an opportunity to say we are 
endowing our future, and instead we are putting ourselves in a position 
of saying, ``Make certain I get my deal covered, that I get what I am 
entitled to, and the heck with the future; don't worry about our 
kids.''

[[Page S2892]]

                           Amendment No. 2215

 (Purpose: To express the sense of the Senate regarding passage of the 
               IRS Restructuring and Reform Act of 1997)

  Mr. KERREY. Mr. President, I send an additional amendment to the desk 
and ask for its immediate consideration.
  The PRESIDING OFFICER (Mr. Burns). Without objection, the pending 
amendment will be set aside. The clerk will report.
  Mr. KERREY. Mr. President, I will talk for 1 minute. I see the 
distinguished chairman of the Finance Committee on the floor. This is 
an amendment that this body ought to act on IRS reform legislation 
prior to our leaving for the recess.
  I believe this legislation has been considered long and hard. The 
taxpayers have a deadline of April 15; 120 million of them will have to 
file their taxes. We need to pass IRS legislation without delay. We 
need to give taxpayers new powers. I note with considerable interest 
that every single freshman in the House sent a letter yesterday to 
Majority Leader Lott and to Democratic Leader Daschle asking that the 
House bill, or something that can be conferenced, be taken up before we 
leave.
  Mr. President, I ask unanimous consent that this letter be printed in 
the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                Congress of the United States,

                                    Washington, DC, April 1, 1998.
     Hon. Trent Lott,
     Senate Majority Leader, Russell Senate Office Building, 
         Washington, DC.

     Hon. Thomas A. Daschle,
     Senate Minority Leader, Hart Senate Office Building, 
         Washington, DC.
       Dear Majority Leader Lott and Minority Leader Daschle: As 
     April 15 approaches, this letter is to urge in the strongest 
     possible terms the United States Senate to pass sound 
     legislation to reform the Internal Revenue Service (IRS).
       As first-term Representatives of the American people from 
     both political parties, we agree that the Congress must give 
     the highest priority to reforming the IRS. Hearings conducted 
     in the House and Senate have made us all too aware of the 
     horror stories of the average American taxpayer being 
     harassed by rogue IRS agents. We believe it is time that the 
     IRS worked for American taxpayers instead of assuming they 
     are guilty of cheating on their taxes.
       As you know, on November 5, 1997, the House overwhelmingly 
     passed historic legislation to reform the IRS. This bill 
     incorporates recommendations by the bipartisan National 
     Commission to Restructure the IRS chaired by Senator J. 
     Robert Kerrey and Representative Rob Portman. H.R. 2676, the 
     IRS Restructuring and Reform Act, would shift the burden of 
     proof from the taxpayer to the IRS, create twenty-eight new 
     taxpayer provisions in a Taxpayer Bill of Rights, and 
     overhaul the management of the agency through the creation of 
     an eleven-member independent Oversight Board.
       With your leadership, we have the opportunity to provide 
     the comprehensive reform of the IRS the American people 
     deserve. We urge the Senate to adhere to the will of the 
     American taxpayer, honor the work of the bipartisan 
     commission, and join the House in passing IRS reform without 
     further delay.
           Sincerely,
     Bob Etheridge,
     John Shimkus,
                                              Members of Congress.

  Mr. KERREY. Mr. President, the taxpayers of the United States have a 
deadline of April 15. All of us know it. We hear about it when we go 
home. As I said, 120 million people have to have their taxes filed by 
April 15. There are 140,000 collection notices that go out every single 
day of the week. Every single working day that the IRS is in operation, 
140,000 collection notices go out.
  There are approximately the same number of Americans who call the IRS 
every day. The way it currently operates is, about 40 percent of them 
cannot get through, and of those who do get through, about 25 percent 
of them get the wrong answer.
  There are many other reasons for to get the laws governing the IRS 
changed, and get them changed soon. My hope is that the chairman of the 
Finance Committee and the ranking member will meet as quickly as 
possible with Mr. Archer, Mr. Rangel, and Mr. Rubin. Let's get this 
bill conferenced as quickly as possible so that the American taxpayers, 
who have waited an awful long time for this piece of legislation, will 
get the power they deserve--indeed, the power they need--in order for 
them to have confidence that this is still Government of, by, and for 
the people.
  Mr. President, I thank you for this wonderful opportunity to speak, 
and I yield the floor.
  The PRESIDING OFFICER. The clerk will report the amendment.
  The assistant legislative clerk read as follows:

       The Senator from Nebraska [Mr. Kerrey] proposes an 
     amendment No. 2215.

  The amendment follows:

       At the end of Title III, insert the following:

     SEC.   . SENSE OF THE SENATE REGARDING PASSAGE OF THE IRS 
                   RESTRUCTURING AND REFORM ACT.

       (a) Findings.--The Senate finds that--
       (1) The House of Representatives overwhelmingly passed IRS 
     Reform Legislation, (H.R. 2676), on November 5, 1997.
       (2) The IRS Restructuring and Reform Act has the potential 
     to benefit 120 million Americans by simplifying the tax 
     process and making the IRS more responsive to taxpayer 
     concerns;
       (3) The President has announced that he would sign H.R. 
     2676;
       (4) The Senate plans to recess without considering 
     legislation to reform the IRS.
       (5) The American people are busy preparing their taxes to 
     meet the April 15th deadline. They do not get to recess 
     before filing their returns; and
       (5) Senators should keep their commitment to take up and 
     pass IRS reform legislation before they recess.
       (b) Sense of the Senate.--
       It is the sense of the Senate that the assumptions 
     underlying the functional totals in this budget resolution 
     assume that the Senate shall not recess until it has 
     considered and voted on H.R. 2676, the IRS Restructuring and 
     Reform Act of 1997.

  Mr. DOMENICI. Mr. President, I inform the Senator that we are willing 
to accept his previous sense-of-the-Senate amendment, and we have 
Senator Burns' amendment. I would like to accept them now and then go 
on to the Senator's second amendment. Is that satisfactory?
  Mr. KERREY. Mr. President, I will allow them merely to be accepted. I 
was going to ask for a rollcall vote on mine. At some point, my fear 
is, without a rollcall vote, I say to the distinguished Senator and 
chairman of the committee, it doesn't necessarily focus people's 
attention as much as it should. I am not sure it will by making them 
vote either, for that matter.
  I know the chairman of this committee is very enthusiastic about this 
issue and has spent a lot of time on it as well. I just think this 
whole budget deliberation occurs in a never-never land where we are 
talking about surpluses and talking about how good everything is and we 
literally are ignoring this enormous problem.
  As I said, the people who are going to suffer the most are that baby-
boom generation, and they will find themselves in a heck of a dilemma 
if we do not act sooner than later. I appreciate the Senator's 
willingness to accept my amendment and Senator Burns' amendment. I 
agree to allow that to go forward.


                       Vote on Amendment No. 2214

  The PRESIDING OFFICER. The question occurs on agreeing to amendment 
No. 2214.
  Without objection, the amendment is agreed to.
  The amendment (No. 2214) was agreed to.


                       Vote on Amendment No. 2178

  Mr. DOMENICI. Mr. President, there is pending an amendment No. 2178 
by Senator Burns. There is no objection on this side and, I understand, 
no objection on the Democrat side.
  The PRESIDING OFFICER. The question occurs on agreeing to the 
amendment.
  Without objection, the amendment is agreed to.
  The amendment (No. 2178) was agreed to.
  Mr. DOMENICI. I move to reconsider the vote on the two amendments, en 
bloc.
  Mr. ROTH. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, I wonder if Senator Lautenberg would 
join me in just a discussion of where we are. And, obviously, I will 
yield the floor. I understand the distinguished chairman of the Finance 
Committee wants to speak. I yield myself time off the budget 
resolution.
  Mr. President, fellow Senators, I understand we have one vote 
scheduled on or in relationship to the Kyl amendment at 12 o'clock. The 
distinguished

[[Page S2893]]

Senator is here. He would like to speak for 1 minute, and there will be 
1 minute in opposition. I make that request and ask unanimous consent.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOMENICI. I would like to just tell Senators that we now have 
about 29 amendments that are pending, for all intents and purposes. I 
consider that everybody wants a vote on them, although I hope not. And 
we still have about 18 hours, so there is plenty of time for more 
amendments. And, frankly, I just hope everybody understands that today 
is Wednesday, tomorrow is Thursday, the next day is Friday.
  I think that everybody should share with me some concern about 
whether we can finish this resolution unless there is some cooperation 
with reference to amendments. I do not ask anything of anyone 
specifically at this point, but I hope and I urge that, if there are 
more amendments, you start getting them in to us. There is no time by 
which you are bound, but I urge that, if you have additional amendments 
or second-degree amendments, you let us see them. I am sure my friend 
from New Jersey will join me in that. At some point we have to try to 
make a little sense of the process on this to see if we can get this 
work done in a timely manner.

  Mr. LAUTENBERG addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Jersey.
  Mr. LAUTENBERG. The chairman of the Budget Committee neglected to 
mention the fact that voting time is not included in the calculation of 
the remaining hours.
  Mr. DOMENICI. Right.
  Mr. LAUTENBERG. That is extra time. So if we have 29 or 30 votes, and 
even if we were able by some stretch of the imagination to reduce that 
to 15 minutes, you are talking about more than 7 hours added to the--
how much time do we have remaining, may I ask?
  The PRESIDING OFFICER. Eighteen hours remaining.
  Mr. LAUTENBERG. Eighteen. So we would be looking at prospectively 25 
hours or more. So I say to all of our colleagues on both sides, get 
them in here and let us try to get action done on them. If a rollcall 
vote can be dispensed with, it will make a huge difference in what time 
we conclude our business for this week, reminding everyone, all those 
whose memory is bad and can't recall, the fact that the recess begins 
for 2 weeks, in case anybody has forgotten, and should we want to hang 
in through Friday or whatever or however long, I understand we are 
going to get this done.
  Mr. DOMENICI. We could stay in here very late tonight, into the 
morning and that would put us on a path to where we could start voting 
and we could see some daylight.


                           Amendment No. 2169

  Mr. DOMENICI. Mr. President, I am going to yield the floor, but I 
want to make a parliamentary inquiry. Would the regular order bring the 
Kyl amendment now to the Senate?

  The PRESIDING OFFICER. The Senator is correct. The Kyl amendment is 
in order. The Senator from Arizona is recognized for 1 minute.
  Mr. KYL. Thank you, Mr. President.
  Let me take about 30 seconds and then see if anyone on the other side 
wishes to speak to this. This is a very simple sense-of-the-Senate 
resolution, and I will read you what the sense is. I cannot imagine 
people would oppose this principle.

       It is the sense of Congress that seniors have the right to 
     see the physician or health care provider of their choice, 
     and not be limited in such right by the imposition of 
     unreasonable conditions on providers who are willing to treat 
     seniors on a private basis. . .

  Mr. President, there are a lot of details in legislation that might 
ultimately be passed that we can argue about, but I think there is no 
doubt that in expressing the principle, we can all be in agreement that 
just because one turns 65 and is eligible for Medicare does not mean 
they lose the right to see the physician of their own choice.
  Mr. President, I reserve the remainder of my time and will see if 
there is anyone who wishes to speak in opposition.
  The PRESIDING OFFICER. Who yields time?
  Mr. DASCHLE addressed the Chair.
  The PRESIDING OFFICER. The distinguished minority leader.
  Mr. DASCHLE. I understand we have 1 minute in response.
  Let me just say, this is not in any way, shape or form an amendment 
designed to provide patients with more choice. This will leave seniors 
totally uncertain about what their Medicare will cover and let doctors 
determine the degree of Medicare coverage each beneficiary will have. 
That is what this is about: Jeopardizing patients' rights, putting them 
in a very uncertain set of circumstances, taking away the certainty and 
the confidence they have when they are in a doctor's office or in a 
hospital or in an operating room that Medicare will pay their bills. 
Let us not jeopardize those patients' rights or their confidence when 
they are sick that the Medicare Program is working for them.
  Mr. GRASSLEY. Mr. President, I want to express my support for Senator 
Kyl's amendment establishing a sense of the Congress regarding Medicare 
beneficiaries freedom to privately contract with physicians. I 
understand there has been a lot of misinformation about private 
contracting and the Balanced Budget Act provision. But the fundamental 
issue behind this debate has always been clear. What this really boils 
down to is what is the appropriate role of the government. And I just 
don't believe that the federal government should tell seniors how they 
can or cannot spend their own hard earned money. While the Balanced 
Budget Act allows private contracting on a limited basis, most 
beneficiaries will not have this freedom because physicians who 
privately contract will have to opt out of the Medicare program for 2 
years. Most physicians won't be able to do that, and most beneficiaries 
would not want their doctor to do this. Therefore, I support the Kyl 
amendment to give seniors the freedom of choice to privately contract.
  Mr. MURKOWSKI. Mr. President, this past New Year rang in a harsh 
reality for senior citizens of America: As of January 1, 1998, senior 
citizens, for all practical purposes, have been stripped of a health 
care right afforded to any other insured American--the right to pay 
out-of-pocket for the doctor of their choice.
  I am outraged over this provision--a provision that was added into 
the Balanced Budget Act of 1997 in the twelfth hour of negotiations 
between the White House and Congress.
  The provision prohibits doctors who privately contract from treating 
Medicare patients for a period of two years. Therefore, it is now 
unlawful for a doctor to take a private payment from a Medicare-
eligible patient if during the previous two years he has billed 
Medicare for any service rendered to a patient over the age of 65.
  What is the reality of the provision? The reality is that it will be 
almost impossible for a senior citizen to contract privately for 
medical services because few or no physicians are going to be able to 
make ends meet if they can't accept Medicare patients for two years. 
The reality is that, unlike every other insured American, senior 
citizens have now lost a significant right--a right of choice in who 
provides their health care.
  Currently seniors are being prohibited from going outside of the 
Medicare system for procedures that are not covered by Medicare. For 
example, if a senior fell and broke his hip, Medicare only reimburses 
for the lowest-cost hip prosthesis. Since seniors cannot pay extra to 
upgrade, they must settle for lower quality. (Private contracting would 
enable them to opt for quality.)
  Why is the federal government making that decision for seniors? If a 
75-year-old women in Fairbanks, Alaska, fell and broke her hip, do you 
think that the government is competent enough to decide what hip 
prosthesis is best for her to gain the best mobility for the rough 
weather conditions of Fairbanks?
  Last week I turned 65 years old. The week before--when I was still 64 
years old--I could choose any doctor I wanted and pay for that doctor 
in any manner I wanted. But now I'm 65, and the federal government is 
suddenly telling me I can't make my own medical decisions--that I no 
longer may enter into a private contract with my doctor.
  Mr. President, I ask you, isn't this a form of age discrimination 
against seniors? How can the Health Care Financing Administration 
restrict such a fundamental liberty--the freedom to

[[Page S2894]]

choose the care and quality of health providers?
  The need for a senior citizen to be able to privately contract is 
magnified in Alaska. Alaska has no HMOs, physician shortages exist in 
two-thirds of the state and health care costs that are on average 70 
percent higher than the rest of the country.
  All these factors combine to create a system where doctors can't 
afford to treat Medicare patients--which means that patient choice for 
Alaskan seniors is extremely limited. I've received letters from 
Alaskans who have been turned down by three or four physicians--because 
the doctors cannot afford new Medicare patients.
  I am pleased with Senator Kyl's sense of Congress--I believe it is an 
important stand for Congress to make. The body must do all it can to 
ensure that Medicare-eligible beneficiaries who choose to pay out of 
pocket will have an unrestricted right to health care.
  Mr. President, even in the socialized medical system of Great 
Britain, choice is offered to the elderly. In Great Britain, a senior 
citizen has the choice to pay privately for his or her medical 
services. Don't the elderly of America deserve that same choice?
  Mr. DODD. Mr. President, today I rise to express my opposition to 
Senator Kyl's sense of the Senate Amendment to the Budget Resolution. 
While this amendment raises important concerns about the scope of 
seniors' choices in determining their personal health care needs, this 
proposal may actually restrict the health care options available to our 
nation's senior citizens and undermine the quality of care afforded all 
Medicare beneficiaries.
  Initially, Senator Kyl's amendment simply seems to endorse the 
important role of choice for seniors when making critical decisions 
about their personal health. I strongly support efforts to increase the 
health care options available to Medicare beneficiaries and improve the 
quality of health care that seniors receive. However, this amendment 
would move us in the wrong direction. With approximately 96 percent of 
physicians treating Medicare patients presently, choice of physicians 
does not appear to be a problem for Medicare beneficiaries. In reality, 
Medicare allows seniors to choose the doctor of their choice along with 
providing protections that shield Medicare beneficiaries from 
unnecessarily high out-of-pocket costs. Ironically, in many ways, 
Senator Kyl's amendment is a problem in search of a solution.
  Senator Kyl's legislation specifically supports private contracting 
between physicians and patients for services traditionally covered by 
Medicare. By allowing doctor's to privately contract for these 
services, this amendment could effectively remove consumer protections 
designed to protect seniors' from excessive out-of-pocket costs. These 
protections are critically important to the elderly who rely on the 
affordable and high-quality care that Medicare provides. Private-
contracting for Medicare-covered services would cause seniors to pay 
100 percent of any given health care service or benefit. Few seniors 
can afford or have any desire to pay, such exorbitantly high-rates. It 
is also important to note that seniors' are perfectly free to contract 
privately with their doctor on health care benefits not covered by 
Medicare such as routine physical exams, eye care, and prescription 
drugs. However, by permitting doctors to charge their Medicare patients 
whatever they wish for Medicare-covered health care services, we would 
be subjecting seniors' to unnecessarily high-out of pocket costs and 
would compromise the quality of care afforded to all Medicare 
beneficiaries.
  I am also deeply concerned that this initiative would create a two-
tiered health care system for the elderly, threatening the quality of 
care afforded all Medicare beneficiaries. Private contracting could 
create an incentive for wealthier and healthier beneficiaries to opt 
out of the Medicare program. This could lead to a health care system 
that provides high-quality coverage to those seniors' who could afford 
the high out-of-pocket costs associated with private-contracting, while 
leaving the majority of Medicare beneficiaries with substandard care. 
Almost 70 percent of Medicare beneficiaries have an annual income under 
$25,000. It is simply unconscionable for these seniors of modest means 
to be subject to paying 100 percent of their health care bill to 
services that are normally covered under the Medicare program. 
Additionally, the implementation of a private-contracting system would 
provide an incentive for doctor's to give priority to those Medicare 
beneficiaries who can afford to pay for it at the expense of providing 
quality and affordable care to the majority of Medicare beneficiaries.
  Additionally, the Kyl amendment would offer the potential for 
increased fraud and abuse within the Medicare program. The Medicare 
system is already fraught with staggering levels of fraud and abuse. 
According to the Inspector General of the U.S. Department of Health and 
Human Services, $23.2 billion annually is wasted on fraud and abuse in 
the Medicare program. Given the financial challenges that face the 
Medicare program in the near future, this level of abuse in 
unacceptable. Allowing physicians to set their own payment rates for 
certain patients, while simultaneously permitting them to submit claims 
to Medicare for the treatment of traditional Medicare beneficiaries for 
the very same procedures, would create the opportunity for double 
billing, a serious form of fraud and abuse. While we should be moving 
to prevent fraud and abuse in the Medicare system, private contracting 
would offer the potential for increased fraud in the Medicare system.
  Mr. LAUTENBERG addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Jersey.
  Mr. LAUTENBERG. Yes. I want to point out that the pending amendment 
is not germane, and I raise a point of order that the amendment 
violates section 305(b)(2) of the Congressional Budget Act.
  The PRESIDING OFFICER. The point of order is not sustained.
  Mr. KYL addressed the Chair.
  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. KYL. Might I inquire, how much time is remaining?
  The PRESIDING OFFICER. The Senator has some 20 seconds.
  Mr. KYL. Thank you.
  I want to respond to the distinguished minority leader.
  It is true that legislation that would actually change the law would 
certainly have to consider all kinds of issues dealing with fraud and 
abuse and similar questions that the distinguished minority leader has 
raised. We can have that debate at the time such legislation might come 
before us.
  What is before us today is simply a sense of the Senate, an 
expression of a principle that it is the sense of Congress that seniors 
have the right to see the physician or health care provider of their 
choice. I hope we can at least agree on that basic principle.
  Thank you, Mr. President.
  The PRESIDING OFFICER. The question occurs on agreeing to amendment 
No. 2169, the Kyl amendment.
  Mr. LAUTENBERG. Mr. President, before we call the roll, I ask 
unanimous consent that the Senator from Washington be able to send up 
two amendments.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                 Amendments Nos. 2216 and 2217, en bloc

  Mrs. MURRAY. Mr. President, I send two amendments to the desk and ask 
unanimous consent that they be laid aside.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Washington [Mrs. Murray] proposes 
     amendments numbered 2216 and 2217.

  Mrs. MURRAY. I ask unanimous consent reading of the amendments be 
dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendments are as follows:


                           amendment no. 2216

 (Purpose: To increase Function 500 discretionary budget authority and 
    outlays to accommodate both President Clinton's investments in 
 education and the $2.5 billion increase assumed by the resolution for 
                                 IDEA)

       On page 16, line 9, increase the amount by $2,088,000,000.
       On page 16, line 10, increase the amount by $81,000,000.
       On page 16, line 13, increase the amount by $1,776,000,000.
       On page 16, line 14, increase the amount by $1,487,000,000.
       On page 16, line 17, increase the amount by $1,437,000,000.

[[Page S2895]]

       On page 16, line 18, increase the amount by $1,686,000,000.
       On page 16, line 21, increase the amount by $593,000,000.
       On page 16, line 22, increase the amount by $1,301,000,000.
       On page 25, line 8, strike ``-$300,000,000'' and insert 
     ``-$2,388,000,000.''
       On page 25, line 9, strike ``-$1,900,000,000'' and insert 
     ``-$1,981,000,000.''
       On page 25, line 12, strike ``-$1,200,000,000'' and insert 
     ``-$2,976,000,000.''
       On page 25, line 13, strike ``-$4,600,000,000'' and insert 
     ``-$6,087,000,000.''
       On page 25, line 16, strike ``-$2,700,000,000'' and insert 
     ``-$4,137,000,000.''
       On page 25, line 17, strike ``-$3,000,000,000'' and insert 
     ``-$4,686,000,000.''
       On page 25, line 20, strike ``-$3,800,000,000'' and insert 
     ``-$4,393,000,000.''
       On page 25, line 21, strike ``-$7,000,000,000'' and insert 
     ``-$8,301,000,000.''
                                  ____



                           AMENDMENT NO. 2217

(Purpose: To express the sense of the Senate regarding the expansion of 
                           Medicare benefits)

       At the end of title III, add the following:

     SEC. __. SENSE OF THE SENATE ON EXPANDING MEDICARE BENEFITS.

       (a) Findings.--The Senate finds the following:
       (1) In the 1997 Balanced Budget Agreement, changes were 
     made to Medicare that extended the solvency of the Trust Fund 
     for 10 years.
       (2) The Medicare Commission, also established in the 
     Balanced Budget Agreement, has just started the task of 
     examining the Medicare program in an effort to make sound 
     policy recommendations to Congress and the Administration 
     about what needs to be done to ensure that Medicare is 
     financially prepared to handle the added burden when the baby 
     boomers begin retiring.
       (3) The problems facing Medicare are not about more 
     revenues. The program needs to do more to improve the health 
     care status of retirees and give them more choices and better 
     information to make wise consumer decisions when purchasing 
     health care services.
       (4) Improving the health care status of senior citizens 
     would ensure additional savings for Medicare. Helping seniors 
     stay healthier should be a priority of any legislation aimed 
     at protecting Medicare.
       (5) In order to keep seniors healthier, Medicare has to 
     become more prevention based. Currently, Medicare offers very 
     few prevention benefits. As a result, seniors are often 
     sicker when they seek care or are hospitalized.
       (6) If the objective is to use tobacco revenues to save 
     Medicare, a portion of these new revenues must be allocated 
     to expanding prevention benefits.
       (7) Preventing illnesses or long hospital stays or repeated 
     hospital stays will save Medicare dollars.
       (8) Medicare cannot be saved without structural changes and 
     reforms. Simply using a new Federal tax to prop up Medicare 
     will not extend solvency much beyond a few months and will do 
     little to improve the health status of senior citizens and 
     the disabled.
       (9) Congress should use these new revenues to expand 
     prevention benefits to ensure that seniors are healthier and 
     stronger. This is how we can truly save Medicare.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that the functional totals underlying this resolution assume 
     the allocation of a portion of the Federal share of tobacco 
     revenues to expand prevention benefits for Medicare 
     beneficiaries with an emphasis on improving the health status 
     of Medicare beneficiaries and providing long term savings to 
     the program.

  The PRESIDING OFFICER. Without objection, the two amendments are laid 
aside.


                       Vote on Amendment No. 2169

  The PRESIDING OFFICER. The question is on agreeing to amendment No. 
2169, the Kyl amendment. The yeas and nays have been ordered. The clerk 
will call the roll.
  Mr. FORD. I announce that the Senator from Massachusetts (Mr. 
Kennedy) and the Senator from Massachusetts (Mr. Kerry) are necessarily 
absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 51, nays 47, as follows:

                      [Rollcall Vote No. 53 Leg.]

                                YEAS--51

     Abraham
     Allard
     Ashcroft
     Bennett
     Bond
     Brownback
     Burns
     Campbell
     Coats
     Cochran
     Coverdell
     Craig
     DeWine
     Domenici
     Enzi
     Faircloth
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hagel
     Hatch
     Helms
     Hollings
     Hutchinson
     Hutchison
     Inhofe
     Jeffords
     Kempthorne
     Kyl
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Murkowski
     Nickles
     Roberts
     Roth
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner

                                NAYS--47

     Akaka
     Baucus
     Biden
     Bingaman
     Boxer
     Breaux
     Bryan
     Bumpers
     Byrd
     Chafee
     Cleland
     Collins
     Conrad
     D'Amato
     Daschle
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Ford
     Glenn
     Graham
     Harkin
     Inouye
     Johnson
     Kerrey
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Reed
     Reid
     Robb
     Rockefeller
     Sarbanes
     Snowe
     Specter
     Torricelli
     Wellstone
     Wyden

                             NOT VOTING--2

     Kennedy
     Kerry
       
  The amendment (No. 2169) was agreed to.
  Mr. DOMENICI. Mr. President, I move to reconsider the vote.
  Mr. LOTT. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The distinguished majority leader.
  Mr. LOTT. Mr. President, this is not aimed at any Senator or group of 
Senators, but it is so that we will all be on notice. In order to be 
able to complete this budget resolution, we are going to have to stick 
to the 15 minute-votes. I realize that there are markups going on and 
Senators have a lot of commitments, but for the remainder of today--
Senator Daschle and I have talked about this--we think it is important 
we begin to stick to 15-minute votes or 10-minute votes if we have in a 
group stacked votes, so we will start sticking pretty close to the time 
that is allocated.
  Mr. FORD. Mr. President, will the majority leader yield for a 
question?
  Mr. LOTT. I am glad to yield.
  Mr. FORD. We are in a major markup in the Commerce Committee, and if 
there is any way you could stack a vote or two to let us come over and 
spend a few minutes and make several votes and then go back to the 
committee, I think it might be helpful, rather than having us run back 
and forth. There is hope we might be able to finish that markup, if not 
late tonight, tomorrow. I am not asking to change your schedule or your 
votes, just group them together sometime, if you could.
  Mr. LOTT. Mr. President, if I could say to the Senator from Kentucky, 
they are certainly involved in very important work, and we will take 
that into consideration. As a matter of fact, we are going to enter a 
unanimous consent request that would allow us to stack some votes. 
Senator Daschle had suggested that, and it seems like a good way to 
proceed where we will have up to as many as, I think, four votes that 
are stacked.
  Mr. FORD. I thank the Senator.
  Mr. LOTT. Would the Democratic leader like to make a comment before I 
make the UC?
  In order to ascertain the remaining workload then ahead of us to 
bring the budget resolution to conclusion, I now ask unanimous consent 
that all first-degree amendments must be offered by 6 p.m. this 
evening. I further ask that at 5:40 p.m. this evening the minority 
manager be recognized to offer any amendments necessary for the 
minority side of the aisle, and at 5:50 p.m. Senator Domenici be 
recognized for up to 10 minutes to offer amendments necessary at that 
point for the majority side.
  I further ask that following the scheduled 2 p.m. vote today, all 
first-degree amendments be limited to 30 minutes, all second-degree 
amendments be limited to 20 minutes, with any votes ordered on any 
remaining amendments to be stacked in a sequence to be decided by the 
two managers. I further ask that the first vote in the stacked voting 
sequence be limited to 15 minutes and all remaining votes in the 
sequence be reduced to 10 minutes in length.
  We hope they will stack as many as three and four in those groupings. 
But it will be up to them, after, of course, consulting with the 
leaders, to make sure we are taking into consideration other things 
that may be going on.
  I finally ask that all time consumed during rollcall votes be counted 
against the overall statutory time limit and the new time restraints on 
first- and second-degree amendments expire at the conclusion or 
yielding back of the overall time limit.

  The PRESIDING OFFICER. Is there objection?
  Ms. MOSELEY-BRAUN. Mr. President, reserving the right to object--and

[[Page S2896]]

I will not object--I just want to make certain that the time agreement 
with regard to the schools amendment has been unchanged.
  Mr. DASCHLE. That is correct.
  Ms. MOSELEY-BRAUN. That is correct.
  Mr. LOTT. That is correct.
  The PRESIDING OFFICER. The Chair hears no objection, and it is so 
ordered.
  Mr. DASCHLE. Mr. President, I didn't want to object, and I was going 
to make that clarification following the conclusion of the request, but 
I would only add one clarification, which I know the majority leader 
will want to do, and that is to allow 1 minute prior to each vote in a 
stacked sequence, to be sure that we can explain the circumstances, as 
is normally our procedure in stacked votes. I know that colleagues on 
both sides of the aisle have requested that in the past.
  With that understanding and also with the understanding, of course, 
that Senator Moseley-Braun would then be recognized following this UC 
to offer her amendment, I think this is a good plan and I commend all 
of those involved, especially our Chair and ranking member. Obviously, 
we won't get done with this unless we can find a way in which to manage 
more efficiently the time remaining. This does it, and I appreciate the 
cooperation of Members on both sides.
  Mr. LOTT. Mr. President, I do amend the unanimous consent request to 
include the 1 minute before each vote and ask for a ruling now.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LOTT. I yield the floor, Mr. President.
  Mr. DOMENICI. Mr. President, might I just ask--everybody might want 
to know this--if in fact we don't complete all the amendments under the 
prescription we have just agreed to, then if there are remaining 
amendments, this agreement does not pertain to this at all, that will 
be looked at by the Senate; we will get it done one way or another?
  Mr. LOTT. That is correct. I think this is a very major step forward. 
We will still need to assess where we are tonight and in the morning. 
Any amendments still pending at the end, we will still have to deal 
with those in as orderly a fashion as we possibly can. But I think this 
will help us move a number of amendments so that we won't have as many 
amendments at the end of the session.
  Mr. DOMENICI. Mr. President, I thank the distinguished majority 
leader and the minority leader for helping with this. Obviously, this 
is a much more orderly process, and I think it has a chance of working 
to the enhancement of the Senate's ability to do this work right.
  I understand that the distinguished Senator from Illinois is going to 
call up an amendment, after which she is going to yield promptly so 
that Senator Roth might speak for a few minutes, and then it will 
return to her for control of her time and we will have time on our 
side.
  Ms. MOSELEY-BRAUN. Yes. I say to the Senator from New Mexico, I have 
been asked by the Senator from Delaware and the Senator from North 
Dakota as well as Senator Roth--all three have business they would like 
to attend to before this amendment is taken up, and so I would suggest 
to the Senator from New Mexico that might be appropriate--let all three 
Senators go before this amendment is taken up.

  Mr. DOMENICI. That is fine with me. I thought the minority leader had 
asked me to call her amendment up and then go ahead and yield this 
time. But if you want to do it another way--Senator Roth, are you 
satisfied?
  Mr. ROTH. I want to speak next.
  Mr. DOMENICI. Would it be possible that we could agree then that if 
you are going to withhold until the following events occur, that 
Senator Roth be permitted to speak for 15 minutes? But he would be 
preceded by two Senators who want to just offer amendments.
  Mr. BIDEN. If the Senator will yield, I need 5 seconds, 10 seconds 
possibly.
  Mr. DOMENICI. Is that possible?
  Mr. KYL. Mr. President, might I clarify. I would like 5 seconds as 
well to offer an amendment.
  The PRESIDING OFFICER. The Chair recognizes the Senator from North 
Dakota.


                     Amendments Nos. 2218 and 2219

  Mr. DORGAN. Mr. President, I ask unanimous consent the pending 
amendment be set aside that I may send two amendments to the desk.
  The PRESIDING OFFICER. Without objection, it is so ordered. The clerk 
will report.
  The legislative clerk read as follows:

       The Senator from North Dakota [Mr. Dorgan] proposes 
     amendments numbered 2218 and 2219.

  The text of the amendments follows:


                           AMENDMENT NO. 2218

  (Purpose: To strike section 301 of the concurrent resolution, which 
 expresses the sense of Congress regarding the sunset of the Internal 
  Revenue Code of 1986, and replace it with a section expressing the 
   sense of Congress that important tax incentives such as those for 
  encouraging home ownership and charitable giving should be retained)

       Strike page 33, line 3, through page 34, line 3, and insert 
     the following:

     SEC. 301. SENSE OF CONGRESS ON THE TAX TREATMENT OF HOME 
                   MORTGAGE INTEREST AND CHARITABLE GIVING.

       (a) Findings.--Congress finds that--
       (1) current Federal income tax laws embrace a number of 
     fundamental tax policies including longstanding encouragement 
     for home ownership and charitable giving;
       (2) the mortgage interest deduction is among the most 
     important incentives in the income tax code and promotes the 
     American Dream of home ownership--the single largest 
     investment for most families, and preserving it is critical 
     for the more than 20,000,000 families claiming it now and for 
     millions more in the future;
       (3) favorable tax treatment to encourage gifts to charities 
     is a longstanding principle that helps charities raise funds 
     needed to provide services to poor families and others when 
     government is simply unable or unwilling to do so, and 
     maintaining this tax incentive will help charities raise 
     money to meet the challenges of their charitable missions in 
     the decades ahead;
       (4) legislation has been proposed to repeal the entire 
     income tax code at the end of the year 2001 without providing 
     a specific replacement; and
       (5) recklessly sunsetting the entire income tax code 
     threatens our Nation's future economic growth and unwisely 
     eliminates existing tax incentives that are crucial for 
     taxpayers who are often making the most important financial 
     decisions of their lives.
       (b) Sense of Congress.--It is the sense of Congress that 
     the levels in this resolution assume that Congress supports 
     the continued tax deductibility of home mortgage interest and 
     charitable contributions.
                                  ____



                           Amendment No. 2219

   (Purpose: To establish a reserve fund for health research at the 
    National Institutes of Health, funded by receipts from tobacco 
                              legislation)

       At the appropriate place in the resolution, insert the 
     following:

     SEC.  . HEALTH RESEARCH RESERVE FUND.

       (a) In General.--In the Senate, revenue and spending 
     aggregates may be adjusted and allocations may be adjusted 
     for legislation that reserves 21 percent of the Federal share 
     of receipts from tobacco legislation for the health research 
     purposes provided in subsection (b), provided that, to the 
     extent that this concurrent resolution on the budget does not 
     include the costs of that legislation, the enactment of that 
     legislation will not increase (by virtue of either 
     contemporaneous or previously-passed deficit reduction) the 
     deficit in this resolution for--
       (1) fiscal year 1999;
       (2) the period of fiscal years 1999 through 2003; or
       (3) the period of fiscal years 2004 through 2009.
       (b) Eligible Health Research.--Of the receipts from tobacco 
     legislation reserved pursuant to subsection (a), the 
     following amounts may be used for the following purposes:
       (1) 7.5 percent of such receipts to fund research into the 
     prevention and cure of cancer;
       (2) 7.5 percent of such receipts to fund research into the 
     prevention and cure of heart disease, stroke, and other 
     cardiovascular diseases;
       (3) 2 percent of such receipts, to be allocated at the 
     discretion of the Director of the National Institutes of 
     Health, to fund the responsibilities of this office and to 
     fund construction and acquisition of equipment or facilities 
     for the National Institutes of Health;
       (4) 2 percent of such receipts for transfer to the National 
     Center for Research Resources to carry out section 1502 of 
     the National Institutes of Health Revitalization Act of 1993;
       (5) 1 percent of such receipts to fund prevention research 
     programs at the Centers for Disease Control and Prevention;
       (6) 1 percent of such receipts to fund quality and health 
     outcomes research at the Agency for Health Care Policy and 
     Research; and
       (7) the remainder of such receipts to fund other member 
     institutes and centers, including the Office of AIDS 
     Research, of the National Institutes of Health in the same 
     proportion to such remainder, as the amount of annual 
     appropriations under appropriations acts for each member 
     institute and center for a fiscal year bears to the total 
     amount of appropriations under appropriations acts for

[[Page S2897]]

     all member institutes and centers for that fiscal year.
       (c) Revised Levels, Aggregate and Allocations.--
       (1) Adjustments for Legislation.--Upon the consideration of 
     legislation pursuant to subsection (a), the Chairman of the 
     Committee on the Budget of the Senate may file with the 
     Senate appropriately-revised allocations under Section 302(a) 
     of the Congressional Budget Act of 1974 and revised 
     functional levels and aggregates to carry out this section.
       (2) Adjustments for Amendments.--If the Chairman of the 
     Committee on the Budget of the Senate submits an adjustment 
     under this section for legislation in furtherance of the 
     purposes described in subsection (b), upon the offering of an 
     amendment that would necessitate such submission, the 
     Chairman shall submit to the Senate appropriately-revised 
     allocations under Section 302(a) of the Congressional Budget 
     Act of 1974 and revised functional levels and aggregates to 
     carry out this section.
       (3) Rule of Construction.--Revised allocations, functional 
     levels and aggregates submitted or filed pursuant to this 
     subsection shall be considered for the purposes of the 
     Congressional Budget Act of 1974 as allocations, functional 
     levels and aggregates contained in this resolution.
       (c) Reporting Revised Allocations.--The appropriate 
     committees shall report appropriately-revised allocations 
     pursuant to Section 302(b) of the Congressional Budget Act of 
     1974 to carry out this section.
       (d) Applications of Section 202 of H.Con.Res. 67.--Section 
     202 of H.Con.Res. 67 (104th Congress) shall not apply for 
     purposes of this section.

  Mr. DORGAN. I ask unanimous consent they be set aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Delaware is recognized.


                           Amendment No. 2220

 (Purpose: To permit the use of Federal tobacco funds to reimburse the 
   Veterans Administration for the costs of treating smoking-related 
                               illnesses)

  Mr. BIDEN. Mr. President, I ask unanimous consent that the pending 
amendment be set aside temporarily so I may offer an amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BIDEN. I send the amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Delaware [Mr. Biden] proposes an amendment 
     numbered 2220.

  Mr. BIDEN. 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 28, line 5, before the period insert ``and Veterans 
     Administration health care''.

  Mr. BIDEN. I further ask that my amendment be set aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Arizona.


                           Amendment No. 2221

(Purpose: To express the sense of the Senate supporting a supermajority 
                     requirement for raising taxes)

  Mr. KYL. Mr. President, I ask unanimous consent that the pending 
amendment be set aside for the purpose of offering an amendment, which 
I send to the desk.
  The PRESIDING OFFICER. Without objection, it is so ordered. The clerk 
will report.
  The legislative clerk read as follows:

       The Senator from Arizona [Mr. Kyl], for himself, Mr. Grams, 
     Mr. Helms, Mr. Brownback, and Mr. Hagel, proposes an 
     amendment numbered 2221.

  The text of the amendment follows:

       At the end of title III, add the following:

     SEC.   . SENSE OF THE SENATE REGARDING A SUPERMAJORITY 
                   REQUIREMENT FOR RAISING TAXES.

       (a) Findings.--The Senate finds that--
       (1) the Nation's current tax system is indefensible, being 
     overly complex, burdensome, and severely limiting to economic 
     opportunity for all Americans;
       (2) fundamental tax reform should be undertaken as soon as 
     practicable to produce a tax system that--
       (A) applies a low tax rate, through easily understood laws, 
     to all Americans;
       (B) provides tax relief for working Americans;
       (C) protects the rights of taxpayers and reduces tax 
     collection abuses;
       (D) eliminates the bias against savings and investment;
       (E) promotes economic growth and job creation;
       (F) does not penalize marriage or families; and
       (G) provides for a taxpayer-friendly collections process to 
     replace the Internal Revenue Service; and
       (3) the stability and longevity of any new tax system 
     designed to achieve these goals should be guaranteed with a 
     supermajority vote requirement so that Congress cannot easily 
     raise tax rates, impose new taxes, or otherwise increase the 
     amount of a taxpayer's income that is subject to tax.
       (b) Sense of Senate.--It is the sense of Senate that the 
     assumptions underlying the functional totals of this 
     resolution assume fundamental tax reform that is accompanied 
     by a proposal to amend the Constitution of the United States 
     to require a supermajority vote in each House of Congress to 
     approve tax increases.

  Mr. KYL. I ask that the amendment be temporarily laid aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Delaware.
  Mr. ROTH. Mr. President, this budget resolution contains some 
provisions that I applaud, but it falls short in several areas: first, 
the proposed tax cuts are too small to provide the relief that 
taxpayers need and deserve; second, it does not adequately restrain the 
growth and reach of the Federal Government. Third, it is not what the 
hardworking men and women of America desire nor deserve. They deserve 
better.
  The current economic expansion is now 84 months old, the third 
longest on record. Overall growth rate has been relatively steady and 
moderate. In the last three months alone, more than one million new 
jobs have been created, while the unemployment rate has been reduced to 
a 24-year low. In addition, inflation as measured by the CPI is only 
1.6 percent.
  In the midst of this prosperity our citizens are burdened by levels 
of taxation that are increasingly oppressive--all to satisfy the 
appetite of the Federal behemoth. This condition runs contrary to 
counsel handed down from President Jefferson--counsel we would do well 
to heed as we move forward with the budget debate. In his First Annual 
message to the Congress, President Jefferson wrote that the object of 
congressional efforts should be ``to preserve the general and State 
governments in their constitutional form and equilibrium; to maintain 
peace abroad, and order and obedience to the laws at home; to establish 
principles and practices of administration favorable to the security of 
liberty and prosperity, and to reduce expenses to what is necessary for 
the useful purposes of government.''

  These are among the core principles which have thus far separated our 
nation from the rest of the world.
  It is up to this Congress to apply President Jefferson's principle to 
``reduce expenses to what is necessary for the useful purposes of 
government.'' All else should remain in the hands of our citizens.
  Today, revenue levels are at all time highs, approaching 20 percent 
of GDP in both this fiscal year and the next. Not only are these levels 
high in historical terms, they are unprecedented for a peace-time 
economy. In fact, the only time in this century that revenues were 
higher was during World War II.
  Unfortunately, this does not appear to be an anomaly; the 
Congressional Budget Office projects that unusually high levels of 
revenue will continue to be extracted from taxpayers for the 
foreseeable future.
  It is worth noting, Mr. President, that these very same revenues are 
largely responsible for the budget surplus that has generated so much 
excitement here in Washington. In fact, the current surplus is mainly 
attributable to additional unanticipated revenues of about $72 billion 
in 1997, rather than the effect of spending cuts. It is also worth 
noting that these revenues have been fueled mainly by our strong 
economic growth in the last year.
  Yet, despite the record high level of revenues that the Federal 
Government now collects to feed its appetite for spending, we are told 
that we need additional Federal programs! Over the past 2 months, 
President Clinton has engaged in a well orchestrated campaign to secure 
approval for spending billions of dollars more on new and expanded 
government programs. He has set a trap for the American people by 
promising to do more for them in exchange for higher taxes on their 
capital and labor.
  We have balanced the Federal budget. But that is only one of the 
steps to be taken to meet Jefferson's objective. We must go on to 
examine whether the current size and breadth, let alone further 
expansion, of the Federal Government for these purposes justifies the 
taxation on the toil of our fellow citizens. Let's never forget that 
the revenue collected by Washington does not

[[Page S2898]]

belong to the Federal Government; it belongs to the hard-working men 
and women of this country.
  Mr. President, the budget resolution should allow for immediate and 
significant tax relief for American taxpayers. However, the $30 billion 
of tax cuts proposed in the current resolution are not sufficient to 
provide this relief.
  I would like to see this budget resolution contain total tax cuts of 
at least $65 billion over 5 years. These cuts could take a number of 
forms, including marriage penalty reforms, family tax relief, and 
savings and investment incentives.
  For example, half of American families face the marriage penalty. The 
Congress proposed to phase out the marriage penalty for non-itemizers 
as part of the 1995 Balanced Budget Act, but the proposal was vetoed by 
President Clinton. In addition to marriage penalty relief, 
consideration could be given to tax relief for families such as a child 
care credits for both stay-at-home parents and working 
parents. Ultimately, whatever the final form that tax cuts take, the 
crucial consideration is that they be substantive and immediate.

  However, we are limited in the ways that we can offset these tax 
cuts. While the President's Fiscal Year 1999 budget contains a number 
of revenue raisers, many are rehashed, or controversial proposals that 
have failed before due to opposition on both sides of the aisle.
  We also cannot look to the spending programs within the jurisdiction 
of the Finance Committee for savings. We are all firmly committed to 
protecting the reforms we have made to the Medicare, Medicaid and 
welfare programs, and should make no further changes at this time. In 
my opinion, the best option is for the cuts to be offset through the 
use of a portion of the tobacco settlement revenues.
  While the lack of meaningful tax relief is my main objection to this 
budget resolution, I am also disappointed to see that there is no 
provision to make better use of the budget surplus.
  We should not simply spend this surplus, or set it aside; we can do 
better for our families and the future. I strongly believe that the 
most productive use of thee surpluses is to fund individual Social 
Security investment accounts for all workers who contribute to the 
payroll tax. Therefore, Mr. president, I will be offering a sense-of-
the-Senate amendment to instruct the Finance Committee to report a 
Social Security bill this year. The bill would dedicate the budget 
surplus to fund Social Security personal retirement accounts. Equally 
important, my bill will place the Senate on record for putting these 
surpluses to work for the American taxpayers, and not simply setting 
them aside to be spend on other less important priorities than social 
security.
  Finally, Mr. President, I must express my concern over some of the 
methods for shifting funds around under the budget resolution. Budget 
rules should not be invented to give authority to one committee to 
achieve budget savings under the jurisdiction of another committee. 
More specifically, this resolution gives control over the Medicaid 
program and welfare programs to the Appropriations Committee. Moreover, 
savings are to be achieved through administrative reforms which may 
prove to be unfair and unworkable with our partners, the states. 
Reforming Medicaid and finding program savings in the child support 
enforcement system or finding other alternatives should be a task for 
the committee of jurisdiction--namely the Finance Committee.
  Mr. President, the American people expect more from us. And it is 
incumbent upon us to see that they get it.
  Mr. President, I yield the floor. I make a point of order a quorum is 
not present.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. DURBIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Thomas). Without objection, it is so 
ordered.
  Mr. DURBIN. Mr. President, it is my understanding the Senator from 
Illinois, under the rule previously agreed to, has 2 hours for debate 
on her amendment?
  The PRESIDING OFFICER. Two hours.


                           Amendment No. 2175

  Ms. MOSELEY-BRAUN. Mr. President, I thank the Senator from Illinois. 
I call up amendment No. 2175 and ask for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Illinois [Ms. Moseley-Braun] proposes an 
     amendment numbered 2175.

  Ms. MOSELEY-BRAUN. Mr. President, I ask unanimous consent that 
reading of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The text of the amendment is printed in the March 30, 1998 edition 
of the Record.)
  Ms. MOSELEY-BRAUN. Mr. President, I ask unanimous consent that 
Senators Daschle, Kennedy, Harkin, and Murray be added as cosponsors of 
this amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Ms. MOSELEY-BRAUN. Mr. President, I yield myself as much time as I 
may require, until such time as someone else comes up to speak.
  This amendment expresses the sense of the Senate that the fiscal year 
1999 budget resolution assumes that we will enact legislation creating 
a partnership between State and local governments and the private 
sector to rebuild and modernize our schools and classrooms for the 21st 
century. The amendment calls for the enactment of legislation similar 
to S. 1705, the Public School Modernization Act of 1998, which I have 
introduced along with a number of my colleagues. Our bill would 
establish a simple and effective means of helping communities modernize 
and revitalize their schools.
  The bill creates a new category of zero coupon bonds for States and 
school districts to issue to finance capital improvements. States and 
school districts would be able to issue $21.8 billion worth of these 
bonds over the next 2 years. Purchasers of the new bonds would receive 
Federal income tax credits in lieu of interest, thereby cutting the 
cost of upgrading the schools by at least a third and in some cases up 
to 50 percent. The bill will cost the Federal Government only $3.3 
billion over five years.
  This amendment to the budget resolution is the first step toward 
enacting that legislation. It sends a signal that we in the Senate are 
serious about improving education in America.
  I call your attention to this report card for America's 
infrastructure. You will notice that school buildings get a failing 
grade; mass transit got a grade of C--we have taken up the 
infrastructure needs for mass transit; bridges, a C-minus; solid waste, 
a C-minus; waste water treatment, D-plus; roads, D-minus--but schools 
get an F. We are literally sending our children to crumbling schools in 
which education becomes well-nigh impossible.
  Those children--14 million of them, in fact--every day attend schools 
that are so deteriorated that they do not even meet basic code; 14 
million children in this country every day attend schools which are 
that dilapidated, Mr. President. From all indications, in failing to 
provide for the modernization, renovation and repair of school 
facilities, we are literally causing these children to get less 
educational opportunity than they should be entitled to, but we are 
also hampering our Nation's ability to be competitive in the 21st 
century.
  At no point in our history has education been more important to both 
individual achievement or national prosperity. As H. G. Wells wrote 
nearly 80 years ago: ``Human history becomes more and more a race 
between education and catastrophe.''
  Education in America correlates with opportunity for individuals, for 
families and for our entire Nation. Indeed, the rungs on the ladder of 
opportunity in America are crafted in the classroom. It is very clear 
that high school graduates earn more money over the course of a 
lifetime. As a matter of fact, every year they earn 46 percent more 
than people who do not graduate from high school. College graduates 
earn 155 percent more than those who do not complete high school. And, 
of course, over the course of a lifetime, the most educated Americans 
will earn

[[Page S2899]]

five times as much as the least educated Americans. That is on an 
individual level.
  The truth is that education correlates with every indicia of economic 
and social well-being. Educational attainment can be tied directly to 
income, to health, to the likelihood of being on welfare, to the 
likelihood of being incarcerated, and even to the likelihood of voting 
and participating in our democracy.
  It is, however, more than a tool to lift people out of poverty or to 
have a better standard of living. It is also the engine that will drive 
America's economy into the 21st century. In a Wall Street Journal 
survey last year of leading economists, 43 percent of them said the 
single most important thing we could do to increase our long-term 
economic growth rate would be to invest more in education, research and 
development. Nothing else came even close in the survey. One economist 
said:

       One of the few things economists will agree upon is the 
     fact that economic growth is very strongly dependent on our 
     own abilities.

  Another study, looking at the changing nature of the American work 
force, said:

       The crucial factor accounting for long-term success in the 
     work force is a basic education provided at the primary and 
     secondary levels.

  Of course, a recent study by the Manufacturing Institute confirmed 
that claim. It concluded that increasing the education level of workers 
by just 1 year raises the productivity level by 8.5 percent in 
manufacturing.
  If we fail to invest in education, we will put our Nation's economic 
future at risk. Unfortunately, too many of our schools, again, are not 
in adequate physical condition to meet the educational needs of our 
children. Too many of our schools are literally crumbling down around 
the students.
  The General Accounting Office, which did a major study, a landmark 
study, on this issue found that 14 million children attend schools in 
need of major renovation or outright replacement. Some 7 million 
children every day attend schools with life-threatening safety code 
violations. And they concluded that it will cost $112 billion just to 
bring our schools up to code--$112 billion across the country just to 
bring our schools up to code. That does not equip them with computers. 
That is not bells and whistles. That is just to address the toll that 
decades of deferred maintenance has taken. So this F relates to the 
$112 billion demand on us as Americans just to get our schools up to 
code in this country.
  I say ``the country'' broadly, and the truth is that crumbling 
schools are to be found in every corner of America. Again, according to 
the GAO, some 38 percent of schools in urban areas are in this kind of 
dilapidated condition; 30 percent of rural schools are in the same 
condition; and 29 percent of suburban schools are in the worst 
condition. Again, this is not statistically all that different between 
29 percent in the suburbs, 30 percent in rural areas and 38 percent in 
urban areas.

  Mr. President, the problem with crumbling schools has become so 
widespread that even Peppermint Patty in the Peanuts cartoon has a 
leaky school roof. Take a look here. In this series of Peanuts cartoon, 
Peppermint Patty and her friend Marcie express their frustration over 
the fact that they cannot get anyone to repair the leaky roof. ``It's 
keeping me awake.'' The roof is leaking. They still don't take it.
  Marcie forgot to mention the repair of the roof as she talked about 
the fact that the children were having difficulty learning. But the 
truth of the matter is that we cannot forget about the fact that our 
schools are dilapidated.
  In my State of Illinois, school modernization and construction needs 
top $13 billion. Many of Illinois' school districts have a difficult 
time even buying textbooks and pencils, much less financing major 
capital improvements. This legislation would free up local resources in 
my State for education by providing Federal support for rebuilding the 
schools.
  This $112 billion national school repair price tag, as enormous as it 
may sound, again, does not include the cost of wiring schools and 
getting them up to speed for modern technology. One of the greatest 
barriers to the incorporation of modern computers into classrooms is 
that the physical condition of many school buildings will not allow for 
it. You cannot very well use a computer if you cannot plug it into the 
wall.
  Again, to quote the General Accounting Office, almost half of all 
schools lack enough electrical power for the full-scale use of 
computers; 60 percent of them lack enough conduits in the school to 
connect classroom computers to a network; and 60 percent of schools 
lack enough phone lines for instructional use.
  Last year, a teacher from Waukegan, IL, came to Washington and was 
talking about the use of computers in the school and that when they 
plugged in the computers, when they deployed the computers around the 
school, fires started all through the school because the wiring was so 
old.
  That situation is replicating itself all over the country. We are 
seeing situations in which the schools cannot give our children the 
tools they need to learn so that they can compete in this 21st century 
because the physical structures simply will not allow it.
  This legislation also will give communities the power to relieve 
overcrowding. Again, according to the Department of Education, 
enrollment this year is at an all-time high and will continue to grow 
over the next 10 years. Just to keep up with growing enrollment, we 
will need to build 6,000 new schools over the next 10 years.
  Again, in my State, I visited schools where study halls are held in 
the hallways because there is no other space. I have seen stairway 
landings converted into computer labs, cardboard partitions used to 
turn one classroom into two. There is one school where the lunchroom 
has been converted into two classrooms, where the students eat in the 
gymnasium, and instead of gym, they have what is called ``adaptive 
physical education'' while they stand next to their desks.
  One youngster from Virginia talked about the fact that the congestion 
in his school is so profound that the kids get into fights in the 
hallway, and they call it ``hall rage,'' when there is just too much 
human presence for them to walk around the hallways and they get into 
disruptive behavior.
  The teachers and parents know full well these conditions directly 
affect the ability of their children to learn, and the research, of 
course, has backed up that intuition. Two separate studies found a 10 
to 11 percent achievement gap between students who attend school in 
good buildings and quality surroundings and those who attend school in 
poor buildings after accounting for all other factors.

  Other studies have found that when the buildings are in poor 
condition, again, the students are more likely to misbehave. Three 
leading researchers recently concluded:

       There is no doubt but that building condition affects 
     academic performance.

  Again, if we are going to address the need to provide our youngsters 
with quality education, we clearly have to look at the factors and the 
environment in which they are called upon to learn.
  Just last month, the results came in on a set of international math 
and science tests. The results were, quite frankly, profoundly 
disturbing.
  The results of that study placed American students at or near the 
bottom on every one of the math and science tests that were offered. 
This cannot be. We cannot go into the 21st century with our children 
performing below some less-industrialized countries because we do not 
provide a quality educational opportunity and, frankly, consistent 
educational opportunity throughout the country.
  We know that we have some of the best schools in the world in this 
country on the one hand. I have some that I visited in the State of 
Illinois--the First in the World School. Those schools are in good 
condition, and the youngsters who go there have a great opportunity for 
education. They have scored above the international norm.
  But at the same time we have the other instance of the crumbling 
schools, the dilapidated conditions and the poor performance across the 
board as well. We have this patchwork quilt of school facilities 
throughout the country. Again, I point out these facilities' problems 
are related to how we finance the system, how we pay for schools.
  Crumbling schools are not just accidents; they are the predictable 
result

[[Page S2900]]

of the way we fund education. The current system was established a 
century ago when the Nation's wealth was measured in terms of 
landholdings. Wealth, of course, is no longer accumulated just in land, 
and the funding mechanism relying on the local property tax is just not 
appropriate, nor is it adequate.
  The current school finance structure works against most American 
children and mitigates against most families' best efforts to improve 
local schools. Again, according to the General Accounting Office, poor 
and middle-class schools try the hardest to raise the revenue to get 
the money together to fix up their schools. But the system works 
against them.
  In some 35 States, poor districts have higher tax rates than wealthy 
districts, but they raise less revenue because, of course, there is 
less property wealth to tax. Now, this local funding model does not 
work for school infrastructure, just as it would not work for highways 
or other infrastructure.
  Imagine for a moment what would happen if we based our system of 
roads on the same funding model that we use for schools. If every 
community was responsible for the construction of and maintenance of 
the roads within its borders and no one else contributed, where we did 
not have a partnership, we relied on the local property tax, in all 
likelihood we would have smooth, good roads in the wealthy towns, a 
patchwork of mediocre roads in middle-income towns, and very few roads 
at all in poor communities.
  Transportation, then, Mr. President, would be hostage to the vagaries 
of wealth and geography. Commerce and travel would be difficult and 
navigation of such a system would not serve the interests of our whole 
country.
  Mr. President, unfortunately, that hypothetical situation that I have 
just described in terms of roads precisely describes our school funding 
system. Schools with a lot of wealth have good schools or are more 
likely to have good schools, middle-class schools have a patchwork, 
poor communities have little or nothing to point to.
  Again, I made the point, as the GAO found, that the phenomenon of 
crumbling schools, the infrastructure, finds itself in all kinds of 
communities, suburban, rural and urban, but, again, it is based on the 
local property tax in the main.
  The American Society of Civil Engineers released a report card on 
America's infrastructure, and, again, they found that the only category 
to get an F was the schools.
  We have just recently acted, and the ranking member, the Senator from 
New Jersey, will point out that we just passed the ISTEA bill, the 
highway and mass transit bill, which addresses a number of these 
issues. The Senate passed that bill almost with unanimous support, and 
we put an additional $214 billion into infrastructure in that 
legislation.
  Schools, however, do not benefit from that bill, and that is why I 
believe we need to talk about a partnership to fund the redevelopment 
of our school infrastructure. Our children need the same level of 
commitment for school infrastructure as we have given to our highways.

  I think the way we ought to look at this is not in the sense of 
finger pointing, saying it is the fault of the States or it is the 
fault of the local governments. I think, if anything, we need to engage 
a partnership in which we all contribute and we all weigh in to try to 
fix these schools and give our children an environment that is 
worthwhile to learn in.
  We have a situation in which States--the argument has been made that 
school construction is just a State or a local responsibility. Some of 
my colleagues have argued that, notwithstanding the fact that the 
school districts face a maintenance backlog of $112 billion--and, 
again, $73 billion in new school construction needed--the States can 
meet these costs on their own and by themselves.
  The truth is that this is not in the interest of our country, that we 
rely on the accident of State effort and the accident of geography and 
the accident of wealth in order to make certain that we address this 
national problem.
  We have an interest, as citizens of this great country, to see to it 
that every child gets an opportunity to learn, that every child gets an 
environment in which learning can take place, and that every child no 
matter where they live in the United States is given a chance to take 
advantage of the new technologies that school modernization would 
allow.
  The General Accounting Office found that only 13 of the States take a 
comprehensive approach to school modernization and construction. In 
1994, for example, the States spent a total of $3.5 billion on school 
repair and construction--$3.5 billion. So again with $112 billion worth 
of deferred maintenance, $73 billion worth of needed new construction, 
the States alone will simply not be able to bear that economic burden.
  Some of my colleagues have argued that because the economy is doing 
so well the States are now in a position to supplement what they spend 
on school facilities with funds from the surpluses that are beginning 
to accumulate in the State treasuries. Most States have a surplus. All 
but two States had some sort of surplus at the end of fiscal year 1997, 
ranging from a $3.2 billion surplus in Alaska to a $32 million surplus 
in Alabama. My own State of Illinois ended 1997 with a $108 million 
surplus. But the sum total of all the surpluses put together is $28.2 
billion. If we were to spend every dime of every State's surplus on 
this issue, you would just begin to make a dent in it.
  I think that the notion of the finger-pointing, the notion of blaming 
one level of Government or another, is something that we, frankly, do 
not have time for. We do not have time for that argument any longer. I 
believe we have a responsibility to engage as a national community to 
work together, giving the States and the local governments control, 
certainly, giving them responsibility for making certain that the 
schools are rebuilt, but providing the financial help that we can at 
the national level in the simplest way possible.
  We have the capacity, at the national level, to provide the funding 
leverage that this legislation will provide that will cost us $3 
billion to allow these local communities and school districts to go 
into the capital markets and raise $22 billion. I think it just makes 
absolute sense, and I encourage my colleagues to support this sense-of-
the-Senate amendment.
  Mr. President, I now yield 5 minutes to the Senator from New Mexico, 
2 minutes to the Senator from Washington, and such time to the Senator 
from California as she may require.


                           Amendment No. 2223

  (Purpose: To establish a deficit-neutral reserve fund for civilian 
                       research and development)

  Mr. BINGAMAN. Mr. President, before I give my few comments here in 
support of the amendment of the Senator from Illinois, I ask unanimous 
consent that it be in order that I send an amendment to the desk and 
then have that laid aside and then return to the amendment of the 
Senator from Illinois.

  The PRESIDING OFFICER. Without objection, it is so ordered. The clerk 
will report.
  The assistant legislative clerk read as follows:

       The Senator from New Mexico [Mr. Bingaman] for himself and 
     Mr. Lieberman, proposes an amendment numbered 2223.

  Mr. BINGAMAN. I ask unanimous consent that reading of the amendment 
be dispensed with and the amendment be set aside and we return to the 
amendment of the Senator from Illinois.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       At the appropriate place, insert the following:

     ``SEC.   . DEFICIT-NEUTRAL RESERVE FUND FOR CIVILIAN RESEARCH 
                   AND DEVELOPMENT.

       ``(a) In General.--In the Senate, revenue and spending 
     aggregates and other appropriate budgetary levels and limits 
     may be adjusted and allocations may be revised for 
     legislation to fund civilian scientific and technological 
     research and development, to increase research and 
     development for the health sciences, or to increase research 
     and development to improve the global environment, provided 
     that, to the extent that this concurrent resolution on the 
     budget does not include the costs of that legislation, the 
     enactment of that legislation will not increase (by virtue of 
     either contemporaneous or previously-passed deficit 
     reduction) the deficit in this resolution for--
       ``(1) fiscal year 1999;
       ``(2) the period of fiscal years 1999 through 2003; or

[[Page S2901]]

       ``(3) the period of fiscal years 2004 through 2009.
       ``(b) Revised Allocations.--
       ``(1) Adjustments for legislation.--Upon the consideration 
     of legislation pursuant to subsection (a), the Chairman of 
     the Committee on the Budget of the Senate may file with the 
     Senate appropriately-revised allocations under section 302(a) 
     of the Congressional Budget Act of 1974 and revised 
     functional levels and aggregates to carry out this section. 
     These revised allocations, functional levels, and aggregates 
     shall be considered for the purposes of the Congressional 
     Budget Act of 1974 as allocations, functional levels, and 
     aggregates contained in this resolution.
       ``(2) Adjustments for amendments.--If the Chairman of the 
     Committee on the Budget of the Senate submits an adjustment 
     under this section for legislation in furtherance of the 
     purpose described in subsection (a), upon the offering of an 
     amendment to that legislation that would necessitate such 
     submission, the Chairman shall submit to the Senate 
     appropriately-revised allocations under section 302(a) of the 
     Congressional Budget Act of 1974 and revised functional 
     levels and aggregates to carry out this section. These 
     revised allocations, functional levels, and aggregates shall 
     be considered for the purposes of the Congressional Budget 
     Act of 1974 as allocations, functional levels, and aggregates 
     contained in this resolution.
       ``(c) Reporting Revised Allocations.--The appropriate 
     committees shall report appropriately-revised allocations 
     pursuant to section 302(b) of the Congressional Budget Act of 
     1974 to carry out this section.''.


                           Amendment No. 2175

  Mr. BINGAMAN. Mr. President, I, first, say that putting together a 
budget resolution is a very complex, difficult process. I commend those 
who have worked on this, particularly my colleague from New Mexico for 
bringing in a budget resolution that is within the constraints of the 
balanced budget agreement. I think that is certainly progress and is to 
be commended. I am, however, troubled by many aspects of it. One aspect 
is that which is intended to be dealt with by this amendment by the 
Senator from Illinois.
  I fear this budget does not reflect the forward-looking perspective 
that prepares us for the world that we are facing in the 21st century.
  I do not think anyone would dispute the paramount importance of 
education, of research, and of a safe, healthy start for our children. 
The importance of those items, in my view, are not reflected in this 
budget. They are not given the priority they should be given in this 
budget.
  Let me give a few examples. In the area of education, and, of course, 
the Senator from Illinois was talking about this general area of 
education, the President has proposed at least $1.6 billion more than 
the Republican budget in 1999 for the budget functions that include 
education, training, and social services. The Republican budget does 
not increase Federal spending by 1 cent over last year's balanced 
budget amendment in that regard.
  More specifically, the President and the Senate Democrats have put 
forth some very significant education proposals, one of which is this 
amendment by the Senator from Illinois. The Republican budget does not 
give the same priority to those concerns. The Democratic alternative 
and this amendment propose to help communities to renovate and build 
school facilities, including BIA schools, which are very important in 
my home State of New Mexico. The Republican budget essentially ignores 
this request. The Democratic proposal provides for the hiring and 
training of 100,000 new teachers, which is projected to reduce the 
average class size in grades 1 through 3 from 22 students in a class to 
18 students in a class. Again, the Republican budget ignores that 
proposal.
  In addition, the Republicans claim they are providing an increase of 
$2.5 billion over the freeze level during this 5-year period for the 
Individuals with Disabilities Act. It turns out that this funding does 
not keep pace with inflation.
  While this resolution proposes to increase money for one type of 
block grant, the simple fact is that spending is cut significantly 
overall and that means that very important programs will have to be 
cut. Some of those programs--we are not clear as to which ones yet, of 
course, since that is not specified in the resolution--but some of 
those might include title I for disadvantaged children, Head Start, 
training and technology for teachers, and teacher quality.
  The resolution also gives short shrift to child care, and again 
Senator Dodd from Connecticut offered an amendment that I support in 
that regard.
  With regard to tobacco, I am tremendously concerned that the budget 
as presently written precludes any meaningful consideration of programs 
to reduce teen smoking. While I strongly agree with the chairman of the 
Budget Committee that we must do something to fix our Medicare Program, 
I believe we do not need to do so at the expense of the current and 
future health needs of our children.
  I commend our colleagues for the hard work that has gone into this 
resolution, but I do differ with my Republican colleagues about the 
ways in which we allocate spending in this bill. We are entering the 
21st century as a strong and vibrant and growing economy, but we will 
only remain that way if we invest in the future and ensure that every 
American has the opportunity to take advantage of that growth. The way 
we do this is to focus on these areas of priority--education, training, 
and the needs of working families.
  I hope we can adopt some amendments to this resolution that will 
allow us to do that more effectively.
  I yield the floor.
  Mrs. MURRAY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Washington.
  Mrs. MURRAY. Thank you, Mr. President.
  I rise in strong support of this amendment and offer my 
congratulations to the Senator from Illinois for bringing this critical 
issue to the attention of the Senate and to the attention of the 
Nation. Certainly it is an issue of safety and health for many children 
across our country. For all of us who go out and visit schools on a 
regular basis, we see classrooms that are in cafeterias, in gymnasiums, 
and in closet space--of all things--all across this country, and that 
is wrong. This is an issue that has to be addressed.
  Let me also bring to the attention of my colleagues the issue that 
many of us hear about--the high number of jobs that are available today 
in the area of technology. The ITEA recently put out a study showing 
there are 200,000 job openings today. These are $40,000- to $60,000-a-
year jobs available in technology, yet we don't have the skills or 
students with the skills available to go into these jobs because they 
haven't had the education and the experience in their schools.
  I have worked very hard to bring technology to the floor of the 
Senate as an issue. We have put computers into our schools, technology 
into our schools. In a few minutes, the Labor Committee will be working 
on the Reauthorization Act that includes my language to train teachers 
in technology throughout our schools, but if we don't pass the issue of 
school construction, far too many of our children will never have 
access to these skills because they are in classrooms where you cannot 
plug in a computer.
  This issue is critical and I urge my colleagues to support it. I, 
again, thank my colleague from Illinois for bringing it to our 
attention and appreciate her long concern and work on this issue.
  The PRESIDING OFFICER. The Senator from California.
  Mrs. FEINSTEIN. Mr. President, I rise to speak in support of this 
amendment, and in particular to thank my friend and colleague, the 
senior Senator from Illinois, for her hard work. I am aware that there 
is another school construction amendment. It is known as the Roth 
amendment. It is part of the Coverdell tax bill. These amendments, in 
my view, complement one another.
  What the Senator from Illinois has done is structure an amendment so 
it really benefits some of the older, more stressed urban school 
districts in America. What the other amendment would do is stress the 
smaller, suburban rural areas where there is substantial growth going 
on. So between the two of them, they provide to the States and the 
cities and the counties of America a truly major, major commitment to 
new school construction.
  This is a $21.8 billion authority for State and local governments to 
issue bonds to construct and rehabilitate schools. For California 
alone, this would mean $2.2 billion in bonds. It is the most of any 
State. Thirty-five percent of these bonds would be used by

[[Page S2902]]

the 100 largest school districts based on their ESEA title I funding 
which assists disadvantaged children; 65 percent would be distributed 
by States based on their own criteria; in addition, the Secretary of 
Education could designate 25 additional districts based on the State's 
share of Elementary and Secondary Education Act title I grants, 
excluding the 100 largest districts.
  Under this amendment, California school districts are really helped. 
Bakersfield would get $19 million; Compton, $30 million; Fresno, $56 
million; Long Beach, $48 million; Los Angeles, deeply troubled, and I 
will show you why in a moment, $488 million; Montebello, $22 million; 
Oakland, $35 million; Pomona, $18 million; Sacramento, $31 million; San 
Bernardino, $32 million; San Diego, $69 million; San Francisco, $28 
million; Santa Ana, $27 million; and Stockton Unified, $24 million.

  This proposal, again, helps the large urban poor districts. 
California's public school enrollment, much of it in these districts 
alone, between 1997 and the year 2007, is going to grow by almost 16 
percent. That is triple the national projected rate of growth of 4.1 
percent. California schools will grow three times faster than schools 
in the rest of the United States.
  Each year, between 160,000 and 190,000 new students will come into 
California schools. The high school enrollment is projected to increase 
by 35 percent by 2007. Approximately 920,000 students--that is almost 1 
million--are to be admitted to schools in the State during that period, 
boosting total enrollment from 5.6 million to 6.8 million.
  Our school population is bigger than the population of most of the 
States. That is how important this bill is to California. California 
needs to build 7 classrooms a day, at 25 students per class, just to 
keep up with the average growth that is going to take place. We need to 
build 327 schools over the next 3 years just to keep pace with the 
growth that is going to take place. We have the largest class sizes in 
the Nation. Students are crammed into every available hallway, assembly 
room, and many of them in temporary buildings. Los Angeles--and this is 
staggering--Unified School District has 560,000 seats for 681,000 
students. That means they don't even have seats for 120,000 students. 
So the absence of seats in Los Angeles is bigger than most of the 
school districts in a State. And this is just one city in the State.
  I could go on and on with examples. But of 60 percent of the schools 
over 30 years old, most do not have modern infrastructure. Eighty-seven 
percent of the schools need to upgrade and repair buildings. The 
California Department of Education estimates that this State--one State 
alone--just to stay even, needs $22 billion during the next decade to 
modernize public schools and an additional $8 billion just to meet 
enrollment growth. That is $30 billion in the next decade just to stay 
even.
  I have heard a lot of talk on this floor about education, and I can 
say only one thing: If you talk education and you have crowded and 
dilapidated schools and you don't have seats for the children in the 
schools, there is only one thing you can really do, and that is put 
your money where your mouth is. This is the first step toward ``putting 
your money where your mouth is'' amendment.
  I am so proud of the Senator from Illinois. There is no single piece 
of legislation, there is no single amendment on any bill, that will 
help the school system of the great State of California more than the 
Moseley-Braun amendment. I want to make that crystal clear.

  Here is what it costs. I mentioned the cost and that we need $30 
billion just to stay even. Here is what it costs to build a school in 
California: An elementary school, $5.2 million; a middle school, $12 
million; a high school, $27 million.
  Our schools must be built to withstand earthquakes, floods, El Nino, 
and myriad other natural disasters. The cost of building a high school 
in California is almost twice the national cost. The U.S. average is 
$15 million; in California, it is $27 million. We have the largest 
pupil-per-teacher ratio in the country. And thanks to the Governor and 
the legislature, we are now beginning to reduce class size. K-3 is now 
limited to 20 students per teacher.
  In conclusion, studies show that test scores of students in schools 
in poor condition can fall as much as 11 percentage points below scores 
of students in good buildings. I think this amendment is important. I 
really hope that no one in this body would not vote for this amendment 
because of the Coverdell bill. The Coverdell bill and the Roth 
amendment cover very different school districts than does this 
amendment. If you want to help the big urban school districts of 
America, where the dilapidated schools are, where the learning really 
needs improvement, there is only one game in town, and it is Carol 
Moseley-Braun's school construction amendment. I am proud to support 
it.
  Ms. MOSELEY-BRAUN. I thank the Senator from California for her 
eloquence. I did, however, want to take issue with one little part. 
This is just a sense of the Senate, but the underlying legislation does 
relate to suburban and rural schools as well as city schools. The 
Senator is right about the urban schools. It does a lot more for urban 
schools than the alternative legislation, but it also covers suburban 
and rural, because in my State, of course, just outside of Chicago is a 
place called Illinois, so I have to make sure that is covered.
  In fact, if I may, for a moment, pick up where the Senator from 
California left off, this is a picture from a suburban school. This is 
outside of Chicago. You can see it is a portable classroom. The doors 
are falling off, and the gutters are down on the ground. It is in a 
dilapidated condition. So we see it all over.
  Senator Feinstein was exactly right to point out how much will be 
required for new construction, in addition to fixing the crumbling 
schools we have already. The GAO points out that we need $112 billion 
just to repair the schools that are falling down. They also found, 
however, that we have about $73 billion worth of need for new schools. 
So what we are really looking at is not just the $112 billion price 
tag, but a $185 billion price tag.
  If you take the argument that somehow this is a local responsibility, 
it should come out of local property taxes, then what you are really 
saying is that the local property taxpayers should cough up an 
additional $185 billion--$185 billion. When you consider that property 
taxes around the country have been increasing, frankly, at a greater 
rate than the taxes at the national level have increased, State and 
local taxes, as a share of income, have risen nearly 10 percent in the 
last decade. In the last 10 years alone, in my State of Illinois, the 
property taxes have more than doubled. All across the country, voters 
reject the property tax hikes to pay for schools and other municipal 
improvements.
  Again, we cannot continue to rely on the property tax alone to build 
the schools that we need for the next century. I think what is called 
for here is a partnership--a partnership in which we come together and 
work together at the Federal, State, and local government level to 
provide the funding that will be required to help rebuild our crumbling 
schools.
  Mr. President, just yesterday a Manhattan State Supreme Court justice 
ordered New York City and the New York Board of Education to eliminate 
hazardous school conditions and to begin regular inspections and 
maintenance of its 1,200 school buildings. That decision came out of a 
lawsuit brought on the issue of the crumbling schools. According to 
that report that was commissioned by the New York board, 40 percent of 
the schools in New York lack functioning or accessible bathrooms and 
water fountains with clean water; 760 buildings had serious heating and 
ventilation problems; an average of 47 percent of the schools in New 
York are falling into unacceptable disrepair.

  Again, this is the kind of dilapidation we are seeing all over. In 
fact, there is litigation pending in another 16 States on this point. I 
think this amendment we are considering today expressing the sense of 
the Senate will go in the right direction.
  The point I believe we have to make is that it is appropriate for us 
at the national level to stop pointing fingers, to stop the divisive 
blame game that stalls Federal support for school improvements, and 
that we all have a responsibility to come together and work on this. I 
am pleased that Senator Feinstein came to the floor to discuss

[[Page S2903]]

this matter. It was my understanding that the Senator from New Jersey 
wanted to speak on this matter. I yield to him.
  Mr. LAUTENBERG. I thank the Senator from Illinois. I do want to say 
something about this important piece of legislation.
  Mr. President, I stand to support the amendment presented by the 
distinguished Senator from Illinois. Senator Moseley-Braun's amendment 
is a critical issue in terms of how we deal with the educational 
requirements of our young people.
  The Senator from Illinois has had a long record--certainly since she 
has been here, and I understand before she arrived to the U.S. Senate--
of interest and involvement in children, particularly focused on 
education in the early years. I am delighted to join with her and 
others here who are supporting an investment in bringing our school 
facilities up to date, making sure that the place in which children are 
expected to learn invites the process of learning and doesn't distract 
them, because it is either too cold, too hot, or too dangerous, or 
because of water leaking through the roof, or perhaps asbestos in the 
building, or insufficient facilities to attend to the children's needs. 
The condition is so outrageous that the GAO says that there are more 
than 14 million children attending schools that are in need of 
extensive repair or replacement. Several million attend schools with 
safety code violations, and, as I mentioned, leaky roofs are in schools 
that house 12 million students.
  The GAO found the problem of crumbling schools transcends demographic 
and geographic boundaries. Roughly one-third of urban rural and 
suburban schools report that at least one building is in need of 
extensive repair, or to be completely replaced. Furthermore, the GAO 
reports that most schools are not prepared to incorporate modern 
technology in the classroom. Forty-six percent of schools lack adequate 
electrical wiring to support the full-scale use of technology. More 
than a third of the schools lack the requisite electrical power. And 56 
percent of schools have insufficient phone lines for modems.
  When we talk about percentages of 56 percent here and 12 percent 
there, it kind of escapes into an amorphous condition that prevents us 
from really analyzing what the effects of these inadequate facilities 
represent. It takes a real toll on students, on children.
  I came out of the computer business. I arrived here some years ago 
from the city of Paterson, NJ, where my company was founded and where I 
was born. We had a population, I would say, of somewhere around 150,000 
people with a commensurate number of students. I have been back there 
many times. I have a fondness of that place of my birth. I know a lot 
of the people who live in the town. One of my schoolmates was a fellow 
named Larry Doby, who was just admitted to the Baseball Hall of Fame.
  I visit the city regularly. Until recently, I used to go to the same 
barbershop every couple of weeks since I was a college student. I 
return there and very often bring people around my old neighborhood to 
kind of give them a sense of what kind of beginning and opportunity I 
had. They were amazed at the dilapidated condition of the facility. I 
met children there and told them I lived in the building. They asked me 
what floor. I said, ``The second floor.'' The number of the building 
was 310 Hamilton Avenue. They asked me, ``What floor?'' I lived on the 
second floor. ``Yes. What apartment?'' I said, ``In the back 
apartment.'' They said, ``You lived there?'' ``Yes. I lived there.''
  So it established a particular attachment.
  I was called on by the board of education at Paterson a year or two 
ago to see if I could get them some help so they could get the schools 
wired in preparation for connection into the Internet. They couldn't 
raise the money within the city. People wanted it; they couldn't afford 
to pay the taxes necessary. The city was in arrearages all over the 
place. I arranged for some people I knew in my old company to pay for 
the facility to be wired. We went down there, and we stood with the 
people from the telephone company and pulled wire. What a pitiful 
condition. Can you imagine that you have to depend on someone's 
goodness, or some company's willingness to step forward so a school can 
be affixed to the Internet so the kids can learn that there is 
something besides pens and pencils and pads that are going to be 
required in the lives that they expect and hope to lead one day? It is 
pretty discouraging if kids don't know what it is that the outside 
world holds for them.

  I once visited a school in Newark earlier in my days in the Senate. 
It caused me to write a piece of legislation called ``computers in 
schools'' to try to make sure that there was a computer available in 
classrooms with a reasonable population-to-computer ratio so that the 
children there would have a chance to learn the applications.
  One of the things that we saw in a visit to a school in a very poor 
neighborhood with high crime in a broken-down neighborhood was that one 
child I was introduced to was sitting at a computer terminal. They told 
me that he was in about the third or fourth grade. They told me that 
this child had such a bad deportment record that they were looking for 
a way perhaps to expel him from the school. Then they brought in a 
couple of computers. This child couldn't keep up academically. His 
behavior, as I say, was bad. They sat him in front of a computer. They 
taught him a couple of basic exercises that children learn. He was so 
proficient in such a short time that he began to outdistance the other 
children.
  I tell you this story only because to me it established the fact that 
children have to be given a chance to learn and develop based on their 
own ability, based on their own capacity to learn, and not be 
restricted to staying with a class where perhaps there is some 
maladjustment to it.
  So I fully support this amendment.
  Broken-down schools have a negative effect on the ability of students 
to learn. They see this grim surrounding, and they begin to believe 
that is the way the world around them exists and will exist for them. 
Academic research has proven that there is a direct correlation between 
the condition of school facilities and student achievement.
  Georgetown researchers found that test scores of students assigned to 
schools in poor condition can be expected to fall 11 percentage points 
below the test scores of students in buildings in adequate condition. 
Unfortunately, many local educational agencies have difficulty securing 
financing for school facility improvements. The proposal called for in 
this amendment would really help. The zero interest school 
modernization bond and the Federal income tax credits to purchase those 
bonds in lieu of interest payments would be an important step toward 
rebuilding and modernizing our Nation's schools.
  Mr. President, I say to those who criticize test scores, who intimate 
that our children are inadequate to the task that they are assigned to, 
I ask those people to look to where the problem is. It is not simply 
looking at students' surroundings. We should provide facilities through 
our Government. Why is it that we encourage this feeling of being 
forlorn, or outside of the mainstream? It is because the condition of 
the facility says that these children are not worth the effort that it 
takes to have them in a better learning condition.
  Mr. President, if we want our kids to learn, if we want our children 
to be competitive in the years ahead, if we expect them to be leaders 
in the true sense of the word, where we are not just making speeches 
but we want to do something about it, then this is an excellent 
opportunity to register our support.
  Again, my commendation goes to the distinguished Senator from 
Illinois for her leadership on this issue.
  Mr. KENNEDY. Mr. President, I strongly support Senator Moseley-
Braun's amendment to the budget resolution to help modernize and repair 
the nation's public school facilities for the 21st century.
  Schools across the nation face serious problems of overcrowding. 
Antiquated facilities are suffering from physical decay, and are not 
equipped to handle the needs of modern education.
  Across the country, 14 million children in a third of the nation's 
schools are learning in substandard buildings. Half the schools have at 
least one unsatisfactory environmental condition.

[[Page S2904]]

 It will take over $110 billion just to repair existing facilities 
nationwide.
  Massachusetts is no exception. 41% of our schools across the state 
report that at least one building needs extensive repair or should be 
replaced. Three-quarters report serious problems in buildings, such as 
plumbing or heating defects. 80% have at least one unsatisfactory 
environmental factor.
  In Boston, many schools cannot keep their heating systems functioning 
properly. On a given day, 15 to 30 schools complain that their heat is 
not working.
  Faulty boilers and leaky pipes are responsible for sewage leaks and 
backups at many schools in Springfield, Massachusetts.
  The leaking roof at Revere High School is so serious that the new 
fire system is threatened. School Committee members estimate that 
fixing the roof will cost an additional $1 million, and they don't know 
where to get the money.
  It is difficult enough to teach or learn in dilapidated classrooms. 
But now, because of escalating enrollments, classrooms are increasingly 
overcrowded. The nation will need 6,000 new schools in the next few 
years, just to maintain current class sizes.
  The student population in Pomona, California has increased 37% in the 
last ten years, and most students are now forced to study in poorly 
ventilated and dimly lit portable classrooms. To accommodate the large 
number of students using the cafeteria, school officials have had to 
schedule five different lunch periods every day.
  Malden, Massachusetts is in the process of building five new 
elementary schools to accommodate increases in student enrollment. The 
estimated cost for constructing these schools will exceed $100 million.
  The Senate recently heard testimony from a student in Clifton, 
Virginia whose high school is so overcrowded that fights often break 
out in the overflowing halls. The problem is called ``Hall Rage,'' and 
it's analogous to ``Road Rage'' on crowded highways. The violence in 
the hallways is bad enough. But it's even worse, because it's difficult 
for teachers to teach when students are distracted by the chaos in the 
hallways and outside their classrooms.
  State governments and local communities are working to meet these 
challenges. In Massachusetts, under the School Building Assistance Act, 
the state will pay 50-90% of the most severe needs. 124 schools now 
have approved projects, and are on a waiting list for funding. The 
state share should be $91 million this year, but only $35 million is 
available. More than 50 other projects are awaiting approval. With that 
kind of deficit at the state and local level, it is clear that the 
federal government has a responsibility to act.
  Incredibly, the Republican budget proposal ignores these pressing 
needs. The Republican plan cuts funding for education. It refuses to 
provide needed new investments to improve public education, including 
school modernization and construction.
  Democrats have made it a top priority to see that America has the 
best education system in the world. Providing safe and adequate school 
facilities is an important step towards meeting that goal.
  I urge the Senate to approve this amendment. Investing in education 
is one of the best investments America can possibly make. For schools 
across America, help is truly on the way--and it can't come a minute 
too soon.
  Mr. LAUTENBERG. Mr. President, I do not know, before I relinquish the 
floor, what the expectation is for Senator Conrad, who has a vote 
coming up. What is the order of business, please?
  The PRESIDING OFFICER. The vote is expected to occur with respect to 
Senator Conrad's amendment 2174 at 2 p.m.
  Mr. LAUTENBERG. Has the unanimous consent order been propounded that 
would give Senator Conrad an opportunity to discuss his amendment 
before the vote takes place?
  The PRESIDING OFFICER. It has not.
  Ms. MOSELEY-BRAUN. Will the Senator yield?
  Mr. LAUTENBERG. It has not. How much time remains on the side of the 
proponents?
  The PRESIDING OFFICER. Six minutes 20 seconds.
  Mr. LAUTENBERG. The Senator from Illinois has a question?
  Ms. MOSELEY-BRAUN. Yes. I thank the Senator from New Jersey. I was 
just going to ask if this colloquy was being charged to time on this 
side because the junior Senator from New Jersey wanted to speak, and I 
wanted to have an opportunity to close. We are 10 minutes from the hour 
of 2 o'clock, and I understand there is a vote scheduled by unanimous 
consent for that time. In just trying to accommodate the time, I was 
wondering if it was being charged to the time of the proponents of this 
amendment.
  Mr. LAUTENBERG. With all due respect, I thought the Senator from 
Illinois had suggested that she was wrapped up with her commentary, and 
in consideration of accepting that condition, it was my understanding 
we were going to provide Senator Conrad with time to address his 
amendment before the vote takes place.
  Ms. MOSELEY-BRAUN. The Senator is correct. In the meantime, the 
Senator from New Jersey came in the Chamber and asked for time to 
speak, and, again, I would take a minute to close and if the Senator 
could take 2 minutes.
  Mr. LAUTENBERG. I would be happy to yield the floor.
  Ms. MOSELEY-BRAUN. I thank the Senator from New Jersey.
  I yield 2 minutes to the Senator from New Jersey.
  Mr. TORRICELLI. Mr. President, if Senator Conrad, indeed, desires to 
speak for 5 minutes and the Senator from Illinois desires to speak for 
5 minutes, I would ask unanimous consent that this Senator have 5 
minutes, the Senator from Illinois have 5 minutes, and Senator Conrad 
have 5 minutes, which would mean that the vote would take place at 
approximately 2:10.
  Mr. LAUTENBERG. I will have to raise an objection because there is an 
understanding being proposed that would include some time for Senator 
Coverdell. And I will ask unanimous consent, before there be any 
further discussion about this, that at 2 o'clock the floor be returned 
to me so that I can engage in a UC with my Republican counterpart.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. TORRICELLI. Mr. President, the situation is the vote is at 2 
o'clock and Senator Carol Moseley-Braun and I will speak until then?
  The PRESIDING OFFICER. That is the understanding.
  Mr. TORRICELLI. I thank the Chair.
  Mr. President, there is a significant chance that this Senate will 
one day be remembered for having finally begun to address the problems 
of educational quality in America. President Clinton in his State of 
the Union Address challenged this Congress to deal with the problems of 
school construction, class size, and competence. We are now taking up 
that challenge, and, indeed, in the last few weeks in dealing with the 
Coverdell-Torricelli proposal, we also address the problem of access to 
private schools and the rights of families to save money privately to 
deal with the costs of public and private education.
  Today we return to the subject again. Senator Carol Moseley-Braun of 
Illinois, as she has on many occasions, is now bringing forward 
consistently and repeatedly a message to deal with the plight--the 
construction of our schools.
  I recognize that in this Senate almost everyone has an idea to deal 
with the problems of education in America. Almost everyone is right 
except those who think they have the only idea. This problem is so 
serious in quality and in access that it will require not just this 
Senate but Congresses to come, not just this idea but many ideas. The 
quality of education in this country is the most serious threat to the 
maintenance of not only social order but our quality of life. We 
recognize it has many components but probably none more difficult than 
rebuilding our Nation's schools.

  It is estimated that it could cost $112 billion to rebuild crumbling 
schools in America.
  Having toured many of these schools in my own State of New Jersey, I 
have seen students sitting in hallways because there was not enough 
room. I have seen students with buckets next to their desks to catch 
the rain, students who did not have restrooms in

[[Page S2905]]

their own school facilities but were sent to other buildings. Our 
parents and their parents before them worked and saved and sacrificed 
to build a system of public education in this country and an 
infrastructure that was without equal in the world. They met that 
challenge. The simple and regrettable truth is we have not.
  This system of education, which more than anything else in the Nation 
is the foundation for our country's prosperity, is crumbling around us. 
One-third of the students in the Nation face exactly the plight that I 
have outlined, and more will join them unless we stand up to this 
challenge.
  To all of you who are part of the efforts to assure there is access 
to the Internet, who joined with us in the fight to help private and 
public savings through Coverdell-Torricelli, who believe in testing, 
who join any of these fights, join this fight because there is no one 
front in the war dealing with educational quality in America. It must 
be fought on all fronts at the same time.
  I am very proud to be part of the efforts of the Senator from 
Illinois, Carol Moseley-Braun, who more than anyone else has brought 
this fight forward and will be principally responsible when we 
ultimately do succeed.
  I thank the Senator for yielding the time.
  Ms. MOSELEY-BRAUN. I thank the Senator from New Jersey.
  In summation, Mr. President, we have heard some of the stories. There 
are many other anecdotal stories, stories even in my State about 
faucets and drains in science labs that don't work and electrical 
wiring that can't support the computers, a school in Alabama where the 
water leaks collapsed the ceiling 40 minutes after the children left 
for the day.
  These stories, frankly, are news to no one. I hope that this Senate 
will take a good look at the sense of the Senate and not let this vote 
come down on truly partisan grounds. I have a sense that it will, and 
that in my opinion is tragic because, if anything, our children are not 
Republican or Democrat or Independent. Our children require an 
education, and politics should stop at the schoolroom door. This should 
be something that would engage nonpartisan support based on the policy 
objective of the sense-of-the-Senate amendment.
  That is what this vote is about. It is about policy. I hope it is not 
about politics. I hope we will send a signal that we are prepared, 
because, again, it is only a sense-of-the-Senate amendment, that we 
will send a signal to the country that this Congress is prepared to 
take up the challenge of rebuilding our crumbling schools; that we are 
prepared to do it in partnership with our State and local governments; 
we are not looking to local property taxpayers alone to carry the 
burden of the $185 billion it will take to build and repair schools; 
that we are not going to try to pass the buck to the States and have 
them raise State taxes to do it; that we can work together to provide a 
bureaucracy free of raising the capital.
  That is all this amendment does. It doesn't tell anybody which school 
to fix. All it says is here is a way to raise the money, and Uncle Sam 
is going to give you a tax credit in lieu of interest on these bonds 
that the local school districts will issue. I think it makes absolute 
sense. It is a very straightforward way of doing it. It will provide 
support for all kinds of schools in rural and suburban districts as 
well as in urban districts where the needs, of course, are the most 
pronounced, but certainly they are pronounced all over the country.
  I encourage my colleagues to support the sense-of-the-Senate 
amendment, and I yield the floor.
  Mr. LAUTENBERG. Mr. President, I thank the Senator from Illinois. We 
are ready to proceed with the next piece of business. I think the 
manager, the chairman of the Budget Committee, has something he wants 
to put down.
  Mr. DOMENICI. Mr. President, might I inquire, where are we on the 
amendment of the distinguished Senator from Illinois?
  The PRESIDING OFFICER (Mr. Smith of Oregon). All time of the 
proponents on the amendment has expired.
  Mr. DOMENICI. We have not used any time in opposition?
  The PRESIDING OFFICER. That is correct.


                           Amendment No. 2174

  Mr. KENNEDY. Mr. President, I strongly support the amendment offered 
by Senators Conrad and Lautenberg, which will ensure that any revenues 
generated from an increase in the price of cigarettes is directed first 
and foremost to protecting the nation's children from nicotine 
addiction and smoking-induced diseases.
  The Republican budget creates a number of serious barriers to these 
efforts by prohibiting tobacco revenues from being used for anti-
smoking initiatives.
  In fact, the budget uses Medicare as a smokescreen to make funding 
more difficult for important smoking cessation programs, counter-
advertising to deglamorize tobacco use among children, biomedical 
research to cure smoking-caused illnesses, and public education to 
inform the American people more fully about the dangers of tobacco use.
  If the current restrictive resolution is adopted, a vote of sixty 
Senators would be required to waive the restrictions. The result is 
that millions of Americans who want to quit smoking will have a much 
more difficult time achieving their goal. Anti-smoking programs are 
central to any effective measure to reduce tobacco use, and they should 
be the first priority for the dollars raised by a cigarette price 
increase.
  If these anti-tobacco initiatives are not funded, the problem of 
teenage smoking in the United States will only increase. According to 
the Centers for Disease Control and Prevention, a million youngsters 
start smoking each year--almost 3,000 a day. One third of them will die 
prematurely from smoking-induced illnesses. The average smoker begins 
at age 13, and becomes a daily smoker by age 15.
  These facts are serious enough. But the crisis is growing worse. A 
Spring 1996 survey by the University of Michigan Institute for Social 
Research found that teenage smoking has continued to rise since 1991. 
It climbed by nearly fifty percent among eighth and tenth graders, and 
by nearly twenty percent among high school seniors between 1991 and 
1996.
  The industry strategy is obvious. The tobacco companies target 
children, because once children are hooked on cigarette smoking, they 
become customers for life. Ninety percent of current adult smokers 
began to smoke before they reached the age of 18. By contrast, if young 
men and women reach that age without beginning to smoke, they are 
unlikely to take up the habit in later years.
  The tobacco companies know these facts. They are fully aware that if 
they do not persuade children to start smoking, the industry may 
collapse within a generation. That's why Big Tobacco has targeted 
children with billions of dollars in advertising and promotional 
giveaways that promise popularity and success for those who take up 
smoking.
  The Centers for Disease Control and Prevention estimate that the 
average 14-year-old is exposed to $20 billion in advertising--$20 
billion--beginning at age 6. In fact, the name ``Joe Camel'' is as 
familiar to children as ``Mickey Mouse.''
  Two recently disclosed industry documents illustrate the blatant 
marketing to youths. In a 1981 Philip Morris memo entitled ``Young 
Smokers--Prevalence, Implications, and Related Demographic Trends,'' 
the authors wrote that:
       It is important to know as much as possible about teenage 
     smoking patterns and attitudes. Today's teenager is 
     tomorrow's potential regular customer, and the overwhelming 
     majority of smokers first begin to smoke while still in their 
     teens. . . The smoking patterns of teenagers are particularly 
     important to Philip Morris. . . Furthermore, it is during the 
     teenage years that the initial choice is made.
  A marketing report by R.J. Reynolds researcher Diane Burrows, written 
prior to launching the Joe Camel advertising campaign, stated:
       Younger adult smokers are critical to R.J. Reynolds' long-
     term profitability. Therefore, RJR must make a substantial 
     long-term commitment of manpower and money dedicated to 
     younger adult smoking programs.

A related RJR document states that ``young adult'' refers to the 14-24 
age group.
  It is no coincidence that shortly after R.J. Reynolds launched the 
Joe Camel campaign in 1988, Camel's share of the youth market soared 
from 0.5% to 32.8%.

[[Page S2906]]

  Unless Congress takes action to reverse this disturbing trend in 
adolescent smoking, five million of today's children will die 
prematurely from smoking-caused illness. That's unacceptable.
  Although all of us agree that Medicare should be protected for future 
generations, one of the best ways to keep Medicare strong is to invest 
in important public health and tobacco control programs that prevent 
children from beginning to smoke, and that help current smokers to quit 
smoking. Americans will lead healthier lives, and the burden of 
tobacco-induced diseases will be greatly reduced.
  Unfortunately, the Republican budget earmarks all of the tobacco 
revenues for Medicare. It prohibits using even one dollar of the 
tobacco revenues to deter youth from smoking.
  Smoking has inflicted great damage on people's health. It is the 
leading preventable cause of death and disability in the nation. 
Tobacco products are responsible for a third of all cancers, and 90% of 
all lung cancers.
  Smoking also causes great harm to nonsmokers. A recent study by the 
Agency for Health Care Policy and Research reports that second-hand 
smoke is responsible for as many as 60% of cases of asthma, bronchitis, 
and wheezing among young children. It makes sense to use tobacco 
revenues to discourage children from beginning to smoke.
  These programs work. Smoking cessation programs are among the most 
effective means to reduce health care costs. At the same time, they 
save and improve the lives of millions of Americans.
  They are also cost-effective. Every dollar invested in a smoking 
cessation program for a pregnant woman saves $6 in costs for neonatal 
intensive care and long-term care for low birthweight babies.
  Dr. Michael Fiore, Director of the Center for Tobacco Research and 
Intervention at the University of Wisconsin at Madison, noted that:

       smoking cessation programs are the most cost-effective 
     prevention intervention a physician can engage in. . . It is 
     a paradox in America that virtually every health insurance 
     policy pays for the outcomes of smoking, whether it is a 
     heart attack, stroke, or cancer, but only half of them pay 
     the $100 to $200 it would take to prevent these very 
     expensive illnesses.

  The Republican budget offers no help in cases like this, and that 
makes no sense. The Republican budget offers no help to states and 
communities for public health advertising to counteract the $5 billion 
a year that the tobacco industry pours into advertising to encourage 
people to start smoking and keep smoking.
  Paid counter-advertising is extremely effective in reducing tobacco 
consumption. Both Massachusetts and California have demonstrated that 
counter-advertising can discourage children from beginning to smoke and 
encourage smokers to quit. It helped reduce cigarette use in 
Massachusetts by 17% between 1992 and 1996, or three times the national 
average. Smoking by junior high school students dropped 8%, while the 
rest of the nation has seen an increase.
  In California, a counter-advertising campaign reduced smoking rates 
by 15% over the last three years.
  A soon-to-be-published study by Professor Frank Chaloupka of the 
University of Illinois found that tobacco counter-advertising can also 
reduce illegal drugs use among youth.
  The Republican budget, however, will provide no funding for these 
important efforts.
  The Republican budget offers no help to the Food and Drug 
Administration to enforce the laws against the sale of tobacco products 
to minors, even though young people spend $1 billion a year to buy 
tobacco products illegally.
  Last year, Congress tried to get away with underfunding the FDA's 
tobacco regulations by providing only $5 million of the $34 million 
President Clinton requested to begin enforcement of the youth access 
rule. An amendment by Senator Harkin to the Agriculture Appropriations 
bill to restore the funding was defeated on the Senate floor.
  Two months later, as public outrage grew, Congress reversed itself 
and overwhelmingly approved the full amount. A similar outcry from our 
constituents and the public health community is likely if we do not 
provide funding for these important enforcement efforts.
  Finally, the Republican budget offers no help for medical research on 
tobacco-related diseases, even though such research can lead to 
enormous savings for Medicare.
  Funding for tobacco-related medical research is vital to fulfilling 
our hopes for healthy lives for all citizens. The promise of new 
medical research is boundless. As impressive as the progress of the 
past has been, it pales in comparison to the opportunities of the 
future.
  In addition, a recent study by researchers at Duke University 
indicates that expanded funding for medical research can help keep 
Medicare and other federal health care programs solvent for the long-
term.
  If the goal of this budget resolution is to protect Medicare, it 
makes no sense to prevent tobacco revenues from being used to support 
anti-smoking programs that will reduce future costs for Medicare.
  Currently, smoking-induced diseases cost the federal government over 
$20 billion a year. If we invest in medical research to make Americans 
healthier, we can save enormous sums, protect these programs for future 
generations, and prevent many of the illnesses caused by smoking.
  The country supports these fundamental priorities, and the Senate 
should support them too. They have been endorsed by the public health 
community, and by Doctor Koop and Doctor Kessler. They are included in 
virtually all of the tobacco bills introduced in Congress by 
Republicans as well as Democrats. I urge my colleagues to support the 
Conrad/Lautenberg amendment.


                      Unanimous-Consent Agreement

  Mr. DOMENICI. Mr. President, I ask unanimous consent that at 2 p.m. 
the Senate resume consideration of the Coverdell amendment and there be 
5 minutes equally divided for debate on the Coverdell amendment; 
following that, there be 5 minutes equally divided for closing debate 
on the Conrad amendment.
  I further ask a vote occur on or in relation to the Conrad amendment 
at 2:10, to be followed by a vote on or in relation to the Coverdell 
amendment, with 2 minutes of debate equally divided between the votes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LAUTENBERG. Mr. President, I note the second vote would be 
limited to a 10-minute vote so Senators who come down here should know 
that they cannot go back and expect to spend 15 or 20 minutes back in 
the office and still be able to vote.
  Mr. DOMENICI. That is the current unanimous consent situation in the 
Senate, is it not, Mr. President?
  The PRESIDING OFFICER. That is correct.
  Mr. DOMENICI. I thank the Senator for reminding us.
  The PRESIDING OFFICER. Who yields time? The Senator from Georgia.


                           Amendment No. 2199

  Mr. COVERDELL. Mr. President, it is my understanding that we now have 
5 minutes equally divided on my amendment?
  The PRESIDING OFFICER. That is correct.
  Mr. COVERDELL. Mr. President, my amendment is the middle-class tax 
relief proposal. It calls on the Government to cut nondefense 
discretionary spending by 6.9 percent over the next 5 years. It would 
return discretionary spending to a level of 1996. That does not seem 
too distant a reach for us. It would produce $200 billion in new tax 
relief to American workers and it would do it by taking 10 million 
American taxpayers who, simply because they now make over $25,000 a 
year, have had their taxes increased from 15 percent to 28 percent. In 
other words, if they got a single raise, or because of inflation, that 
has taken these very modest income families and doubled their taxes.
  So we are saying we are going to lift the bar and we are going to 
allow those families, 10 million of them, to be pushed back down into 
the 15 percent tax bracket, remembering that American workers today are 
keeping less than half their paychecks by the time the Government romps 
through their checking account. No wonder we have so much trouble in 
our country in terms of families trying to make ends meet. We don't 
leave them enough resources to do the job we have always

[[Page S2907]]

asked them to do. This is a major step to correct that problem. I might 
add--how much time do I have remaining?
  The PRESIDING OFFICER. The Senator has 45 seconds.
  Mr. COVERDELL. I might add that one of the functional components of 
American liberty was and remains the right of workers to have their 
resources come to them so they can live out their dreams and their 
lives. We have changed this over the years.

  I pointed out this morning, my father kept 80 percent of his lifetime 
wages, he was born in 1912, and his granddaughter will be lucky if she 
keeps 40 percent of her lifetime wages. That will functionally change 
the way this country governs itself and lives. We must restore economic 
liberty to American workers.
  The PRESIDING OFFICER. The Senator from New Jersey.
  Mr. LAUTENBERG. Mr. President, I have 2\1/2\ minutes to respond. I 
won't take 2\1/2\ minutes because I want to yield some time to Senator 
Conrad. But I want to tell you something. My father kept 100 percent of 
his wages. They were so meager he couldn't pay taxes on them. But he 
had an opportunity to work whenever he could, and he held his head high 
and he loved America every day that he lived here, and that is what we 
are talking about. We can beat ourselves to death about how terrible 
conditions are here when people are living longer, living better, and 
enjoying life better than ever before in the history of mankind--
including in America. I am proud of this country and, as I said 
earlier: America, America the beautiful.
  I yield the remainder of my time to Senator Conrad.
  The PRESIDING OFFICER. The Senator from North Dakota.


                           Amendment No. 2174

  Mr. CONRAD. Mr. President, my amendment is designed to allow the 
reserve fund for possible tobacco revenues to be used for more than 
just Medicare. My amendment is cosponsored by the distinguished Senator 
from New Jersey, Senator Lautenberg, Senator Bingaman of New Mexico, 
and Senator Reed of Rhode Island. While we acknowledge Medicare is an 
important priority, we understand it is not the only priority. We all 
understand if tobacco legislation passes, there are other things that 
are necessary for a national tobacco policy. The health community has 
told us very clearly we need to fund smoking cessation, smoking 
prevention. We need to promote and support additional health research. 
We also need to be able to fund counteradvertising and also ease the 
transition for farmers. All of those are things that need to be funded 
by a possible tobacco settlement.
  Unfortunately, under the terms of the budget resolution, none of 
those things are possible, none of them, even though every bill that 
has been introduced on the floor, every comprehensive piece of 
legislation, by Republicans and Democrats, has said that these other 
priorities also need to be funded.
  Here are the priorities in each of the comprehensive bills that have 
been introduced: Tobacco revenue should be provided for smoking 
education initiatives, to educate our young people. The Republican 
budget resolution says no, not one dime.
  The PRESIDING OFFICER. All time on the amendment has expired.
  Mr. CONRAD. Mr. President, I ask for 1 additional minute. I ask for 
an additional 1 minute. I would go on to the amendment itself, that 
gives me an additional 2\1/2\ minutes.
  The PRESIDING OFFICER. The Senator has 2\1/2\ minutes.
  Mr. DOMENICI. Senator, there is a unanimous consent agreement, so we 
will not disagree. We will give you the minute. I am not objecting.
  Mr. CONRAD. We are saying, in addition, tobacco revenues need to be 
used for counteradvertising. The resolution says no, none of the money 
can be used for that purpose.
  We say some of the money needs to be used for tobacco-related 
research. The resolution says no, none of the money can be used for 
that purpose.
  We think some of the money needs to be used to fund smoking 
prevention and cessation programs. The resolution says no, none of the 
money can be used for that purpose.
  We think some of it should be used to assist farmers in the 
transition. The resolution says no, none of the money.
  We will be told that, in fact, there is money in other parts of the 
budget, but all of us who are budgeteers understand that those are 
assumptions. There is no assurance whatever that 1 penny will be 
available for these purposes from these other funds. And even if they 
were available, under the assumptions of the Budget Committee, they are 
woefully inadequate. They only provide about $100 million a year when 
the health community tells us we need at least $2 billion a year if we 
are really going to have a chance to reduce youth smoking and protect 
the public health.
  We have an opportunity now to respond and broaden the use of the 
reserve fund so we can have comprehensive tobacco legislation pass in 
this Chamber. The only way any of the bills that are before us now will 
be in order on the floor of the Senate is if my amendment passes.
  I urge my colleagues to support it.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, I gather I have 5 minutes to respond?
  The PRESIDING OFFICER. The Senator has 2\1/2\ minutes.
  Mr. DOMENICI. I have 2\1/2\ minutes--it was 5 minutes equally 
divided.
  Mr. President, this is a very simple proposition. Do you want to 
start and create five new entitlement programs or do you want to save 
Medicare? It is a very simple proposition. We suggested, as 
Republicans, that Social Security and Medicare are the two most 
important American programs to save, reform, and make available well 
into the next century.
  We put our money where our mouth is, and we put whatever is left of 
the cigarette settlement on the highest priority health expenditure of 
this Nation: the salvaging and reforming of the Medicare system.
  In contrast, my good friend who offers this amendment says, ``Let's 
create five new entitlement programs.'' Even though the money will run 
out someday, we will have some permanent programs.
  Everyone knows this Nation should not have new entitlement programs, 
and everyone knows that there are many high-priority items in the 
American budget. We have said in our budget that we have made room for 
high-priority expenditures, and I will tell you quickly what they are:
  $15.5 billion increase in the National Institutes of Health. We have 
taken Presidential reductions and said we will spend them here;
  $825 million for a smoking cessation program, twice the size of the 
President's;
  And then we have said in our settlement of the tobacco fund, if it 
ever occurs, we pay the States their share and the rest of it goes to 
the program most in need--Medicare.
  Let me tell you, there is no relationship between some of the new 
entitlement programs that some want to create out of this tobacco 
settlement, but there is a direct relationship between the insolvency 
of the Medicare fund and tobacco smoking. As a matter of fact, in 1995 
there was $25 billion of costs in the Medicare system that came from 
smoking. So if you are going to get money from the tobacco settlement, 
put it where the damage to the senior citizens is occurring, and it is 
occurring by virtue of their fund for medical care going bankrupt.
  I believe the issue is very simple--very simple: Do you want a budget 
that begins to help with Medicare, or do you want a budget that says 
not one nickel for Medicare; let's take care of that later with money 
from somewhere else.
  The PRESIDING OFFICER. The Senator's time has expired. The Senator 
from North Dakota has 44 seconds remaining.
  Mr. CONRAD. Mr. President, this issue is simple. The question is, Are 
we going to have a reserve fund so that there is a solution to the 
tobacco controversy, that we can use the money in a way that 
accommodates every comprehensive bill that is before this body, 
introduced by Republicans or Democrats?
  Unfortunately, under the budget resolution, the money can only go for 
one purpose: Medicare. While that is an important priority, there are 
other priorities as well--smoking cessation, smoking prevention, health 
research, countertobacco advertising, easing the transition for 
farmers. We should not

[[Page S2908]]

be creating supermajority hurdles in the way of tobacco legislation, 
and the only way we avoid that is to pass this amendment.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. DOMENICI. Mr. President, the pending amendment is not germane to 
provisions of the Budget Act. Pursuant to section 305(b)(2) of the 
Budget Act, I raise a point of order against the pending amendment.
  Mr. CONRAD. Mr. President, I move to waive the Budget Act, and I ask 
for the yeas and nays on the motion.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The question is on agreeing to the motion to 
waive the Budget Act with respect to amendment No. 2174. The yeas and 
nays have been ordered. The clerk will call the roll.

  The assistant 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 46, nays 54, as follows:

                      [Rollcall Vote No. 54 Leg.]

                                YEAS--46

     Akaka
     Baucus
     Biden
     Bingaman
     Boxer
     Breaux
     Bryan
     Bumpers
     Byrd
     Cleland
     Conrad
     Daschle
     Dodd
     Dorgan
     Durbin
     Faircloth
     Feingold
     Feinstein
     Glenn
     Graham
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerrey
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Reed
     Reid
     Robb
     Rockefeller
     Sarbanes
     Torricelli
     Wellstone
     Wyden

                                NAYS--54

     Abraham
     Allard
     Ashcroft
     Bennett
     Bond
     Brownback
     Burns
     Campbell
     Chafee
     Coats
     Cochran
     Collins
     Coverdell
     Craig
     D'Amato
     DeWine
     Domenici
     Enzi
     Ford
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hagel
     Hatch
     Helms
     Hutchinson
     Hutchison
     Inhofe
     Kempthorne
     Kyl
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Murkowski
     Nickles
     Roberts
     Roth
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner
  The PRESIDING OFFICER. On this vote, the yeas are 46, the nays are 
54.
  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.
  Mr. COVERDELL. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 2199

  Mr. DOMENICI. Mr. President, what is the next order of business?
  The PRESIDING OFFICER. There are 2 minutes of debate equally divided 
before the vote on the Coverdell amendment.
  Mr. DOMENICI. Mr. President, there are a number of Senators who want 
us to tender amendments on their behalf. We will start to accumulate 
them. When the next vote is over, we will get them in.
  Mr. McCAIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Arizona is recognized.
  Mr. McCAIN. Mr. President, I thank Senator Coverdell for his 
leadership on this issue. It is one that is important to American 
families. It represents an important step toward a flatter, fairer tax 
system, and it also provides immediate tax relief for hard-working 
Americans and their families. The amendment provides broad-based middle 
class tax relief by increasing the number of individuals who pay the 
lowest tax rates of 15 percent and significantly lessening the impact 
of one of the Tax Code's most inequitable provisions, the marriage 
penalty. An estimated 28 percent of Americans would reap some benefit 
from the broad-based tax relief provisions in the bill, according to 
the Tax Foundation.
  Again, I thank Senator Coverdell for his leadership on this issue in 
the ongoing efforts to reduce the tax burden on the American citizens.
  I yield the floor.
  Mr. LAUTENBERG. Mr. President, first I make the point that the 
pending amendment is not germane, and therefore I will raise a point of 
order. Also, Mr. President, I rise in strong opposition to the McCain-
Coverdell amendment. The amendment would cut domestic programs like 
education, child care, law enforcement, veterans, environmental 
protection, and would violate current budget rules. I think it is 
fiscally dangerous and irresponsible, and I hope we will marshal a vote 
against this amendment.
  The PRESIDING OFFICER. The Senator from Georgia has 30 seconds 
remaining.
  Mr. COVERDELL. Mr. President, I yield back the balance of my time.
  Mr. LAUTENBERG. Mr. President, I yield back the balance of my time.
  Mr. McCAIN. Mr. President, pursuant to section 904(c), I move to 
waive the Budget Act for the consideration of this amendment.
  Mr. LAUTENBERG. Mr. President, I raise a point of order that this 
amendment is nongermane.
  Mr. GRAMM. 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.
  The PRESIDING OFFICER. The question is on agreeing to the motion to 
waive the Budget Act with respect to Coverdell Amendment No. 2199.
  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 38, nays 62, as follows:

                      [Rollcall Vote No. 55 Leg.]

                                YEAS--38

     Abraham
     Allard
     Ashcroft
     Bennett
     Brownback
     Burns
     Campbell
     Coverdell
     Craig
     Enzi
     Faircloth
     Frist
     Gramm
     Grams
     Gregg
     Hatch
     Helms
     Hutchinson
     Hutchison
     Inhofe
     Kempthorne
     Kyl
     Lott
     McCain
     McConnell
     Murkowski
     Nickles
     Roberts
     Roth
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Thomas
     Thompson
     Thurmond
     Warner

                                NAYS--62

     Akaka
     Baucus
     Biden
     Bingaman
     Bond
     Boxer
     Breaux
     Bryan
     Bumpers
     Byrd
     Chafee
     Cleland
     Coats
     Cochran
     Collins
     Conrad
     D'Amato
     Daschle
     DeWine
     Dodd
     Domenici
     Dorgan
     Durbin
     Feingold
     Feinstein
     Ford
     Glenn
     Gorton
     Graham
     Grassley
     Hagel
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerrey
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lugar
     Mack
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Reed
     Reid
     Robb
     Rockefeller
     Sarbanes
     Snowe
     Specter
     Stevens
     Torricelli
     Wellstone
     Wyden
  The PRESIDING OFFICER. On this vote, the yeas are 38, the nays are 
62. 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. LEAHY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, will the distinguished Senator from New 
Jersey yield 2 minutes?
  Mr. LAUTENBERG. I am happy to yield 2 minutes to the Senator from 
Vermont.
  The PRESIDING OFFICER. The Senator from Vermont is recognized.
  Mr. LEAHY. Mr. President, using that 2 minutes, I ask unanimous 
consent to speak for the purpose of introducing legislation, if it 
would be appropriate to do that.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LEAHY. I thank the Chair.
  (The remarks of Mr. Leahy pertaining to the introduction of S. 1901 
are located in today's Record under ``Statements on Introduced Bills 
and Joint Resolutions.'')


                           Amendment No. 2174

  Mr. FAIRCLOTH. Mr. President, I wish to offer a few remarks to make 
clear my vote on the Conrad amendment. I don't want to see a potential 
tobacco settlement degenerate into just a piggy bank for the Clinton 
Administration's plans to expand social programs. Certainly, the 
revenues need to go to health care, but I will not let the Senate 
forget about tobacco farmers. I voted for this amendment today

[[Page S2909]]

because it included the tobacco farmers, and the Smith amendment does 
not. I do not want my vote to imply an endorsement of other programs in 
this amendment, however, and I do not want to see public health 
programs turned into politicized slush funds. I think that this 
scenario poses a real danger. However, I want to see the Senate on 
record in support of farmers, and this amendment recognizes the need to 
protect them from the impact of tobacco legislation.
  The PRESIDING OFFICER. The pending question is amendment No. 2175 by 
the Senator from Illinois, Senator Moseley-Braun.
  The Senator from Wisconsin.
  Mr. FEINGOLD. I ask unanimous consent the pending amendment be 
temporarily laid aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LAUTENBERG. Mr. President, I yield to the Senator from Wisconsin 
who just wants to make an introduction. I give him 1 minute of my time.
  The PRESIDING OFFICER. The Senator from Wisconsin is recognized for 1 
minute.


                           Amendment No. 2224

           (Purpose: To establish a disability reserve fund)

  Mr. FEINGOLD. 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 Wisconsin [Mr. Feingold], for himself, Mr. 
     Kennedy and Mr. Harkin, proposes an amendment numbered 2224.

  Mr. FEINGOLD. 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 end of title II, add the following:

     SEC. __. DISABILITY RESERVE FUND FOR FISCAL YEARS 1999-2003.

       (a) In General.--If legislation generates revenue increases 
     or direct spending reductions to finance disability programs 
     designed to allow persons with a disability to become 
     employed and remain independent and to the extent that such 
     increases or reductions are not included in this concurrent 
     resolution on the budget, the appropriate budgetary levels, 
     allocations, and limits may be adjusted (but by amounts not 
     to exceed $2,000,000,000 for the period of fiscal years 1999 
     through 2003) if such adjustments do not cause an increase in 
     the deficit in the resolution.
       (b) Adjustment for Budget Authority.--After the reporting 
     of legislation (the offering of an amendment thereto or 
     conference report thereon) that reduces nondisability direct 
     spending or increases revenue for a fiscal year or years, the 
     Chairman of the Committee on the Budget shall submit 
     appropriately revised allocations and aggregates by an amount 
     that equals the amount such legislation reduces direct 
     spending or increases revenues for a fiscal year or years.
       (c) Establishing a Reserve.--
       (1) Revisions.--After the enactment of legislation 
     described in subsection (a), the Chairman of the Committee on 
     the Budget shall submit revisions to the appropriate 
     allocations and aggregates by the amount that provisions in 
     such legislation generates revenue increases or direct 
     nondisability-related spending reductions.
       (2) Revenue increases or direct spending reductions.--After 
     the submission of revisions under paragraph (1), the Chairman 
     of the Committee on the Budget shall also submit the amount 
     of revenue increases or nondisability related direct spending 
     reductions such legislation generates and the maximum amount 
     available each year for adjustments pursuant to subsection 
     (d).
       (d) Effect of Revised Allocations and Aggregates.--Revised 
     allocations and aggregates submitted under subsection (c) 
     shall be considered for the purposes of the Congressional 
     Budget Act of 1974 as allocations and aggregates contained in 
     this resolution.
       (e) Reporting Revised Subdivisions.--The appropriate 
     committee may report appropriately revised subdivisions of 
     allocations pursuant to section 302 of the Congressional 
     Budget Act of 1974 to carry out this section.

  Mr. FEINGOLD. Mr. President, I ask unanimous consent my amendment be 
laid aside at this time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. FEINGOLD. I yield the floor.
  The PRESIDING OFFICER. The Senator from New Mexico.


                           Amendment No. 2225

  (Purpose: To state the sense of the Senate regarding the quality of 
                               teachers)

  Mr. DOMENICI. Mr. President, I send an amendment to the desk on 
behalf of Senator DeWine.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from New Mexico [Mr. Domenici], for Mr. DeWine, 
     proposes an amendment numbered 2225.

  The amendment (No. 2225), is as follows:

       At the appropriate place, insert the following:

     SEC. __. FINDINGS AND SENSE OF THE SENATE.

       (a) Findings.--The Senate finds that--
       (1) while it is important to study the effects of class 
     size on learning and study the need to hire more teachers, 
     each type of study must be carried out in conjunction with an 
     effort to ensure that there will be quality teachers in every 
     classroom;
       (2) all children deserve well-educated teachers;
       (3) there is a teacher quality crisis in the United States;
       (4) individuals entering a classroom as teachers should 
     have a sound grasp on the subject the individuals intend to 
     teach, and the individuals should know how to teach;
       (5) less than 40 percent of the individuals teaching core 
     subjects (consisting of English, mathematics, science, social 
     studies, and foreign languages) majored or minored in the 
     core subjects;
       (6) the quality of teachers impacts student achievement;
       (7) the measure of a good teacher is how much and how well 
     the teacher's students learn;
       (8) teachers should have the opportunity to learn new 
     technology and teaching methods through the establishment of 
     teacher training facilities so that teachers can share their 
     new knowledge and experiences with children in the classroom;
       (9) school officials should have the flexibility the 
     officials need to have teachers in their schools adequately 
     trained to meet strenuous teacher standards;
       (10) knowledgeable and eager individuals of sound character 
     and various professional backgrounds should be encouraged to 
     enter kindergarten through grade 12 classrooms as teachers; 
     and
       (11) States should have maximum flexibility and incentives 
     to create alternative teacher certification and licensure 
     programs in order to recruit well-educated people into the 
     teaching profession.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that the functional totals in this concurrent resolution on 
     the budget assume--
       (1) the enactment of legislation to provide assistance for 
     programs that--
       (A) focus on teacher training delivered through local 
     partnerships, with private and public partners, to ensure 
     that current and future teachers possess necessary teaching 
     skills and knowledge of subject areas; and
       (B) focus on alternative certification to recruit 
     knowledgeable and eager individuals of sound character to 
     enter kindergarten through grade 12 classrooms as teachers;
       (2) that the quality of teachers can be strengthened by 
     improving the academic knowledge of teachers in the subject 
     areas in which the teachers teach;
       (3) that institutions of higher education should be held 
     accountable to prepare teachers who are highly competent in 
     the subject areas in which the teachers teach, including 
     preparing teachers by providing training in the effective 
     uses of technologies in classrooms; and
       (4) that there should be recruitment into teaching of high 
     quality individuals, including individuals from other 
     occupations.

  Mr. DOMENICI. Mr. President, I understand that amendment will be put 
in the process whereby it will be assigned an opportunity to be voted 
on, if that is the case, in due course.
  Mr. President, I might discuss with the distinguished Senator from 
New Jersey where we are now. Senator Tim Johnson has an amendment that 
he would like not only to call up but to take 3 or 4 minutes on. I am a 
cosponsor. I think we should accept it. We might be able to get that 
one done today.
  Mr. LAUTENBERG. I appreciate the fact the manager is going to yield 
to our friend from South Dakota.


                    Amendment No. 2210, as modified

   (Purpose: To express the sense of the Senate regarding repair and 
                 construction needs of Indian schools)

  Mr. JOHNSON. Mr. President, I ask unanimous consent to send a 
modified version of the amendment to the desk.
  The PRESIDING OFFICER. The Senator has a right to modify his 
amendment.
  The amendment (No. 2210) as modified, is as follows:

       At the end of Title III, insert the following:

     SEC  . SENSE OF THE SENATE REGARDING REPAIR AND CONSTRUCTION 
                   NEEDS OF INDIAN SCHOOLS.

       (a) Findings.--The Senate finds that--
       (1) many of our nation's tribal schools are in a state of 
     serious disrepair. The Bureau of Indian Affairs (BIA) 
     operates 187 school facilities nationwide. Enrollment in 
     these schools, which presently numbers 47,214 students, has 
     been growing rapidly. A recent General Accounting Office 
     report indicates that the repair backlog in these schools 
     totals $754 million, and that the BIA schools are in 
     generally worse condition than all schools nationally;

[[Page S2910]]

       (2) approximately 60 of these schools are in need of 
     complete replacement or serious renovation. Many of the 
     renovations include basic structural repair for the safety of 
     children, new heating components to keep students warm, and 
     roofing replacement to keep the snow and rain out of the 
     classroom. In addition to failing to provide adequate 
     learning environments for Indian children, these repair and 
     replacement needs pose a serious liability issue for the 
     Federal government;
       (3) sixty-three percent of the BIA schools are over 30 
     years old, and twenty-six percent are over 50 years old. 
     Approximately forty percent of all students in BIA schools 
     are in portable classrooms. Originally intended as temporary 
     facilities while tribes awaited new construction funds, these 
     ``portables'' have a maximum 10 year life-span. Because of 
     the construction backlog, children have been shuffling 
     between classrooms in the harsh climates of the Northern 
     plains and Western states for ten to fifteen years;
       (4) annual appropriations for BIA education facilities 
     replacement and repair combined have averaged $20-$30 million 
     annually, meeting only 4% of total need. At the present rate, 
     one deteriorating BIA school can be replaced each year, with 
     estimates of completion of nine schools in the next seven 
     years. Since the new construction and repair backlog is so 
     great and growing, the current focus at BIA construction must 
     remain on emergency and safety needs only, without 
     prioritizing program needs such as increasing enrollment or 
     technology in the classroom; and
       (5) unlike most schools, the BIA schools are a 
     responsibility of the federal government. Unfortunately, the 
     failure of the federal government to live up to this 
     responsibility has come at the expense of quality education 
     for some of this nation's poorest children with the fewest 
     existing opportunities to better themselves.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that the assumptions underlying the functional totals in this 
     budget resolution assume that the repair and construction 
     backlog affecting Bureau of Indian Affairs school facilities 
     should be eliminated over a period of no more than five years 
     beginning with Fiscal Year 1999, and that the President 
     should submit to Congress a plan for the orderly elimination 
     of this backlog.

  The PRESIDING OFFICER. Does the Senator from New Mexico yield time?
  Mr. DOMENICI. I believe he is calling up an amendment and he has time 
on the amendment.
  Mr. JOHNSON. Mr. President, the amendment that is being offered is 
with the cooperation of Chairman Domenici. It is cosponsored by 
Senators Daschle, Dorgan, Bingaman, Wellstone, McCain, Kohl, Conrad and 
Murray, and it is a sense-of-the-Senate resolution, which is designed 
to reflect on the crisis that we have with Indian school funding in the 
United States today. This is an issue that Chairman Domenici has shared 
with me as a matter of great concern on the Senate Budget Committee.
  We recognize the budget resolution assumes $166 million will be 
allocated for Indian school repair work and replacement work. However, 
we recognize this is part of the budget resolution and is not binding 
on the Appropriations Committee.
  There is a need to raise the visibility of the very real crisis that 
exists in terms of BIA school funding and replacement needs. That is 
the purpose of this sense of the Senate. The BIA manages some 143 
schools within the United States. It is a Federal responsibility. This 
is not a question of whether the Federal Government ought to be 
involved in these schools or not. In this instance, these schools are 
Federal property and it is a Federal responsibility.
  We have a repair and replacement backlog now of about $754 million. 
The rate at which we have been replacing some 60 schools that currently 
are in need of replacement has been at about one per year. So obviously 
the backlog is getting larger and larger as we go about this kind of 
underfunded replacement and renovation.
  Mr. President, 40 percent of the BIA students attending class are 
attending class in portable classrooms. We have a fast-growing 
population attending these schools, and it is clear that something far 
different from what we have been doing in the past is absolutely 
essential if, in fact, we are going to meaningfully address this 
backlog.
  It is our concern that we have to infuse more resources into the 
backlog problem, and that we have greater direction from the White 
House itself, from the BIA itself, relative to a concrete plan to get 
this done over a relatively modest timeframe, over the next 5 years.
  So this resolution calls on the administration to work with us in 
arriving at a plan that is infused with sufficient funds to make 
significant progress over these coming years on this backlog. This 
resolution will send a signal, and I think an important signal, to the 
appropriators and to the administration that this is a crisis that we 
recognize and we acknowledge, and for which there is a bipartisan 
concern.
  So that is the thrust of this resolution. I commend Chairman Domenici 
for working with me, and for the work of his staff, working with my 
staff, trying to arrive at a strategy that is constructive and is 
meaningful on this problem. The Senator represents a State with a 
significant Indian population, suffering many of the same problems that 
the Native American population in my State of South Dakota suffer. So 
this is a problem about which we jointly share a great concern.
  The chairman is commended for a longstanding commitment to trying to 
enhance opportunities and the quality of life for the Native American 
population of his State and around the United States in general. This 
is one area where we both agree; I believe that higher visibility and a 
higher level of commitment is badly needed.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. I wonder if the Senator will yield me 5 minutes?
  Mr. JOHNSON. I yield the Senator 5 minutes.
  Mr. DOMENICI. First, I want to ask, did the Senator name me as a 
cosponsor?
  Mr. JOHNSON. Yes; I did.
  Mr. DOMENICI. I wonder if Senator Bingaman of New Mexico has been 
asked about being a cosponsor?
  Mr. JOHNSON. Senator Bingaman was also named. We are very proud to 
have both Senators from New Mexico on this amendment as cosponsors.
  Mr. DOMENICI. Is Senator Campbell, the chairman of the Indian Affairs 
Committee, on it?
  Mr. JOHNSON. We do not have Senator Campbell on it. Senator Campbell 
held a hearing and a mark-up today at his committee, and we have not 
been able to reach him on this amendment as yet.
  Mr. DOMENICI. I wonder if you would mind having him called and we 
will modify it by adding him on it. I think we should ask to have the 
chairman on it.
  Mr. JOHNSON. That is a good idea.
  Mr. DOMENICI. What has been amazing to the Senator from New Mexico is 
the way the U.S. Government fails to recognize its sole and singular 
responsibility. We are busy all the time, every year, with budgets that 
try to do new things. Frankly, the President of the United States had a 
very long list of new things, new programs. In fact, he had a 
suggestion that we use a lot of the money for helping classroom size, 
helping build public schools. But the real problem here is that if we 
do not rebuild the Indian schools that are run by the Government and 
put them under some management and maintenance, nobody will. They don't 
belong to anybody else. They are not being run by the State of Georgia, 
or the school board of Bernalillo County, Albuquerque. It is either we 
do it or the Indian young people go to school in buildings that are not 
fit for occupancy, much less for Indian education.
  I don't know what to do about it. The Senator from New Mexico doesn't 
know what to do about it. I work at it every year. We need to get some 
proposal to get this huge backlog taken care of and get on with being 
able to say to our Indian young people and the teachers who are in 
those schools, ``We think enough of you to give you a school that 
offers you an opportunity like the rest of Americans to get educated.'' 
The school building doesn't make the child, but I tell you, you can 
have a bad enough school building that the child can hardly learn.
  So I have asked that this resolution contain another provision, just 
in an effort to see if we can get there, and that provision, which was 
in the modification that Senator Johnson sent to the desk, asked the 
President of the United States--if I am not correct--it asked the 
President to submit to us by a date certain a 5-year plan to see to it 
that, regarding the Indian schools the Government owns, the Government 
must maintain them or they will not get maintained, and those where we 
have to build a new one because the old one is decrepit, that entire 
package be put in a 5-year plan and the President

[[Page S2911]]

recommend to us how we might get that done.
  Frankly, I believe unless and until that shows up in a Presidential 
budget, we are not going to find the resources in the Senate or the 
House to do what we must do. This is not a little $50 million problem; 
this is a hundreds-of-million-dollar problem. So I believe we are on to 
something here in this resolution. It is not just a hollow one; it is 
one that is to get something back from the Chief Executive of America, 
and it is going to tell us whether we agree on this problem, and if 
they do, how do we take care of it in a given number of years.
  I anxiously await, and I will see to it that we hold this in 
conference, because I think it is the kind of thing that should be in 
the budget. Some sense-of-the-Senates don't belong in, but this belongs 
in because this is a problem we can't fix in a budget resolution. We 
can hardly fix it in appropriations, as you know. So, Senator, thanks 
for your leadership. I am glad to be on board. This will be welcome 
news in Indian country.
  Mr. JOHNSON. I thank the chairman for his supportive remarks here. 
The chairman has a great understanding, profound understanding, of the 
immensity of the problem that this country faces relative to Indian 
schools and the need for White House leadership on this issue. We will 
work with the White House in that regard, but it is going to require a 
cooperative effort if we are going to have any success on a problem of 
this immensity.

  Mr. President, I ask unanimous consent that Senators Kohl, Conrad, 
Inouye, and Murray be added as cosponsors to this amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered. And the 
Senator from North Dakota?
  Mr. DORGAN. Mr. President, I will be proud to be made a cosponsor of 
this amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. Let me just take 30 seconds.
  Mr. JOHNSON. I yield to the Senator.
  Mr. DORGAN. Mr. President, I support fully the comments made by the 
Senators from South Dakota and New Mexico, and in fact I hope in just a 
moment to be able to speak off the bill on the Moseley-Braun amendment, 
and I intend to address a few of these issues with respect to that as 
well. And I am pleased the Senator offered the amendment and pleased to 
hear the comments of the Senator from New Mexico as a cosponsor.
  Mr. CONRAD. Mr. President, I rise today in support of the Johnson 
amendment, which expresses the sense of the Senate about the need to 
address the Bureau of Indian Affairs school construction backlog.
  The conditions at the schools on America's Indian reservations are 
some of the worst in the nation. They are truly deplorable. In January, 
I accompanied the Assistant Secretary for Indian Affairs on a tour of 
the Standing Rock Community School at Fort Yates, North Dakota. I wish 
every one of my colleagues in the Senate could see the conditions at 
this school. The school was built in an open-classroom design, without 
walls between the classrooms. The noise at the school can be deafening 
at times, and this is not an environment in which students can learn. 
How is it that we can have a school in which the physical conditions 
actually prohibit learning from happening? In addition, the heating and 
cooling system at the school is grossly inadequate, so it can be 50 
degrees in one wing of the school, and 80 degrees in another.
  As bad as this is, things have recently gotten worse: the lights at 
this school and the local elementary school have begun to leak an oily 
substance that has been found to contain PCBs. The Bureau of Indian 
Affairs is in the process of removing these lights and conducting 
additional testing for further contamination. They are also testing the 
ceiling tiles, which preliminary tests show may contain dioxin. To 
protect the health of the students, the schools were shut down for 
weeks. The BIA is in the process of reopening the schools' classrooms 
and other facilities, as clean-up is completed. These conditions pose 
serious threats to the health of the children of the Standing Rock 
Reservation. How can we ask families to sent their children to be 
educated in such deplorable conditions?
  In looking at conditions at schools throughout Indian Country, the 
Standing Rock Community is not an anomaly. In January, the GAO released 
a report on conditions at BIA schools and the costs to repair these 
schools. The BIA estimates that the costs of total inventory repair 
need for BIA education facilities is $754 million.
  Data from a 1994 National Schools Facilities Survey conducted by GAO 
show that BIA schools are generally in poorer physical condition, have 
more unsatisfactory environmental factors, more often lack key 
facilities requirements for educational reform, and are less able to 
support computer and communications technology, compared to other 
schools nationwide.
  Of the conditions found at BIA schools:
  62 percent had at least one building in less than adequate condition, 
compared with 33 percent of all schools.
  79 percent had at least one inadequate building feature (such as 
roofs, floors, foundations, plumbing, heating, electrical power, and 
life safety codes). Nationwide, 57 percent of all schools had at least 
one inadequate building feature.
  94 percent had at least one unsatisfactory environmental condition, 
compared with 50 percent of schools nationwide. Environmental 
conditions include lighting, heating, ventilation, indoor air quality, 
acoustics, flexibility of instructional space, energy efficiency, and 
physical security of building.
  These are serious school construction needs--about $754 million 
worth--that should be addressed, and should be addressed quickly. The 
Johnson amendment expresses the sense of the Senate that the BIA school 
construction backlog should be eliminated within five years. We need a 
serious, sustained effort to get the job done and provide a safe 
environment in which Native American children can get an education.
  The Johnson amendment also requires the Administration to submit to 
Congress a plan for how this construction backlog will be addressed. As 
a member of the Senate Committee on Indian Affairs, I intend to work 
closely with Kevin Gover, Assistant Secretary for Indian Affairs, to 
ensure that the job gets done. Assistant Secretary Gover visited North 
Dakota and quickly grasped the magnitude of the school construction 
problem. He has made a commitment to me and other members of the 
Committee to take action on this school construction backlog.
  We cannot let these conditions persist. We cannot let the BIA school 
construction backlog continue to grow out of control. And we cannot 
continue to ask parents to send their children to school where learning 
cannot take place and where serious health hazards exist. I hope that 
all of my colleagues will vote for the Johnson amendment and show their 
support for the will-being of Native American children.
  Mr. DOMENICI. Mr. President, today there is a $1.5 billion backlog of 
repairs, renovation, and replacement for all federally owned and 
operated BIA schools, including elementary, secondary, and post-
secondary schools.
  A December, 1997 report by the General Accounting Office (GAO) 
concluded that ``the cost of the total inventory of repairs needed for 
BIA education facilities (elementary and secondary only) is $754 
million. This includes $693 million for repairs to school buildings, 
including dormitories for students. It also includes $61.7 million in 
repairs needed for education quarters such as employee housing.
  The footnote to this estimate notes that $754 million ``does not 
include the costs of replacing school buildings. BIA's priority list 
for constructing education facilities includes eight unfunded school 
replacement projects with a total estimated cost of $112 million.''


                   The BIA Construction Priority List

  Mr. President, we in the Senate who pay close attention to this BIA 
priority list for school construction are well aware that this list has 
been frozen for several years now. This means that the eight school 
scheduled for replacement are the ones on this frozen priority list. I 
am attaching this list of 16 total BIA schools from the 
Administration's FY 1999 budget request for the Record.

[[Page S2912]]

  Obviously, a school that is replaced would be deleted from the list 
of school needing repair. The GAO report includes the costs of schools 
scheduled for replacement. In short, the GAO estimate does not fully 
estimate the costs of replacement schools.
  To get a rough idea of the costs of replacing these schools, 
including those that are not on the frozen priority list, I have 
checked with the Assistant Secretary for Indian Affairs, Kevin Gover. 
His office informs me that 50% of the 185 BIA schools are over 30 years 
old and fail to meet current codes and standards.
  The GAO, has noted that 25% of BIA schools are over 50 years old, 
and, of course fail to meet the same standards for safety and teaching.


            Total BIA Schools Needing Replacement and Repair

  There are 93 BIA schools that should be replaced--well beyond the 
current priority list of 16. At an average cost of $180 per square 
foot, these 93 schools would cost one billion dollars to replace.
  Replacing these 93 oldest BIA schools would leave about $200 million 
in repair and renovation costs for the remaining 92 BIA schools.
  This simple arithmetic gives us a current estimate of about $1.2 
billion to bring all federally operated BIA schools up to par.


                       Indian Community Colleges

  These Indian community colleges fall into two categories: those run 
by the BIA and those that are tribally controlled community colleges.
  In the first category, those run by the BIA, Haskell (Kansas) and 
SIPI (Albuquerque) are the only two that are fully federally operated 
by the BIA. The BIA now has 26 tribally controlled community colleges 
eligible to receive funds through the Tribally Controlled Community 
Colleges Act, and one more, United Tribes Technical College, funded 
through the BIA's Community Development funds.
  In total, then, there are 29 Indian Community Colleges with direct 
BIA funding, and one, Crownpoint Institute of Technology, that is 
funded primarily through the Carl Perkins Vocational Education program 
of the U.S. Department of Education.
  These Indian community colleges have an estimated repair and 
renovation cost of about $310 million. Replacement costs, such as the 
Shiprock branch of Navajo Community College, are not included. The 
Shiprock branch is estimating the costs for a new campus at about $28 
million. The need for married student housing at Crownpoint Institute 
of Technology is also not included.


            Total BIA Schools and Indian Community Colleges

  For the sake of simplicity, we can easily estimate that total repair, 
renovation, and replacement costs for all elementary, secondary, and 
post-secondary BIA schools and tribal schools eligible for BIA funds, 
exceed $1.5 billion.


                       GAO Report on BIA Schools

  For the benefit of my colleagues, I would like to submit an edited 
version of the GAO study on Indian school repair needs. Please keep in 
mind that this report is focused on elementary and secondary schools 
only.
  The GAO finds that 47,200 Indian students are served by 173 schools. 
The BIA count is 185 schools and over 50,000 students. The BIA schools 
range in size from 15 to 1,144 students, with about half of these 
schools enrolling fewer than 200 pupils.
  Growth is very high in these schools with an increase in student 
enrollment of 25 percent since 1987. Most of this growth has occurred 
in the last 5 years.
  About 10 percent of all Indian students attend BIA schools, funded or 
operated by the BIA. The vast majority or 90% of Indian students in 
America attend regular public schools.
  BIA schools are located in 23 states, but are highly concentrated in 
5 states--North Dakota, South Dakota, Arizona, New Mexico, and 
Washington.
  BIA schools are generally in poorer physical condition that even 
central city schools and lack more key facility requirements than 
typical American schools.
  The BIA schools are older and less able to support computer and 
communications technology than average American schools.


       Conclusion (S. Res. 100 on Education of American Indians)

  In addition to the physical needs of our federally operated Indian 
schools and colleges, there is a parallel crisis in operating funds for 
Indian schools nationwide.
  American Indian students have the highest dropout rate of any racial 
ethnic group (36%) and the lowest high school completion and college 
attendance rates of any minority group.
  Average annual funding for Indian college students is $2,900 compared 
to $6,200 for Americans as a whole.
  Senate Resolution 100, introduced in the First Session of this 
Congress which I introduced with the cosponsorship of Senators 
Campbell, Inouye, Johnson, Dorgan, and Wellstone, discusses the overall 
situation of Indian education and calls upon the 105th Congress to 
address these issues through major education bills under consideration.
  I urge my colleagues to review Senate Resolution 100, and support its 
passage by this body in order to draw more needed attention to the 
major problems we face today in Indian education.
  I ask unanimous consent that S. Res. 100 be printed in the Record, 
along with the BIA school construction priority list, and my summary of 
the GAO report on Indian school repairs.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:


                    replacement school construction

       Program Description ($19,200,000: During fiscal years 1991 
     thru 1997, $117.2 million was appropriated to complete 
     construction of schools at Laguna, Choctaw, Dunseith, Pine 
     Ridge, and the Haskell Dormitory, as well as the first eight 
     schools on the Replacement School Construction Priority List 
     (List). Funds appropriated in FY 1998 were used to start 
     construction of the Many Farms School complex. This school is 
     ranked no. 4 on the Replacement School Priority List (List). 
     Funds appropriated in FY 1998 will be used to accomplish site 
     work at both the Sac & Fox Settlement School and the Pyramid 
     Lake High School. These schools are ranked 10 and 11, 
     respectively, on the List. Congress also funded this 
     rebuilding of the Wa-He-Lut School which was completed in 
     seven months and is occupied. The status of each school 
     project on the List is presented below.

----------------------------------------------------------------------------------------------------------------
                    Replacement school project                                     Project status
----------------------------------------------------------------------------------------------------------------
1. Pinon Community School Dorms..................................  Funded, Construction is Complete, except
                                                                    Employee Quarters for which Public Law 93-
                                                                    638 construction contract due for completion
                                                                    March, 1998.
2. Eastern Cheyenne River Consol. School.........................  Funded, Construction is Complete; school is
                                                                    occupied.
3. Rock Point Community School...................................  Funded, Construction is Complete; school is
                                                                    occupied.
4. Many Farms High School........................................  Funded, Construction anticipated to start in
                                                                    summer of 1998.
5. Tucker Day School.............................................  Funded, Construction is Complete; school is
                                                                    occupied.
6. Shoshone Bannock School.......................................  Funded, Construction is Complete; school is
                                                                    occupied.
7. Standing Pine Day School......................................  Funded, Construction is Complete; school is
                                                                    occupied.
8. Chief Leschi School...........................................  Funded, Construction is Complete; school is
                                                                    occupied.
9. Seba Dalkai School............................................  Design scheduled for completion July 1998;
                                                                    construction funds requested in 1999.
10. Sac & Fox Settlement School..................................  Design 70% complete; requesting construction
                                                                    funding in FY 1999.
11. Pyramid Lake High School.....................................  Design completed; requesting construction
                                                                    funding in FY 1999.
12. Shiprock Alternative School..................................  Planning is nearly complete; funded for
                                                                    design; not funded for construction.
13. Tuba City Boarding School....................................  Planning to begin Spring of 1998; funded for
                                                                    design; not funded for construction.
14. Fond Du Lac Ojibway School...................................  Design is underway; not funded for
                                                                    construction.
15. Second Mesa Day School.......................................  Design to 40% is underway; not funded for
                                                                    construction.
16. Zia Day School...............................................  Planning completion is anticipate in second
                                                                    quarter of 1998; funded for design; not
                                                                    funded for construction.
----------------------------------------------------------------------------------------------------------------

           Summary of GAO Report on Condition of BIA Schools

       (1) BIA reports that the cost of the total inventory of 
     repairs needed for BIA education facilities is $754 million; 
     (2) this includes the cost of repairs to all school 
     buildings, including dormitories for students and employee 
     housing; and (3) data from GAO's 1994 National School 
     Facilities Survey show that, compared to other schools 
     nationally, responding BIA schools: (a) are generally in 
     poorer physical condition; (b) have more unsatisfactory 
     environmental factors; (c) more often lack key facilities 
     requirements for education reform; and (d) are less able to

[[Page S2913]]

     support computer and communications technology.


               Percent of Indian Children in BIA Schools

       While most Native American children attend regular public 
     schools, about 10 percent attend BIA schools, which are 
     funded by BIA and operated either by BIA or by various tribes 
     through grants or contracts from BIA.
       BIA schools are found in 23 states but are highly 
     concentrated in 5--North Dakota, South Dakota, Arizona, New 
     Mexico, and Washington.
       BIA funded 173 schools (including boarding schools) in 
     school year 1996-97, with a total enrollment of 47,214. The 
     schools ranged in size from 15 to 1,144 students, with about 
     one-half enrolling fewer than 200 pupils.
       Enrollment in BIA schools is growing and overall has 
     increased 25 percent since 1987. Most of this growth has 
     occurred in the last 5 years.


                   GAO Estimates on Nation's Schools

       We estimated that the nation's schools needed about $112 
     billion (+/- 6.6% sampling error) to repair or upgrade 
     facilities to good overall condition. Responses to our survey 
     indicated that about 33 percent of America's schools reported 
     needing extensive repair or replacement of one or more 
     buildings; almost 60 percent reported problems with at least 
     one major building feature, such as plumbing; and about 50 
     percent reported unsatisfactory environmental conditions.
       Furthermore, many reported lacking critical physical 
     capabilities to meet the functional requirements of education 
     reform and key technology elements to support computers and 
     communications technology.


                        Isolation of BIA Schools

       BIA officials told us that BIA schools are often located in 
     isolated areas and have to provide and maintain extensive 
     campus infrastructures because they are too far from 
     population centers to have access to town or city services. 
     For example, one school we visited had to house and maintain 
     a fire truck on campus because it is too far from the nearest 
     city to use its fire department.
       In addition, some schools must provide dormitory space for 
     students and/or housing for faculty and staff because they 
     are so distant from population centers. BIA officials told us 
     that this isolation may also contribute to maintenance 
     difficulties and costs when materials have to be shipped long 
     distances and construction/repair staff have to be housed 
     while on site.


                           Age of BIA Schools

       Officials also told us that about 25 percent of BIA school 
     buildings are at least 50 years old, and many of these 
     buildings are on the National Historic Register. BIA 
     officials told us that this listing often restricts the 
     ability to make education-related renovations and 
     improvements.


                     BIA to Update Repair Inventory

  BIA reports that, as of October 1997, the cost of the total inventory 
of repairs needed for education facilities at all BIA schools is $754 
million. This includes $693 million for repairs to school buildings, 
including dormitories for students. It also includes $61.7 million in 
repairs needed for education quarters such as employee housing.
  BIA's inventory of repairs needed--the facilities backlog--is an 
amalgam of information collected by architects, engineers, and BIA 
staff over the years. The inventory describes in detail individual work 
items required by national standards and codes such as the Uniform 
Building Code, National Fire Codes, and National Electrical Codes to 
repair the facilities. The facilities backlog contains the repair cost 
for deficiencies identified in a building or at a site.
  The deficiencies may involve safety and health, access for persons 
with disabilities, or noncompliance with other building codes. BIA is 
currently developing a new Facilities Management Information System and 
will be validating and reassessing the entire facilities backlog and 
inventory. The validation will include professional estimates of the 
cost of all backlog repair items and a determination of the relative 
economic values of repair versus replacement. The system development 
and validation projects are scheduled for completion in fiscal year 
1999.
  Our 1994 survey asked school officials to estimate the total cost of 
all repairs, renovations, and modernizations required to put their 
school buildings in good overall condition. The amounts reported by the 
71 BIA schools responding to our survey were generally in agreement 
with BIA's estimates of the costs required to address the inventory of 
repairs needed at these schools.

                              S. Res. 100

       Whereas there exists a unique legal and political 
     relationship between the United States and tribal governments 
     and a unique Federal responsibility to American Indians and 
     Alaska Natives;
       Whereas, under law and practice, the United States has 
     undertaken a trust responsibility to protect and preserve 
     Indian tribes, Indians, and tribal assets and resources;
       Whereas the Federal Government's commitment to Indian 
     education has been recognized, reinforced, and carried out 
     through most treaties with Indian tribes, Congressional 
     legislation, numerous court decisions and Presidential 
     executive orders;
       Whereas this Federal responsibility includes working with 
     tribal governments and their members to improve the education 
     of tribal members;
       Whereas the 1990 census shows the poverty rate for American 
     Indians and Alaska Natives was nearly twice the national 
     average--31 percent of Indians live below the poverty level, 
     compared to 13 percent of the total population. Nearly 38 
     percent of Indian children above the age of 5 were living 
     below the poverty level in 1990, compared with 11 percent of 
     non-minority children;
       Whereas the development of tribal economies is dependent on 
     physical infrastructure, capital investment, and highly 
     developed human capital and an educated labor force;
       Whereas excellence in educational facilities and services 
     is a key to building the skills necessary for Indian people 
     to develop vibrant tribal economies;
       Whereas ever-increasing regional, national, and 
     international economic competition demands that Indians have 
     every competitive advantage accruing from achieving 
     excellence in education;
       Whereas there are approximately 600,000 American Indian and 
     Alaska Native children attending schools in this country. An 
     estimated 87 percent of these children attend public schools 
     located on or near reservations and in urban areas; another 
     10 percent attend schools funded by the Bureau of Indian 
     Affairs (BIA) and an estimated 3 percent attend private 
     schools;
       Whereas these schools have experienced an increase in 
     student population of 3-4 percent in the past 5 years, 
     however, annual funding for the education of Indian children 
     has not increased proportionately;
       Whereas United States census data shows that the Indian and 
     Alaska Native population has increased significantly in the 
     past three decades. Primary growth concentrations are at ages 
     5 through 19;
       Whereas the 1994 National Assessment of Education Progress 
     (NAEP) showed over 50 percent of American Indian fourth 
     graders scored below the basic level in reading proficiency, 
     compared with 42 percent of all students;
       Whereas American Indian students have the highest dropout 
     rate of any racial ethnic group (36 percent) and the lowest 
     high school completion and college attendance rates of any 
     minority group. As of 1990, only 66 percent of American 
     Indians aged 25 years or older were high school graduates, 
     compared to 78 percent of the general population;
       Whereas the demonstrated need for improvements to Indian 
     schools and colleges is acute as reflected in the great 
     disparity between average annual college funding per student 
     of $2,900 for Indian students, and $6,200 for non-Indians in 
     America, and the Federal Government should assist in bringing 
     the Indian schools and colleges up to parity with the rest of 
     America;
       Whereas tribal scholarship programs nationally are only 
     able to serve an estimated 40 percent of the eligible college 
     student population and funding for graduate scholarships has 
     been cut in half in the past 2 years;
       Whereas there is a major backlog of $680 million in funding 
     need for facilities constructions, maintenance and repair for 
     the 185 BIA-funded schools as well as for public schools 
     located on and near Indian reservations;
       Whereas there exists an alarming decline in the use of 
     Native languages indigenous to the United States. A 1969 
     Senate Committee report stated that in 1969 there were 300 
     separate languages still being spoken. In 1996, the number 
     had dropped to 206 still being spoken. These languages are 
     spoken nowhere else in the world; and
       Whereas, despite these alarming statistics, funding for the 
     education of American Indian and Alaska Native students has 
     been reduced substantially in the past 3 years. The United 
     States Congress in fiscal year 1996 eliminated discretionary 
     education programs in the Office of Indian Education budget 
     which had funded adult education, research and demonstration 
     programs, the Indian Fellowship Program and teacher training 
     and professional development projects. At the same time, 
     funding for reservation-based education programs in the BIA 
     budget was reduced by more than $100 million in the fiscal 
     year 1996 budget: Now, therefore, be it
       Resolved, That it is the sense of the United States 
     Senate--
       (1) that the Senate recognizes and supports the Federal 
     Government's legal and moral commitment to the education of 
     American Indian and Alaska Native children, which is a part 
     of treaties, Executive orders, court decisions and public 
     laws which have been enacted by the House and Senate of the 
     United States Government;
       (2) that funding for all bills, including reauthorizing 
     legislation in the 105th Congress with specific programs for 
     American Indians and Alaska Natives be funded at levels 
     sufficient to meet the ever-increasing educational and 
     economic demands facing Indian people on reservations, urban 
     communities and Alaska Native villages;
       (3) that the Senate recognizes the adult literacy needs of 
     American Indians and Alaska Natives through the inclusion of 
     tribal provisions in the administration's proposal to 
     reauthorize the Adult Education Act;

[[Page S2914]]

       (4) that the administration's bill for reauthorization of 
     the Higher Education Act of 1965, Public Law 102-325, 
     preserve the original purpose and intent of the Tribally-
     Controlled Community Colleges Act and promote access to 
     higher education opportunities for American Indians and 
     Alaska Natives;
       (5) that during the 105th Congress' reauthorization of 
     agricultural research programs, the needs of tribal colleges 
     as designated land-grant institutions must be given close 
     attention, through amendments to the Educational Equity in 
     Land-Grant Status Act of 1994;
       (6) that early childhood programs such as Head Start 
     (Public Law 103-252) and Healthy Start contain resources 
     needed to meet a growing number of American Indian and Alaska 
     Native children whose rate of growth exceeds the national 
     average; and
       (7) that the Senate recognizes the need for development and 
     implementation of a Government-wide policy on Indian 
     education which addresses the needs of American Indian and 
     Alaska Native people.
  Mr. DOMENICI. Mr. President, from what I understand, we have no 
objection on this side, and I understand there are no objections on the 
Democratic side. Therefore, I believe if we yield back our respective 
times, we can accept this amendment.
  The PRESIDING OFFICER. Is there objection?
  Mr. JOHNSON. I yield back my time.
  Mr. DOMENICI. If there was time in opposition--I don't know what it 
is--we yield it back.
  The PRESIDING OFFICER. Without objection, the Johnson amendment is 
agreed to.
  The amendment (No. 2210), as modified, was agreed to.
  Mr. DOMENICI. Mr. President, I move to reconsider the vote by which 
the amendment was agreed to.
  Mr. JOHNSON. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. DOMENICI. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. LAUTENBERG. 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. LAUTENBERG. Mr. President, I yield 10 minutes, or such time as 
may be needed, to the Senator from North Dakota. The time is to come 
off the resolution.
  The PRESIDING OFFICER. The Senator from North Dakota is recognized 
for such time as he may consume.


                           Amendment No. 2175

  Mr. DORGAN. Mr. President, I very much appreciate Senator Lautenberg 
yielding me the time. I am going to visit a bit some of the items that 
were just discussed about Indian schools and schools generally. I 
wanted to come and talk about the Moseley-Braun amendment.
  We talk a lot about family values in this Chamber. It seems to me 
that every family that sits around in the evening and talks about their 
lives must certainly talk about the schools their kids are going to. We 
have 14 million students who attend schools in this country now, 
schools that are in need of extensive repair--extensive repair.
  This afternoon, we sit in a nice Chamber. We have people here who 
enjoy their lives, and they are well dressed. We talk about education 
and theory in the abstract. In Cannonball, ND, today there is some 
little kid sitting in school, and I bet you that child is smelling 
sewer gas backed up from the pipes, because that is the way the school 
is down in Cannonball. That school is 70 years old. There are 150 kids 
attending that school with two bathrooms and one water fountain, and 
that school is in serious disrepair.
  I just mention that one, but I could mention thousands of schools 
across this country that are in desperate need of repair. Senator 
Moseley-Braun has proposed an amendment that says in this Budget Act 
let us make room for school construction, for the Federal Government to 
provide some incentive, some small incentive to State and local 
governments to help repair and rebuild our schools.
  I have two children in public school this afternoon. Last year in 
public school, one of those children was in a classroom with 30 
students. That is too big. This year, one of them is in a temporary 
classroom or an expanded mobile home. That is too bad. It is a good 
school, and both of them are getting a good education. The fact is, we 
can do better in all of these areas, especially with respect to school 
construction. We know what the problem is and we know how to fix it. 
The issue of the budget on the floor of the Senate is a matter of 
priorities. What do each of us think is important for this country.

  I watched last week during consideration of the supplemental 
appropriations bill someone come into this Chamber and offered an 
amendment that went just like that, just that quick, for $170 million 
for missile defense. It wasn't debated, it wasn't discussed, it was 
just added. And there it was, $170 million.
  Let me talk about these schools for a moment, and let me talk 
specifically about the Indian schools, because while we are talking 
about the 14 million students who are in school today in schools that 
need extensive repair, let me talk just for a moment about the students 
in the Indian schools run by the BIA. These are schools owned by the 
Federal Government. They are owned by us. We have no one else to blame 
if we don't fix those schools, and it doesn't take a rocket scientist 
to figure out how to fix it. You can look at the school, find out what 
is wrong and spend the money to invest in that school to help those 
children.
  Let me tell you about the Ojibwa school. That is up on the Turtle 
Mountain Indian Reservation. Those children walk between portable 
classrooms in the middle of the winter up to six times a day in bone-
chilling weather. A health and safety inspection of that school and 
temporary classrooms in 1995 found 156 violations--fire hazards, broken 
windows, roof leaking, wooden stairs and landings for portable 
classrooms had deteriorated so much to the point they were no longer 
safe, wires hanging exposed from some classrooms.
  The Cannonball School is a public school. It is not a BIA school. It 
is on the Standing Rock Indian Reservation for grades K through five. 
The school is 70 years old. It has been condemned as a fire hazard, but 
the local tax base cannot support building a new school. The second 
level of the school isn't used because the stairs are unsafe. The water 
and sewer systems are old and regularly back up.
  Last week, when we talked to the Cannonball School superintendent, 
she said two classes had to be moved in with other classes because the 
smell of sewage got so bad in the classrooms of these young children. 
One wing of the school doesn't have running water. Mr. President, 145 
students and 40 staff share two bathrooms and one water fountain. The 
electric wiring is so old that it cannot support computers in the 
classrooms, but it doesn't matter, because there can't be computers in 
these classrooms. The classrooms are 8 foot by 12 foot. The music 
classes take place in what used to be the janitor's closet, 8 foot by 
10 foot.
  Standing Rock Reservation: Standing Rock School has PCBs leaking from 
the light fixtures. PCB, as we know, is a carcinogen. It is very 
dangerous. Federal law says that PCB levels over 50 parts per million 
are unsafe. In the Fort Yates school, the PCBs leaking from the light 
fixtures measured not 50 parts per million, which is unsafe, but 
143,000 parts per million. That is in our school. That is with kids 
attending school.
  What happened? They shut the school. The took the kids out of the 
school and placed them around town in portable classrooms, some in a 
home. Six classes have been meeting in the school gymnasium. The others 
have been meeting in portable trailers and a private home. The extra 
classes, like physical education, music and art, of course, have been 
suspended, and the school officials don't yet know when the students 
will return to their classrooms.

  PCBs leaking from light fixtures in a school that is in disrepair--
this happens to be on an Indian reservation where, incidentally, in 9 
months, 48 teenagers attempted suicide. In the last 9 months, 48 
attempted suicides, 6 of which were successful.
  If I sound a little angry about this, I am. Every single year I have 
come to the floor of the Senate to talk about this problem, and these 
kids go to school in conditions for which we ought to be ashamed. This 
Congress can do something about it, and the

[[Page S2915]]

budget process is a process in which we make decisions. If someone 
stands up here and says, ``No, school construction doesn't count 
because we have other priorities,'' I ask them, ``What is your priority 
if it is not your children?'' By ``your children,'' I mean this 
country's children.
  All across this country, when our kids go to school, I hope every 
parent wants their child to walk into a school that is safe, secure, 
and in good repair. I defy anybody in this Chamber to stand up and say 
to me that kids who go to school where sewer gas leaks into the 
classrooms and they have to move kids out of those classrooms because 
of the stench of sewer gas, I defy anybody to say it is a good thing 
for kids. If it is not a good thing for kids, and we know it is going 
on around this country--and anecdotically we see it in a GAO report and 
other investigations--then let's decide we want to do something about 
it. The question isn't whether, the question is what.
  Senator Moseley-Braun has made a proposal. Her proposal is modest. I 
suspect it will be voted down. It will be voted down because we have 
people who construct the budget and say, ``Here are our priorities; 
this is what we want to spend money on, and it doesn't include this.''
  The amount of school repairs necessary in this country last year--3 
percent of the funds available to meet the needs of school repairs was 
allocated to the State and local governments last year. If this 
Congress doesn't have the nerve and the will to say on behalf of our 
kids that you matter, this is a problem we know we can fix and we are 
going to put in our budget the provisions that allow us to say to kids, 
``We're going to invest in your young lives,'' if this Congress doesn't 
have the capability to do that, then there is something, in my 
judgment, fundamentally wrong with the priorities we have established 
for public spending.
  I said yesterday that everybody in this Chamber will be dead in 100 
years. Everybody. Nobody will be around here feeling good, working. 
They will all be dead. We will all be dead. Only historians will 
evaluate through our budget, by looking back at the budget process in 
this Congress, the 105th Congress, what were our values; what did we 
think was important; what did we decide to invest in; what did we think 
would improve this country.
  I hope historians will not look back at us and say, ``Well, oh, they 
had discussions about a terrible deplorable condition in some schools 
in their country, but they decided not to invest in schools, because, 
somehow, schools took a backseat, schools were in second place to a 
range of other priorities, some of them very strange priorities.''
  I hope historians will say that this Congress, yes, in tight fiscal 
times decided that one of the most important investments they could 
make in America was to make a good investment in the education of our 
kids.
  No kid in this country can go to school and learn the way we expect 
children to be able to learn unless those schools are in decent repair. 
They must be safe, in decent repair, good places of learning. You have 
to have a teacher who knows how to teach, a student who is willing to 
learn, and a parent involved in that education. When you have that at 
work and have invested in good school facilities that are necessary to 
make that take place, then we will have done our job as a country.
  I wanted to come and say Senator Moseley-Braun has offered an 
amendment that is very, very important. I can think of a thousand 
reasons why people will stand up and say they are against it. None of 
them are good. Mark Twain was once asked to debate--I have told my 
colleagues this before. He said, ``Of course.''
  ``We've not told you the subject.''
  He said, ``Doesn't matter, as long as I can take the negative side; 
that takes no preparation.''
  It takes very little preparation to oppose. The Senator from Illinois 
has proposed something that ought to rank right at the top of the list 
of what is important for this country. When we vote today, I hope the 
American people who listen to this debate will call the offices and 
say, ``We agree that this represents the first priority for the 
Congress, the first priority for this country, to invest in the lives 
and education of the American children.''
  Mr. President, I yield the floor, and 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. LAUTENBERG. 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. LAUTENBERG. Mr. President, I yield such time as needed to my 
colleague from Illinois so that she may discuss her amendment. And 
until such time as my colleague is ready----
  Ms. MOSELEY-BRAUN. I am. I thank the Senator from New Jersey.
  The PRESIDING OFFICER. The Senator from Illinois is recognized for 
such time as she may consume.
  Ms. MOSELEY-BRAUN. I thank the Senator from New Jersey for his 
indulgence, for allowing additional time to talk about this issue 
because it is such an important issue and we were limited by virtue of 
the agreement on this budget discussion so we did not get the time to 
really go through all the details. But I did want to pick up on a 
couple points that were made while the Senator from North Dakota spoke. 
He was so eloquent in his support of the legislation. But he touched on 
two themes that I would like to touch on or respond to now.
  The first one goes to, whose job is it? Whose responsibility is it to 
see to it that our children go to school in environments that are 
suitable for learning? Whose fault is it? Whose fault is it that we 
have crumbling schools, that we have schools that fall below building 
codes? We have schools where the ceilings are falling in because of 
faulty plumbing. We have schools where the wiring is insufficient to 
maintain a computer. We have schools with broken windows in this 
country.
  Almost fully a third of the schools, according to the General 
Accounting Office, fall below the code standards, decent environments 
for learning, just basic kinds of facilities requirements. This is not 
bells and whistles. This is not anything exceptional, just the basic 
level of facilities and infrastructure. Almost a third of the schools 
in this country fall below that level.
  So as you go through the debate, a lot of this debate really comes 
down to, whose fault is it that it is this way? And what the sense-of-
the-Senate amendment proposes is that we stop playing the game, the 
blame game, that we stop trying to pass the buck, that we stop trying 
to point the finger to assess the blame, to make it somebody else's 
problem, because, indeed, the children of this country are all of our 
problem.
  We will not be able to maintain the standard of living that we all 
talk about and maintain as the American dream, we will not be able to 
maintain that American dream into the next century if we do not give 
every one of our children an opportunity to learn, if we do not give 
every child the best access to education that we can possibly make 
available to them. Quite frankly, we cannot give quality education to 
children in school buildings that are literally falling down.
  It should be intuitive to everybody in this Chamber, but beyond 
intuition, the fact is that the studies actually have confirmed that 
performance is directly related to the condition of the environment in 
which learning is supposed to take place.
  Children who go to schools that are falling down consistently score 
below children in quality facilities, across the board, on all the 
tests. We should have gotten a warning call as a nation just a couple 
weeks ago when the results came in on the international tests in math 
and science. What those results said to us was that the United States 
has fallen behind most industrialized countries.

  The United States scored below Slovenia. I do not mean to disparage 
Slovenia, but we scored below Slovenia in math and in science. How can 
we possibly expect to compete in this global economy with this kind of 
laissez faire attitude, this kind of neglect, this kind of, I would 
even suggest, triage of our children, that leaves their education up to 
how much their parents happen to be able to afford?
  That gets to the point of--there was a chart over there, and it has 
kind of fallen. I do not know where it went. I actually would like to 
use it for a second. It was on the opponents' side. It

[[Page S2916]]

was a quote from one of the White House assistants in 1996 when this 
proposal got cut out of the budget. In spite of the fact that the White 
House said at the time they were in support, the fact is--and everybody 
in this room knows; and I am not embarrassed about it anymore--that the 
White House said, ``Well, we have some other priorities. We can't 
afford to do this now.'' So they punted on the school construction 
proposal. They essentially let it get cut out at the table because 
there was opposition on the other side of the aisle, and the majority 
objected to it. The White House said, ``OK, fine. We'll let it go.'' So 
the proposal fell once again that time just under the circumstances of 
that debate.
  But that loss, in my opinion, should have just been temporary 
because, if nothing else has happened, I think in the ensuing years 
people have had a chance to take a look at the whole question of whose 
fault it is and whose responsibility it is. The truth is, we cannot 
just expect to pay for rebuilding our crumbling schools based on the 
local property tax.
  Right now our school finance structure proceeds from the local 
property tax. That is one of the reasons why we have this patchwork of 
schools across the country. In much the same way General Eisenhower, 
when he set up the Interstate Highway System, concluded that the only 
way we were going to serve the national interest in transportation from 
one end of the country to the other was to have a system that had some 
congruence and some core communication and some networking, if you 
will, to it. So we were able then to get around the wealth of a 
specific community by saying we are going to have one good road that 
takes us from one end of this country to the other.
  Well, so it is with facilities. If we just rely on the local property 
tax, we will be forced then to have a school system where in wealthy 
communities there will be good faculties, in middle class communities 
there will be a patchwork of full school facilities, and in poor 
communities there will be school facilities with broken windows and 
falling bricks and leaky roofs. That is the situation we are in. And 
that is the situation we have come to.
  Let me suggest this debate and this sense of the Senate does not say 
that State and local governments do not have a role to play or that we 
should take this up as a new program for the Federal Government. 
Indeed, we should not. If anything, this calls on all levels of 
government to go into a partnership, to work together, to collaborate, 
to get beyond the blame game and the finger pointing and the skirting 
of responsibility, to say let us work together to make this happen, to 
fix these crumbling schools.
  The property taxes have already--already--been rising. In fact, State 
and local taxes as a share of income have risen nearly 10 percent--
nearly 10 percent. And the increase in State and local taxes has been 
greater than the increase in Federal taxes. It is stunning. People 
think, ``Oh, taxes are terrible.'' Well, most of the tax hikes have 
come at the State and local level. This is going to dawn in the general 
conversation fairly soon, I suspect, because the problem is not coming 
from here, it is coming because we are pushing off to State and local 
governments a lot of responsibility that we could help them with. That 
is the point, not that we are going to take it over; we can help them.

  Indeed, if we do not create a more equitable partnership to modernize 
our schools, the local property taxpayers will have to come up with an 
additional $153 billion--$153 billion. This sense of the Senate 
suggests that we have that partnership, that we work together, that we 
provide some financial assistance to local governments, that we provide 
an opportunity for them to give some relief of the local property 
taxes, that we support State efforts to rebuild the schools, that we 
work together for our children, because they are all our children and 
we have a stake as citizens of this great country in the education of 
each and every one of them.
  It seems to me that if we form this partnership, we will be able to 
meet this challenge, we will be able to provide our children with 
decent facilities, we will be able to give them the tools they need to 
take up the challenges of this technological age of their time.
  I thank the ranking member for giving me this time. It appears that 
the majority is prepared to take the floor. But I yield back to the 
Senator from New Jersey. I thank the Senator so much for his support of 
this. He has been a builder. I have to say one thing about the Senator 
from New Jersey. He likes and he understands the importance of 
infrastructure; of the basics; of making certain that our roads are 
good in this country, because that is how business gets done; of making 
certain that we have infrastructure with the bridges so we do not have 
accidents, so that people can get from one place to the other, can get 
to work; of making certain that our children have the quality education 
and that the infrastructure is adequate to that end.
  It seems to me that there can be no more fundamental priority for us. 
And this is an opportunity for us to provide for educational 
excellence, again, in collaboration and cooperation and in partnership 
with State and local governments on ways in which they retain control. 
There is not a lot of bureaucracy with the proposal. Actually, this is 
not a proposal. The sense of the Senate is so general, I would expect 
it to have unanimous--it could very well, if it were not so partisan an 
issue, it could very well have unanimous support in this Senate. It 
should have. It should have.
  The politics, frankly, should stop at the schoolroom door, and it 
should stop on something like a sense of the Senate that just says, 
look, this makes sense for us to do. It does not legislate, it does not 
mandate, it does not dictate anything. A sense-of-the-Senate amendment, 
as the Presiding Officer knows, is just a statement of what we think is 
the right thing to do.
  And I hope that we could have unanimous support for the right thing 
to do by our children, by our school facilities. I hope to have 99, if 
not 100, votes. It would be very nice. But I am a realist in this 
matter. I know that it is going to fall prey to partisan politics. I 
think that is a shame too, because I really think the time when we have 
to just have these partisan divides on these kinds of issues, that time 
has passed.

  I think the American people have gotten to the point where they are 
tired of the blame game, they are tired of the finger pointing, they 
are tired of the argument, the argument of, ``This is what's wrong with 
America, and isn't this a shame?'' Let us move to the constructive, to 
the positive, and talk about what is right with America, what is right 
with our generation. Our generation is as capable as any of the 
generations that have gone before us of meeting the challenges of our 
times. I submit to you that this crumbling school initiative is 
precisely such a challenge.
  When I went to school, we were in schools largely my parents' 
generation built, my grandparents' generation built. What is our 
generation going to leave as its legacy to the kids? Schools based on 
whether or not your parents are wealthy? Schools based on whether or 
not you live in a community that has a big shopping center so there are 
a lot of property taxes? Are we going to just leave it to an accident 
of geography whether or not a youngster has a chance to be educated in 
a decent facility? I hope not.
  I hope we take advantage of this opportunity and see this sense-of-
the-Senate amendment as an opportunity--as an opportunity--for us to 
come together as Americans for something that we all believe is the 
right thing to do.
  I want to again thank the Senator from New Jersey. I yield to the 
Senator from New Jersey and thank him again for his indulgence and for 
all of his great support in this matter.
  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. I wonder if I might ask a couple questions.
  Ms. MOSELEY-BRAUN. Absolutely.
  Mr. DOMENICI. How much is the program that you envision going to cost 
the Federal Treasury?
  Ms. MOSELEY-BRAUN. $3.3 billion.
  Mr. DOMENICI. $3.3 billion?
  Ms. MOSELEY-BRAUN. Yes.
  Mr. DOMENICI. Can you explain how we will get so much for so little?
  Ms. MOSELEY-BRAUN. In the first instance, this sense of the Senate 
does not prescribe a level. The sense-of-the-

[[Page S2917]]

Senate amendment is conceptual; it does not go to $3.3 billion. That is 
the underlying legislation that has that figure in it.
  How do we get so much for so little? That is a very good question. I 
will tell you how. What we do is provide the issuers of the zero coupon 
bonds with the ability to give, basically, a tax break to purchasers of 
the bonds. So instead of having even an interest rate buydown, an 
individual will get a tax credit when they buy one of these 
instruments. They will get a tax credit instead of interest. That will 
allow for the leveraging to the $22 billion or thereabouts of the bond 
issue.
  Mr. DOMENICI. Let me make sure I understand a couple more things.
  Ms. MOSELEY-BRAUN. $21.8 billion. The $3 billion I mentioned will 
leverage into $21.8 billion worth of these bonds over the next 2 years. 
Again, it is calling for a partnership. It calls for private-sector 
investment--private-sector investment--in helping to rebuild these 
schools. It is not all out of the Treasury. It is largely the private 
sector stepping forward and saying, ``As purchasers of these 
instruments, we want to help achieve a national goal.''
  Mr. DOMENICI. In a sense, if this sense of the Senate is ever carried 
out, the Finance Committee would have to find room on the tax side for 
$3.3 billion of tax cuts; is that correct?
  Ms. MOSELEY-BRAUN. We have the tradition of paying for those things 
that are authorized out of the Finance Committee.
  We passed a bill last night that wasn't fully paid for, as I know the 
distinguished Senator from New Mexico is aware. However, yes, we would 
have to find the ``pay for.'' There is no question about it. Whether or 
not that would come out of some of the various revenue streams 
mentioned in connection with the bill we passed out last night or some 
other--we can be innovative. The chairman of the Finance Committee is 
sitting here, and he is one of the most innovative persons I know in 
coming up with things like that. We can work together to find the 
revenue stream to support the $3.3 billion. It is a small price to 
leverage $21 billion of private-sector investment to achieve the goal 
of helping to start down the path of meeting this $112 billion worth of 
deferred maintenance.
  Mr. DOMENICI. I don't have any further questions. I think there are 
some other Senators on our side that do, and in due course they will 
come down. I have nothing further.
  Are you finished on your side?
  Ms. MOSELEY-BRAUN. I yielded for the Senator from New Jersey.


                           amendment no. 2209

  Mr. ROTH. Mr. President, I ask unanimous consent that the pending 
amendment be set aside, and I ask for the immediate consideration of 
amendment No. 2209.
  The PRESIDING OFFICER. That will be the pending question.
  Mr. ROTH. Mr. President, this amendment deals with a vital national 
issue--Social Security reform. This amendment is cosponsored by 
Senators Breaux, Gregg, Robb, Hatch, Nickles, Gramm, Gordon, Smith, and 
Santorum.
  Let me say first that as the chairman of the Finance Committee I am 
acutely aware of Social Security's future financial problems. I am sure 
these problems are familiar to most members, but nonetheless they bear 
repeating.
  In just 14 years, in 2012, revenues to the Social Security trust 
funds will no longer cover benefits. Social Security will then cash in 
Treasury bonds that are now accumulating in the trust funds. This will 
place major pressure on the Federal budget and crowd out other 
important spending.
  By 2029 the bonds will be gone. Social Security will then be able to 
cover only 75 percent of benefits directly from revenues. The long-term 
debt of the Social Security system--the difference between revenues and 
benefit through 2075--is estimated to be an astounding $121 trillion.
  The purpose of my amendment is simple. Nevertheless, it is important 
and urgent. The amendment instructs the Finance Committee to dedicate 
the budget surplus to establishing Social Security personal retirement 
accounts.
  Despite its simplicity, I know that many of my colleagues will have 
at least two questions about this amendment. First: ``Why establish 
personal retirement accounts this year, rather than wait until next 
year?'' And second: ``Why not begin with comprehensive Social Security 
reform, rather than start with personal retirement accounts?''
  Mr. President, the easy course would be to wait until next year to 
begin Social Security reform. But the fact is, Social Security reform 
will be a big job. I am very concerned that trying to do it all in one 
year--in 1999--will simply not be possible.
  Americans have learned that big, comprehensive proposals, with many 
parts, often run into problems in Congress and can easily take several 
years to enact. Particularly proposals that deal with an important, 
sensitive program like Social Security.
  The place to start with Social Security reform is to establish a 
program of personal retirement accounts--funded by the budget 
surpluses. Dedicating the surplus to personal retirement accounts 
allows us to get started on reform without running into controversies 
over changes to the traditional program.
  Personal retirement accounts themselves would be a big, new feature 
of Social Security. We will need to explain these accounts to the 
American people, and writing a bill will require thoughtful action by 
the Finance Committee.
  Mr. President, let me note for the record that there is a growing 
bipartisan consensus that personal retirement accounts must be an 
essential feature of Social Security reform. And I want to emphasize 
the word ``bipartisan.''
  In the Senate, Senator Bob Kerrey, another member of the Finance 
Committee, was an early and vocal advocate of personal retirement 
accounts. In the last Congress, he and Senator Alan Simpson, now 
retired, introduced a ground-breaking Social Security reform bill with 
personal retirement accounts that grew out of their experience on the 
1994 Bipartisan Commission on Entitlement and Tax Reform.
  Other Democrats support this concept. For example, Senator Robb, 
another cosponsor of my amendment, proposed a sense-of-the-Senate to 
last year's budget resolution that would have funded Social Security 
retirement accounts.
  And just two weeks ago, Senator Moynihan, the ranking Democrat on the 
Finance Committee and a recognized expert on Social Security, 
introduced a comprehensive Social Security reform package that included 
personal retirement accounts.
  On the Republican side of the aisle, there is strong support as well. 
Senators Judd Gregg, Don Nickles, Phil Gramm, Rick Santorum, and Rod 
Grams, among others, have been enthusiastic advocates of Social 
Security personal retirement accounts.
  Let me explain why Social Security personal retirement accounts find 
so much support--not only in Congress, but among the American people. 
While proposals differ, the basic objective of this program is to 
provide each working American with funds to be deposited into personal 
retirement accounts.
  With even conservative investment, such accounts have the potential 
to grow to provide a secure and generous retirement nest egg. Indeed, 
for the first time Americans could look forward to having real personal 
wealth in old age, not just enough to keep body and soul together.
  A recent report by the Congressional Research Service provides many 
illustrations of what Social Security personal accounts may offer. For 
example, for an individual who is 28 years old today and earns an 
average wage--about $27,000, just 1 percent of an amount equal to his 
or her wages invested over the next 37 years in the S&P 500 would grow 
to $132,000, which would be worth about 20 percent of his or her Social 
Security benefits. By the way, CRS assumed a 10-percent rate of return 
for the S&P 500. In fact, over the past 10 years, the compounded annual 
return on the S&P 500 has been 18 percent.
  Mr. President, using the budget surpluses to create retirement 
accounts represents an opportunity to get these accounts up and 
running. Once in place, we can then begin looking at Social Security 
benefits for the long run. It will help insure that Social Security 
benefits continue to provide a secure foundation of retirement income. 
Establishing these accounts this year--as a new program in addition to 
the current Social Security program--would allow us to demonstrate 
their value in

[[Page S2918]]

providing retirement benefits for working Americans in the years to 
come.
  Creating these accounts would also give the majority of Americans who 
do not own any investment assets a new stake in America's economic 
growth, because that growth will be returned directly to their benefit. 
More Americans will be the owners of capital--not just workers.
  Creating these accounts will help Americans to better be prepared for 
retirement, generally. According to the Congressional Research Service, 
60 percent of Americans are not actively participating in a retirement 
program other than Social Security; this, in spite of the fact that 
Social Security was never intended to be the sole source of retirement 
income.
  Mr. President, could there be a more important use of the budget 
surplus? Some may believe that the budget surplus should be used to 
reduce the debt, not dedicated to personal retirement accounts. That is 
exactly what we will do by using the surplus to create these accounts. 
Social Security, a $121 billion unfunded liability over the next 75 
years, is a huge debt and we need to recognize it as such.
  Retirement accounts and other solvency proposals would be a critical 
first step in reform. At the same time, it would tackle that debt and 
protect benefits. Most observers expect a surplus upwards of $60 
billion this fiscal year, enough to get started on retirement accounts 
and to begin reducing the Federal debt. Some may be concerned that the 
President and others have called for a year-long national dialog on 
Social Security reform. They may be erroneously believing that doing 
reform this year might undermine the national dialog. On the contrary, 
I can think of no better way to focus it than with specific proposals 
and action by a U.S. Senate committee.
  Mr. President, Congress has talked for a long time about the need to 
do something to shore up Social Security. The time has come for action. 
It is indeed a blessing that we have a surplus to work with. Now let's 
put that surplus to work. The Finance Committee must get started on 
Social Security reform this year. The place to start is by dedicating 
the budget surplus to fund personal retirement accounts. This amendment 
will get the ball rolling. I urge Members to support it.
  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, I rise in support of the Roth amendment. 
Clearly, there is a long way to go before we have rendered Social 
Security solvent way into the next century. But it is even more obvious 
that this is the era when part of what a citizen who is working should 
have for retirement should be a personalized savings account or an 
annuity that comes from that personalized savings account. There can be 
no doubt that it can be structured in such a way that it will turn out 
to be better for the senior citizen. They will be assured of the 
benefits that they are getting now and, in most cases, will come out 
far, far ahead.
  In the meantime, if it works right, the surpluses of the U.S. 
Government, if used partially for this, will be invested in a safe way, 
not solely in IOU's from the Federal Government, which is where they go 
now, which is the law now; rather, they will be invested where they 
can, without much risk, yield significantly more and, when compounded, 
the power of compounding is enormous.
  So in a very real sense I come here today saying to the distinguished 
Senator, Senator Roth, chairman of the Finance Committee, that the time 
has come for some significant reforms that will not put in jeopardy the 
Social Security system, but rather in the long run make sure that it is 
not short of money, that its liabilities will not be there to destroy 
the system, but rather that in years to come, it will be more solvent, 
and that ultimately, with part of it being compounded because of 
the annual return that will come from safe investments, it is clear 
that everyone gains. The seniors gain, the 21-year-old paying into the 
system today gains, and the American economy is the beneficiary of 
individuals investing in this economy across the board so that the 
working people of the United States will own an interest in the 
American companies that produce our wealth.

  Frankly, I am delighted that we are going to discuss this today. If 
we discuss it for a long time, that is fine with me. If we discuss it 
for a short time and it passes, that is fine with me. But clearly, we 
discuss a lot of things that are not nearly as important to our future, 
and we adopt sense-of-the-Senate resolutions that are, in many 
instances, not even important to the fiscal policy of our Nation and 
the future well-being of our people.
  This is moving in the direction of reform and personalized accounts, 
and is a very appropriate thing to be doing on a budget resolution. It 
has everything to do with what we do with our surpluses, if we have 
them, what we do with capital needs in the future, and how we assure 
senior citizens that they are going to be guaranteed a Social Security 
check or better, because they will have invested some portion of it in 
personalized accounts.
  I yield the floor.
  Mr. SANTORUM. Mr. President, may I have some time under the bill?
  Mr. DOMENICI. How much time does the Senator want?
  Mr. SANTORUM. Fifteen minutes.
  Mr. DOMENICI. I yield Senator Santorum 15 minutes, and then Senator 
Nickles needs 15 minutes.
  The PRESIDING OFFICER. The Senator from Pennsylvania.
  Mr. SANTORUM. Mr. President, I rise in very strong support of 
Chairman Roth's amendment. There is nobody in this Chamber who has done 
more to look out for the retirement security of Americans than Senator 
Roth from Delaware. It is with his Roth IRA and other kinds of 
innovation in his work on the Finance Committee that he has helped to 
provide for retirement security for millions of Americans, which is 
legendary. I commend him for that and for firing, if you will, here on 
the floor of the Senate, the first salvo in what I believe will be a 
long debate, and I hope will not be a hostile debate, on the issue of 
transitioning Social Security.
  What we have seen is now a bipartisan agreement that personal savings 
accounts must have a very significant role in transitioning Social 
Security. Why is that? Social Security is in trouble. It is not in 
trouble next year or the year after, but Social Security, which was 
``saved'' back in 1983 with the most recent revision--it was supposed 
to save it for generations to come, but it is now scheduled to go 
bankrupt some 30 years sooner than originally expected. That number is 
not set in stone either. It is now 2029 when the system goes bankrupt. 
In the year 2013, the system starts running a deficit, paying out more 
than it takes in. Now is the time, before that bulk of the population, 
the baby boom generation, goes into retirement, to begin to look at how 
we can begin to solve this problem. Well, there are things you can do 
within the current structure, like changing benefits--when I say 
``changing,'' I don't mean raising them, I mean cutting benefits--
increasing taxes, and do a whole lot of things to try to preserve a 
pay-as-you-go system that will not work over time because of very 
simple demographics, the most important of which is that people are 
living much longer, which is a good thing, and also we have very low 
birth rates in this country. You have people living longer and fewer 
people to pay for them. So you are looking at dramatic increases in 
taxes or cuts in benefits, and that is a mindset of a finite, fixed 
pie.

  What Senator Roth is suggesting here is, let's grow the pie. So when 
he says let's grow the pie, let's invest this money, not, as Senator 
Domenici said, in Treasury bonds that earn a very small rate of 
return--in fact, if you are entering the work force now, the rate of 
return on Social Security taxes you are going to pay is below zero. 
That is not a good deal for young people in this country. But what we 
have to do is transition the system using the ideas of growth in 
producing more retirement income for people who are just entering the 
work force, or who have been in the work force a relatively short 
period of time, but at the same time, make sure that we do not change 
what has been promised to those at or near retirement.
  That is our challenge. But with challenge comes tremendous 
opportunity; in crisis comes a tremendous will to be innovative in 
using the private market

[[Page S2919]]

systems that work so well in this country to provide wealth. As the 
Senator from Delaware said, our modest amount of money being paid on 
Social Security was never intended to be the sole source of retirement. 
As a result, it is a very modest amount. People living on Social 
Security today will tell you that if that is their only income and they 
have no other pension income or savings income, they are hard pressed 
to make a living. This is not an adequate savings system. What we need 
to do is enhance that, create an opportunity for more growth in 
people's wealth and, at the same time, protect those who are in the 
system or have been in the system such a long period of time, so that 
they will keep at least what we have promised in the past.
  We can do that, but we must use the power of the marketplace, the 
power of investment and savings. In so doing, we will not only open up 
the opportunity for wealth and a better retirement income for 
generations to come, but open up huge economic benefits for this 
country with the amount of money that is going to be poured into the 
capital markets and the debt markets, to be able to finance future 
economic expansion and growth, better jobs, and higher standards of 
living and real wage growth. I heard earlier today from Jose Pinero, 
who was the Secretary of Labor during the time Chile went to a private 
personal saving system there, some 17 years ago. He said that 30 years 
prior to Chile going to that system, they had a real wage growth of 1 
percent a year, on average. Since they passed the personal savings 
accounts in Chile, they have had a real wage growth of 7 percent a 
year, for almost 15 years, in that country.
  What they have done is dramatically increase--over double; two and a 
half times--their savings rate. People now understood. Senator Roth 
said a very important thing, that only 40 percent of the people in this 
country have some investment in the marketplace and understand the 
dynamics of how the market works, how our economy works. That is a 
disability, if you will, for millions of Americans who don't have that 
advantage. The average, ordinary Chilean has that knowledge now and 
understands the marketplace and uses that knowledge to their own 
benefit--and not only their own benefit in their personal savings 
account, but in their life and in their savings and other skills of 
interacting in the economic marketplace. It creates such synergy that 
it will have a dramatically positive impact on the future of this 
country.

  This is the opportunity that is before us, and what I am so excited 
about is what I see is a real chance for a bipartisan solution to this 
problem. With Senator Moynihan's proposal of putting 2 percent aside in 
private savings, I think that is a very healthy initiative. We want to 
build, in my opinion, from that as to how we can transform this system 
to provide the security for those at or near retirement, put it in the 
law, which is not the case today, so that those benefits will be there 
as long as they are alive, that we will not change the benefit 
structure as long as they are alive--there is no law that says that 
right now--guarantee it. Then we can create opportunities for those, 
frankly, who have very little expectation that Social Security will be 
there.
  I talk to a lot of young people. I have been to over 110 high schools 
in my State since I have been in office. I can tell you, when I ask the 
question, ``How many believe Social Security will be there when you 
retire?'' if anybody raises their hand, the other kids in the crowd 
look at them and laugh at them. They have no expectation that Social 
Security will be there. They think it is, in fact, a pyramid scheme, a 
ponzi scheme, some sort of thing that the folks who are in power right 
now are just going to make them pay and then slash the heck out of 
Social Security when it comes their time.
  Well, what we are going to do here is create hope. One of the things 
I hear so much about is how young people are cynical in this country 
and they don't believe in our institutions and our culture, and what we 
are doing here is, in fact, giving them something they can hold, they 
can have a passbook with their money in it so they can track it every 
day and see how it grows, and they can say, ``This is my money,'' from 
the first day they worked flipping that first hamburger at a fast food 
restaurant. That money goes into their account and is building for 
their retirement security. They can see that happening with them at 
work. They can see hope. They can see the potential for wealth and for 
a good life. They will understand the dynamics that are so important 
for all of us to understand that have to survive economically in this 
country and in the world that is out in front. This is truly not 
something we should be looking at and saying, how are we going to fix 
Social Security? Such a problem, such a crisis. What are we going to do 
and have money? But to walk hand in hand and jump at the opportunity to 
create a whole new way of looking at providing opportunities for 
millions of Americans upon their retirement and energizing and 
uplifting an economy through that process, this is a great opportunity 
for all of us.

  What the chairman of the Finance Committee has done today is to lay 
down the first mark on the budget where it should be laid down, because 
what we will be doing by allowing private investment is dramatically 
lower--not everyone talks about how we are going to use the surplus in 
transition. That is a big concern we have to worry about--how we 
transition these costs. That is the big nut we have to crunch. But at 
the end, what will happen is that budget deficits and the huge 
unemployment liability in $7 trillion or $8 trillion of unfunded 
liability in the Social Security trust fund today will in effect over 
time vanish because of the dynamics of allowing private savings to 
occur.
  This is in fact a multifaceted solution to many problems that are out 
there, one of which is the long-term problems of the budget deficit in 
the outyears when the baby boomers are beginning to take retirement--
not only Social Security but Medicare as well--when the budget deficit 
comes back again. You hear so much about surplus. It comes back again. 
That is the era, that is the time that we can, by acting now, keep 
surpluses coming long into the future and grow the economy, create 
stability, create hope for those who now do not have it.
  Mr. President, I yield the floor.
  Mr. NICKLES addressed the Chair.
  The PRESIDING OFFICER. The Senator from Oklahoma.
  Mr. NICKLES. Mr. President, I compliment my colleague from 
Pennsylvania for his statement. I also compliment Senator Roth for his 
resolution. I am happy to cosponsor this resolution. I hope we will 
have overwhelming bipartisan support for it, and hopefully everyone can 
understand what we are talking about doing. We are talking about saving 
Social Security.
  The President during his State of the Union speech says we want to 
save Social Security; we don't want to spend one dime of the surplus. 
Senator Roth is trying to save Social Security. Because we do not just 
save Social Security by not spending the surplus either in the form of 
additional outlays--frankly, the President is violating that as we 
speak because he wants to have a supplemental appropriations bill and 
doesn't want to pay for it. He is already violating what he said in the 
State of the Union Address.
  But I agree. We should save Social Security. This resolution says 
that we should take the surplus and allow individuals to set up 
personal savings accounts. I think that is the way to save Social 
Security. I think that is the way to fund Social Security. Right now we 
don't fund Social Security. It is an unfunded paying system. One 
generation pays for retired generations, or working employees today pay 
the Social Security tax. Social Security taxes are enormous. They 
have grown, and they have exploded in cost.

  As a matter of fact, somebody paying Social Security today is paying 
a total--if you look at Social Security taxes, their contribution today 
is a total of $10,465 if they have the maximum amount of income, which 
is $68,400. That is a lot. That actually includes Social Security and 
Medicare, I might mention. So that is a lot. Social Security is 12.4 
percent of $68,000. That is a lot of money. That is over $9,000 that 
people are paying. If somebody happens to be making $68,000, they are 
paying a lot. What do they have to show for it? Nothing. They can't 
open up a bank account and say, ``Here is

[[Page S2920]]

my money for an investment.'' Basically they are funding a previous 
commitment.
  Senator Roth is saying we should take the surplus and allow people to 
set up their own individual retirement accounts, let them be able to 
invest in the marketplace, let them be able to enjoy the rewards of 
compounding interest. Right now the rate of return on Social Security 
as an investment--some people say 1 percent, some people say 1.2 
percent, or 1.3 percent. That is not a very good rate of return. It is 
pathetic if you consider what the market has done in the last several 
years. The marketplace--the Dow Jones or Standard & Poors 500--has been 
compounding in the 20 and 30 percent range for the last 4 years. But to 
have individuals be able to enjoy this? The answer is no, not in Social 
Security.
  Senator Roth has done something else. I really appreciate it, because 
it is important. He said not only should they be able to invest a 
portion, but also we should be able to use that money to reduce the 
unfunded promises that we now have in Social Security.
  I want to do this proposal for two reasons.
  One, I want millions of Americans to become millionaires. If we let 
them take--some people say 2 percent. I think it should be up to maybe 
5 or 6 percent, maybe half of their Social Security tax. Of the Social 
Security tax of 12.4 percent of their income up to $68,000, you would 
let them put 6.2 percent of their income in for 40-some-odd years 
before they retire, and you will find that we will have lots of people 
who started out maybe making $20,000 a year who are going to be 
millionaires.
  Senator Roth's example is they put in 1 percent at age 28, and they 
can have over 100-some-odd thousands. That is 1 percent. Let's get it 
up, and it can really compound, and individuals can have hundreds of 
thousands of dollars, if not over a million dollars.
  I want those individuals to be wealthy, whether they are on the lower 
end of the income scale or in the higher end. We want them to be 
independent.
  Likewise, I want to reduce the unfunded promises that we don't have 
the money to pay for. I am really concerned about what our kids are 
going to have to pay for 20 years from now. If we do not do something, 
as Senator Roth is proposing--Senator Moynihan, Senator Breaux, and 
Senator Kerrey, and others of us have been working on it--our kids are 
going to be inheriting a debt that is twice as large as our national 
debt. Everybody is bragging around here. We are patting ourselves on 
the back. ``Hey, we balanced the budget.'' We are balancing the budget 
on using a great deal of Social Security surplus. That debt right now 
has accumulated, the Federal debt--usually people say about $3.3 
trillion or $4 trillion. The unfunded vested promises that we have in 
Social Security today is almost $10 trillion, twice as large as our 
national debt.

  What this change by going to a capitalist-funded retirement system 
would do would provide security, provide retirement funds for 
individuals, and likewise could reduce the Government's obligations in 
the future--to me that is a very positive thing--so future generations 
won't have to have a payroll tax that is maybe twice as high as the 
payroll taxes we have today. I think it is a very positive thing.
  I might mention--I see a couple of colleagues on the floor who talked 
about how we should not use Social Security funds to balance the 
budget. Today the Social Security trust fund, this year 1998, $101 
billion more will go in than goes out. That is a surplus. Yet, we are 
using that surplus just like every administration has used it since we 
have had Social Security.
  What I would like to see it do--I might mention the Budget Committee 
has already passed it. I was interested. I was going to introduce a 
resolution that says we should pass in 2 or 3 years--3 years, let's 
say--the budget resolution that doesn't use one dime of Social Security 
trust funds to balance the budget.
  I tell my colleague from North Dakota, who has talked about this on 
more than one occasion, that I am willing to do it. It won't be easy, 
but we should do it. I tell my colleague that in 10 years the Social 
Security surplus will be $197 billion, almost $200 billion. I don't 
think we should use these Social Security revenues to balance the 
budget. If we balance the budget without that, we can make these moneys 
available for personal security accounts. Now you are talking about 
real money. You are talking about $200 billion in the year 2008 alone 
that can go into personal security accounts that can be invested in the 
stock market, that can be invested in mutual funds, that can be 
invested in bonds, that can be invested in T bills. Let the individual 
decide how he wants to invest it. We allow Federal employees to invest 
in the stock market, in bonds, and in T bills. Federal employees are 
able to do this. My colleague from Pennsylvania mentioned that they do 
it in Chile. They make investments. Surely Americans are capable of 
making these investments. I think it would be exciting to allow people 
to be able to invest their own money. It is their money. It is not the 
Government's money. We have been taking it from them. Shouldn't we 
allow, out of that 12.4 percent, the individuals to take maybe 4 
percent or 5 or 6 percent and be able to invest it for themselves? In 
exchange for that, they will be a lot more dependent on themselves and 
a lot less dependent on the Government.
  This is a mandatory tax. Shouldn't we allow them to have part of that 
for themselves so they can have an account and look at it on a monthly 
basis, so it is there, and it is something they can count on, not for 
an unfunded Government promise that we hope will be there. 
Demographically, everybody who has ever looked at this problem says we 
have a real problem. Some people say we don't have problems until 30 
years. That is hogwash. We have problems, as Senator Roth mentioned, in 
12 years.
  It is estimated that by the year 2010 or 2012, for Social Security 
that line of more money going in switches. More money goes out. No 
later than 2012, more money goes out than in. We will start drawing on 
the trust fund. What is in the trust fund? Nothing but Government IOUs. 
That is the promise. The way we finance those--you say they are the 
same things as T bills or the paper equivalent. It is just an IOU. The 
way we pay for these is we issue more T bills. In 12 years we have a 
big problem. We will have enormously high payroll taxes and a lot of 
debt. You have to issue more debt. I think that is a bad solution. This 
is the right solution, and I will tell you that millions of people in 
the private sector have done this. We did it in my company. We went 
from a defined benefit to defined contribution plan. Our employees love 
us. I think we should give every American an opportunity to do this for 
at least part of their Social Security. It doesn't have to be for all 
of it. Some people say 2 percent. I said maybe it should be half of 
it--maybe 6.4 percent, 6.2 percent. The Government, the employer 
portion, can still go to meet current obligations. But, likewise, we 
would be reducing current or future obligations. I think that is very 
important.

  What Congress has done in the past--we have had problems with Social 
Security--is raise taxes. We raised the base. We raised the tax rate.
  Mr. President, I ask unanimous consent to have printed in the Record 
a chart showing payroll taxes--Social Security taxes and employer taxes 
combined. For the record--my colleagues can see this--if you look at 
Social Security and if you look at disability, Medicare, if you add 
those taxes together, in 1998, for a person making maximum of the base, 
the base amount, which is $68,000, it shows they are paying in payroll 
taxes alone $10,465. That is a lot of money. I am saying we should 
allow individuals to take part of that, a few thousand dollars of it, 
and be able to put it into their own account and likewise reduce 
Government's obligation at the same time. I think it is awfully 
important.
  I ask unanimous consent to have printed in the Record a chart that I 
have prepared that shows the budget deficits and Social Security and 
how that equates. It shows that we are becoming more and more reliant 
over the next several years on Social Security surpluses that I 
mentioned before, which disappear by the year 2012.
  There being no objection, the chart was ordered to be printed in the 
Record, as follows:

[[Page S2921]]



                    BUDGET DEFICITS & SOCIAL SECURITY
------------------------------------------------------------------------
                                                  Social       Unified
                                   On-budget     Security      budget
                                    deficit      deficit/     deficit/
                                                 surplus     surplus \1\
------------------------------------------------------------------------
1962............................        (5.9)        (1.3)         (7.1)
1963............................        (4.0)        (0.8)         (4.8)
1964............................        (6.5)          0.6         (5.9)
1965............................        (1.6)          0.2         (1.4)
1966............................        (3.1)        (0.6)         (3.7)
1967............................       (12.6)          4.0         (8.6)
1968............................       (27.7)          2.6        (25.2)
1969............................        (0.5)          3.7          3.2
1970............................        (8.7)          5.9         (2.8)
1971............................       (26.1)          3.0        (23.0)
1972............................       (26.4)          3.0        (23.4)
1973............................       (15.4)          0.5        (14.9)
1974............................        (8.0)          1.8         (6.1)
1975............................       (55.3)          2.0        (53.2)
1976............................       (70.5)        (3.2)        (73.7)
1977............................       (49.8)        (3.9)        (53.7)
1978............................       (54.9)        (4.3)        (59.2)
1979............................       (38.7)        (2.0)        (40.7)
1980............................       (72.7)        (1.1)        (73.8)
1981............................       (74.0)        (5.0)        (79.0)
1982............................      (120.1)        (7.9)       (128.0)
1983............................      (208.0)          0.2       (207.8)
1984............................      (185.7)          0.3       (185.4)
1985............................      (221.7)          9.4       (212.3)
1986............................      (238.0)         16.7       (221.2)
1987............................      (169.3)         19.6       (149.8)
1988............................      (194.0)         38.8       (155.2)
1989............................      (205.2)         52.4       (152.5)
1990............................      (277.8)         58.2       (221.2)
1991............................      (321.6)         53.5       (269.4)
1992............................      (340.5)         50.7       (290.4)
1993............................      (300.4)         46.8       255.1()
1994............................      (258.8)         56.8       (203.1)
1995............................      (226.3)         60.4       (163.9)
1996............................      (174.0)         66.4       (107.3)
1997............................      (103.3)         81.3        (22.0)
1998............................       (92.0)        101.0          8.0
                                 =======================================
1999............................      (104.0)        113.0          9.0
2000............................      (121.0)        123.0          1.0
2001............................      (117.0)        130.0         13.0
2002............................       (72.0)        139.0         67.0
2003............................       (94.0)        148.0         53.0
2004............................       (88.0)        158.0         70.0
2005............................       (96.0)        170.0         75.0
2006............................       (64.0)        179.0        115.0
2007............................       (59.0)        189.0        130.0
2008............................       (59.0)        197.0        138.0
                                 ---------------------------------------
      Totals for 1999-2008......      (874.0)      1,546.0        671.0
------------------------------------------------------------------------
\1\ The unified budget deficit/surplus includes the on-budget deficit,
  the Social Security surplus, and the Postal Service deficit/surplus.

  
                                  ____
                             Payroll Taxes

                                             TAX RATE AND WAGE BASE
                                        [Employee and employer combined]
----------------------------------------------------------------------------------------------------------------
                                              Tax rates (in percent)                          Wage base
                                         --------------------------------   Total  -----------------------------
                                           Social                            (in
                                          Security  Disability  Medicare  percent)   OASDI            HI
                                           (OASI)      (DI)       (HI)
----------------------------------------------------------------------------------------------------------------
1950....................................      3.00        n/a        n/a      3.00    3,000  n/a
1955....................................      4.00        n/a        n/a      4.00    4,200  n/a
1960....................................      5.50       0.50        n/a      6.00    4,800  n/a
1965....................................      6.75       0.50        n/a      7.25    4,800  n/a
1970....................................      7.30       1.10       1.20      9.60    7,800  7,800
1975....................................      8.75       1.15       1.80     11.70   14,100  14,100
1980....................................      9.04       1.12       2.10     12.26   25,900  25,900
1985....................................     10.40       1.00       2.70     14.10   39,600  39,600
1990....................................     11.20       1.20       2.90     15.30   51,300  51,300
1995....................................     10.52       1.88       2.90     15.30   61,200  No limit
1996....................................     10.52       1.88       2.90     15.30   62,700  No limit
1997....................................     10.70       1.70       2.90     15.30   65,400  No limit
1998....................................     10.70       1.70       2.90     15.30   68,400  No limit
1999....................................     10.70       1.70       2.90     15.30   70,800  No limit
2000....................................     10.60       1.80       2.90     15.30   74,100  No limit
2001....................................     10.60       1.80       2.90     15.30   76,800  No limit
2002....................................     10.60       1.80       2.90     15.30   79,800  No limit
2003....................................     10.60       1.80       2.90     15.30   82,800  No limit
----------------------------------------------------------------------------------------------------------------


                                       TOTAL PAYROLL TAX CONTRIBUTION \1\
                                        [Employee and employer combined]
----------------------------------------------------------------------------------------------------------------
                                                                       Social
                                                                      Security  Disability   Medicare    Total
                                                                       (OASI)      (DI)        (HI)
----------------------------------------------------------------------------------------------------------------
1950...............................................................         90           0          0         90
1955...............................................................        168           0          0        168
1960...............................................................        264          24          0        288
1965...............................................................        324          24          0        348
1970...............................................................        569          86         94        749
1975...............................................................      1,234         162        254      1,650
1980...............................................................      2,341         290        544      3,175
1985...............................................................      4,118         396      1,069      5,584
1990...............................................................      5,746         616      1,488      7,849
1995 \1\...........................................................      6,438       1,151      1,775      9,364
1996 \1\...........................................................      6,596       1,179      1,818      9,593
1997 \1\...........................................................      6,998       1,112      1,897     10,006
1998 \1\...........................................................      7,319       1,163      1,984     10,465
1999 \1\...........................................................      7,576       1,204      2,053     10,832
2000 \1\...........................................................      7,855       1,334      2,149     11,337
2001 \1\...........................................................      8,141       1,382      2,227     11,750
2002 \1\...........................................................      8,459       1,436      2,314     12,209
2003 \1\...........................................................      8,777       1,490      2,401     12,668
----------------------------------------------------------------------------------------------------------------
\1\ The Medicare (HI) contribution shown above is based on the OASDI wage base. The HI wage base was eliminated
  beginning in 1994, making the maximum HI contribution unlimited.


  Mr. NICKLES. Mr. President, we need to wean ourselves and get off of 
this addiction to this and take that money and allow people to put it 
in their own account. That to me is a challenge. We shouldn't be 
sitting back and saying, ``Oh, we balance the budget. Aren't we proud 
of ourselves? We are doing good. We have a unified budget.''
  I think we should have a unified budget. But I think we should go 
back and let's balance the budget without using Social Security. Then 
let's allow people to take that amount of money and be able to put that 
in their own account.
  I might mention that in the 10 years, if we did that, there would be 
over $1.5 trillion that could go into individual accounts and we would 
have more constituents that would be happier with us than anything else 
we would do. We would do more to secure their retirement and their 
future than anything else we could do.
  I have even told the President's representatives. I said, if the 
President really wants to go down in history and show that he has done 
something significant, this change, this evolution of allowing at least 
part of Social Security to be funded as a defined contribution in a 
personal savings accounts would be an astronomically positive impact 
for not only this generation; I think it would be a positive impact for 
future generations, which history will record as having truly been a 
great thing to do for seniors, a very positive thing to do for future 
generations as well.
  So I compliment my colleague from Delaware, the chairman of the 
Finance Committee. I tell him that, as a member of that committee, I 
will work energetically to try to see that we can make this happen as 
soon as possible.
  Mr. President, I yield the floor.
  Mr. GREGG. Mr. President, I wish to join my colleague, Senator John 
Breaux, in delivering a statement as to why we support the sense of the 
Senate language put forth by the chairman of the Finance Committee, 
Senator Roth.
  For the past year, Senator Breaux and I have co-chaired the National 
Commission on Retirement Policy, convened by the Center for Strategic 
and International Studies. Our task is to review the situation facing 
our Nation with respect to retirement income in the 21st century.
  We will soon be releasing a final report of our findings and 
recommendations, and we need not preview them here in detail. Suffice 
to say that each of the major sources of retirement income--Social 
Security, employer-provided pensions, and personal savings--will be 
under severe strain in the 21st century, as a consequence of the aging 
of our population, and the declining ratio of workers to retirees.
  The situation facing Social Security is sufficiently dire to command 
our immediate attention. We, as co-chairs of the NCRP, wrote to 
President Clinton last December, urging him to make this issue a 
priority in his state of the union address, and we were extremely 
pleased that he did so. Social Security will begin running operating 
deficits in the year 2012 under current law, and even if the $2.89 
trillion that the Federal Government will owe Social Security is repaid 
in full, the Trust Fund would still run dry in the year 2029. The 
unfunded liabilities of the Social Security--the gap between projected 
outlays and projected revenues--is on the order of $3 trillion. The 
true ``unfunded liability,'' however, is much greater, because those 
taxes haven't been collected yet, and therefore all of the future 
liabilities of the program are in a sense unfunded, to be financed from 
tax revenue at the time that they are paid.
  We have carefully studied this problem for a year, and we believe 
that there are several problems that must be solved simultaneously. The 
actuarial soundness of Social Security is but one of these. There is 
also a huge problem residing in the size of the tax burden that is 
awaiting the future economy if we do not advance fund some of Social 
Security's future liabilities. A solution to this problem is no 
solution at all if it achieves actuarial soundness at the price of an 
unfair tax burden on tomorrow's economy, or at the price of further 
worsening the quality of the deal that today's young workers will 
receive from the Social Security program.
  It is for this reason that Senator Breaux and I believe that personal 
accounts must be a component of the Social Security solution. Tough 
choices will need to be made in order to bring the outlays and the 
revenues of Social Security back into balance, and we believe that 
personal accounts should be established within this context. Creating a 
funded savings account component within the Social Security system is 
perhaps the only way to give something back to today's young workers to 
improve their treatment by the Social Security system relative to a set 
of traditional solutions alone. This is one way that we have found to 
prevent the income provided by the Social Security system from 
declining below the level that we expect from the program.
  Before turning to Senator Breaux, let me also note the flexibility of 
Senator Roth's language with regard to the administration of such 
accounts. This language does not commit the Senate to any particular 
method of administration. Senator Breaux and I,

[[Page S2922]]

after a year of study, have reached the conclusion that the best way to 
administer personal accounts is through the existing payroll tax 
collection system. That money is already being paid in a timely way by 
employers on behalf of individual employees, and is a structure that we 
can practicably work through to set up accounts in every wage-earner's 
name through a refund of some portion of the payroll tax. The Roth 
language is flexible enough to permit a variety of approaches to 
administering the accounts, as it should be. I hope that Senators who 
differ as to the best administrative mechanism will be able to unite 
behind it.
  Mr. BREAUX. I thank Senator Gregg for his unwavering leadership on 
this issue. It has been a pleasure to work with him over the past year. 
I also want to thank Chairman Roth for his leadership. Times have 
certainly changed since the days when no one would even talk about 
Social Security reform. Today, we have key members of the Senate 
presenting innovative ideas about how to address the looming 
liabilities of the Social Security program. I applaud Chairman Roth's 
efforts because he is moving this debate forward.
  This is critical because the motto must be ``sooner rather than 
later''. There is no better time to tackle entitlement reform than 
during good economic times. While SS's financing is projected to pay 
full benefits until 2029--the strain on the Federal budget will begin 
much earlier, only 10 years from now. The Social Security Advisory 
Council could not agree on an approach to reform Social Security; 
however, they all agreed that early action should be taken. This call 
has been echoed time and time again by the General Accounting Office, 
Alan Greenspan, Chairman of the Federal Reserve Board, as well as most 
other experts.
  The budget resolution already contains Sense of the Senate language 
regarding the budget surplus and Social Security reform. It reads as 
follows: ``Congress should use unified budget surpluses to reform 
Social Security for future generations . . .'' I support Chairman 
Roth's Sense of the Senate because it takes this language a step 
further. It suggests that individual accounts are the direction in 
which Social Security reform should move. I agree with this.
  The American people will hear again and again over the next several 
months about the financial instability of Social Security--about the 
promises made that we can no longer afford to keep. Americans will also 
hear about what is necessary to put Social Security on sound financial 
footing--the difficult sacrifices and the tough choices. This dialogue 
will only compound the already low level of confidence most Americans 
have in our nation's public retirement system. I adamantly believe we 
must do something to reverse this trend. We must provide some good news 
in the middle of this debate. If we include individual accounts within 
Social Security reform we are giving all Americans a new chance to 
provide substantial retirement savings for themselves--that is the good 
news.
  This Sense of the Senate does not dictate or even suggest how these 
individual accounts should be administered or that they be done 
independently of fundamental Social Security reform. Senator Gregg and 
I have our own ideas about how Social Security should be reformed and, 
specifically, how individual accounts should be set-up and 
administered. I look forward to our ideas being discussed and debated 
during the coming weeks and months, along with all the other ideas 
being put on the table. The Aging Committee, which I am pleased to 
serve as Ranking Member, is looking at this issue closely. I hope the 
Finance Committee will hold hearings as soon as May.
  In looking to Social Security reform we cannot lose sight of the 
larger budget picture and the difficult steps we have taken in this 
Congress to get our country's books in order. What we tried to do with 
the balanced budget--and what we should be trying to do with the 
surplus--is reduce this country's overall financial liabilities. As 
stated in the budget resolution, Social Security's unfunded liability 
stands at around $3 trillion. Obviously, Social Security is a large 
part of this country's debt and must be addressed. Again, it must be 
addressed sooner rather than later. In conclusion, I want to again 
thank Chairman Roth and Senator Gregg for their efforts in moving this 
debate forward.
  The PRESIDING OFFICER. Who yields time?
  Several Senators addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Jersey.
  Mr. LAUTENBERG. Mr. President, a few moments ago I had an opportunity 
to discuss with the chairman of the Budget Committee how we might 
proceed, because one of the things we are running into is that, 
although we had agreed to have a half-hour limit on amendments equally 
divided, as a result of courtesy, we have extended time on the 
resolution. It, thusly, then challenges whether or not we are ever 
going to get done here, because we have almost 30 amendments. If we 
take 30 amendments, you have 2 hours each, 7 or 8 hours of votes to 
accompany that, that is another, who knows, 7, 8, 10 hours.
  So what we are going to do, unless there is a difference in the 
conversation as I remember it from what the distinguished Senator from 
New Mexico agreed, we are going to permit approximate time on this side 
equal to the two speakers that we just had. Then we are going to 
eliminate further time off the bill itself for amendments.
  With that, I yield some time to the Senator from North Dakota, as he 
sees fit.
  The PRESIDING OFFICER (Mr. Inhofe). The Senator from North Dakota.
  Mr. CONRAD. Mr. President, I thank the Chair and I thank the ranking 
member. We have just seen a proposal unveiled on the floor of the 
Senate which has some interesting aspects. I must say some of the 
concepts here are ones that I am interested in. But I am concerned 
about the specifics of the proposal that is before us in this regard. 
The chairman of the Finance Committee suggests we ought to devote the 
budget surpluses to building private accounts in Social Security. I am 
on record as one member of the Finance Committee who favors moving 
towards private accounts over time. But I must say, I am concerned 
about the specifics of the proposal of the Senator from Delaware in 
that it is based on, I think, a false assumption. I see the false 
assumption as being that we have budget surpluses.
  I am certain there are people listening here, here in the Senate 
Chamber and people listening at home, who wonder what is this talk 
about budget surpluses and Social Security surpluses? What does this 
all mean? It is confusing. Unfortunately, the language we use here in 
Washington, I think, contributes to that confusion. We talk about 
budget surpluses but what we do not tell people is the way we have 
calculated their surpluses is that we have included the Social Security 
trust fund surpluses. This year that amounts to over $100 billion. And 
by throwing that money into the pot, by, in effect, raiding Social 
Security, we say there is a $8 billion surplus in the budget.
  There is not a surplus in the budget. The truth is there is a 
significant deficit. Oh, yes, on a unified basis--if you take all the 
funds of the Federal Government and throw them into the pot and look at 
all of the expenditures of the Federal Government, we are in balance. 
That is what they call the unified budget. But the problem with that 
is, and the little dirty secret here, is that $100 billion of the 
Social Security surplus is being put into that calculation.
  If any private company tried to balance their books in this way, they 
would be headed for a Federal institution all right, but it would not 
be the Congress of the United States. They would be headed for a 
Federal facility all right. It would be a Federal prison, because that 
is fraud. That is fraud. To take money for one purpose and use it for 
another is fraud. Unfortunately, that is the pattern and practice here 
and has been for 30 years. We are taking Social Security trust fund 
surpluses, throwing those into the pot, and this year we are saying we 
have balanced the budget.
  If any company tried to take the retirement funds of its employees 
and throw those into the pot and say they balanced the operating budget 
of the company, they would be in violation of Federal law. So I think 
we want to be cautious when we have a proposal that

[[Page S2923]]

in many ways is attractive. I want to say to the Senator from Delaware, 
I am on record as favoring a partial privatization. I like the idea of 
individuals being able to have several percentage points of Social 
Security trust fund payments that they make be reserved in private 
accounts that they could invest. I like that basic concept.
  But how do you fund it? How do you fund it? It seems to me the first 
thing we have to do is stop the practice of looting Social Security. If 
we are going to secure the long-term prospects for Social Security, we 
ought to stop raiding it. We ought to stop looting it. And we ought to 
stop the talk that we have a budget surplus. Because the only way we 
got a budget surplus is by counting those Social Security trust fund 
surpluses, which we are going to need for the day when the baby boom 
generation starts to retire.
  We have a demographic time bomb just over the horizon, and it is the 
baby boom generation. When they start to retire in the year 2012, all 
of a sudden everything that looks rosy now is going to change and 
change quickly. In fact, by the year 2029 we anticipate the Social 
Security fund will have run through these massive surpluses that are 
being built now. They are not built up in terms of money actually in 
the bank, but built up in terms of IOUs that are being registered and 
accumulated based on borrowing by the other parts of Government that 
are spending those moneys, even though we know we are going to need 
those funds when the baby boomers start to retire.
  I think the basic concept the Senator from Delaware has merit. But I 
am very concerned about the specifics that he has proposed, because to 
take these so-called budget surpluses that we have on paper that only 
exist because we are raiding Social Security and use those funds before 
we use them to preserve and protect Social Security, has the prospect 
of undermining our first responsibility and our first obligation. Our 
first responsibility and our first obligation is to keep the promise to 
the tens of millions of people who are relying on that Social Security 
check.
  Before we go off and raid the Social Security trust fund surpluses in 
order to claim we have a budget surplus, we ought to stop that 
practice. We ought to clean up our act, stop raiding Social Security, 
stop looting Social Security, and then we can move in the direction 
proposed by the Senator from Delaware. But I think the proposal that he 
has before us at this moment is based on a misnomer. And the misnomer 
is that there are budget surpluses. There are only budget surpluses 
because we are taking $100 billion a year from Social Security 
surpluses and throwing those into the pot when we make the calculation 
of budget surpluses. So we say we have a budget surplus next year of $8 
billion, but we are taking $100 billion from Social Security surpluses 
in order to make that claim.

  So I just say to my colleagues, I favor the notion of having some 
portion of Social Security in an account where people control their own 
investment. I like that idea. But we have to work through the 
transition costs of this very carefully or we will undermine and 
threaten the solvency, the long-term solvency, of the Social Security 
trust fund itself. That should not be anything that we do.
  Our first obligation, I believe, is to stop raiding the Social 
Security trust fund, stop raiding those funds, and move to secure the 
long-term solvency of Social Security and then have a chance to move in 
the direction the Senator from Delaware has asked for.
  Mr. President, I will be happy to yield back my time so the 
distinguished Senator from New York has a chance to comment on the 
issue before us.
  Mr. LAUTENBERG. Mr. President, I yield up to 15 minutes to the 
Senator from New York, Senator Moynihan.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. MOYNIHAN. Mr. President, I thank my friend and neighbor from New 
Jersey, the manager on our side, and my friend Senator Conrad of the 
Finance Committee, for his remarks.
  Mr. President, I rise not so much in opposition to the proposal by 
the esteemed chairman of our committee, as to see if it is not possible 
to clarify some of these issues. And to welcome the Senate to what 
should be a substantive, constructive debate over the next 6 months--
pending the time when our distinguished Director of the Office of 
Management and Budget, Mr. Franklin D. Raines, has indicated the 
administration plans to begin to have legislation on this issue, in the 
first session of the next Congress. In my view, we ought to take up 
such legislation as a first order of business in that session.
  May I take the presumed responsibility of this body, which tends to 
have long tenure, to give a bit of history? In 1935, we established the 
Social Security system on a pay-as-you-go basis. It was no time, in the 
midst of a great economic depression, to take more money out of the 
economy than was being put back, even if it was only a nominal process.
  This went on until 1977 when we moved from a pay-as-you-go system to 
a partially funded system. I was a member of the committee of 
conference between the Senate and the House which adopted that change, 
and I can say there was very little attention paid to it. We put in 
place a huge surplus to provide for the baby boom retirement, as the 
phrase was. But we did not put in place any mechanism to save that 
surplus.
  Indeed, if I look around the horizon of political economy, I do not 
think there is any such mechanism. You can strengthen an economy by 
paying down debt such that the private sector grows. Theoretically you 
could build warehouses and fill them with cans of Campbell soup to be 
opened in 30 years time. But in a system of this kind, a defined 
benefit arrangement for retirement and for survivors and the disabled--
only 62 percent of persons receiving Social Security benefits are 
retired persons; the rest are spouses and children of persons who have 
died, and the disabled--there is no way to save a surplus.
  The result was that for 21, now 22 years, we have had each year a 
large surplus from the payroll tax. This is what Senator Conrad was 
speaking about. And we have used it for other reasons altogether. We 
have abused it because at a minimum we have never let our debt be paid 
down so our private savings and investment would rise as an absolute 
reciprocal, as mathematicians say. For every dollar of debt you pay 
down you get a dollar of savings that will be used for private 
investment.
  Instead, we used this money to conceal the enormity of the deficits 
we ran in the 1980s and which we now have gotten past. We are now down 
to a stable situation, not yet one of surplus, because we still have 
this money coming in from the partially funded system we put in place 
in 1977 with a very regressive, high payroll tax, 12.4 percent of 
payroll, paid on the first dollar of income and up to $68,400 this 
year.
  But this is no longer much of a surplus. The numbers are 
approximately this, and I say approximately because we won't know for 
another year or so, but next year the combined costs of old age and 
survivors and disability insurance, plus hospital insurance, will be 
roughly equal to the combined payroll tax revenues for these two 
programs; thereafter you are in deficit. Technically, there are 
Treasury bonds that can be cashed in, but then you have to get general 
revenue or borrow more to convert them into benefits.
  By about the year 2010, there is no longer any surplus in the primary 
OASDI, Old Age, Survivors, and Disability Insurance. We have 11 years 
until there is nothing left there either.
  Senator Kerrey of Nebraska and I have introduced legislation that we 
think accommodates the situation we are in which, first of all, does 
not save Social Security. Social Security does not need to be saved. 
What it does not need is to be destroyed. There is now abroad a 
powerful ideological movement to turn the system of retirement benefits 
and survivors benefits over to personal savings in the market. This is 
a legitimate idea, but I am not sure, if it were understood, it would 
be a very popular idea.
  It puts at risk much more than we would ever wish to do in terms of 
the entire population. It translates the experience of successful 
entrepreneurial people in an age of great economic growth into a 
proposition that this is something that the whole of the population can 
and ought to want to do.
  We have a plan which does two things: One, it secures Social Security 
as a defined benefit for retired persons, for disabled persons, for 
survivors indefinitely. Simultaneously, it provides

[[Page S2924]]

for lowering payroll taxes and allowing the difference to be used for 
just the kind of personal savings accounts, investment accounts, that 
our friend from Delaware would like to do.
  Specifically, we move from the current 12.4 percent payroll tax--half 
of it by the employee, half by the employer--to 10.4. That will pay 
your benefits for more than 30 years; thereafter the payroll tax is 
gradually increased to a combined 13.4 percent thereby, with some other 
adjustments I will mention, securing the system for more than a 
century. Then we say give the employee the option of taking his or her 
1 percent as income--some will do that; young persons will do, no 
doubt--or having the 2 percent deposited into some kind of thrift 
savings plan.
  We have such an arrangement in the Federal Government. You can 
contribute part of your salary, which the Federal Government matches. 
There is a booklet, and you pick the kind of investment you would like. 
Some people like index funds, bonds, mutual funds--there are a whole 
range of these products, as they are called, and you can pick what you 
wish, and from time to time you can change, if you wish.
  The prospect for the average earner with a 2 percent investment is 
that, after contributing for 45 years into the system, the worker would 
have a nominal asset from that 2 percent contribution in the range of 
$400,000. This would mean Americans would have an estate. They could 
leave something to their grandchildren, who might even be more 
attentive given that prospect.
  We have an idea of an America very different from the world of the 
1930s and the system we put in place, which was put in place in Europe 
in the 1880s. We have an idea of a retirement system in which persons 
begin to have a three-tiered system: You have your Social Security, a 
fixed amount, an annuity. You have benefits from private pensions that 
you earned with your employer. About half of American workers now have 
such. And then you have income, if you wish it, from your savings and 
investment accounts.
  That requires a few other changes. It requires that we get an 
accurate cost-of-living index by which to adjust the benefits for 
changes in the cost of living. We do not now have one. There is a small 
group of economists who dissent, but the overwhelming judgment of the 
profession is that the Bureau of Labor Statistics' Consumer Price Index 
is not a cost-of-living index, which the Bureau of Labor Statistics 
insists it is not. They do not misrepresent their product; it is we who 
misuse it.

  I will say that again. The Department of Labor does not misrepresent 
its Consumer Price Index; it is we who misuse it. We began the practice 
in 1972 at a time when Social Security benefits were the object of a 
biannual auction on the House and Senate floors as Members rose to say, 
``I propose we raise benefits 5 percent,'' then 10 percent, then 15 
percent. I think on one occasion we went up 20 percent. We had to stop 
that. The nearest thing at hand was the CPI. We can make a correction.
  A committee of distinguished economists, headed by Professor Michael 
Boskin, the former chairman of the Council of Economic Advisers under 
President Bush, reported to the Committee on Finance a year and a half 
ago recommending a correction of 1.1 percentage points.
  Different economists, different Government officials, have different 
judgments, but they are almost all in the same range. And just at this 
moment, the principal economic planners of the U.S. Government do not 
use the CPI as a measure of inflation. They just don't; they know 
otherwise.
  We have to gradually increase the age of retirement to 70, as we do 
in our bill, way into the next century. Under current law, we are 
already approaching an increase to 67. The majority of beneficiaries, 
Mr. President, retire at age 62 at a reduced benefit, which is 
actuarially sound.
  We get rid of that dumb earnings test. It wasn't dumb in 1935 when we 
were encouraging people not to be in the labor force. Right now, if you 
work between ages 62 and 70, you lose some or all of your benefits. At 
age 70 and above, you would then get increased benefits. That is, you 
receive the same benefits over the course of your retirement. Under our 
bill, you can decide when to collect your benefits, regardless of 
whether you are working. You don't have to fool around.
  We would tax these benefits at the rate at which ordinary pension 
income is taxed. May I say, Mr. President, for a very, very large 
number of our present recipients, particularly the old ones, their 
Social Security benefit and any other income they might have is so low 
that they pay no Federal taxes of any kind and would not pay any taxes 
under this new proposal.
  But I say that this can be done, but it won't be done if we don't 
understand that we are dealing with a group, a body of respectable 
opinion, that basically thinks Social Security is a failed plan, 
perhaps never should have been put in place and now should be 
transitioned out. This is not the view of the Senator from Delaware. He 
would like to see a basic annuity for all Americans continue. But it is 
the view of many more people than we know, or perhaps are aware of, or 
perhaps are collected in a coherent manner.
  This morning in the Committee on Ways and Means, Mr. Gingrich spoke 
very much in these terms. Typically, Senator Dole, who appeared as a 
witness, did not. The problem is, right now there are groups who are so 
attached to the present system that they will not make the changes 
necessary to maintain the present system. It is painful. They know who 
they are. If I may say, the White House knows who they are. I daresay 
there aren't many of us in the Finance Committee who do not know. But 
they must recognize that the alternative is the loss of everything we 
have developed over 60 years, 60 years in which the system has never 
been a day late or dollar short on any payment, but which has somehow 
lost the confidence of the public. I ask my distinguished friend for 
another 2 minutes to conclude.
  Mr. LAUTENBERG. I will be happy to yield up to 5 minutes, as needed, 
by the Senator from New York.
  Mr. MOYNIHAN. Mr. President, I want to make this point. I want to 
shout this point at the American people: They are trying to scare you 
out of your Social Security. You don't think you are going to get it 
now. Why, I am not sure. But ask anyone on the streets at home. Ask 
someone in their thirties or in their forties. The polls are clear. 
People do not expect to get it. Partly this is bad management at the 
Social Security Administration. It got lost in the HEW and then HHS.

  In 1994, we re-created it as an independent agency with an 
independent Administrator, but the SSA never tells people that the 
agency knows their name, what they are going to get in benefits, and 
that they are on top of this.
  I say it right now, there are people who would like to scare you into 
thinking you are not going to get Social Security, so don't worry about 
it when they take it away, and what they are going to make you instead 
is a millionaire in the stock market. I don't think that will happen. I 
don't think it should. I think we should allow the accommodation of 
both. I think we should begin, if I can use a term from the academy, to 
demystify some of these claims, not by Senator Roth, who is loyal to 
this institution. He has been on the Finance Committee for 30 years and 
has helped maintain the system.
  But there are those who are out to do away with it. Why, I do not 
know. They take as their model the system in the Nation of Chile, a 
nation of some 12 million people, I believe, a system developed under 
General Pinochet, which does not immediately suggest sound social 
policy or equity. I don't say there is anything wrong with their 
system, but there is nothing wrong with ours either. It is ours to 
maintain. We should do it, and we should not let our people be 
frightened into giving up something so important to them and to their 
children and to their parents.
  I thank my friend for giving me this time. I regretfully have to say 
that while I very much endorse the idea of personal savings accounts, 
right now we should use the surplus money we have to pay down the debt, 
increase investment, and get on with the simple changes we need to make 
this system permanent and stable.
  Mr. President, I yield the floor, and I thank the manager for his 
courtesy.
  Mr. KENNEDY. Mr. President, this amendment sounds innocuous, but it 
is a direct assault on Social Security, and

[[Page S2925]]

it deserves resounding rejection by the Senate.
  Millions of senior citizens depend on Social Security. In fact, 
Social Security benefits comprise more than 75% of the income of half 
of the nation's 28 million recipients. It is a sacred compact between 
citizens and their government that says, ``pay into Social Security 
during your working years, and we will guarantee you a decent 
retirement income during your golden years.''
  Social Security is one of the most popular programs ever enacted. It 
is also one of our nation's most successful anti-poverty programs. In 
1959, 35% of the nation's elderly lived in poverty. Today, that number 
has dropped to 9%.
  We all recognize that legislative action is necessary to assure that 
Social Security will be solvent throughout the 21st century. There is 
no crisis--but there is a problem, and the sooner we take action to 
solve it the better. All of us know that Social Security will run out 
of money in 2030. All of us know that the single highest priority of 
the American people is to see Social Security preserved.
  All of us know that the President has said that none of the budget 
surplus should be spent until we solve the Social Security problem--and 
the American people strongly support this approach.
  But this amendment takes a different approach. It says: ``Let's 
forget about preserving Social Security. Let's go ahead and spend the 
surplus on a risky and untried experiment with individual retirement 
accounts.''
  We all know what is going on here. There are a number of members of 
this body who want to throw Security on the scrap heap of history. They 
think it ought to be privatized. They think the concept of Social 
Security is wrong. They think individuals, instead of relying on the 
tried and true and guaranteed support that Social Security provides, 
should take their chances by speculating in the stock market. If they 
do well, they can become rich. If they do poorly and are impoverished 
in their old age--so be it.
  I reject that philosophy. The American people, I believe, also reject 
that philosophy. And the Senate should reject that amendment.
  Mr. LAUTENBERG. Mr. President, just to be certain, if we combine the 
time that was yielded off the resolution and off of the amendment, the 
proponents used a total of?
  The PRESIDING OFFICER. Forty minutes.
  Mr. LAUTENBERG. We to this point have used a total of?
  The PRESIDING OFFICER. Thirty minutes.
  Mr. LAUTENBERG. Thirty. So I will yield myself some time off of the 
amendment, which I understand is the time that remains to respond to 
the proposal by the distinguished chairman of the Finance Committee, 
the Senator from Delaware, whose proposals we always take seriously. 
This is a man who is intelligent, who is committed to the proper 
procedure of getting things done. We have great respect and regard for 
the Senator from Delaware. But we can nevertheless disagree.
  On this particular proposal, I do disagree because I see things in 
perhaps a different light. When I think of the prospect--and I thank 
the Senator from New York because, as usual, he has a grasp of issues 
that goes way beyond the capacity of the average human being. And, boy, 
do we learn, and we learn in a hurry here. But nevertheless, I listened 
carefully to what the Senator from New York said. He talked about the 
possibilities of some investment on the private side, and I respect 
that, when combined with other changes that have to be made. I think 
otherwise we are rushing almost willy-nilly into a change, if this 
proves to be law at some time, that would rock the timbers of our 
society.
  When we think of Social Security, we think of the foundation that it 
holds for senior citizens. I kind of ask myself, well, would we 
recommend to the elderly across this country that they go ahead with 
some investment adviser, or make a decision on their own, whether it is 
to buy fund X, A, B, or C? We saw what happened to this investment club 
that was doing so well, according to the papers, and finally they 
admitted they made a few accounting mistakes. Would anyone want to have 
to face that widow who perhaps gets $700, $800 a month and say, 
``Sorry, there's an error; you don't have $800 a month, you have $400 a 
month or $500 a month''? Or would you rather say, ``Listen, what you 
have is guaranteed. It may not have provided the kinds of things that 
your husband and you had when you were living together, but you will 
not be chased out of your room or your house. You will have a chance to 
continue to live at some scale, modest as it may be.''
  But when I look at companies like the Prudential Insurance Company, 
one of the great companies of the world, one of, if not the largest 
company in the world--it was among the top five--it had some 
inappropriate management problems there. And they are good friends of 
mine, so I do not knock the company. But they, nevertheless, had to 
reduce the interest they were paying on policies, on cash reserves on 
their policies. This giant company, the Rock, the Rock of Gibraltar was 
their trademark, and they had to reduce their interest rates.
  In October, a few years ago, 1987, the market lost a substantial 
portion of the holdings. I was at a meeting in Boston and people up 
there were shaken to their foundation to see their investments, their 
growth in investments, suddenly whittled away by some 15-plus percent. 
While I am excited about the market and where it is going, just like 
everybody else, I know one thing: That going down is always faster than 
going up when there is any velocity attached to it.
  I think that without full deliberation about what the consequences 
might be, pro and con, with this kind of investment, it is excessively 
hasty. I would not want to be talking to people who suddenly decided 
they wished they had had Social Security IOUs, as they were described 
here. I do not know about you, but I know that I still feel pretty good 
about an IOU owed by the U.S. Government, by the people of America. 
Those are, as they say in the movies, as good as it gets, not high-
paying but everybody pretty much feels that, listen, the worst that 
happens, we are going to get paid. We may even have it monetized a 
little bit with inflation, but the fact is we know it is there.

  So when I look at the proposition that is offered, I say that I hope 
my colleagues will vote against it. When you cast your vote, you must 
look or try to look in the eyes of an elderly parent or grandparent, or 
perhaps, at some of our ages, a brother or sister, who are totally 
dependent on Social Security for their survival--for their survival.
  I tell you, I would not recommend on a personal basis--and I have had 
a lot of experience. I ran a big company. And I managed, as part of my 
responsibilities, the company's investments. I managed acquisition. I 
had a lot to do with the financial side of things. I could hardly 
imagine myself recommending to someone whose principal asset, exclusive 
asset in some cases, was Social Security, that they invest in the 
market a little bit, buy a hedge fund maybe or, gee, your adviser--I 
remember when one of the great unions, I say to Senator Moynihan, sued 
a bank in New York, who I will not identify here, for the poor 
performance that this bank had with hundreds of millions of dollars 
that belonged to this union's pension funds because it underperformed.
  Who, with an investment of a couple thousand dollars a year or a 
thousand dollars a year or less, is going to be able to pick just the 
right adviser? There is some genius sitting there waiting to take your 
$1,000 a year and monitor it and watch it? Come on, what do we think 
this is? The guys who get that kind of attention are the guys who hit 
the new scales on the heights--$500 million in net worth, $1 billion in 
net worth, the people who are outside.
  I know of one university fund, common among investments, being made 
today by university endowments, who wants to get into investments that 
they can be out of in 5 years. They do not want to be stuck in 
investments that carry them indefinitely. And you will find that true 
in place after place.
  I say also that everyone is aware today that capital is not a problem 
in this country. Capital is chasing investment all over. I know people 
in the real estate business. I know people in the investment business 
and merchant banks. And people are coming to them--institutions, 
universities, companies, individuals--with money saying, ``Please help 
me invest it properly.

[[Page S2926]]

 Please help me place it securely. Please help me make sure that it's 
safe.''
  So how is a person who has a modest Social Security income going to 
have the security to know that they have the right person advising them 
or whether they know how to read a financial statement? It is an 
interesting idea, but an idea, in my view, whose time has not come. I 
hope that we will stand securely against it, give it a chance, led by 
the leadership that the chairman of the Finance Committee can so aptly 
provide, and have a full review of what it means.
  We have discussed it. We have discussed it in the Budget Committee, 
and we have discussed it with other committees, with Alan Greenspan and 
with other distinguished economists: What does it mean? What about 
privatization? Some say yes, some say no. I tell you this, I would far 
rather be one who said no, just leave it where it is, than take the 
risk that we have to face someone who is depending on Social Security 
and not finding the reserve there when they need it.

  So I hope this amendment does not pass. I urge my colleagues to vote 
against it. No disrespect to the chairman of the Finance Committee or 
those who are supporting it, but it just needs more time than we have.
  Mr. President, as I stated, I must oppose the proposal to allocate 
the surplus for personal savings accounts. In my view, this proposal 
has serious ramifications for the future of Social Security. And we 
shouldn't endorse it without first carefully examining all of its 
implications.
  Mr. President, let me just discuss a few of the concerns raised by 
this amendment.
  First, this proposal represents a major step toward privatizing 
Social Security. And privatization, in my view, is directly 
inconsistent with the fundamental purpose of the program.
  Social Security is supposed to guarantee that all American seniors 
can avoid poverty and live their lives with a basic level of dignity. 
It is a social insurance program. It is not supposed to be the only 
source of retirement income for most seniors.
  Moving to a system of private accounts represents a dramatic shift in 
risks. Away from government. And onto the backs of individual senior 
citizens.
  Under a privatized system, seniors would lose: protection against 
declines in stock prices; protection against inflation through cost of 
living adjustments; and protection against outliving their assets.
  Mr. President, protections against these kinds of risks--which are 
completely beyond the control of any individual--are why we need social 
insurance in the first place.
  Let me be clear. I'm all for private retirement savings. I support 
IRAs and 401(k)s, and believe Americans need to save more. But private 
savings should supplement, not replace, social insurance. Otherwise, 
most Americans will spend their old age walking a financial high wire, 
without a safety net. And as someone who lived through the Great 
Depression, that is not what I want for my children and grandchildren.
  If we use a surplus to roll back payroll taxes and force people to 
put this money into private accounts, money would be drained from the 
Social Security trust funds. That would accelerate the date when the 
program will go bankrupt. And that is the opposite of what we should be 
doing.
  There are many other points I could make about this proposal, but I 
will not get into great detail here. Let me just say again that this is 
not the kind of change that we should endorse without a great deal of 
careful and thoughtful debate. That discussion is only now just getting 
underway. And it would be premature to rush to judgment on such a 
fundamental change in our system.
  So I hope my colleagues will oppose this proposal. Let us fix Social 
Security. But let us do it carefully. And let us do it right.
  I ask unanimous consent to have printed some editorials in the 
Record. The Senator from New York has asked us to do that, and I put 
them forward.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                    [From USA Today, Mar. 17, 1998]

Social Security Needs Repair, But Poor Shouldn't Pay For It--Moynihan's 
        Plan Isn't Perfect, But at Least He's Got People Talking

                          (By Michael Tanner)

       Before the nation can solve its $15 trillion problem of 
     financing 70 million baby-boomer retirements, people need to 
     start talking about it. On Monday, Sen. Daniel Patrick 
     Moynihan, D-N.Y., gave them a place to begin.
       His conversation starter: a 15% cut in the Social Security 
     payroll tax that could all go into a personal retirement 
     account.
       In a speech at Harvard, Moynihan tacked that concept on to 
     his long-standing plan to put Social Security on a pay-as-
     you-go basis. That's a small step, perhaps, but one that 
     could help break a political stalemate over Social Security 
     reform.
       It bows to GOP plans to give people more control over 
     Social Security contributions while keeping the safety net 
     Democrats favor.
       To pay for these enticements. Moynihan proposes some hard 
     medicine members of both parties have balked at swallowing.
       Neither party has shown enthusiasm for Moynihan's plan to 
     end their balanced-budget charade. Payroll tax cuts now would 
     take away revenue that's used to mask government's $100 
     million operating deficit.
       And even those who embrace budget honesty aren't likely to 
     enjoy the senator's proposals for making up the money and 
     ensuring Social Security's fiscal soundness.
       He'd reduce cost-of-living adjustments for both tax 
     deductions and benefit increases. He'd also subject more 
     income to the payroll tax, raise the retirement age to 67 
     more quickly than now planned, and raise payroll taxes higher 
     than today's levels after 2025.
       Trade-offs like those are inevitable if Social Security is 
     to be saved. But the real problem with Moynihan's plan is the 
     risk that it may not go far enough to protect the poorest 
     workers in their old age.
       That is Social Security's fundamental goal. And it has 
     almost been achieved.
       In 1935 when the program was initiated, more than half of 
     all elderly were supported by their children. Today, most are 
     independent. In 40 years, poverty rates among the elderly 
     have plummeted from 35% to under 11%, with Social Security 
     providing the bulk of income for 40% of elderly households.
       Unlike most plans to privatize all or part of Social 
     Security, Moynihan's would not make savings mandatory. So 
     low-income families, squeezed for pennies, likely would spend 
     the $4 a week they'd get from the payroll tax cut.
       That permissiveness is counterproductive. If the money were 
     saved for 40 years at 7% interest, it would generate more 
     than $40,000. The income from those savings--about $2,800 a 
     year at the same 7% rate--combined with other Social Security 
     payments would keep recipients out of poverty. Such savings 
     are essential for laborers who may not be able to work into 
     their late 60s as Moynihan's higher retirement age would 
     require.
       Congress needs to start moving soon on Social Security 
     reform. Time is the great enemy of affordable answers. And 
     enabling people to invest some Social Security themselves may 
     be part of the answer.
       But the test for any changes is whether they'll assure all 
     Americans of an adequate retirement. Social Security 
     shouldn't be saved or altered by robbing the poor.
                                  ____


                    [From USA Today, Mar. 17, 1998]

 Tinkering Won't do the Job--The Only Sensible Solution Allows Private 
                               Investment

                          (By Michael Tanner)

       From President Clinton on down, there is now a national 
     consensus that Social Security is in trouble. Indeed, the 
     retirement program will begin running a deficit by 2012, just 
     14 years from now. The program's total unfunded liabilities 
     top $9 trillion.
       Yet, in the face of the coming crisis, some still resist 
     serious change. They will suggest that a little tinkering 
     around the edges will be enough to fix Social Security.
       Some want to raise taxes. But payroll taxes have already 
     been raised more than 38 times since Social Security began. 
     Even after accounting for inflation, payroll taxes are 800% 
     higher than at the program's inception. Three out of four 
     American workers now pay more in payroll taxes than they pay 
     in federal income taxes.
       Others want to cut benefits. But young workers are already 
     going to receive less back in benefits than they pay in 
     Social Security taxes. Reducing benefits will only make 
     Social Security a worse deal for these young workers.
       Tinkering will not fix Social Security's most basic flaw. 
     Social Security is a pay-as-you-go program, similar to the 
     type of pyramid scheme that is illegal in every state.
       Taxes paid by today's workers are not saved for their 
     retirement, but rather are spent immediately to pay benefits 
     for today's retirees. When those workers retire, they have to 
     hope that the next generation of workers will be large enough 
     to support them. But with people living longer and having 
     fewer children, the number of workers supporting each retiree 
     is shrinking.
       What we really need is a new Social Security system based 
     on the power of private investment and individual savings.
       Under such a plan, benefits to current retirees would be 
     guaranteed, but workers would be given the option of shifting 
     their payroll taxes to individually owned retirement 
     accounts, similar to IRAs or 401(k) plans.

[[Page S2927]]

       Those accounts would be privately invested in real assets 
     such as stocks, bonds, annuities, etc. Because private 
     investment brings much higher returns, individuals could 
     expect to receive much higher retirement benefits.
       It's time to stop tinkering and get on with the fundamental 
     reform necessary to preserve retirement security for future 
     generations.
                                  ____


             [From the Wall Street Journal, Mar. 18, 1998]

                          Public Trust Busting

       When Senator Pat Moynihan speaks, liberals listen. So it 
     just might mark a watershed in the Social Security reform 
     debate that the New York Democrat this week embraced private 
     investment retirement accounts.
       Mr. Moynihan's welfare state credentials are impeccable. He 
     helped to expand it during the Johnson and Nixon years and 
     he's been its most intellectually nimble defender since. He 
     bitterly opposed President Clinton's decision to sign a 
     welfare reform law. And only last year, writing in the New 
     York times, he seemed to rule out any significant change in 
     Social Security.
       Well, he's now revising and extending those remarks. On 
     Monday at Harvard, he said Social Security can be saved only 
     by changing it. And not merely with the usual political 
     kamikaze run of raising taxes and slashing benefits. He's 
     also endorsing a redesign that would allow individuals to 
     invest two percentage points of their payroll tax as they 
     please, presumably in stocks, bonds and other private 
     investments.
       This is a big breakthrough, ideologically and politically. 
     The idea of a private Social Security option has until 
     recently been the province of libertarians and other 
     romantics. When Steve Forbes talked up the concept in 1996, 
     he was demagogued by fellow Republicans. Even such a free-
     marketeer as Ronald Reagan was forced to accept a Social 
     Security fix in 1983 that relied mostly on tax hikes.
       What's changed? Only the world, as Mr. Moynihan admits. The 
     weight of the looming Baby Boom retirement has caused a loss 
     of public faith in Social Security's sustainability. Few Gen-
     Xers even expect to receive it. More and more Americans also 
     began to see the virtue of private retirement vehicles like 
     IRAs and 401(k)s, which grew like Topsy as the stock market 
     boomed.
       ``In the meanwhile the academic world had changed,'' Mr. 
     Moynihan also told the mostly liberal academics at Harvard. 
     ``The most energetic and innovative minds had turned away 
     from government programs--the nanny state-toward individual 
     enterprise, self-reliance, free markets.'' (No, he wasn't 
     quoting from this editorial page.) Privatizing Social 
     Security suddenly became thinkable, in many minds even 
     preferable.
       In short, the same economic and political forces that have 
     remade American business are now imposing change on 
     government. Global competition and instant information have 
     forced industry to streamline or die. Now those forces are 
     busting up public monopolies--the public trusts, to adapt a 
     Teddy Roosevelt phrase--that deliver poor results.
       In the U.S. that means breaking a public school monopoly 
     that traps poor kids in mediocrity or worse. And it means 
     reforming a retirement system that gives individuals only a 
     fraction of the return on their savings that they know they'd 
     receive if they invested the money themselves. These are 
     ultimately moral questions, because in the name of equity 
     these public trusts are damaging opportunity for those who 
     need it most.
       The rich have known for years how to exploit the magic of 
     compound interest, for example. Why shouldn't working stiffs 
     have the same chance? Mr. Moynihan shows that a worker 
     earning $30,000 a year can, at a modest 5% annual return, 
     amass $450,000 in savings over 45 years by shifting just 2% 
     of the payroll tax into a private account. Thus do even 
     liberals become capitalists.
       Now, let us acknowledge that ``privatizing'' Social 
     Security is not what Mr. Moynihan desires. His political goal 
     is to reform Social Security just enough to be able to save 
     its universal guarantee. He fears, sensibly enough, that if 
     liberals oppose any change they may find the debate has moved 
     on without them. ``The veto groups that prevented any change 
     in the welfare system,'' he says, ``looked up one day to find 
     the system had vanished.''
       No doubt many conservatives will want to go much further 
     than the New Yorker, us among them. If investing 2% of the 
     payroll tax rate is desirable, why not more? Workers ought to 
     be able to decide for themselves if they want to trade lower 
     taxes now for a lower Social Security payment at retirement.
       We also disagree with Mr. Moynihan on some of his details. 
     To defray the cost of reducing the payroll tax, he would 
     increase the amount of wages subject to that tax--from 
     $68,400 now to $97,500 by 2003. This is a large increase in 
     the marginal tax rate for many taxpayers that would defeat 
     reform's very purpose. He'd also raise the payroll tax rate 
     down the line as the Boomers retire--something that needn't 
     happen if the reform were more ambitious than the Senator 
     says he wants.
       Yet for all of that, Mr. Moynihan moves the debate in the 
     direction of more individual control and more market sense. 
     Along with his pal and co-sponsor, Nebraska's Bob Kerrey, he 
     has broken with liberal orthodoxy. Maybe their daring will 
     even give courage to Republicans.
                                  ____


                [From the New York Times, Mar. 29, 1998]

                      Wrong Way on Social Security

       Proposals from archconservatives to chip away at a 
     gargantuan Government program like Social Security shock no 
     one. But when an influential moderate like Senator Daniel 
     Patrick Moynihan proposes to divert Social Security taxes 
     into private retirement accounts, a flawed idea gains ominous 
     support. Mr. Moynihan's rationale is complex. But it is also 
     misleading and unwise.
       Mr. Moynihan exaggerates the financial predicament by 
     pointing to 2029 as the date that actuaries say the Social 
     Security trust fund will empty out. But actuaries also say 
     that annual revenues will continue to cover almost all of 
     each year's outlays. Indeed, the financial gap amounts to 
     only about 2 percent of payrolls and can be eliminated with 
     modest benefit trims, changes in retirement rules and small 
     tax increases. Instead, Mr. Moynihan proposes a cut of up to 
     30 percent in future benefits, larger even than what is 
     needed to balance the trust fund's books. He does so because 
     his plan includes a second agenda--partial privatization.
       Mr. Moynihan would temporarily cut payroll taxes and invite 
     workers to deposit the money saved into individual tax-
     sheltered retirement accounts. Some will accept the 
     invitation and, depending on the outcome of risky investment, 
     replace some or all of the 30 percent benefit cut. But based 
     on past behavior, most workers will not save for their 
     future. Mr. Moynihan's reasons for cutting revenues of a 
     program that he depicts as near bankrupt are political. He 
     wants to stop Congress from frittering away the current 
     temporary surpluses in the program to support other programs 
     in the Federal budget. He also proposes partial privatization 
     to ward off a more sweeping privatization assault by 
     conservatives.
       Private accounts are popular because, if invested in 
     stocks, they can grow faster than money deposited in the 
     trust fund, which is invested in low-yielding Treasury bonds. 
     Mr. Moynihan warns that liberals who oppose his partial 
     privatization risk having the entire Social Security program 
     scrapped, along with its magnificent record in redistributing 
     money from the rich to poor and thereby lifting millions of 
     retirees out of poverty each year.
       But Mr. Moynihan refuses to acknowledge the harm his 
     partial privatization scheme would do. Small savings accounts 
     are expensive to administer, threatening to burn up a quarter 
     of a low-wage worker's annual deposit in commissions and bank 
     fees. Besides, the seemingly small return on money turned 
     over to Social Security is partly an optical illusion.
       Social Security has promised to pay millions of retirees 
     benefits that far exceed the amounts they pay into the trust 
     fund. Part of the payroll tax that workers turn over to the 
     Social Security system covers these unfunded benefits. If 
     part of the money that workers would deposit in private 
     retirement accounts under the Moynihan plan were siphoned off 
     to pay their fair share of unfunded benefits, then the yield 
     on these accounts would look puny too.
       By reinforcing the false notion that private accounts are 
     far superior to public accounts, Mr. Moynihan risks setting 
     off a political process that would feed the conservative goal 
     to replace virtually the entire public program with private 
     savings.
       Mr. Moynihan's warning that Social Security looks like a 
     lousy deal for workers should be heeded. The best way to 
     increase retirement funds is to invest payroll taxes in 
     stocks. But rather than having a hundred million workers 
     invest itsy-bitsy amounts on their own, the trust fund 
     itself, through a process insulated from politics, should 
     invest in equities on behalf of everyone. The Social Security 
     problem is modest. So too are the right solutions
                                  ____


          [From the Christian Science Monitor, Mar. 19, 1998]

                               SOS for SS

       Always pungent Sen. Daniel Patrick Moynihan has gotten to 
     the heart of America's Social Security problem. In a speech 
     at Harvard this week he offered a specific, tough-minded 
     formula for saving Social Security from the demographic 
     collision it faces in future decades.
       Moynihan, long an expert on Social Security, shrewdly weds 
     (a) a conservative plan to allow workers to invest a portion 
     of their SS payroll tax in a private nest egg to (b) a return 
     to a Rooseveltian pay-as-you-go pension system.
       As ranking Democrat on the Senate Finance Committee, he 
     plans to propose such a reform immediately.
       Compare that with the official Washington crawl on Social 
     Security.
       In his state of the union speech last month, President 
     Clinton claimed to be concentrating mightily on Social 
     Security, but then sent it out for yet another scrutiny by 
     commission. Mr. Clinton also cast himself as a latter day 
     Horatius telling politicians to keep their hands off federal 
     budget surpluses. He said he was earmarking those surpluses 
     to save SS.
       Good theater. Poor economics. The best way to preserve 
     those surplus revenues for a need starting two decades hence 
     would be to use them now to reduce the national debt. That 
     would trim those huge interest bills on the debt for years to 
     come. And that, in turn,

[[Page S2928]]

     would allow more pay-as-you-go money for SS.
       Instead, Clinton announced a clutch of new programs that 
     would eat up the surpluses--despite iffy funding from tobacco 
     revenues.
       Hence the appeal of Moynihan's approach. It would allow 
     Americans to voluntarily use as much as 15 percent of their 
     SS payroll tax for personal pension savings accounts. Because 
     that's optional and restricted to a modest percentage, it 
     would minimize the danger that at retirement a pensioner 
     might suffer from a market drop. And the upside--higher 
     compounded returns over decades of savings--would compensate 
     for increased risk.
       Meanwhile, Moynihan would seek to ensure that the basic SS 
     pension remains rock solid by assuring its yearly pay-as-you-
     go integrity. To make bearable the tax burden borne by next 
     generation workers paying for their retiring baby boom 
     parents, he adapts two existing ideas: (1) Speed the move to 
     a standard retirement age of 70, reflecting longevity 
     statistics. (2) Trim the rate of indexing for inflation.
       There will be battles to come. But at least one of our most 
     thoughtful political statements has gotten a realistic mix of 
     elements on the table. Now it's up to his colleagues.

  Mr. LAUTENBERG. With that, Mr. President, I yield back the time on 
our side and hope that we can proceed forthwith.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  Mr. DOMENICI. The Senator wants to ask for the yeas and nays on his 
amendment.
  The PRESIDING OFFICER. Is there a sufficient second? There appears to 
be a sufficient second.
  The yeas and nays were ordered.
  Mr. ROTH. I also ask unanimous consent that Senator Brownback be 
added as a cosponsor.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LAUTENBERG. I have a request.
  Mr. DOMENICI. Did you have a request?
  Mr. LAUTENBERG. I do.
  Mr. President, the Senator from Iowa has asked for some time to 
discuss something, and I would give him 5 minutes off of the resolution 
to do that, unless there is an objection.
  Mr. DOMENICI. Let me just see if we can get an agreement that you and 
I have spoken to.
  I say to the Senator, are you going to speak on the subject that is 
before us? Or do you just want consent to speak on a subject not 
pertaining to the budget for 5 minutes?
  Mr. HARKIN. It has something to do with the budget.
  Mr. DOMENICI. But it is not a proposal?
  Mr. HARKIN. No.
  Mr. DOMENICI. We are going to be able to arrange that for the 
Senator.
  Mr. President, I want to suggest that when we entered into the 
unanimous consent agreement, the idea was that we would expedite the 
voting on amendments and minimize the number perhaps that was going to 
be voted on in the so-called ``votarama'' with 1 minute on a side by 
amending the statutorily allotted amount of time for amendments and 
second-degree amendments. And we did so agree. But we were not specific 
in saying that there shall be no time yielded off the bill to those new 
time agreements. So I just ask, with the concurrence of my friend from 
New Jersey, unanimous consent that there be added to the unanimous 
consent agreement regarding the time allotted on amendments and second-
degree amendments, the following language: And that no time, no 
additional time, shall be allotted from time remaining on the bill by 
either side.

  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  Mr. DOMENICI. I thank the Chair.
  I say to the Senator, did you want to do something?
  Mr. LAUTENBERG. If we can let our friend from Iowa make his 
statement.
  Mr. DOMENICI. I say to the Senator, we will yield you 5 minutes off 
the bill.
  Mr. HARKIN. I thank the Senator. I appreciate it.
  The PRESIDING OFFICER. The Senator from Iowa.

                          ____________________