[Congressional Record Volume 152, Number 116 (Monday, September 18, 2006)]
[Senate]
[Pages S9681-S9685]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. DOMENICI (for himself and Mr. Bingaman):
  S. 3907. A bill to direct the Secretary of the Interior to conduct a 
study of water resources in the State of New Mexico; to the Committee 
on Energy and Natural Resources.
  Mr. DOMENICI. Mr. President, above-average rainfall in New Mexico 
this summer has led many to turn a blind eye to the grim water 
situation faced by our State only 2 months ago. New Mexico was fast 
approaching a disaster due to drought. Many of our municipalities' 
wells were running dry and reservoirs were at dangerously low levels. 
Providence intervened; narrowly averting a crisis resulting from water 
scarcity.
  The development of the centrifugal pump was an event of great 
significance in the history of the West. Windmill driven pumps provided 
enough water for a family and several livestock. The centrifugal pump, 
on the other hand, was capable of pumping 800 gallons of water a 
minute, making possible the habitation of what was previously barren 
desert. To a large extent, this invention provided the water for 
growing towns and agricultural industry. However, it also resulted in a 
great dependence on groundwater. As such, we need to fully understand 
the nature and extent of our groundwater resources. This bill will 
provide us with the information necessary to ensure that the water on 
which we have come to rely is available for years to come.
  During times of drought, when surface water is scarce, we must be 
able to reliably turn to groundwater reserves. Approximately 90 percent 
of New Mexicans depend on groundwater for drinking water and 77 percent 
of New Mexicans obtain water exclusively from groundwater sources. 
While groundwater supplies throughout the State are coming under 
increasing competition, not enough is known about these resources in 
order to make sound decisions regarding their use.
  Nearly 40 percent of the State's population resides in the Middle Rio 
Grande Basin. Once thought to contain vast quantities of water, we are 
now faced with the reality the Middle Rio Grande Basin contains far 
less water than originally thought. Between 1995 and 2001, the United 
States Geological Survey undertook a study of the basin which added 
greatly to our knowledge regarding the primary source of water for our 
largest population center. Had we proceeded with our water planning 
without the information provided by this study, I have little doubt 
that we would ultimately find ourselves in a dire situation. However, 
there is much more to be learned about this basin.
  Roughly 65 percent of the State's population lives along the Rio 
Grande. Also located along the river are the four largest cities in New 
Mexico: Santa Fe, Albuquerque, Rio Rancho and Las Cruces. While the 
completion of the San Juan-Chama Diversion by the Albuquerque 
Bernalillo County Water Utility Authority will allow the county of 
Bernalillo and city of Albuquerque to take advantage of their 
allocation of San Juan-Chama water, the remainder of the cities and 
counties located along the Rio Grande will continue to receive the 
majority of their water from aquifers beneath the Rio Grande. Aside 
from the Middle Rio Grande Basin, we have limited knowledge of the 
amount of water contained in the aquifers below the Rio Grande, the 
rate at which they recharge, aquifer contamination, and the interaction 
between surface flows and ground water.
  Elsewhere in the State, even less is understood regarding groundwater 
resources. While there is limited unallocated surface water in the 
State, there are significant quantities of untapped underground water 
in the Tularosa and Salt Basins. The Tularosa Basin is approximately 60 
miles wide and 200 miles long. Making the conservative estimate that 10 
percent of the water contained in that aquifer is available for use 
through desalination, it would provide 100 years of water for a city 
the size of Albuquerque. With the development of desalination 
technology, I anticipate that even a greater amount of the brackish 
water contained in the Tularosa Basin will be available for human use.
  Another untapped water supply is the Salt Basin located in southern 
New Mexico. The basin lies in a geologically complex area and our 
understanding of the total resource is incomplete. However, initial 
estimates predict sustainable withdrawals on the order of 100,000 acre-
feet per year of potable water from the New Mexico portion of the 
aquifer. This is enough water to support a city the size of our largest 
municipal area. Additional brackish resources in that basin are highly 
likely. Because the basin is located near expanding metropolitan areas 
near the U.S.-Mexico Border, it is a resource of critical importance.
  The bill I introduce today would direct the United States Geological 
Survey, in collaboration with the State of New Mexico, to undertake a 
groundwater resources study in the State of New Mexico. A comprehensive 
study of the State's water resources is critical to effective water 
planning. Absent such a study, I fear that there is a significant 
likelihood that we may be depleting aquifers at an unsustainable rate.
  I thank Senator Bingaman for being an original co-sponsor of this 
legislation. I also thank Representative Heather Wilson for introducing 
companion legislation in the House of Representatives and I look 
forward to working with them to ensure the bill's passage.
  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. 3707

       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 ``New Mexico Aquifer 
     Assessment Act of 2006''.

     SEC. 2. NEW MEXICO WATER RESOURCES STUDY.

       (a) In General.--The Secretary of the Interior, acting 
     through the Director of the United States Geological Survey 
     (referred to in this Act as the ``Secretary''), in 
     coordination with the State of New Mexico (referred to in 
     this Act as the ``State'') and any other entities that the 
     Secretary determines to be appropriate (including other 
     Federal agencies and institutions of higher education),

[[Page S9682]]

     shall, in accordance with this Act and any other applicable 
     law, conduct a study of water resources in the State, 
     including--
       (1) a survey of groundwater resources, including an 
     analysis of--
       (A) aquifers in the State, including the quantity of water 
     in the aquifers;
       (B) the availability of groundwater resources for human 
     use;
       (C) the salinity of groundwater resources;
       (D) the potential of the groundwater resources to recharge;
       (E) the interaction between groundwater and surface water;
       (F) the susceptibility of the aquifers to contamination; 
     and
       (G) any other relevant criteria; and
       (2) a characterization of surface and bedrock geology, 
     including the effect of the geology on groundwater yield and 
     quality.
       (b) Study Areas.--The study carried out under subsection 
     (a) shall include the Estancia Basin, Salt Basin, Tularosa 
     Basin, Hueco Basin, and middle Rio Grande Basin in the State.
       (c) Report.--Not later than 2 years after the date of 
     enactment of this Act, the Secretary shall submit to the 
     Committee on Energy and Natural Resources of the Senate and 
     the Committee on Resources of the House of Representatives a 
     report that describes the results of the study.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this Act.
                                 ______
                                 
      By Mr. WYDEN (for himself and Mr. Bennett):
  S. 3908. A bill to amend the Internal Revenue Code of 1986 to provide 
a credit for fuel-efficient motor vehicles and to require major 
integrated oil companies to amortize intangible drilling and 
development costs; to the Committee on Finance.
  Mr. WYDEN. Mr. President, after years and years of congressional 
gridlock on the issue of automobile efficiency, I and Senator Bennett 
of Utah are today bringing to the Senate legislation that is market 
oriented, bipartisan, and a bill that we believe will bring millions 
and millions of fuel-efficient automobiles, cars, and trucks to the 
streets of our country.
  We put our Nation on the road to energy independence by rewarding 
drivers who buy more fuel-efficient cars, trucks, and SUVs. These 
rewards, under the legislation I have drafted with the distinguished 
Senator from Utah, Mr. Bennett, are available on a sliding scale. The 
more fuel-efficient the vehicle, the greater the reward that the 
consumer would receive.
  We also put the brakes on a needless subsidy to the major oil 
companies and use the savings that are derived from stopping that 
windfall to reward consumers in their wallets for helping to end our 
country's oil dependence. To his credit, the President of the United 
States has said: You don't need these incentives when oil is over $55 a 
barrel, as it is today.
  I asked the CEOs when the major oil companies came before a joint 
hearing--I see the distinguished Senator from Alaska in the chair. He 
will recall at our hearing, the joint Commerce and Energy hearing that 
was held, I asked the oil company executives of the major companies 
whether they needed the various tax breaks that were currently offered, 
and to a person, they said they did not.
  I see my good friend from Utah, and I thank him for his efforts to 
make this legislation bipartisan. What I will do, now that the Senator 
from Utah has arrived, is briefly describe how our bipartisan 
legislation works and why we think this will be a major transformation 
in terms of the cars, trucks, and SUVs on the roads of our country.
  Under our bipartisan, market-oriented bill, consumers who buy 
vehicles that are at least 25 percent more fuel efficient than the 
applicable standards, called CAFE, would get a rebate of at least $630 
and as much as $1,860 for the most fuel-efficient cars. We have 
separate standards for cars and trucks so the consumers can choose the 
type of vehicle they want and still get the rebate or the credit as 
long as they choose a fuel-efficient model.
  In the past, the automobile industry has said that fuel economy 
standards are hard to achieve because car buyers place little value on 
fuel economy. The new program created by our bill directly addresses 
that concern by providing rebates to consumers for purchasing fuel-
efficient vehicles.
  Many in the automobile industry have also said that car buyers don't 
fully appreciate the value of lifetime fuel savings at the time of 
purchase. I and Senator Bennett believe this will change that by 
providing the rebates or the credits through focusing consumer 
attention on fuel efficiency at the time of purchase.
  It will be possible for consumers at the time of purchase to see the 
type of notice I am holding as a sticker on the window of the 
automobile. So right at the time of purchase, because of this sticker--
I am holding a copy of it--it will be possible for purchasers to see 
the real value of fuel-efficient purchases in the automotive sector.
  For vehicles that qualify, the rebate or credit amount would be 
printed on the window sticker, as I have described, and the consumer 
could claim the rebate as a tax credit on his or her tax 
return. Alternatively, I and Senator Bennett conceived that the rebate 
could be transferred to automobile dealers, allowing dealers to provide 
the rebates to consumers as cash back at the time of purchase.

  In our view, the legislation also builds on the incentives that were 
provided in the Energy bill specifically for hybrid gasoline/electric-
powered cars. We believe the approach that we are advocating will be 
especially popular because it is simpler and fairer. For example, 
unlike the hybrid credit that is in the energy bill, there is no 
phaseout of the incentives we propose, based on when a hybrid carmaker 
sells its 60,000th car. Because our legislation eliminates the truly 
complicated phaseout of the credit that now exists, it is our view that 
consumers will not be confused as they are today about when they can 
get a credit and how much it will be. Also, unlike the approach taken 
in the energy legislation, our bipartisan bill does not pick winners 
and losers among competitive technology. It takes a technology-neutral 
approach that allows any vehicle that has superior fuel efficiency to 
qualify for a rebate, whether it uses hybrid or conventional 
technologies.
  I also want to emphasize why I think it is important that we take 
bolder action to jumpstart the markets for fuel-efficient vehicles. As 
I mentioned, there is a phaseout for the incentives today based on when 
a hybrid carmaker sells its 60,000th car. We have tried to get our arms 
around exactly how many of these alternative-fuel vehicles are going to 
be purchased this year. Many estimates seem to be just a bit over 
100,000. But compare those 100,000 hybrids to the 1.8 million vehicles 
that could be purchased with the kind of incentives that I and Senator 
Bennett are proposing. We are significantly increasing, through a 
marketplace approach, the chance to multiply many times over the number 
of fuel-efficient vehicles on the streets of our country. The 
distinguished Senator from Alaska who is in the chair has sat in on 
many of the debates with me on the Energy Committee where we have heard 
views expressed about what could be done through a regulatory approach. 
Those approaches have been fought to gridlock on the floor of the 
Senate.
  What I and Senator Bennett want to do is something very different. We 
want to use a marketplace approach to significantly jumpstart the 
market for these fuel-efficient vehicles over the next 5 years. Compare 
100,000 hybrid vehicles that are likely to be purchased this year to 
the 1.8 million vehicles that could be purchased for each of the next 5 
years under the legislation we are advocating and we get a sense of the 
difference in approach and why we think ours is very much needed and 
can make a break with the policies that have produced gridlock on the 
floor of the Senate.
  Finally, I would wrap up by saying that the legislation I and Senator 
Bennett are proposing is fully paid for. According to the Joint 
Committee on Taxation, our bill saves $6.8 billion by limiting just one 
of the tax breaks that the major oil companies have said they no longer 
need. It is known as the expensing of intangible drilling costs, which 
includes land acquisition costs, development costs, and the costs of 
leasing equipment. The Congressional Research Service has called this 
special break economically inefficient. I looked very carefully at it 
after the hearing attended by myself and the distinguished Senator from 
Alaska and others, when I asked the major oil executives if they needed 
all of the tax breaks that were currently allowed under the code. They 
said they did not. The President, to his credit, said the major oil 
companies do not need tax

[[Page S9683]]

breaks when the price of oil is over $55 a barrel.
  So according to the analysis done by the Joint Committee on Taxation, 
the savings derived by limiting one tax break for major oil companies 
more than covers the $1.3 billion-per-year cost of the marketplace-
oriented rebate and credit program.
  To finally sum up, I believe our legislation--we call it OILSAVE--is 
a winner for consumers, a winner for energy security, and a winner for 
taxpayers. It is a win for the consumer because it helps our Nation's 
energy security by the purchase of what could be millions of fuel-
efficient cars and trucks and SUVs. It helps us kick our Nation's oil 
dependence by stimulating the purchase of a number of greener vehicles 
at home and by limiting a tax break the Congressional Research Service 
calls economically inefficient. Finally, it is a win for our taxpayers 
because after the major oil company executives said that they didn't 
need this break, and the President indicated that with oil at these 
prices you didn't need incentives, it is possible for us now to 
jumpstart the marketplace for these vehicles without any additional 
costs to the taxpayers.
  So I hope my colleagues will reflect on the difference between this 
discussion and the ones we have had previously on the floor of the 
Senate. The decibel level got pretty high during those past debates. 
When Senator Bennett and I launched our discussion, it was a different 
kind of discussion. It was a discussion about how we can find common 
ground in the Senate, how we can be significantly bolder in the area of 
automobile efficiency. We have zeroed in on this area, an area I know 
has been of interest to the Presiding Officer over the years, because 
automobile efficiency is the ball game as it relates to the issue of 
energy security. That is where our oil is going.
  So I hope our colleagues will be interested in the legislation that 
we are bringing to the Senate today. The OILSAVE legislation is a 
departure from the polarized debates we have had in this body.
  I want to say, wrapping up, that I don't think I could have a better 
partner for this particular effort than the distinguished Senator from 
Utah. He is the chair, as our colleagues know, of the Joint Economic 
Committee. He has been interested in energy legislation as a member of 
the Republican leadership for quite some time. I would note that today 
is his birthday, and he has decided to use this special day, when his 
family is clamoring for his time, to be part of this bipartisan effort 
with me. I am very grateful for his involvement in this task, and I 
would like to yield the floor, if I might.
  I also see our distinguished friend from West Virginia here, and if 
it is acceptable, perhaps Senator Bennett could wrap up for our 
legislation, and then I know the entire Senate wishes to here the 
remarks of the distinguished senior Senator from West Virginia.
  I ask unanimous consent that the text of the OILSAVE bill introduced 
today be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 3908

       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 ``Oil Independence, Limiting 
     Subsidies, and Accelerating Vehicle Efficiency (OILSAVE) 
     Act''.

     SEC. 2. TAX CREDIT FOR FUEL-EFFICIENT MOTOR VEHICLES.

       (a) In General.--Subpart B of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 (relating to 
     other credits) is amended by inserting after section 30C the 
     following new section:

     ``SEC. 30D. FUEL-EFFICIENT MOTOR VEHICLE CREDIT.

       ``(a) Allowance of Credit.--There shall be allowed a credit 
     against the tax imposed by this chapter for the taxable year 
     an amount equal to the applicable amount for each new 
     qualified fuel-efficient motor vehicle placed in service by 
     the taxpayer during the taxable year.
       ``(b) New Qualified Fuel-Efficient Motor Vehicle.--For 
     purposes of this section, the term `new qualified fuel-
     efficient motor vehicle' means a motor vehicle (as defined 
     under section 30(c)(2))--
       ``(1) which is a passenger automobile or a light truck,
       ``(2) which--
       ``(A) in the case of a passenger automobile, achieves a 
     fuel economy of not less than 34.5 miles per gallon, and
       ``(B) in the case of a light truck, achieves a fuel economy 
     of not less than 27.5 miles per gallon,
       ``(3) the original use of which commences with the 
     taxpayer,
       ``(4) which is acquired for use or lease by the taxpayer 
     and not for resale, and
       ``(5) which is made by a manufacturer for model year 2007, 
     2008, 2009, 2010, or 2011.
       ``(c) Applicable Amount.--For purposes of this section, the 
     applicable amount shall be determined as follows:


------------------------------------------------------------------------
                                                In the case
                                                    of a     In the case
                                                 passenger    of a light
``If the motor vehicle achieves a fuel economy  automobile,   truck, the
                      of:                           the       applicable
                                                 applicable   amount is:
                                                 amount is:
------------------------------------------------------------------------
27.5 miles per gallon.........................           $0         $630
28.5..........................................            0          710
29.5..........................................            0          780
30.5..........................................            0          850
31.5..........................................            0          920
32.5..........................................            0          980
33.5..........................................            0        1,040
34.5..........................................          630        1.090
35.5..........................................          700        1,140
36.5..........................................          760        1,190
37.5..........................................          820        1,240
38.5..........................................          880        1,280
39.5..........................................          940        1,320
40.5..........................................          990        1,360
41.5..........................................        1,040        1,400
42.5..........................................        1,090        1,430
43.5..........................................        1.140        1,470
44.5..........................................        1,180        1,500
45.5..........................................        1,220        1,530
46.5..........................................        1,260        1,560
47.5..........................................        1,300        1,590
48.5..........................................        1,340        1,620
49.5..........................................        1,370        1,640
50.5..........................................        1,410        1,670
51.5..........................................        1,440        1,690
52.5..........................................        1,470        1,720
53.5..........................................        1,500        1,740
54.5..........................................        1,530        1,760
55.5..........................................        1,560        1,780
56.5..........................................        1,590        1,800
57.5..........................................        1,610        1,820
58.5..........................................        1,640        1,840
59.5 or more..................................        1,660        1,860
------------------------------------------------------------------------

       ``(d) Other Definitions and Special Rules.--For purposes of 
     this section--
       ``(1) Fuel economy.--The term `fuel economy' has the 
     meaning given such term under section 32901(a)(10) of title 
     49, United States Code.
       ``(2) Model year.--The term `model year' has the meaning 
     given such term under section 32901(a)(14) of such title.
       ``(3) Other terms.--The terms `passenger automobile', 
     `light truck', and `manufacturer' have the meaning given such 
     terms in regulations prescribed by the Administrator of the 
     Environmental Protection Agency for purposes of the 
     administration of title II of the Clean Air Act.
       ``(4) Reduction in basis.--For purposes of this subtitle, 
     the basis of any property for which a credit is allowable 
     under subsection (a) shall be reduced by the amount of such 
     credit so allowed.
       ``(5) No double benefit.--
       ``(A) Coordination with other vehicle credits.--No credit 
     shall be allowed under subsection (a) with respect to any new 
     qualified fuel-efficient motor vehicle for any taxable year 
     if a credit is allowed with respect to such motor vehicle for 
     such taxable year under section 30 or 30B.
       ``(B) Other tax benefits.--The amount of any deduction or 
     credit (other than the credit allowable under this section 
     and any credit described in subparagraph (A)) allowable under 
     this chapter with respect to any new qualified fuel-efficient 
     motor vehicle shall be reduced by the amount of credit 
     allowed under subsection (a) for such motor vehicle for such 
     taxable year.
       ``(6) Property used outside the united states, etc., not 
     qualified.--No credit shall be allowable under subsection (a) 
     with respect to any property referred to in section 50(b)(1) 
     or with respect to the portion of the cost of any property 
     taken into account under section 179.
       ``(7) Election not to take credit.--No credit shall be 
     allowed under subsection (a) for any vehicle if the taxpayer 
     elects not to have this section apply to such vehicle.
       ``(8) Interaction with air quality and motor vehicle safety 
     standards.--Unless otherwise provided in this section, a 
     motor vehicle shall not be considered eligible for a credit 
     under this section unless such vehicle is in compliance 
     with--
       ``(A) the applicable provisions of the Clean Air Act for 
     the applicable make and model year of the vehicle (or 
     applicable air quality provisions of State law in the case of 
     a State which has adopted such provision under a waiver under 
     section 209(b) of the Clean Air Act), and

[[Page S9684]]

       ``(B) the motor vehicle safety provisions of sections 30101 
     through 30169 of title 49, United States Code.
       ``(e) Credit May Be Transferred.--
       ``(1) In general.--A taxpayer may, in connection with the 
     purchase of a new qualified fuel-efficient motor vehicle, 
     transfer any credit allowable under subsection (a) to any 
     person who is in the trade or business of selling new 
     qualified fuel-efficient motor vehicles, but only if such 
     person clearly discloses to such taxpayer, through the use of 
     a window sticker attached to the new qualified fuel-efficient 
     vehicle--
       ``(A) the amount of any credit allowable under subsection 
     (a) with respect to such vehicle, and
       ``(B) a notification that the taxpayer will not be eligible 
     for any credit under section 30 or 30B with respect to such 
     vehicle unless the taxpayer elects not to have this section 
     apply with respect to such vehicle.
       ``(2) Consent required for revocation.--Any transfer under 
     paragraph (1) may be revoked only with the consent of the 
     Secretary.
       ``(3) Regulations.--The Secretary may prescribe such 
     regulations as necessary to ensure that any credit described 
     in paragraph (1) is claimed once and not retransferred by a 
     transferee.''.
       (b) Conforming Amendments.--
       (1) Section 1016(a) of the Internal Revenue Code of 1986 is 
     amended by striking ``and'' at the end of paragraph (36), by 
     striking the period at the end of paragraph (37) and 
     inserting ``, and'', and by adding at the end the following 
     new paragraph:
       ``(38) to the extent provided in section 30D(d)(4).''.
       (2) Section 6501(m) of such Code is amended by inserting 
     ``30D(d)(7),'' after ``30C(e)(5),''.
       (3) The table of section for subpart C of part IV of 
     subchapter A of chapter 1 of such Code is amended by 
     inserting after the item relating to section 30C the 
     following new item:

``Sec. 30D. Fuel-efficient motor vehicle credit.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after the date of 
     the enactment of this Act.

     SEC. 3. AMORTIZATION OF INTANGIBLE DRILLING AND DEVELOPMENT 
                   COSTS FOR MAJOR INTEGRATED OIL COMPANIES.

       (a) In General.--Subsection (i) of section 263 of the 
     Internal Revenue Code of 1986 is amended--
       (1) by striking ``Incurred Outside the United States'' in 
     the heading,
       (2) by inserting ``or owned or operated by a major 
     integrated oil company (as defined in section 167(h)(5)(B))'' 
     after ``United States'', and
       (3) by inserting ``located outside the United States'' 
     after ``nonproductive well'' in the last sentence thereof.
       (b) Effective Date.--The amendments made by this section 
     shall apply to costs paid or incurred after the date of the 
     enactment of this Act.

  Mr. BENNETT. Mr. President, I thank my friend from Oregon for his 
overly kind remarks. I have enjoyed working with him on this particular 
project. It is very clear he has the initiative on this legislation, 
but I am happy to respond to his initiative and lend what assistance I 
possibly can.
  I want to make just a few additional comments about the presentation 
he has made. I have always been very nervous about CAFE standards. For 
those who are watching and don't know what CAFE standards mean, it has 
nothing to do with lunch, but it comes from the acronym CAFE, or 
corporate aggregate fleet emissions, having to do with automobiles.
  I have always thought that whenever government gets in the way of the 
market, government tends to make mistakes with the market. I think we 
can look back over the years of the CAFE standards, and in an effort to 
get lower emissions and more efficiency out of our automobiles, we have 
had a situation where manufacturers have had to make cars people don't 
want to buy, just to make the CAFE standard requirements. I am always 
nervous about that. That is one of the reasons I have been hesitant to 
support CAFE standards.
  Here is a solution that will create incentives for people to buy 
lower emission automobiles, or more efficient automobiles, without 
dictating what those automobiles will be and without dictating a 
Federal target. It simply says: If you buy a car that gets higher 
mileage than the CAFE standard average, to a certain extent, as the 
Senator from Oregon has explained, the Federal Government will give you 
a rebate. Now, it is a tax rebate. It is a tax credit. So that is cash 
in your pocket if you pay income taxes, and 50 percent of American wage 
earners do not pay income taxes. This is one of the things we have to 
understand. The income tax is so constructed that it applies only to 
the top 50 percent of Americans, and the majority is paid by the top 5 
percent of Americans.
  So you can say: Well, the tax credit isn't really fair because only 
the people at the top get to take advantage of it. So in the bill that 
the Senator from Oregon has crafted and what I am cosponsoring, a car 
buyer can say: Instead of the tax credit, once the whole deal has been 
made, the price negotiated, I want my $630 or my $1,000 or my $1,800 or 
whatever it might be on the deal to go against my responsibility for a 
downpayment.
  Now, we very carefully have not put it in a situation where it can be 
part of a deal because we think the car dealer will say: Ok. I will 
simply raise the price by the amount of the rebate and do a little bait 
and switch and not give strong economic incentives for somebody who 
really understands what is going on to buy this particular car. The 
dealer doesn't know when the buyer comes in whether the buyer is going 
to take the amount as a tax rebate directly to the buyer or whether he 
is going to apply it to the downpayment. So the dealer cannot do any 
bait and switch or smoke and mirrors to try to take advantage of that. 
That is one of the talking points in favor of this particular approach.
  But it means, as the Senator from Oregon has said, that the 
government now becomes technology neutral. The government says: We 
don't really care whether the increased mileage comes as a result of a 
hybrid or, as one auto manufacturer said, improved diesel, or some 
other technology that no one has thought of. This means that someone 
who is working on additional technology that needs a little bit of a 
nudge to have people buy it doesn't have to put that aside and say: 
Well, I can't compete with the subsidy that is created for hybrid. I 
have something that will get just as good mileage as a hybrid, but I 
can't put it on the marketplace because the present law says you get so 
much of an advantage for hybrid but not for this new one that I have 
come up with. So the government stays technology neutral and tax 
neutral in terms of the impact on the people who get the advantage of 
it, and the manufacturer deals directly with the customer in producing 
the kinds of automobiles people want to buy. And if people say: I 
really don't want to buy that automobile, if CAFE standards disappear, 
the manufacturer can say: OK, if you don't want to buy it, we won't 
produce it. Whereas, now there is pressure; we have to produce it in 
order to meet the CAFE average, whether people want to buy it or not.
  Economics is all about incentives. This is the right kind of 
government intervention to create incentives that I think ultimately 
will correct some of the wrong kinds of government intervention, 
however well intentioned, that we have seen.
  So I am delighted with the leadership shown by my friend from Oregon. 
I am happy to work with him on this issue, as I am working with him on 
other issues. I think it is an example of the kind of bipartisan 
approach to solve the Nation's problems that we all need to follow. I 
congratulate him, salute him for his leadership, and I am happy to be 
part of the team.
                                 ______
                                 
      By Mrs. CLINTON:
  S. 3909. A bill to amend the Foreign Assistance Act of 1961 to 
provide assistance for developing countries to promote quality basic 
education and to establish the achievement of universal basic education 
in all developing countries as an objective of United States foreign 
assistance policy, and for other purposes; to the Committee on Foreign 
Relations.
  Mrs. CLINTON. Mr. President, for several years now, I have been 
working to raise the profile of the issue of the more than 100 million 
children around the world who are out of school.
  An April 2004 report authored by Barbara Herz and Gene Sperling, in 
conjunction with the Center on Universal Education at the Council on 
Foreign Relations, clearly demonstrated in striking fashion the 
overwhelming and incontrovertible evidence on the need to invest in 
girls' education. It catalogs literally hundreds of rigorous studies on 
the tangible economic, social, and political gains that come from 
giving a girl the opportunity to learn. Let me highlight a few of the 
report's findings: A single year of primary education correlates with a 
10-20

[[Page S9685]]

percent increase in women's wages later in life. Academic studies find 
the return to a year of secondary education is even higher--in the 15 
to 25 percent range.
  An extra year of a woman's education has been shown to reduce the 
risk that her children will die in infancy by 5 to 10 percent.
  Education offers what the World Bank has referred to as a window of 
hope in helping prevent the spread of AIDS among today's children. A 
recent study of a school-based AIDS education program in Uganda found a 
75 percent reduction in the likelihood that children would be sexually 
active in their last year of primary school.
  Girls' education is the best single policy for reducing fertility and 
therefore achieving sustainable families, according to a recent survey 
of the academic literature. In Brazil, for example, illiterate mothers 
have an average of 6 children while literate mothers choose to have 
less than 3 children, and are better able to care for an invest in 
their children's well-being.
  A study of South Asia and Sub-Saharan Africa found that from 1960 to 
1992, more equal education between men and women could have led to 
nearly 1 percent higher annual per capita GDP growth.
  The report also documents in extensive detail what I have seen in 
many countries--that the most effective way to reach the goal of 
getting all girls in school is by encouraging countries to make a firm 
commitment to universal basic education for all children. When 
countries devise and adopt specific targeted strategies to address the 
unique obstacles girls face, they improve the reach and quality of 
education for all children, both girls and boys.
  Two years ago, Representative Nita Lowey and I introduced the 
Education for All Act, legislation that I am proud to reintroduce 
today. This bill would enable us to increase our spending on global 
education initiatives in order to help millions of children around the 
world have the opportunity to receive an education.
  At the time we originally introduced this bill, we may have seemed 
like we were dreamers to expect a G8 nation like ours to take such a 
bold step on education in Africa and the rest of the developing world.
  Yet earlier this year we saw the UK put forward $15 billion over the 
next 10 years. This means that the UK, a nation with an economy about 
one-sixth our size, will be spending three times more than the U.S. to 
ensure that every boy--and particularly every girl--has a chance for a 
free education.
  I know that our current commitment does not represent the generous 
heart or the wise minds of the American people. And they know that 
education--particularly the education of girls--is the best investment 
we can make to reducing global poverty; they know that education is our 
best social vaccine against the spread of HIV/AIDS.
  There is no greater proof of such big hearts and wise minds as the 
young people from all over the United States, as well as around the 
world whom I have met, and who have shared with me their commitment to 
advocate for children thousands of miles away who they still consider 
to be their friends--their brothers and sisters who deserve the 
opportunity to learn.
  I am proud to stand with these children in support of their friends 
around the world. They understand that in order to make our world more 
peaceful and secure in the long term, girls and boys must be given the 
chance to read, to write, and to get a basic education.
  Education has to be the foundation of any strategy to secure peace 
and prosperity around the world, because when children can reach their 
potential, we are all better for it, and this bill will help provide a 
strong foundation for our efforts to help children around the world.

                          ____________________