[Congressional Record Volume 144, Number 61 (Thursday, May 14, 1998)]
[Senate]
[Pages S4906-S4916]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. SMITH of Oregon (for himself, Mr. Hatch, Mr. Grams, Mr. 
        Abraham, Mr. Wyden, and Mr. Hutchinson):
  S. 2079. A bill to amend the Internal Revenue Code of 1986 to replace 
the dependent care credit for children age 5 and under with an increase 
in the amount of the child tax credit for such children; to the 
Committee on Finance.


                      child tax credit legislation

  Mr. SMITH of Oregon. Mr. President, colleagues, and ladies and 
gentlemen, I rise today to introduce legislation to change the Tax Code 
to put stay-at-home moms and dads on an equal footing with two-income 
families. My legislation is cosponsored by Senators Hatch, Grams, 
Wyden, and Abraham. This legislation that we introduce will

[[Page S4907]]

increase the current $500-per-child credit to $1,500 per child for 
children up to 6 years of age. This credit would replace the current 
dependent care tax credit with real money that directly benefits 
families and restores equality and fairness in child care.
  Mr. President, there are many proposals to reduce tax burdens, many 
of which I wholeheartedly support, such as the elimination of the 
marriage penalty. But I must confess some frustration that I felt on 
the night our President gave his State of the Union Address when he 
spoke at great length about child care. He made a proposal, about $20 
billion worth, that contained many laudable provisions and parts of 
which I could support. But it contained a very glaring omission, in my 
view. The Clinton administration policy is both a direct and indirect 
subsidy to the marketplace day care industry. The administration seeks 
to help only a small portion of working parents, ruling out those who 
wish to stay at home to take care of their child and those who do not 
want to use marketplace day care. Government policy ought not to 
discriminate in this manner against the best form of child care where 
the child is taken care of by his or her own parents or family member.
  A few months ago Renee Anderson of Medford, OR, sent me an e-mail 
commenting that government spending will not give tax relief to parents 
of preschoolers who take care of their own children.
  Here is her letter, Mr. President. I ask unanimous consent it be 
printed in the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                                  Medford, OR,

                                                    March 7, 1998.
     Re the President's National Day Care Plan.

       Dear Senator Gordon Smith: Please do all you can to squelch 
     Bill and Hillary Clinton's $21.7 billion National Day Care 
     Plan.
       It is loaded with a number of government-controlled 
     programs.
       New spending will not give tax relief to parents of 
     preschoolers who take care of their own children.
       Not one penny of relief will help increase the amount of 
     time parents will have available to spend with their 
     children.
       This is ``day care,'' not ``child care.'' Child care is 
     something that every family does. Day care is the activity, 
     undertaken out of preference or necessity, that some families 
     choose.
       There is a rampant prejudice against stay-at-home parents.
       Here's what's at stake: the continued importance of 
     parental care of children and through that care, passing on 
     the values that families hold dear.
       Commercial day care is often avoided if at all possible 
     because there is a lack of personalized attention and 
     affection. Plus there is a greater exposure to childhood 
     diseases and many other sicknesses.
       Surely this new public policy is very characteristic of 
     today's government arrogance.
       I strongly oppose this $21.7 billion national day care 
     plan. It is an alarming example of government encroachment.
           Sincerely,
                                                   Renee Anderson.
  Mr. SMITH of Oregon. Renee, like many mothers and fathers, sees most 
government spending as ``day care'' and not ``child care.'' Child care, 
she says, is something that every family does. Day care is the activity 
undertaken out of either preference or necessity that some families are 
able to choose or forced to choose.
  A recent Wirthlin poll shows that care by a child's own parent or 
immediate family member is rated as the most desirable form of child 
care, with child care by a family's mother ranking the highest.
  Census Bureau statistics show that many families--nearly half of 
those with children under 6 years of age--pass up a second income and 
care for their children themselves, and yet where is the tax relief to 
help ease the burden of child care expenses for families that choose to 
take care of their children in their homes? It simply is not there. 
This legislation will eliminate the current discriminatory tax policy 
and replace it with one that is fair to all families regardless of the 
child care choices they make.
  I hope many of my colleagues can join in supporting this legislation. 
I know it competes with many other proposals, but I, frankly, can think 
of no greater priority that we ought to have than helping mothers and 
fathers take care of their children, for truly the hand that rocks the 
cradle is the hand that controls the future. There is no more important 
responsibility that any of us as mortals undertake than to rear a 
child. So the Federal Government ought to not get in the way of that 
but ought to reduce its take and leave more resources to mothers and 
fathers to leave them at home where they can serve real human and child 
needs.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2079

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. REPLACEMENT OF DEPENDENT CARE CREDIT FOR CHILDREN 
                   UNDER AGE 6 WITH INCREASE IN CHILD TAX CREDIT.

       (a) Increase in Child Tax Credit.--Subsection (a) of 
     section 24 of the Internal Revenue Code of 1986 (relating to 
     child tax credit) is amended by striking ``an amount equal to 
     $500'' and all that follows through the period and inserting 
     the following: ``an amount equal to--
       ``(1) $1,500 in the case of a qualifying child who is 5 
     years of age or less, and
       ``(2) $500 in the case of all other qualifying children.''.
       (b) Coordination of Dependent Care Credit.--Section 21 of 
     the Internal Revenue Code of 1986 (relating to expenses for 
     household and dependent care services necessary for gainful 
     employment) is amended by inserting ``over the age of 5 and'' 
     before ``under the age of 13'' each place it appears in 
     subsections (b)(1)(A) and (e)(5)(B).
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1998.
                                 ______
                                 
      By Mr. HELMS (for himself, Mr. Lott, Mr. Mack, Mr. Graham, Mr. 
        Torricelli, Mr. Coverdell, Mr. D'Amato, Mr. Reid, Mr. 
        Lieberman, Mr. Hatch, Mr. Roth, Mr. Thurmond, Mr. Nickles, Mr. 
        Grassley, Mrs. Hutchison, Mr. Ashcroft, Mr. Faircloth, Mr. 
        Inhofe, Mr. Smith of New Hampshire, Mr. Hollings, Mr. DeWine, 
        and Mr. Thompson):
  S. 2080. A bill to provide for the President to increase support to 
the democratic opposition in Cuba, to authorize support under the Cuban 
Liberty and Democratic Solidarity (LIBERTAD) Act of 1996 for the 
provision and transport of increased humanitarian assistance directly 
to the oppressed people of Cuba to help them regain their freedom, and 
for other purposes; to the Committee on Foreign Relations.


             THE CUBAN SOLIDARITY ACT OF 1998 (SOLIDARIDAD)

  Mr. HELMS. Mr. President, immediately upon his return from Cuba, Pope 
John Paul II gave an audience at the Vatican where he discussed his 
historic Cuban pilgrimage. While Fidel Castro and others were working 
hard to distort the purpose of his visit, the Pope was unambiguous 
about the aims and purposes of his visit in Cuba.
  His Holiness said: ``I wish for our brothers and sisters on that 
beautiful island that the fruits of this pilgrimage will be similar to 
the fruits of that pilgrimage in Poland,'' referring to his June 1979 
visit to his native Poland--a visit which is widely credited with 
inspiring the Polish people to throw off the shackles of their 
oppression, and embrace their God-given spiritual and political 
freedom.
  That visit marked the beginning of the end for Poland's communist 
dictatorship--just as, I believe, the Pope's historic visit to Cuba has 
marked the beginning of the end of Fidel Castro's despotic rule.
  With his Cuban pilgrimage, John Paul II has sown the seeds of 
spiritual and political liberation in the Cuban mind. The United States 
must now help the Cuban people to cultivate those seeds of liberation 
which His Holiness had planted in Cuba--just as the United States 
worked with him in helping the Polish people in their struggle against 
communist oppression nearly two decades ago.
  That is why today--along with more than 20 of my Senate colleagues--I 
am introducing legislation that will bring new energy and focus to the 
U.S. Cuba policy--``The Cuban Solidarity Act of 1998'' or 
``SOLIDARIDAD'' Act.
  The buttons we are all wearing may look familiar to many watching 
today. Our buttons bear the logo of the Polish Solidarity movement--but 
with a Cuban twist. You see, we are calling this legislation the 
``Cuban Solidarity Act'' for a reason. Our goal is to do today for the 
people of Cuba, what the United States did for the Solidarity

[[Page S4908]]

movement in Poland during the 1980s: Give the Cuban people the 
resources they need to build a free, functioning civil society within 
the empty shell of Castro's bankrupt communist ``revolution.''
  The Cuban Solidarity Act proposes to authorize $100 million over four 
years in U.S. government humanitarian assistance to the Cuban people--
donations of food and medicine, to be delivered through the Catholic 
Church and truly independent relief organizations in Cuba like Caritas.
  The legislation we are introducing today will authorize direct 
humanitarian flights to deliver both private and U.S. government 
donations to Cuba. And it will mandate a proactive U.S. policy to 
support the internal opposition in Cuba, just as the U.S. supported the 
Solidarity movement in Poland during the 1980s.
  This legislation is not about the Cuban embargo. It does not tighten 
the embargo; it does not loosen the embargo. What it does is add a new 
dimension to the U.S. policy regarding Cuba: With the enactment of this 
legislation, U.S. policy will no longer be simply to isolate the Castro 
regime, but to actively support those working to bring about change 
inside Cuba.
  As Secretary of State Madeline Albright recently put it, there are 
two embargoes in Cuba today: The U.S. embargo on the Castro regime, and 
Castro's embargo on his own people. We must, Secretary Albright said, 
maintain the first, while breaking the second.
  This legislation is designed to break Fidel Castro's brutal embargo 
on the Cuban people. The Cuban Solidarity Act has four central 
objectives:
  First, this bill will provide free food and medicine to Cubans most 
in need--those who cannot possibly afford to buy the necessities of 
life because they have no access to U.S. dollars.
  Second, it will strengthen those institutions delivering this aid by 
giving them the resources they need to expand their space in Cuba and 
nurture a nascent civil society on the island.
  Third, this bill will undermine the Castro regime's ability to stifle 
dissent through the denial of work and basic necessities. In Cuba 
today, anyone who dares to speak out against Castro's despotic rule can 
lose his or her job (or be thrown in jail) and thus lose their ability 
to feed their families. This bill will help undermine Castro's ability 
to maintain social control through deprivation, by helping build 
alternative sources of food and medicine in Cuba.
  And finally, this bill will take away Fidel Castro's excuses, by 
neutralizing Castro's propaganda which falsely blames the U.S. embargo 
for the hardships suffered by the Cuban people.
  This legislation puts Castro in a no-win situation. There is no way 
for him to be on the right side of denying the Cuban people access to 
free food and medicine from the United States.
  If Castro allows this food and medicine into Cuba, it will bring 
relief to millions of Cubans who cannot afford to buy basic 
necessities; it will remove his ability to use deprivation as a tool of 
oppression; and it will help independent institutions create space for 
themselves in Cuba society.
  But if he does not allow the food and medicine in, them 11 million 
Cubans will know exactly who is responsible for their daily suffering. 
They will know that the American people wanted to send them $100 
million in food and medicine, but that Castro said ``No''.
  In addition to this humanitarian relief, the Cuban Solidarity Act 
also instructs the President to take a series of steps intended to 
hasten the liberation of the Cuban people. Among other provisions:
  The bill instructs the President to increase all forms of U.S. 
government support for ``democratic opposition groups in Cuba,'' who 
risk life and limb each day to challenge the regime.
  The bill also urges the President to seek a U.N. Security Council 
resolution calling on Fidel Castro to ``immediately respect all human 
rights, free all political prisoners, legalize independent political 
parties, allow independent trade unions, and conduct freely contested 
elections.''
  The Cuban Solidarity Act also calls for creative measures to overcome 
Castro's blockade on information coming into Cuba instructing the 
President to commence ``freedom broadcasting'' through Radio and TV 
Marti from the U.S. naval base at Guantanamo, and other suitable sites 
around Cuba.
  The bill also requires the Administration to produce a series of 
reports on the plight of average Cubans, including conditions of human 
rights, workers' rights, and the apparent policy of coercing abortions 
among poor, less-educated Cuban women.
  And the bill will authorize increased personnel in the Treasury and 
Commerce Departments to facilitate licenses for American medical sales 
to Cuba--which have been fully legal since 1992--taking away Castro's 
excuses for his failure to provide American medicine and medical 
equipment for his people.
  The Cuban Solidarity Act is a bill that could and should be supported 
by all U.S. Senators, those for the Cuban embargo, and those opposed.
  All of us should unite behind a policy of providing free food and 
medicine to those trapped in Castro's Orwellian economy. I cannot 
imagine that anyone would disagree with the notion that the United 
States should bring the same intense commitment to its Cuba policy that 
made the difference in Poland's struggle with communist tyranny.
  Now some have suggested that we should not give the Cuban people free 
food and medicine--rather, we should sell it to them. My question is 
this: What exactly will they use to buy this American food and 
medicine? Soviet rubles?
  The Cuban people can't afford to buy American food and medicine! 
Today, in Cuba, food and medicine is available everywhere. In Havana, 
there are bakeries overflowing with fresh bread, pharmacies stocked 
with Western medicines, grocery stores brimming with foods. But these 
products are completely out of reach to most Cubans.
  Why? Castro allows them to be sold only for dollars, which the vast 
majority of Cubans don't have. Castro pays them in worthless Cuban 
pesos. The only Cubans who can afford to shop in these exclusive stores 
are cronies of the Castro regime, and those few lucky Cubans who get 
dollars from abroad--or those poor Cuban women and girls who are forced 
to prostitute themselves to foreign tourists from Canada and Europe in 
order to survive.
  Instead of trading with the Castro regime (and thus subsidizing the 
brutal state security apparatus which keeps him in power), our call 
today is: Let us unite to circumvent this monstrous system Castro has 
built; Let's give food and medicine directly to the Cuban people.
  The Cuban Solidarity Act will also encourage and facilitate increased 
private donations to Cuba. There are many in the private sector who 
have been enormously generous in their humanitarian efforts for the 
Cuban people, and we will be encouraging them to redouble their 
efforts.
  But we will also be issuing a challenge to all of our big-hearted 
friends in the corporate community who have been lobbying to lift the 
Cuban embargo. Since they claim to have so much concern for the Cuban 
people, we will be asking them: What are you willing to donate to help 
suffering Cubans who cannot afford to buy food and medicine for 
themselves? We'll see if the floodgates of generosity open up, showing 
corporate America's concern for Cuba's suffering people.
  Fidel Castro will never change his stripes. The Cuban Solidarity Act 
is based on the belief that we must do more than wait for Fidel Castro 
to die or ``get religion.'' We must do what was done for Lech Walesa 
and his courageous Polish brothers; that is, we must undertake a 
proactive policy under which the United States will lend decisive 
support to the cause of freedom in Cuba.
  The Pope's visit planted the seeds of liberation in Cuba. The Cuban 
Solidarity Act is the American people's way of cultivating those seeds 
for the benefit of Cubans and freedom-loving people everywhere.
  Let's get about it.
  Mr. GRAHAM. Mr. President, I am proud to join Senators Helms, Lott, 
Mack, and nearly twenty other Senators in introducing the Cuban 
Solidarity Act. This bill will capitalize on the historic opportunity 
provided by Pope John Paul II's visit to Cuba this past January. It 
provides for $100 million in humanitarian assistance directly to the 
Cuban people over four years, and does so in a way that will strengthen

[[Page S4909]]

the Catholic Church and other independent organizations in Cuba. We 
must seize this opportunity to help our Cuban brothers and sisters who 
have suffered under Castro's brutal rule for far too long.
  Communism has collapsed around the world, and the only countries that 
maintain this economic sytsem--Cuba and North Korea--are crumbling 
under their own weight. This failed system has created shortages of 
food and medicine, and Castro has denied the basic freedoms that we 
take for granted to millions of ordinary Cubans.
  In addition to providing humanitarian assistance to Cuba, this bill 
also directs the administration to expedite the licensing of sales of 
medicine and medical supplies to Cuba. Since 1992, the embargo has been 
lifted on the sale of medicines, medical equipment, and medical 
supplies to Cuba. While Castro continues to claim that the United 
States is responsible for Cubans' lack of access to much needed 
medicines, the truth is that we are doing everything we can to ensure 
that the Cuban people can get the medical supplies denied them by the 
Castro government.
  Pope John Paul II called the world's attention to the suffering of 
the Cuban people during his visit to Cuba in January. I feel the time 
is right to make assistance to oppressed Cubans more easily available 
through organizations such as the Catholic Church and other independent 
groups. Targeting additional aid in this matter will have three 
important effects. First, it will provide humanitarian assistance 
directly to the Cuban people who have suffered under communism. Second, 
it will strengthen the position of the Catholic Church as a more 
independent, viable institution in Cuba. Finally, it will help to 
undermine Castro's policy of denying food and medicine as a means of 
political control.
  Pope John Paul II asked the world to open up to Cuba, and asked Cuba 
to open itself to the world. This bill will begin that process by 
providing humanitarian assistance to the Cuban people. We hope that 
Castro will respond by opening Cuba to the world.
  Just yesterday, Cuban Cardinal Ortega expressed concern that the 
Castro regime was not making an effort to open Cuba to the world--
specifically regarding the political prisoners that continue to fill 
Cuban jails. Four of these political prisoners are in particularly 
desperate condition--Marta Beatriz Roque, Vladimiro Roca, Felix Bonne, 
and Rene Gomez Manzano--and Castro has refused appeals by the Pope and 
Canadian Prime Minister Jean Chretien to release them on humanitarian 
grounds. In fact, Marta Beatriz Roque is very ill with breast cancer 
and is being denied medical attention in jail. I hope that these 
political prisoners, as well as thousands of others, live to see a time 
when expressing one's political ideas does not mean a death sentence.
  This legislation will provide an upwelling of support for the 
advocates of freedom and human rights in Cuba. A number of periodic 
reports on exploitative labor conditions and the plight of political 
prisoners in Cuba will help bring the world's attention to the reality 
of Castro's oppression. Democracy efforts in Cuba will be bolstered 
through pro-active U.S. support for the Cuban opposition. Direct mail 
delivery from the U.S. to Cuba and additional Radio and TV Marti 
broadcasts will allow the Cuban people to receive uncensored news from 
the outside world, breaking Catro's monopoly on the dissemination of 
information.
  Let us not forget that U.S. support for the democracy movements of 
Eastern Europe helped millions of people there win the freedom to 
express their ideas, live without fear, and create better lives for 
their children. We should not turn our backs on the Cuban people now, 
when they need our help more than ever. The Castro government does not 
need food and medicine: the Cuban people do. We must ensure that our 
aid does not go to those who torture and kill. The Cuban Solidarity Act 
works to give food and medicine to those who are forgotten by Castro's 
regime--the poor mothers who need prenatal care, the children who need 
bread and milk, the elderly who die of easily curable diseases.
  Mr. President, the 11 million Cubans imprisoned by Castro's reign of 
terror are counting on us to enact this vital and historic piece of 
legislation. I hope that all of my colleagues will join Senators Helms, 
Lott, Mack, myself, and nearly twenty others in supporting this effort 
to provide a lifeline to the Cuban people.
  Mr. THURMOND. Mr. President, I rise as an original cosponsor of the 
Cuban Assistance and Solidarity (SOLIDARIDAD) Act that my distinguished 
friend and Chairman of the foreign Relations Committee, Senator Helms, 
is introducing today. I commend the Chairman for his leadership on this 
issue and strongly support him in this endeavor.
  The intent of this legislation is very simple * * * to actively 
assist the repressed Cuban people and those dedicated to ending the 
regime of Fidel Castro.
  This Act will authorize $100 million in humanitarian assistance over 
four years for food, medicine, and medical supplies, donated by the 
U.S. government. In addition, direct flights to deliver this 
humanitarian aid will be authorized and monitored to ensure that all 
aid is directly delivered to the Cubans who need it most, those who are 
unable to afford to make purchases in the Castro controlled dollar-only 
stores.
  Mr. President, this is an important piece of legislation. This bill 
will eliminate Castro's claims that the U.S. embargo is the cause of 
the hardships suffered by the Cuban people. It effectively creates a 
Catch-22 for him. If he allows the aid, he loses his control by 
deprivation. If he prohibits the aid, he will no longer be able to 
prevent the people from receiving food and medicine without the 
knowledge that he is responsible for their pain and suffering, not the 
United States.
  Further, this bill requires the President to take several timely and 
appropriate pro-democracy steps regarding Cuba, such as strengthening 
support for democratic opposition within Cuba; seeking a U.N. Security 
Council resolution on free elections; beginning ``freedom 
broadcasting'' through Radio and TV Marti; producing a series of 
reports on the plight of average Cubans; authorizing increased 
personnel to expedite American medical sales licenses; and obtaining 
the International Court of Justice indictment in the downing of two 
unarmed planes and the murder of four people in 1996.
  Mr. President, I urge all of my colleagues to take a proactive stand 
for the people of Cuba and support the SOLIDARIDAD Act.
                                 ______
                                 
      By Mr. BINGAMAN (for himself, Mr. Santorum, and Mr. Lieberman):
  S. 2081. A bill to guarantee the long-term national security of the 
United States by investing in a robust Defense Science and Technology 
Program; to the Committee on Armed Services.


        THE NATIONAL DEFENSE SCIENCE AND TECHNOLOGY ACT OF 1998

  Mr. BINGAMAN. Mr. President, I am pleased to introduce today the 
National Defense Science and Technology Investment Act of 1998. In line 
with the clear bipartisan support for Defense research I am very 
pleased to be joined by Senator Santorum and Lieberman in introducing 
this important bill.
  The National Defense Science and Technology Investment Act of 1998 
will lay the fiscal framework for the Defense research needed to 
achieve, early in the next century, what the Department of Defense call 
``Full Spectrum Dominance''--the ability of our armed forces to 
dominate potential adversaries in any conceivable military operation, 
from humanitarian operations through the highest intensity conflict. 
The bill creates a plan that would achieve the equivalent of at least a 
$9 billion Defense Science and Technology Program budget in today's 
dollars within the next 10 years--an increase of 16% over today. The 
bill also sets similar increases for the non-proliferation research of 
the Department of Energy.
  Much of the technology that gave the United States a quick victory 
with so few casualties in Desert Storm came from DoD's research of the 
1960s and 1970s. More Defense research is needed today to prepare for 
the next century for a number of reasons.
  First, as the DoD has noted, the two key enablers of ``Full Spectrum 
Dominance'' will be information superiority and technological 
innovation. The DoD has been the preeminent federal agency funding the 
disciplines undergirding these enablers, for example, supporting

[[Page S4910]]

roughly 80% of the federally sponsored research in electrical 
engineering, and 50% of that in computer science and mathematics. No 
other organizations, public or private, can be expected to substitute 
for the unique role of the DoD in these research areas. Second, the 
global spread of advanced technology and a nascent revolution in 
military affairs are creating new threats to the United States which 
will challenge our ability to achieve Full Spectrum Dominance. These 
include: information warfare; cheap precise cruise missiles; and the 
spread of weapons of mass destruction. Finally, we are now in a 
relatively secure interlude in our international relations, a time when 
we can afford to work on transforming our military forces. While the 
world is still a dangerous place, it will be even more dangerous in the 
future. So now is the time to undertake the Defense research needed to 
secure our future.
  Yet, the DoD's current Science and Technology budget plans do not 
reflect these realities. The outyear budgets are basically flat in real 
terms out to 2003, at a level $200 million lower than 1998's level. 
This money pays for the research and concept experimentation needed to 
invent and experiment with new military capabilities. Worse yet, the 
Department of Energy's budget for non-proliferation research will 
decline by around 20% in real terms by 2003. Simply put, Mr. President, 
these budget plans are just not consistent with the vision of Full 
Spectrum Dominance, the threats on the horizon, and the opportunity we 
have today.
  National Defense Science and Technology Investment Act creates budget 
plans that are consistent with the vision, threats, and opportunity. 
Starting with fiscal year 2000, the Act calls on the Secretary of 
Defense to increase the Defense Science and Technology budget request 
by at least 2% a year over inflation until fiscal year 2008. The end 
result will be a Defense Science and Technology budget that reaches at 
least $9 billion in today's dollars by 2008, an increase of $1.2 
billion or 16% over today's level. The Department of Energy's non-
proliferation research would also increase the same 2% over inflation 
yearly.
  These budget increases are significant for research, yet modest and 
achievable; they will be an excellent investment. While they may 
require some shifting of funds within DoD's budget, the total amount 
shifted will be around half a percent of that total budget over ten 
years. I am extremely confident that the Secretary of Defense will be 
able to make this gradual shift in the budget without damaging other 
priorities. I am also quite sure its something we need to do.
  Imagine, if you will, a large company in the most ferociously 
competitive high tech business in the world--a company that has done 
very well over the years, but faces downstream a series of new, highly 
aggressive, innovative and unpredictable competitors. Would we, as 
shareholders, say that shifting half a percent of its revenue into 
research over ten years would be something it couldn't afford to do? 
No. It would be clear that is something it couldn't afford not to do. I 
suggest the DoD is in a similar position.
  Technological supremacy has been a keystone of America's security 
strategy since World War II. Supporting that supremacy has been Defense 
research, one of the highest return investments this nation makes. This 
coming decade is the time to start increasing this investment in our 
national security. The National Defense Science and Technology 
Investment Act of 1998 is a modest approach to making this investment, 
but one, I am sure, which will yield immodest returns to our military.
  Mr. President, I urge my colleagues to join Senators Santorum, 
Lieberman, and myself in support of this important bill.
  Mr. President, I ask unanimous consent that the text of the bill be 
placed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2081

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``National Defense Science and 
     Technology Investment Act of 1998.''

     SEC. 2. FINDINGS.

       The Congress of the United States finds the following:
       (1) To provide for the national security of the United 
     States in the 21st century, the U.S. military must be able to 
     dominate the full range of military operations, from 
     humanitarian assistance to full-scale conflict. The keys to 
     achieving this ``Full Spectrum Dominance,'' as described in 
     the Department of Defense's ``Joint Vision 2010,'' are 
     technological innovation and information superiority.
       (2) The global spread of advanced technology is 
     transforming the military threats faced by the United States 
     and will challenge our ability to achieve Full Spectrum 
     Dominance. Some of the major technological challenges our 
     military face include information warfare; proliferating 
     weapons of mass destruction; inexpensive, precise, cruise 
     missiles; and increasingly difficult operations in urban 
     environments.
       (3) The United States is now in a relatively secure 
     interlude in its international relations, but the future 
     security environment is very uncertain. Thus, now is the time 
     to focus our Defense investments on the research and 
     experimentation needs to meet new and undefined threats and 
     achieve Full Spectrum Dominance.
       (4) The Department of Defense has been the preeminent 
     federal agency supporting research in engineering, 
     mathematics, and computer science, and a key supporter of 
     research in the physical and environmental sciences. These 
     disciplines remain critical to achieving information 
     superiority and maintaining technological innovation in our 
     military. The Department of Energy has played a critical role 
     in supporting the research needed to limit the spread of 
     weapons of mass destruction. No other organizations, public 
     or private, can be expected to substitute for the role of the 
     Department of Defense and Department of Energy in these 
     research areas.
       (5) However, the current budget plan for the Defense 
     Science and Technology Program is essentially flat in real 
     terms through fiscal year 2003. The planned budget for 
     nonproliferation science and technology activities at the 
     Department of Energy will decline.
       (6) These budget plans are not consistent with the vision 
     of Full Spectrum Dominance, the threats or uncertainties on 
     the horizon, or the opportunity presented by the current 
     state of international relations. The planned level of 
     investment could pose a serious threat to our national 
     security in the next 15 years, given the usual time it takes 
     from the start of Defense research to achieving new military 
     capabilities.
       (7) Consequently, the Congress must act to establish a 
     long-term vision for the Defense Science and Technology 
     Program's funding if the United States is to encourage the 
     research and experimentation needed to seize the current 
     opportunity and begin transforming our military to meet the 
     new threats and achieve Full Spectrum Dominance early in the 
     next century.
       (8) The Congress must also act to establish a robust long-
     term vision and funding plan in support of nonproliferation 
     science and technology activities at the Department of 
     Energy.

     SEC. 3. PURPOSE AND FUNDING REQUIREMENTS.

       (a) Purpose.--The purpose of this Act is to create a ten-
     year budget plan to support the disciplines, research, and 
     concept of operations experimentation that will transform our 
     military and reduce the threat from weapons of mass 
     destruction early in the next century.
       (b) Funding Requirements.--
       (1) Defense science and technology program budget.--For 
     each year from fiscal year 2000 until fiscal year 2008, it 
     shall be an objective of the Secretary of Defense to increase 
     the Defense Science and Technology Program budget by no less 
     than 2.0 percent over inflation greater than the previous 
     fiscal year's budget requests.
       (2) Nonproliferation science and technology activities 
     budget.--For each year from fiscal year 2000 until fiscal 
     year 2008, it shall be an objective of the Secretary of 
     Energy to increase the budget for nonproliferation science 
     and technology activities by no less than 2.0 percent a year 
     over inflation greater than the previous fiscal year's budget 
     request.

     SEC. 4. GUIDELINES FOR THE DEFENSE SCIENCE AND TECHNOLOGY 
                   PROGRAM.

       (a) Synergistic management of research and development.--
     The Secretary of Defense may allocate a combination of funds 
     from Department of Defense 6.1, 6.2, or 6.3 accounts in 
     supporting any individual project or program of the Defense 
     Science and Technology Program.
       (b) Relationship of the Defense Science and Technology 
     Program to Commercial Research and Technology.--
       (1) In supporting projects within the Defense Science and 
     Technology Program, the Secretary of Defense shall attempt to 
     leverage commercial research, technology, products, and 
     processes for the benefit of the Department of Defense to the 
     maximum extent practicable.
       (2) Funds made available to the Defense Science and 
     Technology Program must only be used to benefit the 
     Department of Defense, which includes--
       (A) the development of defense unique technology;
       (B) the development of military useful, commercially viable 
     technology; or

[[Page S4911]]

       (C) the adaption of commercial technology, products, or 
     processes for military purposes.
       (c) Relationship of Defense Science and Technology Program 
     to University Research.--The following shall be key 
     objectives of the Defense Science and Technology Program--
       (1) the sustainment of research capabilities in scientific 
     and engineering disciplines critical to the Department of 
     Defense;
       (2) the education and training of the next generation of 
     scientists and engineers in disciplines relevant to future 
     Defense systems, particularly through the conduct of basic 
     research; and
       (3) the continued support of the Defense Experimental 
     Program to Stimulate Competitive Research and research 
     programs at Historically Black Colleges and Universities and 
     Minority Institutions.

     SEC. 5. DEFINITIONS.

       As used in this Act--
       (1) Defense science and technology program.--The term 
     ``Defense Science and Technology Program'' means work funded 
     in Department of Defense accounts 6.1, 6.2, or 6.3; and
       (2) Nonproliferation science and technology activities.--
     The term ``nonproliferation science and technology 
     activities'' means work related to preventing and countering 
     the proliferation of weapons of mass destruction that is 
     funded by the Department of Energy under the following 
     programs and projects of the Department's Office of 
     Nonproliferation and National Security and Office of Defense 
     Programs:
       (A) the Verification and Control Technology program within 
     the Office of Nonproliferation and National Security;
       (B) projects under the ``Technology and Systems 
     Development'' element of the Nuclear Safeguards and Security 
     program within the Office of Nonproliferation and National 
     Security;
       (C) projects relating to a national capability to assess 
     the credibility of radiological and extortion threats, or to 
     combat nuclear materials trafficking or terrorism, under the 
     Emergency Management program within the Office of 
     Nonproliferation and National Security;
       (D) projects relating to developing or integrating new 
     technology to respond to emergencies and threats involving 
     the presence, or possible presence, of weapons of mass 
     destruction; radiological emergencies; and related terrorist 
     threats, under the Office of Defense Programs; and
       (E) program direction costs for the programs and projects 
     funded under subparagraphs (A) through (D).

  Mr. LIEBERMAN. Mr. President, I am pleased to introduce, along with 
Senators Bingaman and Santorum, the National Defense Science and 
Technology Investment Act of 1998. I have been concerned for some time 
now that our investments in defense R&D are not commensurate with the 
opportunity that new technology developments afford. I recognize, Mr. 
President, that relative to the procurement budget, defense R&D has 
fared well in recent years. While the ratio of R&D funding relative to 
procurement was an appropriate benchmark during the Cold War, I would 
argue that it is a misleading indicator in the current environment.
  We find ourselves in a comparatively peaceful historical interlude in 
which we face no peer military competitors. How likely is it that this 
set of circumstances will last? We don't know the answer to that 
question. The future is uncertain and, if history is our guide, will be 
considerably more dangerous than today. At the same time, the ongoing 
technology revolution is creating revolutionary new capabilities that 
will change the nature of warfare itself. These new capabilities would 
enable our forces to engage an enemy in a coordinated fashion across an 
entire theater of operations and thereby rapidly and totally dominate 
the battlespace. By aggressively exploiting the new capabilities that 
technology has to offer, the U.S. can assure its decisive military 
superiority over any potential adversary, even with numerically smaller 
forces than are fielded today. Our ability to realize this vision of 
the future, however, depends on the research and development we conduct 
today.
  All of the assessments, both internal and external, of our nation's 
defense posture concur that we must transform our force structure 
through greatly accelerated rates of technology insertion. The 
transformed military force envisioned in, for example, General 
Shalikashvili's Joint Vision 2010 requires a much higher level of 
research, development, prototyping, and testing than we are engaged in 
today. Our current defense R&D budgets simply don't support the 
accelerated rates of technology insertion and integration that these 
assessments imply.
  Mr. President, I realize that our military has many needs today that 
compete for scarce defense dollars. But we cannot mortgage our future 
security to short-term demands. Increased funding for our nation's 
defense R&D enterprise is essential if we are to realize the vision of 
a transformed force structure that takes advantage of the new 
opportunities that the high-tech revolution has to offer. The National 
Defense Science and Technology Investment Act of 1998 would put us on 
the path of higher defense R&D budgets by outlining a plan for real 
increases of 16% over ten years. This is a modest proposal, Mr. 
President, and one that holds the promise of very significant future 
returns. I urge my colleagues to join Senator Bingaman, Santorum, and 
me and support this important piece of legislation.
                                 ______
                                 
      By Mr. COCHRAN:
  S. 2082. A bill to amend chapter 36 of title 39, United States Code, 
to provide authority to fix rates and fees for domestic and 
international postal services, and for other purposes; to the Committee 
on Governmental Affairs.


             the International Postal Services Act of 1998

  Mr. COCHRAN. Mr. President, today I am introducing the International 
Postal Services Act of 1998. This bill would amend section 3621 of 
title 39 of the U.S. Code, dealing with the authority of the Board of 
Governors of the U.S. Postal Service to establish rates and classes of 
postal services, by subjecting international postal services to review 
by the Postal Rate Commission.
  At present, the Board of Governors' and Postal Rate Commission's 
authority to collect and review Postal Service data on costs, volumes, 
and revenues extends only to domestic mail. Therefore, the regulators 
and Congress, and the public, cannot require data to support statements 
by the Postal Service that international mail is covering its 
attributable costs.
  Allegations have been made that the Postal Service uses its revenues 
from first class mail to subsidize its international postal services. 
The Postal Service denies this, and reminds its competitors that the 
Postal Reorganization Act prohibits the Postal Service from using the 
revenues from one service to reduce the price of another.
  When Congress drafted, and later passed, the postal Reorganization 
Act of 1970, no specific language was included that would grant the 
Postal Rate Commission jurisdiction over international postal 
services--as it was granted for all domestic postal services. I believe 
this was an oversight by Congress, and I believe it would be best if, 
for the purposes of establishing classes and rates for mail, 
international postal services were to be treated the same as domestic 
postal services are treated.
  I invite Senators to consider this proposal and support this effort 
to bring harmony to the treatment of international and domestic postal 
services.
                                 ______
                                 
      By Mr. GRASSLEY (for himself and Mr. Kohl):
  S. 2083. A bill to provide for Federal class action reform, and for 
other purposes; to the Committee on the Judiciary.


                     the class action fairness act

  Mr. GRASSLEY. Mr. President, I rise today to introduce a bill that 
will help fight class action lawsuit abuses. This bill, which Senator 
Kohl and I are introducing today, will go a long way toward ending 
class action lawsuit abuses where the plaintiffs receive very little 
and their lawyers receive a whole lot. It will also preserve class 
action lawsuits as an important toll that bring representation to the 
unrepresented and result in important discrimination and consumer 
decisions.
  My Judiciary Subcommittee held a hearing last Fall that exposed and 
discussed the problem of certain class action lawsuit settlements. Let 
me give you an example of a class action lawsuit settlement that I find 
particularly disturbing. In an antitrust case settled in the Northern 
District of Illinois in 1993, the plaintiff class alleged that multiple 
domestic airlines participated in pricefixing beginning at least as 
early as January 1, 1988. This pricefixing resulted in plaintiffs 
paying more for airline tickets that they otherwise would have had to 
pay.
  The settlement in this case gave a coupon book to all of the 
plaintiffs. These coupons varied in amount and

[[Page S4912]]

number, according to how many plane tickets the plaintiffs had 
purchased. These coupons can be used toward the purchase of future 
airline tickets. The catch is that the plaintiff still has to pay for 
the majority of any new airline ticket out of his or her own pocket. 
This means that only $10 worth of coupons can be used towards the 
purchase of a $100 dollar ticket; up to $25 worth of coupons can be 
used towards the purchase of a $250 ticket; up to $50 worth of coupons 
can be used towards the purchase of a $500 ticket, and so on. In 
addition, these coupons cannot be used on certain blackout dates, which 
seem to include all holidays and peak travel times.
  The attorneys, interestingly enough, did not get paid in coupons. The 
plaintiffs' attorneys got paid in cash. They got paid $16 million 
dollars in cash. If the coupons were good enough for their clients, I 
wonder why coupons were not good enough for the lawyers.
  Another egregious class action lawsuit settlement was discussed by 
one of the witnesses in my subcommittee hearing. Ms. Martha Preston was 
a member of the class in Hoffman versus BancBoston, where some of the 
plaintiffs received under $10 dollars each in compensation for their 
injuries, yet were docked around $75 or $90 for attorneys' fees. This 
means that attorneys that they had never met, who were supposed to be 
representing their best interests, agreed to a settlement that cost 
some of the plaintiffs more money than they received in compensation 
for being wronged.
  These lawsuit abuses happen for a number of reasons. One reason is 
that plaintiffs' lawyers negotiate their own fees as part of the 
settlement. This can result in distracting lawyers from focussing on 
their clients' needs, and settling or refusing to settle based on the 
amount of their own compensation.
  During our hearing, evidence was presented that at least one group of 
plaintiffs' lawyers meets regularly to discuss initiating class action 
lawsuits. They scan the Federal Register and other publications to get 
ideas for lawsuits, and only after they have identified the wrong, do 
they find clients for their lawsuits. Rather than having clients 
complaining of harms, they find harms first, and then recruit clients 
with the promise of compensation.

  The defendants are not always innocent, though. Plaintiffs' lawyers 
say that they are approached by lawyers from large corporations who 
urge them to find a class and sue the corporation. The corporations may 
use this as a tool to limit their liability. Once this suit is 
initiated and settled, no member of the class may sue based on that 
claim. In other words, if a corporation settles a class action lawsuit 
by paying all class members $10 as compensation for a faulty car door 
latch, the plaintiffs can no longer sue for any harm caused by the 
faulty door latch. this is one way of buying immunity for liability.
  The Preliminary Results of the Rand Study of Class Action Litigation 
states that, ``It is generally agreed that fees drive plaintiffs' 
attorneys' filing behavior, that defendants' risk aversion in the face 
of large aggregate exposures drives their settlement behavior. . . . In 
other words, the problems with class actions flow from incentives that 
are embedded in the process itself.''
  The Glassley/Kohl Class Action Fairness Act does the following:


                             plain english

  Notice of proposed settlements (as well as all class notices) in all 
class actions must be in clear, easily understood English and must 
include all material settlement terms, including the amount and source 
of attorney's fees. One thing that I knew before our hearing, but that 
witness testimony confirm, is that the notice most plaintiffs receive 
are written in small print and confusing legal jargon. Even one of the 
lawyers testifying before my subcommittee said that he couldn't 
understand the notice he received as a plaintiff in a class action 
lawsuit. Since plaintiffs are giving up their right to sue, it is 
imperative that they understand what they are doing and the 
ramifications of their actions.


                   notice to state attorneys general

  The Class Action Fairness Act requires that State Attorneys General 
be notified of any proposed class settlement that would affect 
residents of their states. The notice give a state AG the opportunity 
to object if the settlement terms are unfair.


                attorneys' fees based on actual damages

  Our bill requires that attorney's fees in all class actions must be a 
reasonable percentage of actual damages and actual costs of complying 
with the terms of a settlement agreement.


          removal of multistate class actions to federal court

  This bill provides that class acting lawsuits may be removed to a 
federal court by a defendant or unnamed class member if the total 
damages exceed $75,000 and parties include citizens from multiple 
states. Currently, only defendants can seek removal, and only if each 
name plaintiff has at minimum a $75,000 claim and complete diversity 
exists between all named plaintiffs and defendants, even if only one 
class members is from the same state as a defendant. The bill also 
eliminates the ability of a lone class action defendant to veto 
removal, and it forecloses class attorneys from avoiding removal by 
raising a class action claim for the first time only after the suit 
already has been pending for a year. Removal still must be sought 
within 30 days from when there is notice of the class claim.


                mandatory sanctions for frivolous suits.

  This section of our bill will reduce frivolous lawsuits by requiring 
that a violation of Rule 11 of the Federal Rules of Civil Procedure, 
which penalizes frivolous filings, will require the imposition of 
sanctions. The nature and extent of sanctions will remain 
discretionary.
  We need this bill. We need this reform. Both plaintiffs and 
defendants are calling for reform in his area. This bill is not just 
procedural reform; this is substantive reform of our courts system. 
This bill will remove the conflict of interest that lawyers face in 
class action lawsuits, and ensue the fair settlement of these cases.
  Mr. KOHL. Mr. President, Senator Grassley and I today introduce the 
Class Action Fairness Act of 1998. This legislation addresses a growing 
problem in class action litigation--too many class lawyers put their 
self-interest above the best interests of their clients, often 
resulting in unfair and abusive settlements that shortchange class 
members while the class lawyers line their pockets with high fees.
  Let me share with you just a few disturbing examples.
  One of my constituents, Martha Preston of Baraboo, Wisconsin, was an 
unnamed member of a class action lawsuit against her mortgage company 
that ended in a settlement. While at first she got four dollars and 
change in compensation, a few months later her lawyers surreptitiously 
took $80--twenty times her compensation--from her escrow account to pay 
their fees. In total, her lawyers managed to pocket over $8 million in 
fees, but never explained that the class--not the defendant--would pay 
the attorneys' fees. Naturally outraged, she and others sued the class 
lawyers. Her lawyers turned around and sued her in alabama--a state she 
had never visited--and demanded an unbelievable $25 million. So not 
only did she lose $75, she was forced to defend herself from a $25 
million lawsuit.
  Class lawyers and defendants often engineer settlements that leave 
plaintiffs with small discounts or coupons unlikely ever to be used. 
Meanwhile class lawyers reap big fees based on unduly optimistic 
valuations. For example, in a settlement of a class action against 
major airlines, most plaintiffs received less than $80 in coupons while 
class attorneys received $14 million in fees based on a projection that 
the discounts were worth hundreds of millions. In a suit over faulty 
computer monitors, class members got $13 coupons, while class lawyers 
pocketed $6 million. And in a class action against Nintendo, plaintiffs 
received $5 coupons, while attorneys took almost $2 million in fees.
  Competing federal and state class actions engage in a race to 
settlement, where the best interests of the class lose out. For 
example, in one state class action the class lawyers negotiated a small 
settlement precluding all other suits, and even agreed to settle 
federal claims that were not at issue in state court. Meanwhile, a 
federal court found that the federal claims could be worth more than $1 
billion, while accusing the state class lawyers of ``hostile 
representation'' that ``surpassed inadequacy and sank to the level of 
subversion;'' ``vigorous disparagement'' of the value of the federal 
claim in order to sell the settlement to

[[Page S4913]]

the state court; and pursuit of self-interest in ``getting a fee'' that 
was ``more in line with the interests of [defendants] than those of 
their clients.''
  Class actions are often filed in state courts that are more likely to 
certify them without adequately considering whether a class action 
would be fair to all class members. On several occasions, a state court 
has certified a class action although federal courts rejected 
certification of the same case. And in several Alabama state courts, 38 
out of 43 classes certified in a three-year period were certified on an 
ex parte basis, without notice and hearing. One Alabama judge acting ex 
parte certified 11 class actions last year alone. Comparably, only an 
estimated 38 class actions were certified in federal court last year 
(excluding suits against the U.S. and suits brought under federal law). 
This lack of close scrutiny appears to create a big incentive to file 
in state court, especially given the recent findings of a Rand study 
that class actions are increasingly concentrated in state courts.
  Class lawyers often manipulate the pleadings in order to avoid 
removal of state class actions to federal court, even by minimizing the 
potential claims of class members. For example, state class actions 
often seek just over $74,000 in damages per plaintiff and forsake 
punitive damage claims, in order to avoid the $75,000 floor that 
qualifies for federal diversity jurisdiction. Or they defeat the 
federal requirement of complete diversity by making sure at least one 
named class member is from the same state as a defendant, even if every 
other class member is from a different state.
  Out-of-state defendants are often hauled into state court to address 
nationwide class claims, although federal courts are a more appropriate 
and more efficient forum. For example, an Alabama court is now 
considering a class action--and could establish a national policy--in a 
suit brought against the big three automakers on behalf of every 
American who bought a dual-equipped air bags in the past eight years. 
The defendants failed in their attempt to remove to federal court based 
on an application of current diversity law. And, unlike federal courts, 
states are unable of consolidate multiple class actions that involve 
the same underlying facts.
  These examples show that abuse of the class action system is not only 
possible, but real. And part of the problem are the incentives and 
realities created by the current system.
  A class action is a lawsuit in which an attorney not only represents 
an individual plaintiff, but, in addition, seeks relief for all those 
individuals who suffered a similar injury. For example, a suit brought 
against a pharmaceutical company by a person suffering from the side 
effects of a drug can be expanded to cover all individuals who used the 
drug. A class action claim may proceed only if a court certifies the 
class, and certification is permitted only if the class procedure will 
be fair to all class members. Prospective class members are usually 
sent notice about the class action, and are presumed to join it, unless 
they specifically ask to be left out.
  Often, these suits are settled. The settlement agreements provide 
money and/or other forms of compensation. The attorneys who brought the 
class action also get paid for their work. All class members are 
notified of the terms of the settlement, and given the chance to object 
if they don't think the settlement is fair. A court must ultimately 
approve a settlement agreement.
  The vast majority of these suits are brought and settled fairly and 
in good faith. Unfortunately, the class action system does not 
adequately protect class members from the few unscrupulous lawyers who 
are more interested in big attorneys' fees than compensation for 
their clients, the victims. The primary problem is that the client in a 
class action is a diffuse group of thousands of individuals scattered 
across the country, which is incapable of exercising meaningful control 
over the litigation. As a result, while in theory the class lawyers 
must be responsive to their clients, the lawyers control all aspects of 
the litigation.

  Moreover, during a class action settlement, the amount of the 
attorney fee is negotiated between plaintiffs' lawyers and the 
defendants, just like other terms of the settlement. But in most cases 
the fees come at the expense of class members--the only party that does 
not have a seat at the bargaining table.
  In addition, defendants may use class action settlements to advance 
their own interests. A settlement will generally preclude all future 
claims by class members. So defendants have ample motivation to give 
class lawyers the fees they want as the price for settling all future 
liabilities.
  In light of the incentives that are driving the parties, it is easy 
to see how class members are left out in the cold. Class attorneys and 
corporate defendants sometimes reach agreements that satisfy their 
respective interests--and even the interests of the named class 
plaintiffs--but that sell short the interests of any class members who 
are not vigilantly monitoring the litigation. And although the judge is 
supposed to determine whether the settlement is fair before approving 
it, class lawyers and defendants ``may even put one over on the court, 
a staged performance. The lawyers support the settlement to get fees; 
the defendants support it to evade liability; the court can't vindicate 
the class's rights because the friendly presentation means that it 
lacks essential information.'' Kamilewicz v. Bank of Boston Corp., 100 
F.3d 1348, 1352 (Easterbrook, J., dissenting) (7th Cir. 1996).
  Although class members get settlement notices and have the 
opportunity to object, they rarely do so, especially if they have 
little at stake. Not only is it expensive to get representation, but 
also it can be extremely difficult to actually understand what the 
settlement really does. Settlements are often written in long, finely 
printed letters with incomprehensible legalese, which even well trained 
attorneys are hard pressed to understand. And settlements often omit 
basic information like how much money will go towards attorney's fees, 
and where that money will come from. In Martha Preston's case, one 
prominent federal judge found that ``the notice not only didn't alert 
the absent class members to the pending loss but also pulled the wool 
over the state judge's eyes.''
  We all know that class actions can result in significant and 
important benefits for class members and society, and that most class 
lawyers and most state courts are acting responsibly. Class actions 
have been used to desegregate racially divided schools, to obtain 
redress for victims of employment discrimination, and to compensate 
individuals exposed to toxic chemicals or defective products. Class 
actions increase access to our civil justice system because they enable 
people to pursue claims that collectively would otherwise be too 
expensive to litigate.
  The difficulty in any effort to improve a basically good system is 
weeding out the abuses without causing undue damage. The legislation we 
propose attempts to do this. It does not limit anyone's ability to file 
a class action or to settle a class action. It seeks to address the 
problem in several ways. First, it requires that State attorneys 
general be notified about proposed class action settlements that would 
affect residents of their states. With notice, the attorneys general 
can intervene in cases where they think the settlements are unfair.
  Second, the legislation requires that class members be notified of a 
potential settlement in clear, easily understood English--not legal 
jargon.
  Third, it limits class attorneys' fees to a reasonable percentage of 
the actual damages received by plaintiffs and the actual costs of 
complying with settlement agreements. This will deter class lawyers 
from using inflated values of coupon settlements to reap big fees, even 
if the settlement doesn't offer much practical value to victims. Some 
courts have already embraced this standard, which parallels the recent 
securities reform law.
  Fourth, it permits removal to federal court of class actions 
involving citizens of multiple states, at the request of unnamed class 
members or defendants. This provision eliminates gaming by class 
lawyers to keep cases in state court. It reinforces the legitimate role 
for diversity jurisdiction--to establish the federal courts as the 
proper forum for lawsuits directly affecting residents from diverse 
states. Diversity jurisdiction makes little sense if a $76,000 claim by 
one out-of-state plaintiff qualifies for federal jurisdiction but a

[[Page S4914]]

multimillion dollar class action bundling thousands of $74,000 claims 
by out-of-state citizens cannot be brought in federal court, and if 
remote state courts can make decisions affecting nationwide classes of 
citizens.
  Finally, it amends Rule 11 of the Federal Rules of Civil Procedures 
to require the imposition of sanctions for filing frivolous lawsuits, 
although the nature and extent of sanctions remains discretionary. This 
provision will deter the filing of frivolous class actions.
  Let me emphasize the limited scope of this legislation. We do not 
close the courthouse door to any class action. We do not require that 
State attorneys general do anything with the notice they receive. We do 
not deny reasonable fees for class lawyers. And we do not mandate that 
every class action be brought in federal court. Instead, we simply 
promote closer and fairer scrutiny of class actions and class 
settlements.
  We are aware that some are critical of provisions in this bill. For 
example, there is concern that attorneys' fee provision does not 
adequately address settlements which offer primarily injunctive relief. 
For this reason, this bill should be viewed as a point of departure, 
not a final product.
  But Mr. President, right now, people across the country can be 
dragged into lawsuits unaware of their rights and unarmed on the legal 
battlefield. What our bill does is give regular people back their 
rights and representation. This measure may not stop all abuses, but it 
moves us forward. It will help ensure that good people like Martha 
Preston don't get ripped off.
  Mr. President, Senator Grassley and I believe this is a moderate 
approach to correct the worst abuses, while preserving the benefits of 
class actions. It is both pro-consumer and pro-defendant. We believe it 
will make a difference.
                                 ______
                                 
      By Mrs. BOXER (for herself, Mr. Sarbanes, Mr. Robb, Mr. 
        Lautenberg, Mrs. Murray, and Mr. Graham):
  S. 2084. A bill to amend the Outer Continental Shelf Lands Act to 
direct the Secretary of the Interior to cease mineral leasing activity 
on submerged land of the Outer Continental Shelf that is adjacent to a 
coastal State that has declared a moratorium on mineral exploration, 
development, or production activity in adjacent State waters; to the 
Committee on Energy and Natural Resources.


                   the coastal states protection act

  Mrs. BOXER. Mr. President, today, I am introducing the Coastal States 
Protection Act--legislation which I also introduced in the 104th 
Congress. This act will provide necessary protection for the nation's 
Outer Continental Shelf (OCS) from the adverse effects of offshore oil 
and gas development by making management of the federal OCS consistent 
with state-mandated protection of state waters. I am pleased that 
Representatives Capps and Miller are introducing the House version of 
this legislation.
  After many years of hard work to prevent further oil drilling in the 
Outer Continental Shelf (OCS), I am very pleased to see the broad bi-
partisan support that now exists for this issue. I began fighting for 
ocean protection on the Marin County Board of Supervisors, continued 
during my 10 years in the House of Representatives, and as a United 
States Senator representing California.
  Simply put, my bill says that when a state establishes a drilling 
moratorium on part or all of its coastal water, that protection would 
be extended to adjacent federal waters.
  It does a state little good to protect its own waters which extend 
three miles from the coast only to have drilling from four miles to 200 
miles in federal waters jeopardizing the entire state's coastline--
including the state's protected waters.
  An oil spill in federal waters will rapidly foul state beaches, 
contaminate the nutrient rich ocean floor upon which local fisheries 
depend, and endanger habitat on state tidelands.
  My legislation simply directs the Secretary of Interior to cease 
leasing activities in federal waters where the state has declared a 
moratorium on such activities thus coordinating federal protection with 
state protection.
  The bill has a very fundamental philosophy--do no harm to the 
magnificent coastlines of America and respect state and local laws.
  I also want to express my strong support for the current protection 
of our precious marine resources.
  The major portions of fragile California coastline is currently 
protected from the dangers of oil and gas drilling in offshore waters 
by several provisions of law. The State has a permanent moratorium on 
oil and gas leasing, which covers state waters up to three miles out. 
U.S. waters, up to 200 miles out, have been protected by a succession 
of one-year leasing and drilling moratoria enacted by Congress each 
year since 1982.
  In addition, in 1990, President George Bush issued a statement 
directing his Secretary of the Interior to cancel several existing 
leases and withhold any further leases in California waters for 10 
years. With this directive, President Bush showed his commitment to 
prohibiting offshore drilling in areas where environmental risks 
outweigh the potential energy benefits to the Nation.
  The strongest protection would be a permanent ban on further offshore 
oil and gas leases in California waters, and I have asked the President 
to consider this.
  California, and the rest of the nation, need a clear statement of 
coastal policy to provide industries, small businesses, homeowners and 
fishermen more certainty than can be provided by yearly moratoria. 
Annual battles over the moratoria make long-range business planning 
difficult, divert resources and attention from the real need for 
national energy security planning, and send confusing signals to both 
industry and those concerned about the impacts of offshore development.
  I understand that some feel that we are losing revenue because of 
these moratoria. I have two things to say about that. First, the public 
strongly supports the moratorium. And second, if the oil companies paid 
the royalties that they currently owe the federal government we could 
make up for the so-called ``lost revenue'' caused by the moratorium. 
Oil companies currently owe the federal government millions upon 
millions of dollars. It does not make sense to give oil companies 
access to more federal oil when they are already cheating the American 
taxpayer out of millions of dollars.
  As we celebrate the United Nations Year of the Ocean, we have a prime 
opportunity to strengthen our commitment to environmental protection by 
giving Americans a long lasting legacy of coastal protection.
  We must recognize that the resources of the lands offshore 
California, and the rest of the country, are priceless. We must 
recognize that renewable uses of the ocean and OCS lands are 
irreplaceable elements of a healthy, growing economy. These moratoria 
recognize that the real costs of offshore fossil fuel development far 
outweigh any benefits that might accrue from those activities.
  I am very pleased that Senators Murray, Sarbanes, Robb, Lautenberg, 
and Graham are original co-sponsors of this legislation.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2084

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Coastal States Protection 
     Act''.

     SEC. 2. STATE MORATORIA ON OFFSHORE MINERAL LEASING.

       Section 8 of the Outer Continental Shelf Lands Act (43 
     U.S.C. 1337) is amended by adding at the end the following:
       ``(p) State Moratoria.--When there is in effect with 
     respect to lands beneath navigable waters of a coastal State 
     a moratorium on oil, gas, or other mineral exploration, 
     development, or production activities established by statute 
     or by order of the Governor, the Secretary shall not issue a 
     lease for the exploration, development, or production of 
     minerals on submerged lands of the outer Continental Shelf 
     that are seaward of or adjacent to those lands.''.

  Mr. GRAHAM. Mr. President, I am very pleased to join my colleague 
Senator Boxer in introducing the ``Outer Continental Shelf Lands Act.'' 
It is a key step forward in Florida's long battle to preserve our 
beautiful coastal and marine ecosystems.

[[Page S4915]]

  Floridians oppose offshore oil drilling because it poses a tremendous 
threat to one of our state's greatest natural and economic resources--
our coastal environment. Florida's beaches, fisheries, and wildlife 
draw millions of tourists each year from around the globe. Tourism 
directly or indirectly supports millions of jobs all across Florida, 
and the travel industry generates billions of dollars in economic 
activity every year.
  The Florida coastline boasts some of the richest estuarine areas in 
the world. These brackish waters, with their mangrove forests and 
seagrass beds, are an irreplaceable link in the life cycle of many 
species, both marine and terrestrial. Florida's commercial fishing 
industry relies on these estuaries because they support the nurseries 
for the most commercially harvested fish. Perhaps the most 
environmentally delicate regions in the Gulf, estuaries could be 
damaged beyond repair by even a relatively small oil spill.
  Over the years, we have met with some success in our effort to 
protect Florida's OCS. In 1995, the lawsuit surrounding the 
cancellation of the leases around the Florida Keys was settled, 
removing the immediate threat of oil and gas drilling from what is an 
extremely sensitive area.
  In June of 1997, Senator Mack and I introduced the Florida Coast 
Protection Act to cancel six leases in an area 17 miles off the coast 
of Pensacola. This bill would have provided leaseholders with the 
absolute right to just compensation from the federal government in 
order to recover their investment in these leases, while simultaneously 
protecting the Florida coastline that is so critical to our economy.
  Luckily, it was never necessary. Less than a week after we introduced 
our legislation, Mobil Oil announced that it was ending its drilling 
operation off the Northwest Florida coast and cancelling its 
exploratory leases. While Mobil's action did not completely eliminate 
the threats posed by oil and gas drilling, it did mean that the 
residents of Florida's Gulf Coast faced one fewer environmental 
catastrophe-in-the-making.
  The Florida delegation has also been successful in blocking other 
attempts to search for energy resources off our state's precious 
coastline. We've worked--and will continue to work--in a united, 
bipartisan fashion to maintain the federal moratorium on drilling in 
sensitive coastal areas.
  Mr. President, the bill that Senator Boxer has introduced today will 
provide further protection to all coastal states that have taken action 
to prevent offshore oil drilling by issuing a state moratorium on oil, 
gas, or mineral exploration, development, or production within state 
waters. Florida will benefit greatly from this bill, and I urge its 
speedy passage.
                                 ______
                                 
      By Mr. HUTCHINSON:
  S. 2085. A bill to assist small businesses and labor organizations in 
defending themselves against Government bureaucracy; to protect the 
right of employers to have a hearing to present their cases in certain 
representation cases; and to prevent the use of the National Labor 
Relations Act for the purpose of disrupting or inflicting economic harm 
on employers; to the Committee on Labor and Human Resources.


       the fairness for small business and employees act of 1998

  Mr. HUTCHINSON. Mr. President, I am pleased to introduce today an 
important piece of legislation which would restore fairness to small 
businesses and their employees in the nation's labor laws, and ensure 
freedom of choice in the marketplace. ``The Fairness for Small Business 
and Employees Act of 1998'' will achieve these goals, and improve 
fairness in the National Labor Relations Board (NLRB) process.
  Small businesses are facing a serious and devastating problem. They 
are the targets of unethical attempts to manipulate the law in order to 
injure or destroy the competition. We cannot allow any group with an 
ulterior and destructive motive to use coercive governmental power just 
to harass small businesses and their workers.
  Frivolus charges cost companies significant time, money, and 
resources to defend themselves against complaints that have no merit. 
Small businesses, in particular, need these resources to secure more 
work opportunities, invest in better equipment, and create more jobs.
  The bill I am introducing today consists of three separate small 
business bills, which I have previously introduced in the Senate: ``The 
Truth in Employment Act,'' ``The Fair Hearing Act,'' and ``The Fair 
Access to Indemnity and Reimbursement Act (FAIR) Act.''
  The first provision, ``The Truth in Employment Act,'' remedies the 
unscrupulous practice of ``salting'' by amending the National Labor 
Relations Act (NLRA) to make clear that an employer is not required to 
hire any person who seeks a job in order to promote interests unrelated 
to those of the employer. I would point out that the language in no way 
infringes upon any rights or protections otherwise accorded employees 
under the NLRA, including the right to organize. This provision would 
merely alleviate the legal pressures imposed upon employers to hire 
individuals whose overriding purpose for seeking the job is to disrupt 
the employer's workplace, or otherwise inflict economic harm designed 
to put the employer out of business.
  The second section, ``The Fair Hearing Act,'' would create a 
statutory right to a hearing for the employer when there is a dispute 
regarding the proper bargaining unit of a company with multiple 
locations. While the NLRB proposal has been ``tabled'' for now, there 
is still nothing in the law to assure fairness for employees.
  The last provision, ``The Fair Access to Indemnity and Reimbursement 
Act (FAIR) Act,'' would amend the NLRA to provide that a small business 
or labor organization which prevails in an action against the NLRB will 
automatically be allowed to recoup the attorneys' fees and expenses it 
spends defending itself. Small employers often cannot afford the 
qualified legal representation necessary to defend themselves against 
NLRB charges.
  Mr. President, it is time to stop the devastating impact of unfair 
labor law enforcement on small businesses and their employees. Small 
businesses are truly the backbone of our nation's economy. We must 
curtail the anti-competitive attacks, and instead help these companies 
devote time, money, and resources toward productivity, growth, and 
providing new jobs.
  I would urge my fellow Senators to join me in cosponsoring this 
legislation, and work to pass ``The Fairness for Small Business and 
Employees Act of 1998.'' The survival of America's small businesses 
demand that we act.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2085

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Fairness for Small Business 
     and Employees Act of 1998''.
                      TITLE I--TRUTH IN EMPLOYMENT

     SEC. 101. FINDINGS.

       Congress makes the following findings:
       (1) An atmosphere of trust and civility in labor-management 
     relationships is essential to a productive workplace and a 
     healthy economy.
       (2) The tactic of using professional union organizers and 
     agents to infiltrate a targeted employer's workplace, a 
     practice commonly referred to as ``salting'' has evolved into 
     an aggressive form of harassment not contemplated when the 
     National Labor Relations Act was enacted and threatens the 
     balance of rights which is fundamental to our system of 
     collective bargaining.
       (3) Increasingly, union organizers are seeking employment 
     with nonunion employers not because of a desire to work for 
     such employers but primarily to organize the employees of 
     such employers or to inflict economic harm specifically 
     designed to put nonunion competitors out of business, or to 
     do both.
       (4) While no employer may discriminate against employees 
     based upon the views of employees concerning collective 
     bargaining, an employer should have the right to expect job 
     applicants to be primarily interested in utilizing the skills 
     of the applicants to further the goals of the business of the 
     employer.

     SEC. 102. PURPOSES.

       The purposes of this title are--
       (1) to preserve the balance of rights between employers, 
     employees, and labor organizations which is fundamental to 
     our system of collective bargaining;
       (2) to preserve the rights of workers to organize, or 
     otherwise engage in concerted activities protected under the 
     National Labor Relations Act; and

[[Page S4916]]

       (3) to alleviate pressure on employers to hire individuals 
     who seek or gain employment in order to disrupt the workplace 
     of the employer or otherwise inflict economic harm designed 
     to put the employer out of business.

     SEC. 103. PROTECTION OF EMPLOYER RIGHTS.

       Section 8(a) of the National Labor Relations Act (29 U.S.C. 
     158(a)) is amended by adding after paragraph (5) the 
     following flush sentence:

     ``Nothing in this subsection shall be construed as requiring 
     an employer to employ any person who is not a bona fide 
     employee applicant, in that such person seeks or has sought 
     employment with the employer with the primary purpose of 
     furthering another employment or agency status: Provided, 
     That this sentence shall not affect the rights and 
     responsibilities under this Act of any employee who is or was 
     a bona fide employee applicant, including the right to self-
     organization, to form, join, or assist labor organizations, 
     to bargain collectively through representatives of their own 
     choosing, and to engage in other concerted activities for the 
     purpose of collective bargaining or other mutual aid or 
     protection.''.
                         TITLE II--FAIR HEARING

     SEC. 201. FINDINGS.

       Congress makes the following findings:
       (1) Bargaining unit determinations by their nature require 
     the type of fact-specific analysis that only case-by-case 
     adjudication allows.
       (2) The National Labor Relations Board has for decades held 
     hearings to determine the appropriateness of certifying a 
     single location bargaining unit.
       (3) The imprecision of a blanket rule limiting the factors 
     considered material to determining the appropriateness of a 
     single location bargaining unit detracts from the National 
     Labor Relations Act's goal of promoting stability in labor 
     relations.

     SEC. 202. PURPOSE.

       The purpose of this title is to ensure that the National 
     Labor Relations Board conducts a hearing process and specific 
     analysis of whether or not a single location bargaining unit 
     is appropriate, given all of the relevant facts and 
     circumstances of a particular case.

     SEC. 203. REPRESENTATIVES AND ELECTIONS.

       Section 9(c) of the National Labor Relations Act (29 U.S.C. 
     159(c)) is amended by adding at the end the following:
       ``(6) If a petition for an election requests the Board to 
     certify a unit which includes the employees employed at one 
     or more facilities of a multi-facility employer, and in the 
     absence of an agreement by the parties (stipulation for 
     certification upon consent election or agreement for consent 
     election) regarding the appropriateness of the bargaining 
     unit at issue for purposes of subsection (b), the Board shall 
     provide for a hearing upon due notice to determine the 
     appropriateness of the bargaining unit. In making its 
     determination, the Board shall consider functional 
     integration, centralized control, common skills, functions 
     and working conditions, permanent and temporary employee 
     interchange, geographical separation, local autonomy, the 
     number of employees, bargaining history, and such other 
     factors as the Board considers appropriate.''.
                       TITLE III--ATTORNEYS FEES

     SEC. 301. FINDINGS AND PURPOSE.

       (a) Findings.--Congress makes the following findings:
       (1) Certain small businesses and labor organizations are at 
     a great disadvantage in terms of expertise and resources when 
     facing actions brought by the National Labor Relations Board.
       (2) The attempt to ``level the playing field'' for small 
     businesses and labor organizations by means of the Equal 
     Access to Justice Act has proven ineffective and has been 
     underutilized by these small entities in their actions before 
     the National Labor Relations Board.
       (3) The greater expertise and resources of the National 
     Labor Relations Board as compared with those of small 
     businesses and labor organizations necessitate a standard 
     that awards fees and costs to certain small entities when 
     they prevail against the National Labor Relations Board.
       (b) Purpose.--It is the purpose of this title--
       (1) to ensure that certain small businesses and labor 
     organizations will not be deterred from seeking review of, or 
     defending against, actions brought against them by the 
     National Labor Relations Board because of the expense 
     involved in securing vindication of their rights;
       (2) to reduce the disparity in resources and expertise 
     between certain small businesses and labor organizations and 
     the National Labor Relations Board; and
       (3) to make the National Labor Relations Board more 
     accountable for its enforcement actions against certain small 
     businesses and labor organizations by awarding fees and costs 
     to these entities when they prevail against the National 
     Labor Relations Board.

     SEC. 302. AMENDMENT TO NATIONAL LABOR RELATIONS ACT.

       The National Labor Relations Act (29 U.S.C. 151 et seq.) is 
     amended by adding at the end the following new section:


                 ``awards of attorneys' fees and costs

       ``Sec. 20. (a) Administrative Proceedings.--An employer 
     who, or a labor organization that--
       ``(1) is the prevailing party in an adversary adjudication 
     conducted by the Board under this or any other Act, and
       ``(2) had not more than 100 employees and a net worth of 
     not more than $1,400,000 at the time the adversary 
     adjudication was initiated,
     shall be awarded fees and other expenses as a prevailing 
     party under section 504 of title 5, United States Code, in 
     accordance with the provisions of that section, but without 
     regard to whether the position of the Board was substantially 
     justified or special circumstances make an award unjust. For 
     purposes of this subsection, the term `adversary 
     adjudication' has the meaning given that term in section 
     504(b)(1)(C) of title 5, United States Code.
       ``(b) Court Proceedings.--An employer who, or a labor 
     organization that--
       ``(1) is the prevailing party in a civil action, including 
     proceedings for judicial review of agency action by the 
     Board, brought by or against the Board, and
       ``(2) had not more than 100 employees and a net worth of 
     not more than $1,400,000 at the time the civil action was 
     filed,

     shall be awarded fees and other expenses as a prevailing 
     party under section 2412(d) of title 28, United States Code, 
     in accordance with the provisions of that section, but 
     without regard to whether the position of the United States 
     was substantially justified or special circumstances make an 
     award unjust. Any appeal of a determination of fees pursuant 
     to subsection (a) or this subsection shall be determined 
     without regard to whether the position of the United States 
     was substantially justified or special circumstances make an 
     award unjust.''.

     SEC. 303. APPLICABILITY.

       (a) Agency Proceedings.--Subsection (a) of section 20 of 
     the National Labor Relations Act (as added by section 302) 
     applies to agency proceedings commenced on or after the date 
     of the enactment of this Act.
       (b) Court Proceedings.--Subsection (b) of section 20 of the 
     National Labor Relations Act (as added by section 302) 
     applies to civil actions commenced on or after the date of 
     the enactment of this Act.

                          ____________________