[Congressional Record Volume 150, Number 39 (Thursday, March 25, 2004)]
[Senate]
[Pages S3182-S3191]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. CAMPBELL (by request):
S. 2232. A bill to amend the Indian Gaming Regulatory Act of 1988 to
revise the fee cap on National Indian Gaming Commission funding and
make certain technical amendments; to the Committee on Indian Affairs.
Mr. CAMPBELL. Mr. President, at the request of the administration,
today I am introducing the Indian Gaming Regulatory Act Amendments of
2004 to amend and update the act.
These amendments are proposed by the administration to update the
Indian Gaming Regulatory Act by: clarifying how vacancies in the
National Indian Gaming Commission (NIGC) are filled; expanding the
NIGC's regulatory responsibilities; revising the NIGC statutory rates
of pay to correspond with other current Federal rates of pay; and
expanding the NIGC's reporting requirements to Congress.
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. 2232
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 ``Indian Gaming Regulatory Act
Amendments of 2004''.
SEC. 2. DEFINITIONS.
Section 4 of the Indian Gaming Regulatory Act (25 U.S.C.
2703) is amended--
(1) by redesignating paragraphs (3), (4), (5), (6), (7),
(8), and (10), as paragraphs (6), (7), (8), (3), (4), (5),
and (11), respectively; and
[[Page S3183]]
(2) by inserting after paragraph (9) the following:
``(10) Regulated person or entity.--The term `regulated
person or entity' means--
``(A) an Indian tribe;
``(B) a tribal operator of an Indian gaming operation;
``(C) a management contractor engaged in Indian gaming;
``(D) any person that is associated with--
``(i) a gaming operation, or any part of a gaming
operation, of an Indian tribe; or
``(ii) a gaming-related contractor of an Indian tribe; and
``(E) any person that--
``(i) agrees, by contract or otherwise, to provide a tribal
gaming operation with supplies, a service, or a concession
with an estimated value in excess of $25,000 annually (not
including a contract for a legal or accounting service,
commercial banking service, or public utility service); or
``(ii) requests a suitability determination by the
Commission, or by an Indian tribe or State, as part of an
effort--
``(I) to acquire a direct financial interest in, or
management responsibility for, a management contract for
operation of a tribal gaming facility; or
``(II) to participate in a gaming-related activity that
requires a licensing decision by an Indian tribe or State.''.
SEC. 3. NATIONAL INDIAN GAMING COMMISSION.
Section 5 of the Indian Gaming Regulatory Act (25 U.S.C.
2704) is amended--
(1) in subsection (b)(2)--
(A) in subparagraph (A), by striking ``(A)''; and
(B) by striking subparagraph (B);
(2) by striking subsection (c) and inserting the following:
``(c) Vacancies.--
``(1) In general.--A vacancy on the Commission shall be
filled in the same manner as the original appointment.
``(2) Service after expiration of term.--A member may serve
after the expiration of the member's term at the pleasure of
the officer of the United States who appointed the member.'';
and
(3) in the second sentence of subsection (e), by striking
``during meetings of the Commission in the absence of the
Chairman'' and inserting ``in the absence of, or during any
period of disability of, the Chairman''.
SEC. 4. POWERS OF CHAIRMAN.
Section 6 of the Indian Gaming Regulatory Act (25 U.S.C.
2705) is amended--
(1) in subsection (a)--
(A) by striking ``, on behalf of the Commission,'';
(B) in paragraph (3), by striking ``and'' at the end;
(C) in paragraph (4), by striking the period at the end and
inserting ``; and''; and
(D) by adding at the end the following:
``(5) to issue to a regulated person or entity an order
that--
``(A) requires an accounting and disgorgement, with
interest;
``(B) reprimands or censures; or
``(C) places a limitation on a gaming activity or gaming
function.''; and
(2) by adding at the end the following:
``(c) Delegation.--The Chairman may delegate to any member
of the Commission, on such terms and conditions as the
Chairman may determine, any power of the Chairman under
subsection (a).
``(d) Manner of Exercise.--Authority under subsection (a)
shall be exercised in a manner that is consistent with--
``(1) due process of law;
``(2) this Act; and
``(3) the rules, findings, and determinations made by the
Commission in accordance with applicable law.''.
SEC. 5. POWERS OF THE COMMISSION.
Section 7 of the Indian Gaming Regulatory Act (25 U.S.C.
2706) is amended--
(1) in subsection (a)(5), by striking ``permanent'' and
inserting ``final'';
(2) in subsection (b)--
(A) in paragraphs (1), (2), and (4), by inserting ``and
class III gaming'' after ``class II gaming'';
(B) in paragraph (9), by striking ``and'' at the end;
(C) in paragraph (10), by striking the period at the end
and inserting ``; and''; and
(D) by adding at the end the following:
``(11) may, in case of contumacy by, or refusal to obey any
subpoena issued to, any person, request the Attorney General
to invoke the jurisdiction of any court of the United States,
within the geographical jurisdiction of which a person to
whom the subpoena was directed is an inhabitant, is
domiciled, is organized, has appointed an agent for service
of process, transacts business, or is found, to compel
compliance with the subpoena to require the attendance and
testimony of witnesses and the production of records; and
``(12) subject to subsection (c), may accept gifts on
behalf of the Commission.''; and
(3) by striking subsection (c) and inserting the following:
``(c) Gifts.--
``(1) In general.--The Commission shall not accept a gift--
``(A) that attaches a condition that is inconsistent with
any applicable law (including a regulation); or
``(B) that is conditioned on, or will require, the
expenditure of appropriated funds that are not available to
the Commission.
``(2) Regulations.--The Commission shall promulgate
regulations specifying the criteria to be used to determine
whether the acceptance of a gift would--
``(A) adversely affect the ability of the Commission or any
employee of the Commission to carry out the duties of the
Commission in a fair and objective manner; or
``(B) compromise the integrity or the appearance of the
integrity of any official involved in a program of the
Commission.
``(d) Regulatory Plan.--
``(1) In general.--The Commission shall develop a
nonbinding regulatory plan for use in carrying out activities
of the Commission.
``(2) Treatment.--In developing the regulatory plan, the
Commission shall not be bound by chapter 6 of title 5, United
States Code.
``(3) Contents.--The regulatory plan shall include--
``(A) a comprehensive mission statement describing the
major functions and operations of the Commission;
``(B) a description of the goals and objectives of the
Commission;
``(C) a description of the general means by which those
goals and objectives are to be achieved, including a
description of the operational processes, skills, and
technology and the human resources, capital, information, and
other resources required to achieve those goals and
objectives;
``(D) a performance plan for achievement of those goals and
objectives, including provision for a report on the actual
performance of the Commission as measured against the goals
and objectives;
``(E) an identification of the key factors that are
external to, or beyond the control of, the Commission that
could significantly affect the achievement of those goals and
objectives; and
``(F) a description of the program evaluations used in
establishing or revising those goals and objectives,
including a schedule for future program evaluations.
``(4) Duration.--The regulatory plan shall cover a period
of not less than 5 fiscal years, beginning with the fiscal
year in which the plan is developed.
``(5) Revision.--The regulatory plan shall be revised
biennially.''.
SEC. 6. COMMISSION STAFFING.
Section 8 of the Indian Gaming Regulatory Act (25 U.S.C.
2707) is amended--
(1) in subsection (a), by striking ``basic pay payable for
GS-18 of the General Schedule under section 5332 of title 5''
and inserting ``pay payable for level IV of the Executive
Schedule under section 5315 of title 5, United States Code,
as adjusted under section 5318 of that title'';
(2) in the second sentence of subsection (b), by striking
``basic pay payable for GS-17 of the General Schedule under
section 5332 of that title'' and inserting ``pay payable for
level IV of the Executive Schedule under section 5315 of
title 5, United States Code, as adjusted under section 5318
of that title''; and
(3) in subsection (c), by striking ``basic pay payable for
GS-18 of the General Schedule'' and inserting ``pay payable
for level IV of the Executive Schedule under section 5315 of
title 5, United States Code, as adjusted under section 5318
of that title''.
SEC. 7. TRIBAL GAMING ORDINANCES.
Section 11 of the Indian Gaming Regulatory Act (25 U.S.C.
2710) is amended--
(1) in subsection (b)(2)(F)(i)--
(A) by inserting ``tribal gaming commissioners, key tribal
gaming commission employees, and'' after ``conducted on'';
(B) by inserting ``primary management officials and key
employees'' after ``oversight of''; and
(C) by striking ``such officials and their management'';
and
(2) in subsection (d)(9), by striking ``the provisions of
subsections (b), (c), (d), (f), (g), and (h) of''.
SEC. 8. MANAGEMENT CONTRACTS.
Section 12(a)(1) of the Indian Gaming Regulatory Act (25
U.S.C. 2711(a)(1)) is amended by inserting ``or a class III
gaming activity that the Indian tribe may engage in under
section 11(d)'' after ``section 11(b)(1)''.
SEC. 9. CIVIL PENALTIES.
Section 14 of the Indian Gaming Regulatory Act (25 U.S.C.
2713) is amended--
(1) by striking the section heading and all that follows
through ``provide such tribal operator or management
contractor'' in subsection (a)(3) and inserting the
following:
``SEC. 14. CIVIL PENALTIES.
``(a) In General.--
``(1) Levy and collection.--Subject to such regulations as
the Commission may promulgate, the Chairman shall have
authority to--
``(A) levy and collect appropriate civil fines, not to
exceed $25,000 per violation, per day;
``(B) issue orders requiring accounting and disgorgement,
including interest; and
``(C) issue orders of reprimand, censure, or the placement
of limitations on gaming activities and functions of any
regulated person or entity for any violation of any provision
of this Act, Commission regulations, or tribal regulations,
ordinances, or resolutions approved under section 11 or 13.
``(2) Appeal.--The Commission shall by regulation provide
an opportunity for an appeal and hearing before the
Commission of an action taken under paragraph (1).
``(3) Complaint.--If the Commission has reason to believe
that a regulated person or entity is engaged in activities
regulated by this Act (including regulations promulgated
[[Page S3184]]
under this Act), or by tribal regulations, ordinances, or
resolutions approved under section 11 or 13, that may result
in the imposition of a fine under subsection (a)(1), the
permanent closure of a game, or the modification or
termination of a management contract, the Commission shall
provide the regulated person or entity.'';
(2) in subsection (b)--
(A) in paragraph (1), by striking ``game'' and inserting
``gaming operation, or any part of a gaming operation,''; and
(B) in paragraph (2)--
(i) in the first sentence, by striking ``permanent'' and
inserting ``final''; and
(ii) in the second sentence, by striking ``order a
permanent closure of the gaming operation'' and inserting
``make final the order of closure''; and
(3) in subsection (c), by striking ``permanent closure''
and inserting ``closure, accounting, disgorgement, reprimand,
or censure or placement of a limitation on a gaming activity
or function''.
SEC. 10. SUBPOENA AND DEPOSITION AUTHORITY.
Section 16 of the Indian Gaming Regulatory Act (25 U.S.C.
2715) is amended--
(1) by striking subsection (c) and inserting the following:
``(c) Judicial Enforcement.--On application of the Attorney
General, a district court of the United States shall have
jurisdiction to issue a writ of mandamus, injunction, or
order commanding any person to comply with this Act.'';
(2) by redesignating subsections (d), (e), and (f) as
subsections (e), (f), and (g), respectively, and inserting
after subsection (c) the following:
``(d) Failure To Obey Subpoena.--
``(1) In general.--In case of a failure to obey a subpoena
issued by the Commission or the Chairman and on request of
the Commission or Chairman, the Attorney General may apply to
the United States District Court for the District of Columbia
or any United States district court within the geographical
jurisdiction of which a person to whom the subpoena was
directed is an inhabitant, is domiciled, is organized, has
appointed an agent for service of process, transacts business
or is found, to compel compliance with the subpoena.
``(2) Remedies.--On application under paragraph (1), the
court shall have jurisdiction to--
``(A) issue a writ commanding the person to comply with the
subpoena; or
``(B) punish a failure to obey the writ as a contempt of
court.
``(3) Process.--Process to a person in any proceeding under
this subsection may be served wherever the person may be
found in the United States or as otherwise authorized by law
or by rule or order of the court.''.
SEC. 11. COMMISSION FUNDING.
Section 18(a)(2) of the Indian Gaming Regulatory Act (25
U.S.C. 2717(a)(2)) is amended by striking subparagraph (B)
and inserting the following:
``(B) Limitation.--The total amount of all fees imposed
during any fiscal year under the schedule established under
paragraph (1) shall not exceed 0.080 percent of the gaming
revenues of all gaming operations subject to regulation by
the Commission.''.
SEC. 12. PRESERVATION OF EXISTING STATUS.
Nothing in this Act or any amendment made by this Act
expands, limits, or otherwise affects any immunity that an
Indian tribe may have under applicable law.
______
By Mr. VOINOVICH (for himself and Mr. Carper):
S. 2233. A bill to amend the Environmental Research, Development, and
Demonstration Authorization Act of 1979 to establish in the
Environmental Protection Agency the position of Deputy Administrator
for Science and Technology; to the Committee on Environment and Public
Works.
Mr. VOINOVICH. Mr. President, I rise today to introduce legislation
with my friend and colleague, Senator Carper, which will strengthen the
use of science at the Environmental Protection Agency. By improving
science at the Agency, we will be improving the framework of our
regulatory decisions. It is important that these regulations be
effective, not onerous and inefficient. To make government regulations
efficient, they must be based on a solid foundation of scientific
understanding and data.
In 2000, the Nation Research Council released a report,
``Strengthening Science at the U.S. Environmental Protection Agency:
Research Management and Peer Review Practices'' which outlined current
practices at the EPA and made recommendations for improving science
within the agency. The bill we are introducing today, the
``Environmental Research Enhancement Act,'' builds on the NRC report.
When the Environmental Protection Agency was created in 1970 by
President Nixon, its mission was set to protect human health and
safeguard the environment. In the 1960s, it had become increasingly
clear that ``we needed to know more about the total environment--land,
water, and air.'' The EPA was part of President Nixon's
reorganizational efforts to effectively ensure the protection,
development and enhancement of the total environment.
For the EPA to reach this mission, establishing rules and priorities
for clean land, air and water require a fundamental understanding of
the science behind the real and potential threats to public health and
the environment. Unfortunately, many institutions, citizens and groups
believe that science has not always played a significant role in the
decision-making process at the EPA.
In NRC's 2002 report, it was concluded that, while the use of sound
science is one of the Environmental Protection Agency's goals, the EPA
needs to change its current structure to allow science to play a more
significant role in decisions made by the Administrator.
The legislation we are introducing today looks to address those
shortcomings at the EPA by implementing portions of the report that
require congressional authorization.
Under our bill, a new position, Deputy Administrator for Science and
Technology will be established at the EPA. This individual will oversee
the Office of Research and Development; the Environmental Information
Agency; the Science Advisory board; the Science Policy Council; and the
scientific and technical activities in the regulatory program at the
EPA. This new position is equal in rank to the current Deputy
Administrator and would report directly to the Administrator. The new
Deputy would be responsible for coordinating scientific research and
application between the scientific and regulatory arms of the Agency.
This will ensure that sound science is the basis for regulatory
decisions. The new Deputy's focus on science could also change how
environmental decisions are made.
Assistant Administrator for Research and Development, currently the
top science job at the EPA, will be appointed for 6 years versus the
current 4 years political appointment. Historically, this position is
recognized to be one of the EPA's weakest and most transient
administrator positions according to NRC's report, even though in my
view, the position addresses some of the Agency's more important
topics. By lengthening the term of this Assistant Administrator
position and removing it from the realm of politics, I believe there
will be more continuity in the scientific work of the Agency across
administrations and allow the Assistant Administrator to focus on
science conducted at the Agency.
In 1997, we learned the problems that can arise when sound science is
not used in making regulatory decisions. Following EPA's ozone and
particulate matter regulations there was great uncertainty on the
scientific side.
When intitally releasing the Ozone/PM regulations, the EPA greatly
over estimated the impacts for both ozone and PM, and they had to
publicly change their figures later on. Additionally, they selectively
applied some study results while ignoring others in their calculations.
For example, the majority of the health benefits for ozone are based on
one PM study by a Dr. Moogarkar, even though the Agency ignored the PM
results of that study because it contradicted their position on PM.
The legislation that Senator Carper and I are introducing will ensure
that science no longer takes a ``back seat'' at the Environmental
Protection Agency in terms of policy making. I call on my colleagues to
join us in cosponsoring this bill.
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. 2233
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 ``Environmental Research
Enhancement Act''.
SEC. 2. ENVIRONMENTAL PROTECTION AGENCY RESEARCH ACTIVITIES.
(a) In General.--Section 6 of the Environmental Research,
Development, and Demonstration Authorization Act of 1979 (42
U.S.C. 4361c) is amended by adding at the end the following:
``(e) Deputy Administrator for Science and Technology.--
[[Page S3185]]
``(1) Establishment.--There is established in the
Environmental Protection Agency (referred to in this section
as the `Agency') the position of Deputy Administrator for
Science and Technology.
``(2) Appointment.--
``(A) In general.--The Deputy Administrator for Science and
Technology shall be appointed by the President, by and with
the advice and consent of the Senate.
``(B) Consideration of recommendations.--In making an
appointment under subparagraph (A), the President shall
consider recommendations submitted by--
``(i) the National Academy of Sciences;
``(ii) the National Academy of Engineering; and
``(iii) the Science Advisory Board established by section 8
of the Environmental Research, Development, and Demonstration
Authorization Act of 1978 (42 U.S.C. 4365).
``(3) Responsibilities.--
``(A) Oversight.--The Deputy Administrator for Science and
Technology shall coordinate and oversee--
``(i) the Office of Research and Development of the Agency
(referred to in this section as the `Office');
``(ii) the Office of Environmental Information of the
Agency;
``(iii) the Science Advisory Board;
``(iv) the Science Policy Council of the Agency; and
``(v) scientific and technical activities in the regulatory
program and regional offices of the Agency.
``(B) Other responsibilities.--The Deputy Administrator for
Science and Technology shall--
``(i) ensure that the most important scientific issues
facing the Agency are identified and defined, including those
issues embedded in major policy or regulatory proposals;
``(ii) develop and oversee an Agency-wide strategy to
acquire and disseminate necessary scientific information
through intramural efforts or through extramural programs
involving academia, other government agencies, and the
private sector in the United States and in foreign countries;
``(iii) ensure that the complex scientific outreach and
communication needs of the Agency are met, including the
needs--
``(I) to reach throughout the Agency for credible science
in support of regulatory office, regional office, and Agency-
wide policy deliberations; and
``(II) to reach out to the broader United States and
international scientific community for scientific knowledge
that is relevant to Agency policy or regulatory issues;
``(iv) coordinate and oversee scientific quality-assurance
and peer-review activities throughout the Agency, including
activities in support of the regulatory and regional offices;
``(v) develop processes to ensure that appropriate
scientific information is used in decisionmaking at all
levels in the Agency; and
``(vi) ensure, and certify to the Administrator of the
Agency, that the scientific and technical information used in
each Agency regulatory decision and policy is--
``(I) valid;
``(II) appropriately characterized in terms of scientific
uncertainty and cross-media issues; and
``(III) appropriately applied.
``(f) Assistant Administrator for Research and
Development.--
``(1) Term of appointment.--Notwithstanding any other
provision of law, the Assistant Administrator for Research
and Development of the Agency shall be appointed for a term
of 6 years.
``(2) Applicability.--Paragraph (1) applies to each
appointment that is made on or after the date of enactment of
this subsection.
``(g) Senior Research Appointments in Office of Research
and Development Laboratories.--
``(1) Establishment.--The head of the Office, in
consultation with the Science Advisory Board and the Board of
Scientific Counselors of the Office, shall establish a
program to recruit and appoint to the laboratories of the
Office senior researchers who have made distinguished
achievements in environmental research.
``(2) Awards.--
``(A) In general.--The head of the Office shall make awards
to the senior researchers appointed under paragraph (1)--
``(i) to support research in areas that are rapidly
advancing and are related to the mission of the Agency; and
``(ii) to train junior researchers who demonstrate
exceptional promise to conduct research in such areas.
``(B) Selection procedures.--The head of the Office shall
establish procedures for the selection of the recipients of
awards under this paragraph, including procedures for
consultation with the Science Advisory Board and the Board of
Scientific Counselors of the Office.
``(C) Duration of awards.--Awards under this paragraph
shall be made for a 5-year period and may be renewed.
``(3) Placement of researchers.--Each laboratory of the
Office shall have not fewer than 1 senior researcher
appointed under the program established under paragraph (1).
``(4) Authorization of appropriations.--There are
authorized to be appropriated such sums as are necessary to
carry out this subsection.
``(h) Other Activities of Office of Research and
Development.--
``(1) Activities of the office.--The Office shall--
``(A) make a concerted effort to give research managers of
the Office a high degree of flexibility and accountability,
including empowering the research managers to make decisions
at the lowest appropriate management level consistent with
the policy of the Agency and the strategic goals and budget
priorities of the Office;
``(B) maintain, to the maximum extent practicable, an even
balance between core research and problem-driven research;
``(C) develop and implement a structured strategy for
encouraging, and acquiring and applying the results of,
research conducted or sponsored by other Federal and State
agencies, universities, and industry, both in the United
States and in foreign countries; and
``(D) substantially improve the documentation and
transparency of the decisionmaking processes of the Office
for--
``(i) establishing research and technical-assistance
priorities;
``(ii) making intramural and extramural assignments; and
``(iii) allocating funds.
``(2) Activities of the administrator.--The Administrator
of the Agency shall--
``(A) substantially increase the efforts of the Agency--
``(i) to disseminate actively the research products and
ongoing projects of the Office;
``(ii) to explain the significance of the research products
and projects; and
``(iii) to assist other persons and entities inside and
outside the Agency in applying the results of the research
products and projects;
``(B)(i) direct the Deputy Administrator for Science and
Technology to expand the science inventory of the Agency by
conducting, documenting, and publishing a more comprehensive
and detailed inventory of all scientific activities conducted
by Agency units outside the Office, which inventory should
include information such as--
``(I) project goals, milestones, and schedules;
``(II) principal investigators and project managers; and
``(III) allocations of staff and financial resources; and
``(ii) use the results of the inventory to ensure that
activities described in clause (i) are properly coordinated
through the Agency-wide science planning and budgeting
process and are appropriately peer reviewed; and
``(C) change the peer-review policy of the Agency to more
strictly separate the management of the development of a work
product from the management of the peer review of that work
product, thereby ensuring greater independence of peer
reviews from the control of program managers, or the
potential appearance of control by program managers,
throughout the Agency.''.
(b) Deputy Administrator for Policy and Management.--
(1) In general.--The position of Deputy Administrator of
the Environmental Protection Agency is redesignated as the
position of ``Deputy Administrator for Policy and Management
of the Environmental Protection Agency''.
(2) References.--Any reference in a law, map, regulation,
document, paper, or other record of the United States to the
Deputy Administrator of the Environmental Protection Agency
shall be deemed to be a reference to the Deputy Administrator
for Policy and Management of the Environmental Protection
Agency.
(c) Executive Schedule Level III.--Section 5314 of title 5,
United States Code, is amended by striking the item relating
to the Deputy Administrator of the Environmental Protection
Agency and inserting the following:
``Deputy Administrator for Policy and Management of the
Environmental Protection Agency.
``Deputy Administrator for Science and Technology of the
Environmental Protection Agency.''.
______
By Mr. DASCHLE (for himself, Mr. Kennedy, Mr. Reed, Mr. Feingold,
Mr. Kohl, Mr. Durbin, Mr. Bingaman, Mr. Graham of Florida, Mr.
Reid, and Mr. Dodd):
S. 2234. A bill to amend title XVIII of the Social Security Act to
ensure that prescription drug card sponsors pass along discounts to
beneficiaries under the medicare prescription drug discount card and
transitional assistance program; to the Committee on Finance.
Mr. DASCHLE. Mr. President, the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 created a temporary drug
discount card program. We expect that program to go into effect this
summer. Under the new law, it is the only prescription drug assistance
seniors will see until 2006. And it isn't much. This program has a lot
of problems and I am very skeptical that it will provide meaningful
assistance to most beneficiaries.
Today, the administration announced which private companies have been
selected to receive beneficiary enrollment fees and provide the cards
to beneficiaries. The applicants included
[[Page S3186]]
big pharmaceutical companies, pharmaceutical benefit managers, and
HMOs. And the list of approved companies is a who's who of the
insurance industry.
One of the most glaring problems with the program is that the
Medicare legislation fails to ensure that these private companies pass
along the discounts they negotiate to beneficiaries. Today, I am
introducing legislation to remedy that failure. My bill would require
card sponsors to pass at least 90 percent of the discounts along to
beneficiaries. It seems like common sense, but, true to form, the
Republican Medicare bill allows the private companies to keep the
discounts as profits. And the administration's regulations only require
that they pass along a ``share'' of the discounts they negotiate. Well,
I think that's giving them too much leeway.
The administration is promising seniors discounts in order to
convince them to pay private companies a $30 fee. My bill would ensure
that these private companies pass the discounts along to those seniors.
It's only fair. The sponsors will still have plenty of room for
benefitting from participating in the program--they get the $30
enrollment fee and they will be able to retain up to 10 percent of the
negotiated price concessions.
Despite all the hoopla, the cards themselves are nothing new. Some
low-income beneficiaries will see $600 in assistance on their cards,
and that is real help. Unfortunately, the process for gaining access to
that money is so cumbersome, I worry that many will not get it. And I
have serious doubts about whether the cards will add any other
meaningful assistance. The General Accounting Office has found that
similar cards now available on the market offer discounts on average of
less than 10 percent--that's about what seniors could save by
comparison shopping at local pharmacies.
Worse, under the Medicare drug program, seniors will only be able to
use one Medicare-endorsed card. Before the program, people could use as
many cards as they wanted and compare discounts. And the real kicker is
that once seniors pay a fee to participate, they're locked into that
card for a year. But the card sponsor isn't locked into anything. It
can change everything whenever it wants--even the amount of the
discount or whether a discount is offered on a particular drug.
And here's the worst part, this drug card program may already be
harming all American drug consumers. As the Wall Street Journal noted
just yesterday, recent drug price increases are eroding even the meager
savings the administration predicts. What's more, all Americans are
already paying higher drug prices. According to the Wall Street
Journal, since the Bush administration proposed a Medicare drug card in
2001, the prices of many drugs the elderly use have ``surged.'' For
example, the article notes that since that time, the price of Lescol, a
cholesterol drug, has increased by more than a third. Similarly, the
price for Celebrex, a popular drug for arthritis pain, has risen 23
percent since the administration proposed the cards.
The administration is claiming the discount cards will result in
beneficiary savings of between 10 and 25 percent. But the
pharmaceutical industry's price hikes negate what little savings the
administration optimistically predicts. Unfortunately, the discount
cards are just one example of the new law's failure to address drug
prices. The Boston University School of Public Health recently found
that the new Medicare law could lead to an additional $139 billion in
profits for the drug companies. The new law actually prohibits Medicare
from using its negotiating power to obtain lower drug prices for
seniors. And the reimportation provisions are meaningless. We know from
experience that seniors can save much more than 10 to 25 percent by
getting their drugs from Canada.
As Families USA points out on its website, the drug cards actually
create an incentive for the drug companies to raise their prices:
``Neither the new law nor the regulations specify the `base prices' to
which discounts will be applied. Any discount will be meaningless if
the base price is undefined--especially if the base price continues to
rise very substantially. It would be like a department store marking up
prices on products so that it can later offer them `on sale' at
tremendous `savings.' ''
The bill I am introducing addresses only one flaw in a program
riddled with problems. I feel that it is a critical step. At the very
least, we should ensure that if this program does offer some sort of
price concession, that Medicare beneficiaries--not private companies
like HMOs--are the ones to profit from the results.
I ask unanimous consent that the text of the bill be printed in the
Record following my remarks.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 2234
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 ``Drug Discount Card
Improvement Act of 2004''.
SEC. 2. ENSURING THAT PRESCRIPTION DRUG CARD SPONSORS PASS
ALONG DISCOUNTS TO BENEFICIARIES.
(a) In General.--Section 1860D-31(e)(1)(A)(ii) of the
Social Security Act (42 U.S.C. 1395w-141(e)(1)(A)(ii)), as
added by section 101 of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (Public Law 108-
173; 117 Stat. 2071), is amended by striking ``take into
account'' and inserting ``reflect at least 90 percent of
all''.
(b) Effective Date.--The amendment made by this section
shall take effect as if included in the enactment of section
101 of the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (Public Law 108-173; 117 Stat.
2066).
By Mr. HOLLINGS:
S. 2235. A bill to rename the Department of Commerce as the
Department of Trade and Commerce and transfer the Office of the United
States Trade Representative into the Department, to consolidate and
enhance statutory authority to protect American jobs from unfair
international competition, and for other purposes; to the Committee on
Finance.
Mr. HOLLINGS. Mr. President, I ask unanimous consent that a copy of
an article I wrote for the Washington Post Outlook section be printed
and that the text of the bill be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 2235
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 ``Domestic Workforce
Protection Act''.
SEC. 2. COMMERCE DEPARTMENT RENAMED AS DEPARTMENT OF TRADE
AND COMMERCE.
(a) In General.--The Department of Commerce is hereby
redesignated the Department of Trade and Commerce, and the
Secretary of Commerce or any other official of the Department
of Commerce is hereby redesignated the Secretary or official,
as appropriate, of Trade and Commerce.
(b) Reference to Department, Secretary, etc. of Commerce
Deemed Reference to Department, Secretary, etc. of Trade and
Commerce.--Any reference to the Department of Commerce, the
Secretary of Commerce, or any other official of the
Department of Commerce in any law, rule, regulation,
certificate, directive, instruction, or other official paper
in force on the effective date of this Act shall be deemed to
refer and apply to the Department of Trade and Commerce or
the Secretary of Trade and Commerce, respectively.
SEC. 3. TRANSFER OF THE OFFICE OF THE UNITED STATES TRADE
REPRESENTATIVE TO WITHIN THE DEPARTMENT OF
COMMERCE AND TRADE.
Section 141(a) of the Trade Act of 1974 (19 U.S.C. 2171(a))
is amended by striking ``Executive Office of the President''
and inserting ``Department of Trade and Commerce''.
SEC. 4. TERMINATION OF DEFERRAL TO ELIMINATE TAX BENEFITS FOR
OFFSHORE PRODUCTION.
(a) General Rule.--Paragraph (1) of section 951(a) of the
Internal Revenue Code of 1986 (relating to amounts included
in gross income of United States shareholders) is amended--
(1) by striking ``and'' after the semicolon in subparagraph
(A)(iii);
(2) by striking ``959(a)(2).'' in subparagraph (B) and
inserting ``959(a)(2); and''; and
(3) by adding at the end thereof the following:
``(C) the amount determined under section 956A with respect
to such shareholder for such year (but only to the extent not
excluded from gross income under section 959(a)(3)).''.
(b) Amount of Inclusion.--Subpart F of part III of
subchapter N of chapter 1 of the Internal Revenue Code of
1986 is amended by inserting after section 956 the following
new section:
``SEC. 956A. EARNINGS OF CONTROLLED FOREIGN CORPORATIONS.
``(a) General Rule.--In the case of any controlled foreign
corporation, the amount
[[Page S3187]]
determined under this section with respect to any United
States shareholder for any taxable year is the lesser of--
``(1) the excess (if any) of--
``(A) such shareholder's pro rata share of the amount of
the controlled foreign corporation's assets for such taxable
year, over
``(B) the amount of earnings and profits described in
section 959(c)(1)(B) with respect to such shareholder, or
``(2) such shareholder's pro rata share of the applicable
earnings of such controlled foreign corporation determined
after the application of section 951(a)(1)(B).
``(b) Applicable Earnings.--For purposes of this section,
the term `applicable earnings' means, with respect to any
controlled foreign corporation, the sum of--
``(1) the amount referred to in section 316(a)(1) to the
extent such amount was accumulated in taxable years beginning
after February 29, 2004, and
``(2) the amount referred to in section 316(a)(2),
reduced by distributions made during the taxable year and
reduced by the earnings and profits described in section
959(c)(1) to the extent that the earnings and profits so
described were accumulated in taxable years beginning after
February 29, 2004.
``(c) Special Rule Where Corporation Ceases To Be
Controlled Foreign Corporation During Taxable Year-.--If any
foreign corporation ceases to be a controlled foreign
corporation during any taxable year--
``(1) the determination of any United States shareholder's
pro rata share shall be made on the basis of stock owned
(within the meaning of section 958(a)) by such shareholder on
the last day during the taxable year on which the foreign
corporation is a controlled foreign corporation,
``(2) the amount of such corporation's assets for such
taxable year shall be determined by only taking into account
quarters ending on or before such last day, and
``(3) in determining applicable earnings, the amount taken
into account by reason of being described in paragraph (2) of
section 316(a) shall be the portion of the amount so
described which is allocable (on a pro rata basis) to the
part of such year during which the corporation is a
controlled foreign corporation.
``(d) Regulations.--The Secretary shall prescribe such
regulations as may be necessary to carry out the purposes of
this section, including regulations to prevent the avoidance
of the provisions of this section through reorganizations or
otherwise.''.
(c) Previously Taxed Income Rules.--
(1) In general.--Subsection (a) of section 959 of the
Internal Revenue Code of 1986 (relating to exclusion from
gross income of previously taxed earnings and profits) is
amended by striking ``or'' at the end of paragraph (1), by
adding ``or'' at the end of paragraph (2), and by inserting
after paragraph (2) the following:
``(3) such amounts would, but for this subsection, be
included under section 951(a)(1)(C) in the gross income
of,''.
(2) Allocation rules.--
(A) Subsection (a) of section 959 of the Internal Revenue
Code of 1986 is amended by striking ``paragraph (2)'' in the
last sentence and inserting ``paragraphs (2) and (3)''.
(B) Section 959(f) of the Internal Revenue Code of 1986 is
amended--
(i) by striking paragraph (1) and inserting the following:
``(1) In general.--For purposes of this section--
``(A) amounts that would be included under subparagraph (B)
of section 951(a)(1) (determined without regard to this
section) shall be treated as attributable first to earnings
described in subsection (c)(2), and then to earnings
described in subsection (c)(3), and
``(B) amounts that would be included under subparagraph (C)
of section 951(a)(1) (determined without regard to this
section) shall be treated as attributable first to earnings
described in subsection (c)(2) to the extent the earnings so
described were accumulated in taxable years beginning after
February 29, 2004, and then to earnings described in
subsection (c)(3).''; and
(ii) by striking ``section 951(a)(1)(B)'' in paragraph (2)
and inserting ``subparagraphs (B) and (C) of section
951(a)(1)''.
(3) Conforming amendment.--Subsection (b) of section 989 of
the Internal Revenue Code of 1986 is amended by striking
``section 951(a)(1)(B)'' and inserting ``subparagraph (B) or
(C) of section 951(a)(1)''.
(d) Effective Date.--The amendments made by this section
shall apply to taxable years of foreign corporations
beginning after February 29, 2004, and to taxable years of
United States shareholders in which or with which such
taxable years of foreign corporations end.
(e) Technical and Conforming Changes.--The Secretary of the
Treasury shall, within 90 days after the date of enactment of
this Act, submit to the Committee on Ways and Means of the
House of Representatives and to the Committee on Finance of
the Senate, a draft of any technical and conforming changes
in the Internal Revenue Code of 1986 that are necessary to
reflect throughout such Code the changes in the substantive
provisions of law made by this section.
SEC. 5. DISALLOWANCE OF DEDUCTIONS FOR CERTAIN OFFSHORE
ROYALTY PAYMENTS.
(a) In General.--Part IX of subchapter B of chapter 1 of
the Internal Revenue Code of 1986 is amended by adding at the
end the following:
``SEC. 280I. CERTAIN OFFSHORE ROYALTY PAYMENTS.
``(a) In General.--In the case of a corporation, no
deduction shall be allowed for the payment of a royalty to an
affiliated entity organized and operated outside the United
States in exchange for the use of rights to a copyrighted or
trademarked product if those rights were transferred by the
corporation or a related party to that entity.
``(b) Exception.--Subsection (a) does not apply to the
payment of a royalty if the taxpayer establishes, to the
satisfaction of the Secretary, that--
``(1) the transfer of the rights to the entity was for a
sound business reason (other than the reduction of liability
for tax under this chapter); and
``(2) the amounts paid or incurred for such royalty
payments are reasonable under the circumstances.''.
(b) Clerical Amendment.--The part analysis for such part is
amended by adding at the end the following:
``280I. Certain offshore royalty payments.''.
(c) Effective Date.--The amendments made by this section
apply to taxable years beginning after December 31, 2003.
SEC. 6. INCREASE IN AUTHORITY OF THE INTERNAL REVENUE SERVICE
TO THWART USE OF TAX HAVENS BY CORPORATIONS.
(a) In General.--Subchapter B of chapter 78 of the Internal
Revenue Code of 1986 is amended by adding at the end the
following:
``SEC. 7625. AUTHORITY TO FRUSTRATE USE OF CORPORATE TAX
HAVENS.
``(a) In General.--The Secretary is authorized--
``(1) to deny any otherwise allowable deduction or credit
under chapter 1,
``(2) to recharacterize, reallocate, and resource income,
``(3) to recharacterize transactions, and
``(4) to disregard any transaction, trust, or other legal
entity,
determined by the Secretary to be necessary to prevent the
use by a corporation of a tax haven to avoid liability for
tax under this chapter.
``(b) Tax Haven Defined.--In this section, the term `tax
haven' means any country that meets the tax haven criteria
established by the Organization for Economic Co-operation and
Development.''.
(b) Conforming Amendment.--The subchapter analysis for
subchapter B of chapter 78 of the Internal Revenue Code of
1986 is amended by adding at the end the following:
``6725. Authority to frustrate use of corporate tax havens''.
SEC. 7. ASSISTANT ATTORNEY GENERAL FOR TRADE.
(a) Position Established.--The Attorney General shall
appoint an Assistant Attorney General for Trade.
(b) Duties.--The Assistant Attorney General for Trade
shall--
(1) investigate anticompetitive conduct by foreign
companies that has an adverse impact on the economy of the
United States (including manufacturing, agriculture, and
employment) or the global competitiveness of United States
companies;
(2) investigate violations of international trade
agreements to which the United States is a party that have an
adverse impact on the economy of the United States (including
manufacturing, agriculture, and employment) or the global
competitiveness of United States companies and take
appropriate action to seek redress or punishment for those
violations; and
(3) investigate and initiate appropriate action against
other activities throughout the world that have an adverse
impact on the economy of the United States (including
manufacturing, agriculture, and employment) or the global
competitiveness of United States companies.
(c) Authority Is in Addition to Other Authorities.--The
authority granted to the Assistant Attorney General for Trade
by this section is in addition to, and not in derogation or
in lieu of, any authority provided by law to any other
officer or agency of the United States charged with
enforcement of the trade laws of the United States or of
international agreements to which the United States is a
party.
(d) Compensation.--Section 5315 of title 5, United States
Code, is amended by striking ``(10)'' in the item relating to
Assistant Attorney General and inserting ``(11)''.
SEC. 8. EMPLOYMENT OF ADDITIONAL CUSTOMS INSPECTORS FOR
ILLEGAL TRANSSHIPMENTS OF TEXTILES.
The Secretary of Homeland Security shall hire, train, and
deploy 1,000 customs agents in addition to the number of
customs agents otherwise authorized by law or otherwise
employed by the Department of Homeland Security for the
purpose of detecting and preventing illegal transshipments of
textiles to avoid textile import quotas and in violation of
trade agreements to which the United States is a party.
SEC. 9. INCREASED DOMESTIC PRODUCTION OF NATIONAL DEFENSE
CRITICAL GOODS.
(a) In General.--The Secretary of Commerce, in consultation
with the Secretary of Defense, the Director of the Central
Intelligence Agency, the Secretary of State, the Secretary of
Homeland Security, and the Administrator of the Small
Business Administration shall develop a program to encourage
and support increased domestic production of goods and
products that are essential or critical to national security
in order to decrease the United States' dependence upon
imports of such goods and products.
[[Page S3188]]
(b) Support Program.--The Secretary of Commerce shall
implement the program developed under subsection (a) to the
maximum extent feasible through existing programs, including
programs administered by the Small Business Administration.
The Secretary shall transmit to the Congress a report, within
18 months after the date of enactment of this Act, describing
the program and making such recommendations, including
legislative recommendations, as the Secretary deems necessary
for expanding the scope or improving the efficacy of the
program. The Secretary may submit the report in both
classified and redacted form.
(c) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary of Commerce such sums as
may be necessary to carry out the program.
SEC. 10. SENSE OF THE SENATE CONCERNING APPROPRIATIONS FOR
CERTAIN PROGRAMS.
It is the sense of the Senate that the Congress should
appropriate the full amount authorized by law to carry out
the Regional Centers for the Transfer of Manufacturing
Technology program under section 25 of the National Institute
of Standards and Technology Act (15 U.S. C. 278k) and the
Advanced Technology Program authorized by section 28 of that
Act (15 U.S. C. 278n).
SEC. 11. TRANSFER OF INTERNATIONAL TRADE COMMISSION
FUNCTIONS.
(a) Abolishment of ITC.--Effective on the first day of the
seventh month beginning after the date of enactment of this
Act, the United States International Trade Commission
established by section 330 of the Tariff Act of 1930 (19
U.S.C. 1330) as in effect on the last day of the sixth month
beginning after the date of enactment of this Act is
abolished.
(b) Transfer of Functions.--Except as otherwise provided in
this Act, all functions that on the last day of the sixth
month beginning after the date of enactment of this Act are
authorized to be performed by the United States International
Trade Commission are transferred to the Department of
Commerce effective on the first day of the seventh month
beginning after the date of enactment of this Act and shall
be performed by the Assistant Secretary of Commerce for
Import Administration.
(c) Determination of Certain Functions.--If necessary, the
Office of Management and Budget shall make any determination
of the functions that are transferred under this section.
SEC. 12. INCIDENTAL TRANSFERS.
The Director of the Office of Management and Budget, in
consultation with the Secretary of Commerce, shall make such
determinations as may be necessary with regard to the
functions, offices, or portions thereof transferred by this
Act, and make such additional incidental dispositions of
personnel, assets, liabilities, grants, contracts, property,
records, and unexpended balances of appropriations,
authorizations, allocations, and other funds held, used,
arising from, available to, or to be made available in
connection with such functions, offices, or portions thereof,
as may be necessary to carry out this Act. The Director shall
provide for the termination of the affairs of all entities
terminated by this Act and, in consultation with the
Administrator, for such further measures and dispositions as
may be necessary to effectuate the purposes of this Act.
[From the Washington Post, March 21, 2004]
Protectionism Happens To Be Congress's Job
(By Ernest F. Hollings)
Free trade is like world peace--you can't get there by
whining about it. You must be willing to fight for it. And
the entity to fight for free trade is the U.S. Congress.
Instead, Congress--whose members are shouting ``fair
trade'' and ``level the playing field''--is the very group
tilting the playing field when it comes to trade.
By piling items onto the cost of doing business here,
Congress has helped end the positive trade balance that the
United States ran right up until the early 1980s. Over the
past 40 years, the minimum wage went up, the Environmental
Protection Agency was established, and the Occupational
Safety and Health Administration was set up. Lawmakers added
the Equal Pay Act, the Age Discrimination in Employment Act
and the Employment Retirement Income Security Act. Then came
the sharp increase in payroll taxes for Social Security in
1983, measures requiring plant closing notice and parental
leave, and the Americans With Disabilities Act. Health costs
increased, too, making it $500 a car cheaper in health costs
alone for General Motors to make Pontiacs in Canada. All this
helped give us a trade deficit that hit a record $43.1
billion in January alone.
Even if wages were equalized, it would still pay for U.S.
companies to move operations to places such as China, which
requires none of these aspects of America's high standard of
living. Recently, columnist George Will wrote: ``The export
of jobs frees U.S. workers for tasks where America has a
comparative advantage.'' But in global competition, what
matters is not the comparative advantage of our ability so
much as the comparative disadvantage of our living standard.
To really level the playing field in trade would require
lowering our living standard, which is not going to happen.
We value our clean air and water, our safe factories and
machinery, and our rights and benefits. Both Republicans
and Democrats overwhelmingly support this living standard
and many are prepared to raise its. The only course
possible, then, is to protect the standard.
To talk in these terms raises cries of ``protectionism.''
But the business of government is protection. The oath of the
public servant is ``to preserve, protect and defend.'' We
have the Army to protect us from enemies without and the FBI
to protect us from enemies within. We have Medicare and
Medicaid to protect us from ill health, and Social Security
to protect us from poverty in old age. We have the Securities
and Exchange Commission to protect us from stock fraud;
banking laws to protect us from usurpers; truth in lending
laws to protect us from charlatans.
When it comes to trade, however, multinational corporations
contend that we do not need to protect, but to educate and to
improve skills; productivity is the problem, they say. But
the United States is the most productive industrial nation in
the world, with skills galore. BMW is producing better-
quality cars in South Carolina than in Munich. There are
other obstacles that need addressing. For 50 years we have
tried to penetrate the Japanese market, but have barely done
so. To sell textiles in Korea, U.S. firms must first obtain
permission from the private Korean textile industry. If you
want to sell in China, it's a lot easier if you produce in
China.
``But we will start a trade war,'' is the cry. Wake up! We
have been in a trade for more than 200 years. And it's the
United States that started it! Just after the colonies won
their freedom, the mother country suggested that the United
States trade what we produced best and, in exchange, Britain
would trade back with what it produced best--as economist
David Ricardo later described in this theory of ``comparative
advantage.'' Alexander Hamilton, in his famous ``Report on
Manufactures,'' told the Brits, in so many words, to bug off.
He said, we are not going to remain your colony shipping you
our natural resources--rice, cotton, indigo, timber, iron
or--and importing your manufactured products. We are going to
build our own manufacturing capacity.
The second bill ever adopted by Congress, on July 4, 1789,
was a 50 percent tariff on numerous articles. This policy of
protectionism, endorsed by James Madison and Thomas
Jefferson, continued under President Lincoln when he launched
America's steel industry by refusing to import from England
the steel for the Transcontinental Railroad. President
Franklin Roosevelt protected agriculture, President
Eisenhower protected oil and President Kennedy protected
textiles. This economic and industrial giant, the United
States, was built on protectionism and, for more than a
century, financed it with tariffs. And it worked.
The Washington mantra of ``retrain, retrain'' comes up
short. For example, Oneita Industries closed its T-shirt
plant in Andrews, SC, back in 1999. The plant had 487
employees averaging 47 years of age. Let's assume they were
``retrained'' and became 487 skilled computer operators. Who
is going to hire a 47-year-old operator over a 21-year-old
operator? No one is going to take on the retirement and
health costs of the 47-year-old. Moreover, that computer job
probably just left for Bangalore, India.
In global competition there is a clash between standards of
living. I supported free trade with Canada because we have
relatively the same standard of living. But I opposed free
trade with Mexico, and therefore voted against the North
American Free Trade Agreement (NAFTA), preferring to raise
the standards in Mexico, as Europe did with Portugal, Spain
and Greece before admitting them to Europe's common market.
To be eligible for a tree trade agreement you should first
have a free market, labor rights, ownership of property,
contract rights of appeal and a respected judiciary. Mexico
lacked these, and after NAFTA there was an immediate flow of
jobs out of the United States because of Mexico's lesser
standards. Australia, on the other hand, has labor rights,
environmental rights and an open market, so the trade
agreement reached with Australia this month should be
approved.
We must engage in competitive trade. To eliminate a
barrier, raise a barrier. Then eliminate them both.
Our trouble is that we have treated trade as aid. After
World War II, we were the only country with industry, and in
order to prosper we needed to spread prosperity. Through the
Marshall Plan, we sent money, equipment and expertise to
Europe and the Pacific Rim. And it worked. Capitalism
defeated communism in the Cold War. Our hope in crying ``free
trade'' was that markets would remain open for our exports.
But our cries went unheeded, and now our Nation's security is
in jeopardy.
National security is like a three-legged stool. The first
leg--values--is solid. Our stand for freedom and democracy is
respected around the world. The second leg of military
strength is unquestioned. But the third leg, economic leg, is
fractured and needs repair. We are losing jobs faster than we
can create them. Some time ago the late Akio Morita, founder
of Sony Corp., was lecturing leaders of third-world
countries, admonishing them to develop their manufacturing
capacity to become nation states. Then, pointing at me in the
audience, he stated, ``That world power that loses its
manufacturing capacity will cease to be a world power.''
[[Page S3189]]
What should we do? First, we need to stop financing the
elimination of jobs. Tax benefits for offshore production
must end. Royalty deductions allowed for offshore activities
must be eliminated, and tax havens for corporations must be
closed down.
Next, we need an assistant attorney general to enforce our
trade laws and agreements. At present, enforcement is largely
left to an injured party. It can take years to jump over
legal hurdles. Then at the end, based on national security,
the president can refuse to implement a court order. Rather
than waste time and money, corporate America has moved
offshore.
We need to organize government to produce and protect jobs,
rather than export them. The Commerce Department recently co-
sponsored a New York seminar, part of which advised companies
on how to move jobs offshore. This aid for exporting jobs
must stop. The Department of Commerce should be reconstituted
as a Department of Trade and Commerce, with the secretary as
czar over the U.S. trade representative. The department's
International Trade Administration should determine not only
whether goods have been dumped on the U.S. market, but how
big the ``injury'' is to U.S. industry. The International
Trade Commission should be eliminated.
While it is illegal to sell foreign-made goods below cost
in the U.S. market (a practice called dumping), we refuse to
enforce such violations. The Treasury Department reports $2
billion worth of illegal transshipments of textiles into the
United States each year. Customs agents charged with drug
enforcement and homeland security are hard-pressed to stop
these transshipments. We need at lead at 1,000 additional
Customs agents.
It won't be easy. A culture of free trade has developed.
The big banks that make most of their money outside the
country, as well as the Business Roundtable, the Conference
Board, the National Association of Manufacturers, the U.S.
Chamber of Commerce, the National Retail Federation (whose
members make bigger profits on imported articles) and the
editorial writers of newspapers that make most of their
profits from retail ads--all these descend on Washington
promoting ``free trade'' to members of Congress. Members
looking for contributions shout the loudest.
Not just jobs, but also the middle class and the strength
of our very democracy are in jeopardy. As Lincoln said, ``The
dogmas of the quiet past, are inadequate to the stormy
present. . . . As our case is new, so we must think anew, and
act anew. We must disenthrall ourselves, and then we shall
save our country.''
Today's dogma is the belief that protectionism will mean
trade war and economic stagnation. But we are already in a
trade war, one from which the president and the Congress are
AWOL.
______
By Mr. LEAHY (for himself and Mr. Hatch):
S. 2237. A bill to amend chapter 5 of title 17, United States Code,
to authorize civil copyright enforcement by the Attorney General, and
for other purposes; to the Committee on the Judiciary.
Mr. LEAHY. Mr. President, the advent of the digital age promises the
efficient distribution of music, films, books, and software on the
Internet, and an easily-accessed, unprecedented variety of content
online. Unfortunately, to see this promise realized, we must overcome
some of the challenges presented by digital content distribution. Today
I am pleased that Senator Hatch is joining me in sponsoring the
``Protecting Intellectual Rights Against Theft and Expropriation
(PIRATE) Act of 2004,'' which will respond to one such challenge. It
will bring the resources and expertise of the United States Attorneys'
Offices to bear on wholesale copyright infringers.
The very ease of duplication and distribution that is the hallmark of
digital content has meant that piracy of that content is just as easy.
The very real--and often realized--threat that creative works will
simply be duplicated and distributed freely online has restricted,
rather than enhanced, the amount and variety of creative works one can
receive over the Internet. Part of combating piracy includes offering a
legal alternative to it. Another important part is enforcing the rights
of copyright owners. Senator Hatch and I have been working with
artists, authors, and software developers to create an environment in
which copyright is protected, so that we can all enjoy American
creativity, and so that copyright owners can be paid for their work.
For too long, Federal prosecutors have been hindered in their pursuit
of pirates, by the fact that they were limited to bringing criminal
charges with high burdens of proof. In the world of copyright, a
criminal charge is unusually difficult to prove because the defendant
must have known that his conduct was illegal and he must have willfully
engaged in the conduct anyway. For this reason prosecutors can rarely
justify bringing criminal charges, and copyright owners have been left
alone to fend for themselves, defending their rights only where they
can afford to do so. In a world in which a computer and an Internet
connection are all the tools you need to engage in massive piracy, this
is an intolerable predicament.
Some steps have already been taken. The Allen-Leahy Amendment to the
Foreign Operations Appropriations Bill, on Combating Piracy of U.S.
Intellectual Property in Foreign Countries, provided $2.5 million for
the Department of State to assist foreign countries in combating piracy
of U.S. copyright works. By providing equipment and training to law
enforcement officers, it will help those countries that are not members
of OECD (Organization for Economic Cooperation & Development) to
enforce intellectual property protections.
The PIRATE Act will give the Attorney General civil enforcement
authority for copyright infringement. It also calls on the Justice
Department to initiate training and pilot programs to ensure that
Federal prosecutors across the country are aware of the many difficult
technical and strategic problems posed by enforcing copyright law in
the digital age.
This new authority does not supplant either the criminal provisions
of the Copyright Act, or the remedies available to the copyright owner
in a private suit. Rather, it allows the government to bring its
resources to bear on this immense problem, and to ensure that more
creative works are made available online, that those works are more
affordable, and that the people who work to bring them to us are paid
for their efforts.
The challenges presented by digital content are multifaceted, and no
single response will resolve all of them. We must, and we will, offer a
broad array of solutions that taken together will help ensure the
protection of intellectual property, encourage the deployment of
digital content, and allow technology to develop unimpeded. This bill
is just one step in this process. I am working with colleagues, members
of the private sector, and officials from the Executive Branch, to
craft careful and effective responses to other such challenges in the
intellectual property arenas.
I hope that my colleagues support the ``Protecting Intellectual
Rights Against Theft and Expropriation (PIRATE) Act of 2004,'' and I
ask unanimous consent that the text of this bill be printed in the
Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 2237
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 ``Protecting Intellectual
Rights Against Theft and Expropriation Act of 2004''.
SEC. 2. AUTHORIZATION OF CIVIL COPYRIGHT ENFORCEMENT BY
ATTORNEY GENERAL.
(a) In General.--Chapter 5 of title 17, United States Code,
is amended by inserting after section 506 the following:
``Sec. 506a. Civil penalties for violations of section 506
``(a) In General.--The Attorney General may commence a
civil action in the appropriate United States district court
against any person who engages in conduct constituting an
offense under section 506. Upon proof of such conduct by a
preponderance of the evidence, such person shall be subject
to a civil penalty under section 504 which shall be in an
amount equal to the amount which would be awarded under
section 3663(a)(1)(B) of title 18 and restitution to the
copyright owner aggrieved by the conduct.
``(b) Other Remedies.--
``(1) In general.--Imposition of a civil penalty under this
section does not preclude any other criminal or civil
statutory, injunctive, common law or administrative remedy,
which is available by law to the United States or any other
person;
``(2) Offset.--Any restitution received by a copyright
owner as a result of a civil action brought under this
section shall be offset against any award of damages in a
subsequent copyright infringement civil action by that
copyright owner for the conduct that gave rise to the civil
action brought under this section.''.
(b) Damages and Profits.--Section 504 of title 17, United
States Code, is amended--
(1) in subsection (b)--
(A) in the first sentence--
(i) by inserting ``, or the Attorney General in a civil
action,'' after ``The copyright owner''; and
[[Page S3190]]
(ii) by striking ``him or her'' and inserting ``the
copyright owner''; and
(B) in the second sentence by inserting ``, or the Attorney
General in a civil action,'' after ``the copyright owner'';
and
(2) in subsection (c)--
(A) in paragraph (1), by inserting ``, or the Attorney
General in a civil action,'' after ``the copyright owner'';
and
(B) in paragraph (2), by inserting ``, or the Attorney
General in a civil action,'' after ``the copyright owner''.
(c) Technical and Conforming Amendment.--The table of
sections for chapter 5 of title 17, United States Code, is
amended by inserting after the item relating to section 506
the following:
``506a. Civil penalties for violation of section 506.''.
SEC. 3. AUTHORIZATION OF FUNDING FOR TRAINING AND PILOT
PROGRAM.
(a) Training and Pilot Program.--Not later than 180 days
after enactment of this Act, the Attorney General shall
develop a program to ensure effective implementation and use
of the authority for civil enforcement of the copyright laws
by--
(1) establishing training programs, including practical
training and written materials, for qualified personnel from
the Department of Justice and United States Attorneys Offices
to educate and inform such personnel about--
(A) resource information on intellectual property and the
legal framework established both to protect and encourage
creative works as well as legitimate uses of information and
rights under the first amendment of the United States
Constitution;
(B) the technological challenges to protecting digital
copyrighted works from online piracy;
(C) guidance on and support for bringing copyright
enforcement actions against persons engaging in infringing
conduct, including model charging documents and related
litigation materials;
(D) strategic issues in copyright enforcement actions,
including whether to proceed in a criminal or a civil action;
(E) how to employ and leverage the expertise of technical
experts in computer forensics;
(F) the collection and preservation of electronic data in a
forensically sound manner for use in court proceedings;
(G) the role of the victim copyright owner in providing
relevant information for enforcement actions and in the
computation of damages; and
(H) the appropriate use of injunctions, impoundment,
forfeiture, and related authorities in copyright law;
(2) designating personnel from at least 4 United States
Attorneys Offices to participate in a pilot program designed
to implement the civil enforcement authority of the Attorney
General under section 506a of title 17, United States Code,
as added by this Act; and
(3) reporting to Congress annually on--
(A) the use of the civil enforcement authority of the
Attorney General under section 506a of title 17, United
States Code, as added by this Act; and
(B) the progress made in implementing the training and
pilot programs described under paragraphs (1) and (2) of this
subsection.
(b) Annual Report.--The report under subsection (a)(3) may
be included in the annual performance report of the
Department of Justice and shall include--
(1) with respect to civil actions filed under section 506a
of title 17, United States Code, as added by this Act--
(A) the number of investigative matters received by the
Department of Justice and United States Attorneys Offices;
(B) the number of defendants involved in those matters;
(C) the number of civil actions filed and the number of
defendants involved;
(D) the number of civil actions resolved or terminated;
(E) the number of defendants involved in those civil
actions;
(F) the disposition of those civil actions, including
whether the civil actions were settled, dismissed, or
resolved after a trial;
(G) the dollar value of any civil penalty imposed and the
amount remitted to any copyright owner; and
(H) other information that the Attorney General may
consider relevant to inform Congress on the effective use of
the civil enforcement authority;
(2) a description of the training program and the number of
personnel who participated in the program; and
(3) the locations of the United States Attorneys Offices
designated to participate in the pilot program.
(c) Authorization of Appropriations.--There are authorized
to be appropriated $2,000,000 for fiscal year 2005 to carry
out this section.
Mr. HATCH. Mr. President, I rise to join Senator Leahy in sponsoring
the Protecting Intellectual Rights Against Theft and Expropriation
Act--the ``PIRATE Act''--a measure that will provide the Department of
Justice with tools to combat the rampant copyright piracy facilitated
by peer-to-peer filesharing software.
Let me underscore at the outset that our bill does not expand the
scope of the existing powers of the Department of Justice to prosecute
persons who infringe copyrights. Instead, our proposal will assist the
Department in exercising existing enforcement powers through a civil
enforcement mechanism. After considerable study, we have concluded that
this is the most appropriate mechanism.
Peer-to-peer file sharing software has created a dilemma for law-
enforcement agencies. Millions of otherwise law-abiding American
citizens are using this software to create and redistribute infringing
copies of popular music, movies, computer games and software.
Some who copy these works do not fully understand the illegality, or
perhaps the serious consequences, of their infringing activities. This
group of filesharers should not be the focus of federal law-enforcement
efforts. Quite frankly, the distributors of most filesharing software
have failed to adequately educate the children and young people who use
their software about its legal and illegal uses.
A second group of filesharers consists of those who copy and
redistribute copyrighted works even though they do know that doing so
violates federal law. In many cases, these are college students or
young people who think that they will not get caught. Many of these
filesharers are engaging in acts that could now subject them to federal
criminal prosecution for copyright piracy.
It is critical that we bring the moral force of the government to
bear against those who knowingly violate the federal copyrights
enshrined in our Constitution. But many of us remain concerned that
using criminal law enforcement remedies to act against these infringers
could have an overly-harsh effect, perhaps, for example, putting
thousands of otherwise law-abiding teenagers and college students in
jail and branding them with the lifelong stigma of a felony criminal
conviction.
The bill I join Senator Leahy in sponsoring today will allow the
Department of Justice to supplement its existing criminal-enforcement
powers through the new civil-enforcement mechanism. As a result, the
Department will be able to impose stiff penalties for violating
copyrights, but can avoid criminal action when warranted.
In advancing this measure, I must note that I view this civil-
enforcement authority as another tool, hopefully a transitional tool at
that. In the long run, I believe that we must find better mechanisms to
ensure that our most vulnerable citizens--our children--are not being
constantly tempted to infringe the copyrights that have made America a
world leader in the production of creative works.
Only recently has America faced the specter of widespread copyright-
enforcement actions against individual users of copyrighted works. For
nearly 200 years, copyright enforcement was rarely directed against the
millions of ordinary American citizens who use and enjoy copyrighted
works. Instead, creators and distributors of copyrighted content worked
together to negotiate the complex licensing agreements and
technological protections needed to distribute copyrighted works in
ways that accommodated both the expectations of users and the
copyrights of artists.
But recently, some unscrupulous corporations may have exploited new
technologies and discovered that the narrow scope of civil contributory
liability for copyright infringement can be utilized so that ordinary
consumers and children become, in effect, ``human shields'' against
copyright owners and law enforcement agencies. Unscrupulous
corporations could distribute to children and students a ``piracy
machine'' designed to tempt them to engage in copyright piracy or
pornography distribution.
Unfortuantely, piracy and pornography could then become the
cornerstones of a ``business model.'' At first, children and students
would be tempted to infringe copyrights or redistribute pornography.
Their illicit activities then generate huge advertising revenues for
the architects of piracy. Those children and students then become
``human shields'' against enforcement efforts that would disrupt the
flow of those revenues. Later, large user-bases and the threat of more
piracy would become levers to force American artists to enter licensing
agreements in which they pay the architects of piracy to distribute and
protect their works on the Internet.
Federal enforcement action is surely warranted if such ``business
models''
[[Page S3191]]
are driving the increasing ease of piracy on peer-to-peer filesharing
networks. Such business models exploit children, cheat artists, and
threaten the future development of commerce on the Internet.
Indeed, our government recognizes that its enforcement powers are
appropriate when protecting intellectual property and public safety.
Recently, in a speech to the United States Chamber of Commerce, Deputy
Attorney General James B. Comey, Jr. asserted that the Department of
Justice should assist private enforcement of intellectual property
rights if any of three criteria are met: (1) the level of piracy
becomes particularly egregious; (2) public health and safety are put at
risk; or (3) private civil remedies fail to adequately deter illegal
conduct.
In the case of peer-to-peer filesharing, all three criteria may be
met. The level of piracy on these networks is not merely egregious, it
is unprecedented. Public health and safety are also directly threatened
by business models that tempt children toward piracy and pornography
and then use them as ``human shields'' against law enforcement.
Finally, the recording industry and other affected rights holders
have tried--so far largely unsuccessfully--to use civil remedies to
halt the operations of those who would profit by turning teenagers and
college students into copyright pirates or pornography distributors.
As a result, our creative industries' only remaining option to deter
piracy is to bring enough civil enforcement actions against users of
filesharing software. Tens of thousands of continuing civil enforcement
actions might be needed to generate the necessary deterrence. I doubt
that any nongovernmental organization has the resources or moral
authority to pursue such a campaign.
If enforcement actions against end-users were really the best or only
way to enforce copyrights on the Internet, then civil enforcement
authority would be necessary. But there may be other ways to combat
this piracy at the root, not at the branch. I thus invite the
Department of Justice and other federal law enforcement agencies to
work with me, Senator Leahy and other members of the Judiciary
Committee to determine how the enforcement powers of the federal
government can best be deployed to solve the problems arising from
piracy and pornography on peer-to-peer filesharing networks.
I also understand that others may be developing proposals to increase
criminal enforcement authority against piracy, and I hope to work with
them on such proposals. Today, I stand with Senator Leahy to buttress
the enforcement of copyrights by enabling the Department of Justice to
proceed with a robust program of civil enforcement.
For the reasons I have just delineated, I urge my colleagues to join
us in supporting the Protecting Intellectual Rights Against Theft and
Expropriation Act.
______
By Mrs. BOXER:
S. 2240. A bill to improve seaport security; to the Committee on
Commerce, Science, and Transportation.
Mrs. BOXER. Mr. President, at the end of 2002, the Maritime
Transportation Security Act became law.
I was a member of the conference committee on that bill, and I think
it was a good first step in improving security at our nation's ports.
It had many good provisions, such as the creation of national and
regional maritime transportation/port security plans to be approved by
the Coast Guard; better coordination of federal, state, local, and
private enforcement agencies; and the establishment of a grant program
for port authorities, waterfront facilities operators, and state and
local agencies to provide security infrastructure improvements.
The problem was that the bill had no guaranteed funding mechanism. As
a result, we are underfunding port security. Since the passage of the
Maritime Transportation Security Act, the Department of Homeland
Security has released $517 million in port security grants. This is not
enough. According to the Coast Guard, it is estimated that the ports
directly need $1.4 billion this year and $6 billion over the next ten
years. Yet, the Administration only requested $46 million in its fiscal
year 2005 budget.
Last year, I visited many of California's ports including Crescent
City in the north down through Stockton to Los Angeles/Long Beach in
the south. I have seen what the ports are confronting. They need more
funding for homeland security.
And, with over 40 percent of the nation's goods imported through
California's ports, freight rail is extremely important to the nation's
commerce. A terrorist attack at a California port would not only be
tragic but would be devastating for our nation's economy.
So, today, I am introducing the Senate version of a bill introduced
by Representative Millender-McDonald. This legislation will provide
more funding to the ports. Specifically, it will: create a Port
Security Grant Program in the Department of Homeland Security; provide
$800 million per year for five years in grant funding; and--this is
very important to California's ports--allow the federal government to
make multiyear grants to help finance larger projects similar to what
is done with many of our airports for aviation security.
I hope that the Senate will act on this bill. Now is not the time to
slow down or delay our efforts to increase and improve transportation
security. The job is not done, and it must be done.
____________________