[Congressional Record Volume 145, Number 165 (Friday, November 19, 1999)]
[Senate]
[Page S15092]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. McCAIN (for himself, Mr. Thompson, Mr. Lieberman, and Mr. 
        Abraham):
  S. 1977. A bill to review, reform, and terminate unnecessary and 
inequitable Federal subsidies; to the Committee on Governmental 
Affairs.


            corporate subsidy reform commission act of 1999

 Mr. McCAIN. Mr. President, I rise today to introduce 
legislation to establish a process to eliminate and reform federal 
subsidies and tax advantages received by corporations. This bill, ``The 
Corporate Subsidy Reform Commission Act'' is identical to a bill that 
was reported out of the Senate Governmental Affairs Committee in May, 
1997. I am pleased to have as cosponsors Senators Thompson, Lieberman, 
and Abraham.
  I would like to briefly describe the major provisions of the 
Corporate Subsidy Reform Commission Act. It defines inequitable 
subsidies as those provided to corporations without a reasonable 
expectation that they will return a commensurate benefit to the public.
  The Act excludes any subsidies that are primarily for research and 
development, education, public health, safety, or the environment. Also 
excluded are subsidies or tax advantages necessary to comply with 
international trade or treaty obligations.
  The Act would create a nine-member commission nominated by the 
President and the Congressional leadership. Federal agencies would be 
required to submit to the Commission, at the time of the 
Administration's next budget, a list of subsidies and tax advantages 
that it believes are inequitable. The Commission will provide 
recommendations to either terminate or reduce the corporate subsidies. 
The President has the authority under the Act to either terminate the 
process, or submit the Commission's recommendations to the Congress as 
a legislative initiative.
  The Congress would then have four months to review the Commission's 
recommendations which have been endorsed by the President. At that 
time, the actions of all involved committees in each respective body 
would be sent to the floor for debate, under expedited procedures.
  Many federal subsidies and special-interest tax breaks for 
corporations are unnecessary, and do not provide a fair return to the 
taxpayers who bear the heavy burden of their cost. If a corporation is 
receiving taxpayer-funded subsidies or tax breaks that are unsupported 
by a compelling benefit to the public, the subsidy should be ended.
  Our nation is just now beginning to pay down a national debt of over 
$5 trillion. Every American shoulders an unconscionable amount of 
debt--somewhere in the range of $19,000 each--not due to any profligate 
spending of their own, but because of the fiscal irresponsibility of 
their elected officials in Congress. The citizens who expect leadership 
and accountability from their representatives have gotten special 
interest pandering in return. This is devastating to our nation's 
fiscal stability, and crippling to the ability of the Congress to 
respond to truly urgent social needs such as health care, education, 
and national security.

  Let me note a couple of estimates of this scope of unjustified 
federal subsidies to corporations that illustrates how expensive this 
burden is. When I first introduced this legislation, the CATO Institute 
had identified 125 federal programs that provided over $85 billion in 
industry subsidies. The Progressive Policy Institute identified an 
additional $30 billion in tax loopholes for major industries.
  Unfortunately, the pervasive system of pork-barreling and special 
interest legislating is speeding along unabated in Washington. Instead 
of pursuing our nation's priorities in a bipartisan manner, both 
parties continue to legislate, posture, and spend for partisan 
advantage. I have worked hard during my service in the Senate to 
eliminate wasteful earmarks in appropriations bills. Yet this year 
alone, more than $13 billion in pork barrel spending was approved by 
the Senate. I was also dismayed at the inclusion of numerous special-
interest tax breaks contained in the comprehensive tax bill passed by 
the Congress this year, then vetoed.
  Mr. President, I want to state openly that I would strongly prefer to 
eliminate corporate subsidies and inequitable tax subsidies without 
resorting to a commission. I would rather have every committee in the 
House and Senate open the next session of Congress by expeditiously 
examining their areas of jurisdiction for unwarranted corporate pork. 
Then, each respective body could engage in a full and thorough debate 
on the merits of each subsidy, and vote on their termination or 
modification. However, I regret that approach is unlikely to occur, 
because of the difficulty in resisting the requests of the special 
interests. The bill I am introducing today represents a practical 
approach to establishing not only a credible process to identify 
corporate pork, but to then take the important next step of achieving 
real reductions on behalf of over-taxed constituents.
  I look forward to this bill being brought before the Senate 
Governmental Affairs Committee early next year. To ensure that the 
Senate Committee on Finance has an opportunity to evaluate any tax 
policy modifications contained in this Act, I have agreed to a 
sequential referral consent request with the leadership of those two 
committees. I am hopeful that this bill represents the beginning of a 
serious and productive process to alleviate the public burden of 
unnecessary corporate subsidies and tax breaks.
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