[Congressional Record Volume 150, Number 42 (Tuesday, March 30, 2004)]
[Senate]
[Pages S3321-S3323]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
JOBS
Mr. ENSIGN. Mr. President, I rise to talk about jobs in the United
States and something that is happening to our country. We have very
complex international tax laws. To go into them, people's eyes would
glaze over in complete boredom. Suffice it to say, because of the
complexities, we have tried over the years to get U.S. companies on a
more level playing field.
In the past year, the international bodies that have jurisdiction
have ruled against the United States versus the European Union
regarding the way we treat U.S. companies doing business outside of the
United States. Therefore, because we have not fixed our laws, they have
decided to put a 5-percent tariff on many of our manufactured goods.
Starting this month and for every month thereafter, that 5-percent
tariff will be raised by 1 percent. As a matter of fact, by this time
next year it will be up to 17 percent, which puts American
manufacturers at a tremendous global disadvantage when compared to the
European Union.
If Members care about manufacturing jobs in this country, it is
important this body bring back the JOBS bill that we had before us in
the Senate last week that was filibustered and get it passed.
The other side keeps talking about, manufacturing jobs and exporting
jobs and outsourcing. If people really care about manufacturing jobs in
this country, we will bring the JOBS bill back up to the floor and get
it voted on and get it worked out between the House and the Senate and
get it down to the President so he can sign it into law so we can start
giving more help and more relief to manufacturing jobs in this country.
Let me read a quote from the Washington Post of last week, quoting a
Democrat tax aide saying:
There's not a lot of incentive for us to figure out this
[FSC-ETI] problem.
That is the problem I just talked about with the international tax
laws with our country and the tariffs.
The Democrat aide went on to say that ``allowing the ETI problem to
fester would yield increased sanctions that could benefit the Democrats
in November.''
Well, if this is true, this is an appalling statement. This debate
should be about policy, not petty politics.
So let's look at what is inside of this JOBS bill.
Not only would it end the $4 billion a year of tariffs against U.S.
exports--and, by the way, those exports include grain, timber, paper,
and manufactured goods. I realize, for some, this may be too
politically tempting to let pass by--but this bill, by ending those
tariffs, would put us on a more level playing field with European Union
companies.
The CBO says we have lost 3 million manufacturing jobs in the United
States since the year 2000. We have been losing gradually, since the
late 1970s, manufacturing jobs in the United States. That is part of
the entire global economy, but it is important that we at least allow
U.S. jobs to be on a level playing field.
The JOBS bill to which I referred, that was being filibustered,
provides $75 billion of tax relief to our manufacturing sector to
promote rehiring in U.S.-based manufacturing firms.
This JOBS bill gives a 3-percentage-point tax rate cut on all income
derived from manufacturing in the United States--it is not for
manufacturing offshore--and we start those cuts in this year. This
manufacturing rate cut applies to sole proprietors, partnerships,
farmers, individuals, family businesses, multinational corporations,
and even foreign companies that decide to set up operations within the
United States and provide jobs in the United States.
The bill also extends the R&D tax credit through the end of the year
2005. Now, the R&D tax credit is absolutely a jobs producer in the
United States. It is for doing research and development, which betters
our companies, which betters our economies, and creates high-paying
jobs in the United States.
The bill also extends, for 2 years, the tax provisions that expired
in 2003 and in 2004, such as the work opportunity tax credit and the
welfare-to-work tax credits--obviously, important pieces of
legislation.
The bill also provides incentives for newly constructed rural
investment buildings, for starting or expanding a rural business in
rural high-outmigration counties.
The JOBS bill includes brownfields revitalization. Those are inner-
city areas. Because of environmental concerns, frankly, many inner
cities have dying areas because companies cannot go in. Because of the
environmental liability of what somebody dumped there before, they
cannot go in and create jobs in the inner cities. That is why it is
important we get this part of the bill done.
I also want to now talk about what I think is probably the most
important part of the tax bill, and it is called the Invest in the USA
Act, a bill that I have sponsored with Senator Barbara Boxer of
California.
This bill would allow U.S. companies that have invested abroad--they
have a little over $600 billion invested that they have made money on
and they have sitting in their bank accounts overseas. If they bring
that money back to the United States, they will pay up to a 35-percent
tax on it. There is not a lot of incentive for them to bring the money
back. Other countries do not treat their companies that way, so they
are able to actually bring the money back to their countries to create
jobs in their countries.
This past weekend, Senator Kerry talked about that issue. He now
supports the idea of giving a tax break for the money coming back into
this country. Last year, we had a vote on our bill, and all 50
Republican Senators and 25 Democratic Senators agreed it was time to
bring this money home at a very low tax rate--a 5.25-percent tax rate.
Senator Kerry has now embraced the idea of bringing it home, but he
wants it taxed at 10 percent. The problem with taxing it at 10 percent
is, because of the low cost of borrowing money today, it would actually
be cheaper for the companies to borrow money in the United States than
to pay the 10-percent tax and bring these funds home. So Senator Kerry
recognizes it is a good thing to bring the money home. Unfortunately,
the fix that he has will not bring the money home.
The bill that Senator Boxer and I have proposed, that received 75
votes on the Senate floor, and now is part of the big JOBS tax bill,
does bring the money home. Estimates are that it will bring at least
$400 billion to the United States. That is a lot of money. As a matter
of fact, that is more money than was raised in all of the initial
public stock offerings from 1996 to 2002. That is a huge stimulus to
our economy. That will produce a lot of good-paying U.S. jobs that we
so desperately need right now.
The economy is growing. GDP is up. There are increases in
productivity. We are obviously doing well with home sales. Where we are
not doing as well as we would like is in the area of new job creation.
There are a lot of new self-employed jobs that are being created, but
on the payroll survey many of those jobs are not being reported.
This bill--for those who want to increase and extend the temporary
unemployment insurance benefits, for those who want to do all kinds of
Government programs--will make those types of provisions unnecessary.
So if the Democrats in the Senate want to do something about jobs for
this country, they will quit trying to put all kinds of extraneous
provisions onto the bill, and we will get a jobs bill done this year.
Mr. President, I yield the floor.
Mr. KENNEDY. Will the Senator yield?
Mr. ENSIGN. My time has expired.
The PRESIDING OFFICER. The Senator's time has expired.
Under the previous order, the Senator from Missouri is recognized.
Mr. BOND. Mr. President, I thank the Chair, and I thank my colleague.
I thank my colleague from Nevada, particularly, for talking about the
importance of the FSC/ETI bill because today jobs are a critical need
in our country.
Yes, we see signs that the economy is recovering, but we are not
seeing the growth in jobs. Now the unemployment rate is down to 5.6
percent. Obviously, we all would like to see it lower. There are a
number of steps that we can take, and I think passing a good highway
bill is one such step.
[[Page S3322]]
There are a number of steps that would be very harmful if we took
them. I think, as we talk about jobs and the very volatile subject of
insourcing and outsourcing, we need to understand what this is all
about.
I was interested this weekend when I read an old story that
apparently had been in the papers in Missouri for some time, but it was
rerun in my hometown paper. When Missourians call a toll-free number
about their food stamps or welfare benefits, the response comes from
India. The State of Missouri has contracted with a call center
operator. It is about a $6 million annual contract, which I guess was
the best contract at the time that Missouri could get. They signed the
contract, and now those jobs have been outsourced to India.
This is something we hear a lot about. People are complaining about
outsourcing. A very interesting figure was in the Wall Street Journal
maybe 10 days or so ago which talked about both sides: jobs going
overseas and jobs coming back. And they came up with the startling
figure that--I think it was for 2003--there was $74 billion worth of
outsourcing.
The United States spent $74 billion outsourcing to other countries,
but at the same time insourcing came to $131 billion, so that is a $54
billion net increase in investment in jobs in this country.
We have done a little work and found out there are about 105,000
Missourians who have jobs with foreign companies in the State. I met
with the officials from the fine Webster University in St. Louis. They
have done some outsourcing. They have three campuses in China that
provide long-distance learning to people throughout Southeast Asia. I
can't tell you how many people, as I have made trips overseas to
promote export of Missouri products and services, have told me they are
getting their degree from Webster University.
The question of outsourcing and insourcing has two sides. It is
absolutely important to not do any harm to jobs that are coming into
this country. But most importantly, we must make sure we don't do
anything in Government that forces jobs out of this country. The FSC/
ETI bill is vitally needed. We need to pass it. We need to get
conferees appointed on the Workforce Investment Act. We need to train
people so they will have the jobs.
I also focused this week on a battle we had on the energy bill. Carl
Levin and I were successful in getting bipartisan support for the Bond-
Levin amendment which imposed reasonable standards for increasing fuel
economy in autos, vans, and light trucks. We were fighting against
something that, as you look at it, would possibly have led to a
significant decline in U.S. jobs. The Kerry-McCain amendment would have
significantly increased CAFE standards, and this could have penalized
full-line manufacturers. Those manufacturers--Ford, Daimler-Chrysler,
General Motors--have plants in Claycomo, Hazelwood, Fenton, Wentzville,
MO, where working families have good jobs in the auto industry that
were put at risk.
I was very interested to go back to my files and find some letters
from the UAW. In one, dated February 26, 2002, President Steve Yokich
wrote urging support for the Bond-Levin proposal, saying the Hollings-
Kerry proposal discriminates against the big three auto companies. On
the second page, it says:
The UAW continues to support improvements in CAFE that are
economically and technologically feasible, and are structured
in a manner that is fair and even-handed towards all
companies. But we strongly oppose changes such as the
Hollings-Kerry proposal that call for increases that are
excessive and are structured in a manner that would
discriminate against the Big Three automakers or facilitate
the outsourcing of small car production to other countries.
Such proposals would result in serious job losses for
thousands of UAW members and other automotive workers.
We have to be careful as we look at regulatory efforts that might
drive jobs out of the country.
Alan Reuther wrote on March 13, 2002, saying the Kerry-McCain
amendment would mandate an excessive discriminatory increase in fuel
standards that would directly threaten thousands of jobs for UAW
members and other automotive workers in the country and would enable
the big three auto companies to outsource their small car production to
other countries, resulting in the loss of additional jobs.
I ask unanimous consent that these letters be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
UAW,
Washington, DC, February 26, 2002.
Dear Senators: This week the Senate is expected to take up
energy legislation covering a wide range of issues. The UAW
strongly opposes the proposed changes in the Corporate
Average Fuel Economy (CAFE) program which have been put forth
by Senators Hollings and Kerry. We urge you to oppose this
proposal, and to support the substitute CAFE proposal that
will be offered by Senators Levin and Bond.
The Hollings-Kerry CAFE proposal would raise fuel economy
standards for both cars and light trucks to 35 miles per
gallon by model year 2013. The UAW opposes Hollings-Kerry
CAFE proposal for three reasons:
(1) The Hollings-Kerry proposal increases CAFE standards
much too high and too quickly. The magnitude of the proposed
increase exceeds even the most optimistic scenarios projected
by the National Academy of Sciences (NAS), and the proposed
timeframe for vehicles to meet that increase is substantially
less than the NAS projection. Under the Hollings-Kerry
proposal, light truck fuel economy would have to jump almost
70 percent to meet a 35 mph standard--one-and-a-half times
higher than even the most ``optimistic'' NAS projections.
Significantly, the cautious NAS projections only indicate an
average fuel economy increase of about 25 percent for light
trucks and 10 percent for cars by model years 2014 to 2019,
far below and later than what would be required under the
excessive Hollings-Kerry proposal. In addition, the increase
proposed by Hollings-Kerry would be made even more extreme by
their other proposals that would tighten testing requirements
and change the definition of light trucks to include vehicles
up to 10,000 lbs.
(2) The Hollings-Kerry proposal discriminates against the
Big Three auto companies. The Hollings-Kerry proposal applies
a flat miles per gallon increase to current CAFE standards
and also requires the standard for light trucks to be
harmonized upward to the substantially higher level
established for passenger cars. This approach would impose a
much heavier burden on the Big Three auto companies compared
to other automakers because the Big Three's product mix is
much more oriented towards larger cars and light trucks.
Under the Hollings-Kerry proposal, the Big Three would have
to increase their fuel economy by 40-50 percent compared to
less than a 15 percent increase for Honda. The net result is
the Big Three could be forced to curtail production of larger
vehicles, resulting in serious job loss for UAW members and
other workers.
(3) The Hollings-Kerry proposal would undermine continued
full-line domestic vehicle production by making it easier to
outsource small car production to other countries. The
Hollings-Kerry proposal gives the National Highway Traffic
Safety Administration (NHTSA) discretion to eliminate the
distinction in the current CAFE program between domestic and
foreign car fleets. If this distinction were eliminated, the
Big Three auto companies would be able to outsource their
small car production to other countries. This is because they
would no longer be required to average the fuel economy of
more efficient, domestically built small cars with less
efficient larger cars produced here. In addition, by
establishing a CAFE credit-trading program, the Hollings-
Kerry proposal would also give the Big Three automakers the
``flexibility'' to outsource their small car production to
other countries. Taken together, these provisions could
result in the loss of thousands of additional automotive jobs
in this country.
The UAW continues to support improvements in CAFE that are
economically and technologically feasible, and are structured
in a manner that is fair and even-handed towards all
companies. But we strongly oppose changes such as the
Hollings-Kerry proposal that call for increases that are
excessive and are structured in a manner that would
discriminate against the Big Three automakers or facilitate
the outsourcing of small car production to other countries.
Such proposals would result in serious job loss for thousands
of UAW members and other automotive workers.
We understand that Senators Levin and Bond will offer a
substitute CAFE proposal that would require the Department of
Transportation to complete a rulemaking within 15 months to
increase fuel economy standards for both cars and light
trucks. This substitute directs DOT to consider a wide range
of factors, including technological and economic feasibility,
the costs and lead time required for the introduction of new
technologies, the disparate impacts on manufacturers due to
differences in product mix, and safety considerations. In
addition, this substitute would require DOT to continue the
existing distinction between foreign and domestic fleets. The
UAW believes the Levin-Bond proposal represents a more
balanced approach that would lead to significant improvements
in fuel economy without jeopardizing thousands of good paying
automotive jobs in this country. Accordingly, we strongly
urge you to vote for the Levin-Bond substitute and against
the Hollings-Kerry proposal.
[[Page S3323]]
The auto industry is already experiencing significant
economic difficulties, and the Big Three automakers have
announced widespread layoffs. In light of this background,
the UAW submits that this is not the time to impose onerous,
discriminatory fuel economy standards on the auto companies
that will only lead to further jobs loss, with potentially
adverse impacts on the overall economy.
Thank you for considering our views on this priority issue
that directly affects the jobs of thousands of UAW members
and other workers.
Sincerely,
Alan Reuther,
Legislative Director.
____
UAW,
Washington, DC,
March 13, 2002.
Dear Senator Bond: Today the Senate is scheduled to vote on
amendments dealing with the CAFE issue. The UAW strongly
urges you to vote for the Levin-Bond substitute and against
the Kerry-McCain amendment.
The Levin-Bond substitute would require the Dept. of
Transportation to issue new fuel economy standards on an
expedited basis, after taking into consideration a wide range
of factors, including employment, safety, technology,
economic practicability and the relative competitive impacts
on companies. The UAW supports this substitute because we
believe it will lead to a significant improvement in fuel
economy, without jeopardizing the jobs of American workers.
In contrast, the Kerry-McCain amendment would mandate an
excessive, discrimatory increase in fuel economy standard
that would directly threaten thousands of jobs for UAW
members and other automotive workers in this country. The 36
mpg fuel economy standard that would be required by Kerry-
McCain for both cars and trucks goes far beyond even the most
optimistic projections by the National Academy of Sciences.
In addition, the structure of the proposed fuel economy
increases--a flat mpg requirement for both cars and trucks--
would impose a much heavier burden on the Big Three
automakers and jeopardize production and jobs associated with
their large car and truck plants. Furthermore, by eliminating
the distinction between foreign and domestic car fleets, the
proposal would enable the Big Three auto companies to
outsource their small car production to other countries,
resulting in the loss of additional jobs.
The UAW believes it is critically important that any
increases in fuel economy standards be economically and
technologically feasible, and that they be structured in a
manner that does not jeopardize jobs in this country. To
accomplish this objective, we believe the Senate must approve
the Levin-Bond substitute, and reject the Kerry-McCain
amendment.
Thank you for considering our views on these two priority
votes.
Sincerely,
Alan Reuther,
Legislative Director.
Mr. BOND. The last time I spoke on this, I pointed out there were a
number of other things we have done that really do endanger jobs. I
mentioned the small engine proposal where, fortunately, we were able to
stop the California Air Resources Board from mandating the use of
catalytic converters on small engines for lawn mowers, leaf blowers,
and chainsaws that would have forced the closure of plants in the
United States that make those small engines and in all likelihood
outsourced 22,000 American jobs to China.
I also talked about asbestos litigation which has driven much of the
refractories business out of the United States because of the excessive
burden of the asbestos claims. We need to move on a good asbestos
reform bill to pay those who are truly sick and stop the jackpot
justice for plaintiffs' attorneys who seek to sue anybody who has had
anything to do with asbestos, whether plaintiffs are sick or not.
Finally, natural gas is a major source of outsourcing right now. Not
only does it hit homes that heat with natural gas with high bills; it
puts heavy costs on farmers who use fertilizer coming from natural gas.
The artificially inflated demand Congress has mandated and the
artificially constrained supply Congress has mandated have pushed the
cost of natural gas so high that many natural gas producing industries
have had to move their operations to other countries where the demand
is not artificially inflated and the supply is not curtailed.
We are outsourcing jobs because of our policy on natural gas. We have
forced natural gas use in electric generating boilers which is not an
effective use of that valuable commodity. We need a good energy bill.
We need to stop the filibusters and get an energy bill done. We need to
move forward on the asbestos litigation reform bill. We need to move
forward on the FSC/ETI bill. All of these are being filibustered or
stopped or delayed, and we need to get about it.
We need to get the Workforce Investment Act. We need to appoint
conferees so we can train these people. One of the great needs is for
more workers with scientific engineering and technological backgrounds
because those are the jobs of the future. We need to train them.
Senator Mikulski and I need money in the VA-HUD bill to increase the
National Science Foundation so they can develop more student interest
in basic science and get more minorities and women involved. We have a
lot of challenges to meet the changing needs of the job force in the
21st century. Rather than bloviating about one part of the problem, we
need to fix the entire problem.
I thank the Chair and yield the floor.
The PRESIDING OFFICER. Who yields time? The Senator from Pennsylvania
is recognized for 20 seconds.
____________________