[Congressional Record Volume 144, Number 136 (Friday, October 2, 1998)]
[Senate]
[Pages S11319-S11321]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


[[Page S11319]]
                             CHANGE OF VOTE

  Mr. HELMS. Mr. President, on rollcall vote No. 296, I was recorded as 
having voted ``nay.'' It was my intention to vote ``aye.'' I ask 
unanimous consent that I be recorded as a ``aye.'' This would not 
affect the outcome of the vote.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The foregoing tally has been changed to reflect the above order.)
  Several Senators addressed the Chair.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. WYDEN. Mr. President, thank you very much.
  Mr. President, let me take just a few minutes to talk about where we 
are with respect to the Internet tax bill and also to express my thanks 
to--who may have left the floor--but to express my thanks to Senator 
Bumpers.
  Senator Bumpers could have filibustered this legislation. He could 
have insisted on his rights as a Senator to speak at length on this 
past amendment that he feels very strongly about, as do a number of 
Senators, and I want to thank him for not doing that. He has been 
exceptionally kind to me. He knows that I feel strongly about this 
legislation. And he has been very constructive in working with the 
bipartisan group pursuing the legislation.
  Let me also just state, as I did, it is our intent--it is clearly 
spelled out in the legislation--that if a firm or a home-based 
business--I have thousands of them in Oregon; I know our colleagues do 
as well--if they are liable for a tax today, they are going to be 
liable under this legislation if that sale is conducted on the 
Internet. It is just that simple.
  So what it comes down to, is if you have a question from a mayor or a 
Governor who asks you about this subject at home--any Senator who is 
asked about this issue should simply say that this legislation does no 
harm to the States or to the localities, and it simply treats Internet 
commerce like any other kind of commerce. That was something that I, as 
the bill's sponsor, felt very strongly about.
  With respect to the legislation, I know other Senators wish to speak 
as well, and Senator Dorgan wants to address the Internet issue this 
afternoon as well. I am very hopeful we will be able to resolve the one 
remaining issue, and that is the question of the commission and what 
they are going to be looking at.
  The Senator from North Dakota, Senator Dorgan, has been very helpful 
on this matter in an effort to try to get an agreement--Senator Graham 
has as well. I am very hopeful that we will be able to, now that we 
have addressed the major amendment, the Bumpers amendment, I hope that 
we will be able to get an agreement on exactly the duties of the 
commission and be able to go forward with the managers' amendment.
  Senator McCain and myself and others have been anxious to try to 
address concerns that Senators have had with respect to the length of 
the moratorium, other issues surrounding the managers' amendment. I 
think we can do that.
  So, again, let me say that I very much appreciate, especially on a 
Friday with Senators having a busy schedule, the opportunity to discuss 
this issue. We made considerable progress. I especially thank Senator 
Bumpers who could have spoken at length, filibustered this legislation, 
and he has been especially kind to me. I express my appreciation to 
him.
  I see the Senator from North Dakota who has worked many, many hours 
in an effort to try to get this issue to the floor, along with me and 
others, and I express my appreciation to him and say that I especially 
appreciate his effort to bring the parties together with respect to the 
commission and the issues that they will be pursuing there in an effort 
to make sure that as we look to the digital economy in the 21st century 
that we have a chance to examine those questions.
  Does the Senator from North Dakota wish to pursue a question at this 
time?
  Mr. DORGAN. Mr. President, it is my intention--I did not provide an 
opening statement as we brought the bill to the floor. Senator McCain, 
who is managing the legislation, and I and Senator Wyden and Senator 
Bumpers and others talked about the schedule. I wanted the vote to be 
able to occur in a way that would allow Members to cast their vote and 
catch their airplanes, so I deferred on an opening statement. It is my 
intention to provide an opening statement to discuss the framework of, 
I think, some of the amendments that we will be debating as we continue 
this legislation this afternoon and also perhaps next week.
  Let me, if I can, describe the circumstances that brought this 
legislation to the floor.
  Mr. President, we are not under a time limit at this moment, are we?
  The PRESIDING OFFICER. Has the Senator from Oregon yielded the floor? 
He still has control.
  Mr. WYDEN. I thought the Senator from North Dakota had a question he 
wanted to postulate. I do want to address the concern that he has on 
the Internet tax bill. He has been very fair in working with the 
sponsors on this matter.
  Mr. DORGAN. If I might, I would like to provide my opening statement. 
If the Senator would yield the floor so I might provide the opening 
statement on this side. There are a number of things I would like to 
discuss with the Senator from Oregon, but I think it would be 
appropriate for me to give the statement that I deferred previously.
  Mr. WYDEN. Parliamentary inquiry, Mr. President.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. WYDEN. Would that be possible--I would like to accommodate the 
Senator from North Dakota--if I were to yield the floor at this point, 
given the fact that he had asked earlier for time to give his opening 
statement, that he be recognized if I yielded the floor?
  The PRESIDING OFFICER. The Senator from North Dakota is the minority 
manager of this legislation and does have priority.
  Mr. WYDEN. Mr. President, I yield the floor.
  Several Senators addressed the Chair.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. DORGAN. Mr. President, as I indicated, along with Senator McCain, 
when we brought the legislation to the floor today, I was interested in 
trying to accommodate the schedules that Members had. And the second 
vote this morning was able to be held at a time that would allow some 
Members the opportunity to catch airplanes back to their home States. 
But I did want to discuss the circumstances that allowed us to get this 
legislation to the floor. And I would like to review with the Senator 
from Oregon some of the provisions of the bill that are yet to be 
completed.
  First, with respect to this general subject of the Internet, my 
orientation of this issue is that, like most Americans, I view the 
Internet as something new and exciting and wonderful in a lot of ways 
and troublesome in other ways. The technology without question is 
remarkable and wonderful.
  Obviously, there are some things on the Internet these days that are 
troublesome and that is why we struggle with this question of the 
Decency Act that we wrote in the Commerce Committee and was struck down 
by the Supreme Court. I think the Senator from Indiana, Senator Coats, 
is going to offer an amendment similar to something we have discussed 
previously with respect to the Internet and decency.
  But leaving that aside, the Internet itself and the 
telecommunications revolution that exists in this country, and the 
information superhighway that comes from that revolution, is really 
quite remarkable.
  I come from a town of 300 people. I have a very different background 
than the Senator from Wyoming or the Senator from Arizona for that 
matter. I come from a town of 300 people. I went to a very small 
school. Obviously, a school in a town of 300 people is not going to be 
big under any circumstance. But my high school graduating class was 
nine students. And we had a library in my high school that was a very 
small coat closet, and that contained all of our books. And that was 
it. That is the way life was in my school. Would I trade it for another 
experience? No. I thought it was a wonderful school, a wonderful 
hometown, and a wonderful education.
  But now when I go back to my hometown it is slightly smaller than it 
was

[[Page S11320]]

when I left. Some of those rural communities are shrinking. I go back 
to that wonderful community and go to the school. The library is not 
much larger than it was then except--that school is now connected to 
the information superhighway. Computers in those small schools can now 
access the information superhighway.
  And what does that mean? It means in my hometown of Regent, ND, there 
is a student today who is able to use a computer and access the Library 
of Congress. Now, the Library of Congress has the largest repository of 
human knowledge that exists anywhere on Earth. Of all of the 
accumulated knowledge in human history--the largest body of that 
knowledge exists in the Library of Congress. In Regent, ND, that small 
library is now augmented by the largest library on Earth as a result of 
the information superhighway and the new revolution in 
telecommunications.

  Is that wonderful? It is more than wonderful. It changes our ability 
to educate. It changes our ability to do a whole series of things. In 
fact, as an aside, I read a while ago that the CEO of IBM Corporation 
gave a speech to shareholders. He said they are on the cusp of 
discovery in researching storage density sufficient so that he expects 
we will soon be able to put all of that information from the Library of 
Congress--14 to 16 million volumes of work, the largest repository of 
human knowledge on Earth--on a wafer the size of a penny. Think of 
that, a computer storage wafer the size of a penny encompassing all of 
the works of the Library of Congress.
  What does that mean? It is a wonderful opportunity in our future to 
use the Internet and to use telecommunications to enhance education and 
a whole range of things.
  I wanted to provide that framework simply to say, especially coming 
from a very small community in North Dakota, we understand the wonders 
and the technological marvels that exist in what we are talking about 
here and how it changes things.
  My hometown, 120 miles southwest of Bismarck, ND, 50 miles from 
Dickinson, and, for those who want to pinpoint it more precisely, 14 
miles west of Mott, ND--my hometown is as close to the Hudson River as 
downtown Manhattan with telecommunications. Just like that, you can 
transmit data off the Internet. We have erased geography as a 
disadvantage.
  Now, in addition to the advantages of education that I have described 
with respect to the Internet and the information superhighway, there is 
another entire area of commerce that also provides significant 
advantages to people in my hometown and people in every hometown in our 
country.
  When I was a young boy, from my hometown we had to drive nearly 60 
miles to go to a hospital. We had to drive 60 miles to a sporting goods 
store. When I was a young boy, that is what I wanted to do when my 
parents took me to the big town, Dickinson, ND, 10,000 people. I wanted 
to go to a sporting goods store. It was a small store with baseball 
mitts and merchandise. In my hometown, we had none. So I would go there 
and get lost in the sporting goods store, picking up the new baseball 
gloves, feeling and nurturing them, and wondering, what if I owned one 
of them? That was a big deal to me.
  It was true with respect to a Dairy Queen--50, 60 miles to a Dairy 
Queen; 60 miles to a clothing store. That is the way it was.
  Now, however, in my hometown you can't order a Dairy Queen over the 
Internet, but that sporting goods store is brought to my hometown by 
the Internet. The Internet changes commerce. Now someone in my hometown 
can dial up on the Internet a sporting goods store, a clothing store. 
Want to buy some new athletic shoes? That is available. How about a 
book? Amazon.com--we all know the success story of that company.
  My point is, we are seeing dramatic new areas of commerce available 
to people around the country, and around the world for that matter, 
which will improve their lives. I agree with that.
  We had a disagreement, the Senator from Oregon and I, about the piece 
of legislation in the Commerce Committee. I felt very strongly that 
what was proposed was dead wrong and he felt strongly it was right on 
target. We didn't disagree because we differed about the policy of what 
the Internet could mean to our country and to our people. I fully 
understand the full flow of benefits that will come from this. I 
understand and recognize that. Members know my interest is not in any 
way, ever, to impede the growth of the Internet or the growth of 
opportunity that people want to take advantage of on the Internet to 
market their goods, to build their business, and to do those kinds of 
things.
  At the same time, however, I recognize that while the Internet might 
bring a sporting goods store to my hometown, it will also bring some 
merchandise to my hometown that those few merchants in my hometown sell 
and must now collect a sales tax on when they sell it. I want to make 
sure, relative to the previous amendment and also some other amendments 
we will discuss, that what we do with respect to this form of new 
commerce has some relationship to fairness, fairness tied to selling on 
Main Street, sales from mail-order catalogs, selling on the Internet. I 
want to make sure what we are doing here is fair to all areas of 
commerce.
  That is why when Senator Wyden--who has been a leader on this, no 
question about that; he was the author in the Senate Commerce Committee 
of the underlying legislation--brought this legislation to the 
committee, I felt very strongly that the way it was constructed was 
going to cause a lot of problems. I opposed it vigorously, as he well 
knows.
  Since that time when it was passed out of the Commerce Committee, it 
has changed substantially. We now, I think, agree on one central 
principle, and that principle embodied in the underlying legislation is 
that we ought to have a moratorium of sorts so that we don't have State 
or local governments creating regimes of taxation here that could be 
punitive or could retard opportunities on the Internet in a punitive or 
discriminatory way. We agree with that and we have constructed 
legislation which I think will accomplish that and doesn't disadvantage 
any State or any local government. If there is a State or local 
government that has plans today to say let me be punitive in the way I 
apply a tax or construct a tax dealing with the Internet, I say I am 
not in your corner. I am not on your side on that. You are wrong; you 
ought not do that.
  I didn't want to snare in the net the kinds of State and local taxes 
that are applied to virtually all other kinds of commerce and do it in 
a way that would say to those who are at home on Main Street that you 
will be at a disadvantage because we have created a special safe harbor 
or special tax haven for certain kinds of electronic commerce. That has 
always been my concern.
  As long as the Senator from Oregon is here, I will engage him in this 
conversation. I think we are coming to the same point, Senator McCain, 
Senator Wyden, myself, and others, with respect to what we want to 
accomplish with this legislation. It is a system which, as we see the 
Internet begin to grow in its infancy--and it still is in its infancy--
is nondiscriminating with respect to how taxes are imposed among 
different forms of commerce.
  I yield for a comment from the Senator from Oregon about whether he 
sees us coming to that same point and whether he shares that goal.
  Mr. WYDEN. I thank the Senator from North Dakota for his thoughtful 
comments, as well. I think there has been a considerable effort in the 
last few months to address this in a bipartisan way.
  I think the Senator from North Dakota is exactly right; what we want 
is technological neutrality. We don't want the Internet to get a 
preference. We don't want the Internet to be discriminated against. We 
want to be able to say, as we look to the brand new economy, the 
digital economy, that we don't make some of the mistakes that we made 
as we tried to sort out some of the issues, for example, with respect 
to mail order. I think the Senator from North Dakota has been very 
persistent in terms of trying to work with all the parties in making 
sure that the commission studies these issues fairly. That is certainly 
what I want.
  I was very interested in my friend's comments with respect to his 
town in North Dakota and how the Internet

[[Page S11321]]

would allow, for example, somebody to log on in North Dakota and get 
goods from a sporting goods store far away and have them shipped to a 
small town in North Dakota. That is clearly one of the benefits. But 
what we also hope to do with the Internet Tax Freedom Act is make it 
possible to grow small businesses in North Dakota that will be able to 
furnish some of those goods and services.
  My friend from North Dakota has many small communities in North 
Dakota, as I do in Oregon. I want to make sure that Burns and Wagontire 
and other small towns in Oregon can compete. My view is that sensible 
Internet policies will make those small businesses more competitive 
than they are today.
  The reason that Main Street businesses support the Internet Tax 
Freedom Act, the bill that is before the Senate today, is that Main 
Street businesses, those small stores, recognize right now they are 
having a lot of difficulty competing with the Wal-Mart giants and 
certainly major corporations that are located overseas.
  And once you make geography irrelevant, which the Internet does, once 
you get a fair tax policy for a home-based business in Oregon or North 
Dakota, rather than those businesses facing discriminatory taxes, as we 
have been addressing today, I think we will grow more small businesses 
in North Dakota and Oregon on Main Street, and that is the hope of the 
sponsors of this legislation.
  So let me yield back to the Senator from North Dakota, as this 
Senator has to head off for a 7 or 8-hour flight home. I want to again 
express my thanks to the Senator from North Dakota. He and his staff 
have spent many, many hours toiling over what is arcane language, at 
best, with respect to the digital economy and these new issues. I think 
the Senator from North Dakota is right in saying that this is just the 
beginning of this whole discussion. We had another initiative yesterday 
that was very sensible--Senator Bryan's initiative dealing with on-line 
privacy as it relates to children. So we are just at the beginning of 
these issues.
  I hope to be sitting next to the Senator from North Dakota on the 
Communications Subcommittee as we tackle these questions. I think we 
have made considerable progress. I specifically thank Senator Graham, 
Senator Bumpers, as well as the Senator from North Dakota. They have 
had strong views on this matter, and they know this bill has been 
important to me. They have all been very gracious in helping to move it 
along. Also, Senator McCain will be back on the floor in a few moments. 
We simply could not have been here without the support of Senator 
McCain and his staff. I am looking forward to seeing this legislation 
go to the President before we wrap up. I thank the Senator from North 
Dakota.
  Mr. DORGAN. Mr. President, one of the issues that we have not 
completely resolved is extending the moratorium. We have a moratorium 
in this legislation that says to the States that if you have not yet 
adopted or enforced an Internet tax, there is a moratorium; you will 
not be able to do that during this time out. During that period, a 
commission will meet and evaluate all of these issues. The Senate 
finance bill reported out a 2-year moratorium on bit taxes, 
discriminatory taxes, and on Internet taxes. The House-passed version 
of this legislation has a 3-year moratorium. My understanding is that 
there will be an amendment calling for a 5-year moratorium on the bill 
that is coming to the floor. The version passed out by the Senate 
Commerce Committee had a 6-year moratorium.
  Keynes used to say, ``In the long run, we are all dead.'' I don't 
know what the long run is, but when you talk about moratoriums here, 6 
years is a large expanse of time. It seems to me that it is wholly 
inappropriate. I would more favor the Senate finance bill, which is a 
2-year time out, or moratorium. We will likely have to agree to 
something more than that, but 5 or 6 years, in my judgment, is not 
reasonable. I think there is another amendment that was noticed, or at 
least will be offered, with a 3-year moratorium, which seems to me to 
be a more reasonable compromise. I ask the Senator from Oregon about 
that.
  Mr. WYDEN. I thank the Senator. He has correctly laid out the various 
time periods. Let me say again, the Senator from North Dakota knows 
both the chairman of the Commerce Committee and I are still wanting to 
work with those who feel that 5 years is too long a period. We are 
anxious to try to get an agreement and, hopefully, this can all be 
resolved as part of a managers' amendment.
  I think the concern of certainly myself and others is that 2 years is 
too short because it is going to take some time to work through a 
subject as complicated as this, and then there is going to need to be a 
period where the States have the chance to address it. I think we can 
come up with a period that is acceptable. Of course, the moratorium, 
such as it is, applies only to Internet access taxes. It does not apply 
to other spheres of economic activity. And with respect to other 
spheres of economic activity, again, Internet will be treated just like 
anything else. If a State and a locality has other means of raising 
revenue, we want to make it clear that, with respect to the Internet, 
the business conducted there will be treated like everything else.
  So let me yield back to the Senator from North Dakota at this time, 
with an assurance that we are going to continue to try to negotiate on 
this point an acceptable time period for all parties. We have discussed 
4 years, and we have discussed a variety of options. We are going to 
continue to do that. I want it understood that both Senator McCain and 
I feel that the Senator from North Dakota is trying very hard to be 
helpful here, and we are going to continue to move forward in working 
with him to get this resolved.
  Mr. DORGAN. Mr. President, I say to the Senator that the way to be 
most helpful would be to agree with me.
  Mr. WYDEN. I will say, having made 30 changes since we left the 
Commerce Committee, that this Senator, who is a good friend of the 
Senator from North Dakota, has a very high batting average--since we 
have been talking about baseball--in terms of agreeing with the Senator 
from North Dakota. We are going to continue to work with him, as he 
knows.
  Mr. DORGAN. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BYRD. 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. BYRD. Mr. President, what is the business before the Senate?
  The PRESIDING OFFICER. Senate bill 442, the Internet access bill.
  Mr. BYRD. Mr. President, I ask unanimous consent that I may speak out 
of order.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BYRD. Is there any time limit, Mr. President?
  The PRESIDING OFFICER (Mr. Thomas). Not that I know of.
  Mr. BYRD. I thank the Chair.

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