Congressional Record, Volume 155 Issue 24 (Friday, February 6, 2009)

[Congressional Record Volume 155, Number 24 (Friday, February 6, 2009)]
[Senate]
[Pages S1774-S1840]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009

The ACTING PRESIDENT pro tempore. Under the previous order, the
Senate will resume consideration of H.R. 1, which the clerk will
report.
The legislative clerk read as follows:

A bill (H.R. 1) making supplemental appropriations for job
preservation and creation, infrastructure investment, energy
efficiency and science, assistance to the unemployed, and
State and local fiscal stabilization, for the fiscal year
ending September 30, 2009, and for other purposes.

Pending:

Reid (for Inouye/Baucus) amendment No. 98, in the nature of
a substitute.

[[Page S1775]]

Murray amendment No. 110 (to amendment No. 98), to
strengthen the infrastructure investments made by the bill.
Baucus (for Dodd) amendment No. 145 (to amendment No. 98),
to improve the efforts of the Federal Government in
mitigating home foreclosures and to require the Secretary of
the Treasury to develop and implement a foreclosure
prevention loan modification plan.
Coburn amendment No. 176 (to amendment No. 98), to require
the use of competitive procedures to award contracts, grants,
and cooperative agreements funded under this act. (By 1 yea
to 96 nays (Vote No. 50), Senate earlier failed to table the
amendment.)
Udall amendment No. 359 (to amendment No. 98), to expand
the number of veterans eligible for the employment tax credit
for unemployed veterans.
Coburn amendment No. 309 (to amendment No. 98), to ensure
that taxpayer money is not lost on wasteful and
nonstimulative projects.
Sanders/Grassley modified amendment No. 306, to require
recipients of TARP funding to meet strict H-1B worker hiring
standard to ensure nondisplacement of U.S. workers.

The ACTING PRESIDENT pro tempore. The Senator from Montana is
recognized.
Mr. BAUCUS. Mr. President, this morning the Senate returns to work on
its bill creating and saving millions of jobs. As the leader said, and
we all know, our work has rarely been more urgent.
Initial jobless claims have hit a 26-year high. I repeat: Initial
jobless claims, 26-year high. Last week, 626,000 people, each of them
mothers and fathers, sisters and brothers, lost their jobs. That is
two-thirds of the entire State of Montana--626,000 people in 1
week. The number of claims by people continuing to apply for
unemployment benefits reached a new record. With 4.8 people applying
for unemployment benefits, we need to respond. We need to complete this
jobs bill.

This past November, our Nation conducted a historic and meaningful
election. America voted for a new era. America voted for change. In
keeping with the call of our new President, the Senate has, this week,
conducted itself with levels of openness and accommodation not seen for
years. I would like to underline that. This has been a very open Senate
process. We have not seen this in a long time and I hope it continues
and even grows. The managers have not filled the amendment tree. We
have not sought to blur issues with second-degree amendments. No tree,
no second-degree amendments. Senators have gotten votes on their
amendments. The Senate has put in a long, full week and worked late
nights. Yesterday, the Senate conducted six rollcall votes and adopted
five amendments with voice votes and we considered and processed
numerous other amendments.
We have now reached the point in this debate, in the adage familiar
to most Senators, that everything has been said but not everyone has
said it. I might underline that everything has been said many times but
not everyone has said it. I now call on my colleagues to show
restraint. I urge my colleagues to forgo offering amendments. I urge my
colleagues to allow the Senate to bring this matter to a close.
Pending now are seven amendments: The underlying Finance-
Appropriations substitute amendment; the Murray amendment, No. 110, to
strengthen infrastructure investments; the Dodd amendment, No. 145,
mitigating home foreclosures; the Coburn amendment, No. 176, on
competitive bidding; the Udall amendment, No. 359, to expand the number
of veterans eligible for the employment tax credit; the Coburn
amendment, No. 309, on particular spending prohibitions; and the
Sanders-Grassley amendment, No. 306, as modified, to require recipients
of TARP funding to meet strict H-1B worker hiring standards.
I hope that in short order the Senate will be able to come to an
arrangement that will allow us to process the remaining Coburn, Udall
and Grassley-Sanders amendments. After that, I hope the Senate will be
able to address amendments by Senators Feingold and Conrad as well as
the pending Dodd amendment on our side, as well as equal numbers of
amendments on the Republican side. Then I hope the Senate will be able
to address amendments by Senators Wyden and Menendez, as well as an
equal number of amendments on the Republican side.
After that, we will seek, as much as possible, to allow a fair system
for the consideration of other Senators' amendments. We will address,
first, amendments of Senators who are here and willing to offer their
amendments. But I renew my call for Senators to resist the temptation
to offer their amendments. We are getting to that point where it is
becoming a point of diminishing returns. The amendments are coming to
the point where they do not need to be offered on this bill at this
time. This is just February. There will be plenty of other
opportunities for Senators to offer amendments on other bills. We have
to get this bill finished today. There will be a conference committee.
The managers will work with Senators in the conference to address their
concerns. Not everything needs to be said by everyone on the Senate
floor today. I urge Senators to forbear offering their amendments as
much as possible.
We will continue to try to give Senators notice of what will be
coming up. Abraham Lincoln appealed to the ``better angels of our
nature.'' I renew that appeal today. Let us work together today in the
spirit of comity and cooperation that reflects the better angels of the
Senate. Let us finish this bill today. I thank all Senators for their
cooperation.
So we can work out an orderly procedure, I now suggest the absence of
a quorum.
The ACTING PRESIDENT pro tempore. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. BAUCUS. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
Mr. BAUCUS. Mr. President, I ask unanimous consent that the time
between now and 11:30 be for debate only, to be equally divided and
controlled between the two leaders or their designees.
The PRESIDING OFFICER. Is there objection?
Mr. McCAIN. Mr. President, reserving the right to object, what would
the manager contemplate at 11:30?
Mr. BAUCUS. Mr. President, the idea is then to have votes on pending
amendments.
Mr. McCAIN. And then would it be agreeable to go back to some more
debate? There is a number of speakers who want to talk about the entire
bill as well.
Mr. BAUCUS. Well, obviously Senators can speak on those amendments,
which includes the underlying bill. But I would hope we process those
amendments and then do the next set of amendments after that.
Mr. McCAIN. I do not object.
Mr. INHOFE. Mr. President, reserving the right to object--I object.
Mr. BAUCUS. Mr. President, I suggest the absence of a quorum.
The ACTING PRESIDENT pro tempore. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. BAUCUS. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
Mr. BAUCUS. I renew my request and ask unanimous consent that the
time between now and 11:30 be equally divided and controlled between
the two leaders or their designees.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
The Senator from Iowa is recognized.

Amendment No. 372

Mr. GRASSLEY. Mr. President, I do not want to take more than 5
minutes, so let me know when 4 minutes is up.
I want to talk about an amendment I am going to put in. But, first, I
think I ought to remind the public at large that here we are on a
Friday, there are lots of amendments being adopted. We have been told
cordially by the majority that they will not fill the tree. But if you
are in the situation where you have to have unanimous consent to get an
amendment up, it is tantamount to filling the tree. So I hope this
deliberative body is going to do what it should be doing. I hope we do
not see a bunch of quorum calls all day where the public back at home
is looking at a blank screen that says ``quorum call'' when the Senate
could be working on dozens of amendments we have been waiting to bring
up for a long period of time,

[[Page S1776]]

because that is a waste of the taxpayers' money.
If it is extremely important to get on with this legislation, and it
is extremely important to get on with this legislation, we should not
be having anybody talk about stonewalling on any political party's
part, when we are ready to do business, waiting to do business, have
been waiting to do business, for a long time. We ought to be able to
offer amendments.
I want to speak shortly then about an amendment No. 372. It is not
the most important amendment I have been waiting to bring up, but I
have spoken about that other amendment before. I want to bring up my
amendment No. 297. This one is 372. It merely says that any agency that
receives funds under this bill must comply with congressional requests
for records. That means our ability as individual Senators to get
records for money that is going to be spent by Departments under this
bill. It is an effort to ensure that the vision of transparency that
President Obama expressed in his Inaugural Address to the Nation is
fulfilled.
This is what the President said:

Those of us who manage the public's dollars will be held to
account to spend wisely, reform bad habits, and do our
business in the light of the day, because only then can we
restore the vital trust between people and their government.

I agree. Of course, unfortunately, when my colleagues and I in
Congress ask for documents from the executive branch, we are usually
stonewalled with bureaucratic excuses and legalese regarding statutes
that were never intended to prevent Congress from gathering
information.
This is not a criticism of the Obama administration, this is
criticism of previous administrations, Republican and Democratic. I
want to make sure it does not happen under this new administration. I
do not think it will, but this legislation will make that certain.
Sometimes even statutes with explicit exceptions allowing information
to be given to Congress are used as excuses to keep the people's
business secret. So to ensure that Members of Congress can gather
information, this amendment would simply impose an obligation on any
agency that receives funds to comply with a request from a chairman or
ranking member of a committee or subcommittee of Congress.
If you support open Government, vigorous congressional oversight, as
President Obama says he does, then you should support this amendment.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Oklahoma is
recognized.

Amendment No. 374

Mr. INHOFE. Mr. President, I have been talking for a couple of days
now about two amendments that if the American people knew we had the
option to do this, they would be very enthusiastic about joining us.
We supposedly have a stimulus bill that should be coming in two
categories, one in tax provisions that would stimulate the economy, and
the other is in work that needs to be done. I am talking specifically
about highways.
I am the ranking member of the Environment and Public Works
Committee. The chairman of the Committee, Senator Barbara Boxer of
California, and I have introduced the amendment No. 374. To me it is a
little bit naive to think we would have a bill that only has less than
3 percent of the money that would actually go to highways and to the
projects that are ready, as they call them spade ready. So this would
increase that amount to $50 billion. But it is done in a rather unique
way. The amendment would not take funds, only the funds that would be
not obligated within a year up to $50 billion from programs in the
stimulus that are not spending or redirecting them to highways.
Now, I would assume that if something has been hanging around here
for 12 months, it is not going to be stimulating the economy
immediately. So that is what I want to bring up. I at least want to
make an effort--I would hate to think that after all of this we have
gone through, that I did not even make an effort to get it up.
I ask unanimous consent to set the pending amendment aside for the
consideration of the Inhofe-Boxer amendment No. 374.

The ACTING PRESIDENT pro tempore. Is there objection?
Mr. BAUCUS. Mr. President, I object. We are under an agreement where
we speak on both sides and offer amendments later. So I respectfully
object.
The ACTING PRESIDENT pro tempore. Objection is heard.

Amendment No. 198

Mr. INHOFE. That is fine. I think I have 4 minutes left. I had
another amendment, which is amendment No. 198.
We had a rather unpleasant conversation on the floor yesterday with
myself and the junior Senator from West Virginia. It is regrettable
because he would not yield for me to respond to accusations that were
made about me. I even suggested a point of order and was turned down.
The other amendment I had was one having to do with the subject we
talked about yesterday; that is, Guantanamo Bay. I have spent time down
there. I will not go on to the same things, because there is not time
that is given to me right now.
But what has happened, what is happening down there, this resource we
have had since 1903, is something we need today. We all know the
consequences and certainly even those individuals who want to close
Guantanamo Bay know if that happened, you would still have to make a
decision of what to do with the some 110 detainees who are considered
to be pretty hard-core terrorists.
Some people say they might be integrated into our U.S. court system.
We all know the rules of evidence are different and there is a
possibility they could be released. I do not think anyone wants that.
There has been a list of some 17 installations within the United States
to which these detainees might go. One of those happens to be in my
State of Oklahoma, Fort Sill. We do not want that to happen. And I do
believe that this is something that we are going to need, so I want to
at least make the motion.
I ask unanimous consent to set the pending amendment aside for the
purpose of considering amendment No. 198.
The ACTING PRESIDENT pro tempore. Is there objection?
Mr. BAUCUS. I object.
The ACTING PRESIDENT pro tempore. Objection is heard.
The Senator from Montana is recognized.
Mr. BAUCUS. Under the agreement, we are going to alternate sides for
speakers. I want to ask the Senator from New Hampshire how much time
she wishes to speak.
Mrs. SHAHEEN. Mr. President, 3 minutes.
Mr. BAUCUS. I yield 3 minutes to the Senator from New Hampshire.

Amendment No. 528

Mrs. SHAHEEN. Mr. President and fellow Senators, I rise in support of
amendment No. 528, which has been cosponsored by Senator Schumer and
enjoys the support of many of the Nation's top education groups,
including the American Council on Education, the American Association
of Colleges for Teacher Education, the National Association of
Independent Colleges and Universities, the American Association of
State Colleges and Universities, the Association of American
Universities, and many others.
America's institutions of higher education are vital to building a
skilled workforce and to developing leaders who can compete in the
global marketplace. Unfortunately, many of our colleges and
universities are feeling the effects of the current economic crisis. As
a former Governor, I understand that in these difficult times States
are often forced to cut back on funding for critical programs such as
education.
My amendment would provide an additional $2.5 billion to the Higher
Education Modernization, Renovation, and Repair portion of the American
Recovery and Reinvestment Act of 2009. The additional funds will bring
the total appropriation to $6 billion, the same amount as in the House
bill. It will fund critical projects and instructional equipment at our
colleges and universities across the country.
This amendment is estimated to create an additional 71,000 jobs. As
we talk about this economic package, one of the things we have all been
focused on is how do we create jobs. This amendment would do that.
According to the National Association of Independent Colleges and
Universities, private colleges in 21 States report they have 572
projects ready to

[[Page S1777]]

go, totaling $4.5 billion. The funding in this amendment is targeted
for those shovel-ready projects that will have an immediate impact and
spur economic growth on the local level. In New Hampshire alone, it
will provide an additional $10 million, money that can be spent on
needed projects such as rebuilding an arts building at Colby-Sawyer
College, renovating a college and innovation center at White Mountains
College, general infrastructure repair at the University of New
Hampshire, and a science building renovation at Franklin Pierce
University. This additional funding will benefit students and colleges
across the country and put many people to work.
I urge Members to join me in support of amendment No. 246.
I ask unanimous consent to have printed in the Record a letter from
the American Council on Education that lists those groups in support of
the amendment.
There being no objection, the material was ordered to be printed in
the Record, as follows:

American Council on Education,

Washington, DC, February 4, 2009.
Senator Jeanne Shaheen,
Dirksen Senate Office Building, U.S. Senate, Washington, DC.
Dear Senator Shaheen: On behalf of the nation's two- and
four-year, public and non-profit private colleges and
universities, we write in support of the amendment you have
offered to H.R. 1, the American Recovery and Reinvestment Act
of 2009. This amendment would set the amount for
infrastructure renovation and repair projects at institutions
of higher education at the same level as provided for in the
House bill, immediately creating jobs in the short term, and
strengthening America's economic future by improving academic
capacity.
This funding is truly stimulative in nature. Public and
private colleges and universities undertake a substantial
number of infrastructure projects for academic facilities
every year. Because of the high cost of borrowing and sharp
declines in state and institutional budgets, many of these
projects have been delayed or canceled. As well, a number of
colleges have halted shovel-ready projects and frozen staff
salaries in order to ensure that they will have more aid for
needy families. While this is a prudent strategy, it can have
a negative economic impact on local communities, where
colleges are often the largest employer.
With more than 4,500 campuses across the country, higher
education is a strong presence in communities--urban and
rural, large and small. These projects have been identified,
developed, and are the very definition of ``shovel-ready.''
If provided funding, such an investment would immediately
create jobs, boost local and regional economies, and build a
lasting improvement to academic capacity at our nation's
colleges and universities.
In addition to creating an estimated 71,000 new jobs, this
amendment would also address the disparities in funding among
states identified by the Congressional Research Service in
its analysis of the current Senate funding level.
We thank you for proposing this amendment and offer our
strong support for its inclusion in the final stimulus
package.
Sincerely,
Molly Corbett Broad,
President.
On behalf of: American Association of Collegiate Registrars
and Admissions Officers, American Association of Community
Colleges, American Association of State Colleges and
Universities, American Council on Education, Association of
American Universities, Council of Graduate Schools, EDUCAUSE,
National Association of College and University Business
Officers, National Association of Independent Colleges and
Universities, National Association of State Universities and
Land-Grant Colleges, National Association of Student
Financial Aid Administrators, United Negro College Fund.

Mrs. SHAHEEN. I ask unanimous consent to set aside the pending
amendments and send my amendment to the desk to be considered.
Mr. BAUCUS. I object.
The ACTING PRESIDENT pro tempore. Objection is heard.
Mrs. SHAHEEN. I yield the floor.
The ACTING PRESIDENT pro tempore. Who yields time?
The Senator from Arizona.
Mr. McCAIN. Mr. President, for the benefit of my colleagues, on this
side we have Senators Thune, Graham, Sessions, Coburn, and Alexander
waiting to speak. I would imagine that, given that, between now and
11:30, hopefully, we could get most of those in between now and the
time for voting, of course observing the protocol of those being
recognized on the other side of the aisle.
While we are here in the Chamber discussing this issue, we all know
discussions are being held behind closed doors between two or three or
four Republicans in order to try to get 60 votes in order to pass this
legislation. Obviously, the overwhelming majority of Republican
Senators are opposed to the legislation. That same overwhelming
majority of Senators are in favor of stimulating our economy and
creating jobs.
How did we get here, and where do we go? We got here by the Speaker
of the House saying: We won, so we wrote the bill. In the years I have
been here, that is not called bipartisanship. Without the votes of 11
Democrats and without the vote of a single Republican, the bill emerged
from the other body and came over here. Again, through the
Appropriations and Finance Committees, the bill was written without
significant input or with negligible input from Senators on this side
of the aisle. There is an old saying: If you are not in on the takeoff,
you will not be in on the landing.
We are up to approximately $1.2 trillion in the piece of legislation
in front of us. The Congressional Budget Office yesterday said that
this legislation would increase employment by the end of the fourth
quarter of 2010 by 1.3 million to 3.9 million jobs. I did the math. So
$1.2 trillion, 3 million jobs, is $923,997 for each job. For 1.3
million jobs, which is the low end determined by the Congressional
Budget Office, it is only $307,092 per job.
The American people are figuring out that this is not a stimulus
bill. It is a spending bill full of unnecessary spending, unexamined
policy changes or policy changes that have been examined and rejected
in the past, and, of course, tax cuts which do not stimulate the
economy.
I ask to have printed in the Record examples of the House spending
provisions and the Senate spending provisions which I find not only
questionable but obviously, in the view of any objective observer,
unnecessary, unwanted, and, indeed, wasteful.
There being no objection, the material was ordered to be printed in
the Record, as follows:

Examples of the House Spending Provisions (Are they really
``stimulus?'')

$1.7 billion to make upgrades in the National Park System.
$50 million in funding for the National Endowment of the
Arts.
$650 million to extend the DTV coupon program.
$6 billion for broadband and wireless services in
underserved areas.
$41 billion to local school districts, including a buy
American iron and steel requirement on the $14 billion School
Modernization and Repair Program.
$325 million to establish an ``innovation'' fund for
academic achievement awards to states and local education
agencies or schools.
$726 million for an after school snack program.
$39 billion to help unemployed pay for COBRA.
$44 million for repairs to USDA headquarters.
$209 million for agricultural research facilities.
$200 million to ``encourage electric vehicle technologies''
in state and local government motor pools.
$600 million for new cars for the Federal government.
$300 million to provide rebates for buying energy efficient
Energy Star products.
$32 billion for energy and transmission system
improvements, including $11 billion for the Smart Grid
Investment Program.
$245 million to upgrade the computer systems at the Farm
Service Agency.
$200 million to repair and modernize U.S. Geological Survey
facilities and equipment.
$400 million to NOAA for ``habitat restoration''.
$70 million for the ``Technology Innovation Program'' at
NIST.
$10 billion for science facilities and research.
$3 billion for the National Science Foundation, including
$100 million to improve instruction in science, math, and
engineering.
$2 billion for NIH Biomedical Research.
$1.5 billion for NIH to renovate university research
facilities and help them compete for biomedical research
grants.
$462 million to enable CDC to complete its Buildings and
Facilities Master Plan.
$1 billion ``to minimize undercounting of minority groups''
in the 2010 census.
$3 billion for a new ``Prevention and Wellness'' fund.
$600 million to increase the number of doctors, nurses and
dentists.
$20 billion for health information technology.
$1.1 billion for Amtrak and Intercity Passenger Rail
Construction Grants to improve speed and capacity.
$500 million to install Aviation Explosive Detection
Systems in airports.
$1 billion for Community Development Block Grants.

[[Page S1778]]

$8 billion for loans for renewable energy power generation
and transmission projects.
$6.7 billion for renovations and repairs to federal
buildings.
$6.9 billion for Local Government Energy Efficiency Block
Grants.
$2.5 billion for Energy Efficiency Housing Retrofits.
$2 billion for Energy Efficiency and Renewable Energy
Research.
$2 billion for the Advanced Battery Loan Guarantee and
Grants Program.
$6.2 billion for Home Weatherization.
$2.4 billion for carbon capture and sequestration
technology demonstration projects.
$500 million for Industrial Energy Efficiency manufacturing
demonstration projects.
$300 million for grants and loans to state and local
governments for projects that reduce diesel emissions.
$98.527 million to support the Comprehensive National
Cybersecurity Initiative to prevent and address cyber
security threats.

Examples of Policy Provisions

Requires TSA to buy 100K employee uniforms from U.S.
textile plants.
Legislation to give federal workers new whistle-blower
protections.
An exemption for yacht-repair companies from paying for
federal workers' compensation insurance to cover those hurt
on the job (an exemption sought for 6 yrs by the Marine
Industries Association of South Florida). Inserted by FL
Reps. Deborah Wasserman Schultz and Ron Klein.
Net neutrality: the bill ``includes language favoring open
access--so-called net neutrality--that telecoms have long
opposed.''
Unemployment: the House language ``secures an expansion of
unemployment insurance for part-time workers'' that Dems
``have sought for more than a decade.''
Education: ``the stimulus aims more than'' $125B ``at
bolstering public education, an unusual federal intervention
in a sphere usually left to state and local governments.''
Public housing: $5B ``for the construction and repair of
public housing. One House GOPer ``depicts it as a quiet
reversal of a 30-year trend of the government extracting
itself from public housing construction.''
Health care: the bill expands COBRA and allows workers
older than 55, or those who have worked at a company for 10
years, to keep their COBRA coverage until they qualify for
Medicare or find a new job. But ``among the plan's biggest
departures'' from past policy is ``allowing those who are
unemployed to enroll in Medicaid.'' That provision ``would
temporarily expand'' the program ``to allow millions of
unemployed workers to qualify for benefits.''
$20 Billion to spur the adoption of electronic medical
records, which would be, ``by far, the biggest government
infusion to enable medical information to follow patients
back and forth among doctors' offices, hospitals and other
providers.'' Starting in Oct. '10, ``hospitals, doctors and
others would be able to get increased payments from Medicare
and Medicaid for using such systems.''

Some of the Questionable Funding in the Senate Stimulus Bill

$20 million ``for the removal of small- to medium-sized
fish passage barriers.''
$400 million for STD prevention.
$25 million to rehabilitate off-roading (ATV) trails.
$34 million to remodel the Department of Commerce
Headquarters.
$70 million to ``Support Supercomputing Activities'' for
climate research.
$1.4 billion to green HUD assisted housing.
$100 million to teach children green construction skills.
$20 million for trail repairs in wildlife refuges.
$25 million for habitat restoration on wildlife refuges.
$198 million for a school food service equipment.
$120 million to upgrade WIC computer systems.
$23 million for repairs to National park Service trails.
$55 million for the Historic Preservation Fund.
$40 million to make Park Service offices more energy
efficient.
$150 million for facility improvements at Smithsonian
museums.
$75 million for smoking cessation.
$88 million for replacement of headquarters of the Health
Resources Services Administration.
$2.9 billion for the Weatherization Assistance Program.
$4.5 billion for Electricity Delivery and Energy
Reliability (ie modernizing the electricity grid).
$430 million for the DOE Science Program including $330
million for laboratory infrastructure and construction and
$100 million is for computer research and development.
$1 billion for National Nuclear Security Administration
Weapons activities.
$20 million is for port modernizations in Guam.
$30 million is for water and wastewater infrastructure
needs in Guam.
$12 million is for electrical transmission line upgrades in
Guam.
$20 million to develop web-based programs for school lunch
programs to manage food orders.
$100 million for grants to state to assist with aquaculture
losses.
$300 million for diesel emission reduction grants.
$50 million to fund biomass utilization grants.
$100 million to repair Forest Service trails.
$20 million for retrofitting BLM offices to make them more
energy efficient.
$20 million for USGS groundwater wells and surface water
stations.
$85 million is provided for new USGS research equipment.
$25 million for abandoned mine site remediation on forest
lands.
Mr. McCAIN. The distinguished majority leader mentioned that
economists like Marty Feldstein said we need a stimulus. He certainly
did. He later said this was not the stimulus we need. There are a large
number of economists saying that what we are doing is what I know we
are doing, and that is to lay an unacceptable multitrillion-dollar debt
on future generations. If the purpose of this legislation is to create
jobs and get the economy going, why did we reject the trigger amendment
yesterday which got 44 votes which said: Once we have two quarters of
positive GDP growth, we are required to embark on spending cuts to stop
mortgaging our children's futures.
If we keep running up these debts, history shows that we will have
debased the currency, printed more money. Hyperinflation takes place,
which is, obviously, the greatest enemy of the middle class.
There are provisions such as the ``Buy American'' provision, Davis-
Bacon, a number of other provisions in the bill which have nothing to
do with jobs, nothing to do with stimulating the economy. In fact,
Davis-Bacon and ``Buy American'' mean additional costs to the taxpayer.
The President, last night, speaking to the Democrats, said:

So then you get the argument this is not a stimulus bill.
This is a spending bill. What do you think a stimulus is?
That's the whole point.

The whole point is to enact tax cuts and spending measures that truly
stimulate the economy. There are billions and tens of billions of
dollars in this bill which will have no effect within 3, 4, 5 or more
years, or ever. We are talking about a lot of money.
I used to come to the floor and object to provisions that were
thousands of dollars, then hundreds of thousands of dollars, then
millions--$50 million in funding for the National Endowment for the
Arts. All of us are for the arts. Tell me how that creates any
significant number of jobs. An afterschool snack program is probably a
good idea. Do we really want to spend $726 million on it?
Here we are. My other colleagues want to speak, and so I will be
speaking later on. It is important that others do as well. But here we
are. We are in a situation where the overwhelming majority of
Republicans--in fact, all--voted for both the trigger amendment and for
our alternative, which was $421 billion in spending. There are behind-
the-scenes negotiations going on so that they can try to pick off two
or three Republicans. You cannot call a bill bipartisan if it has two
or three or four or even five Republicans out of 535 Members of
Congress. You can call it an agreement, but you cannot call it a
bipartisan agreement. That is not what the American people want today.
Yes, unemployment is up to 7.6 percent. The American people expect us
to sit down together.
I see the distinguished chairman of the Budget Committee, the Senator
from North Dakota. He probably knows as much about budget issues and
spending as anybody. My recommendation is that he and others be
appointed by both leaders to sit down in a room so that we can come out
with a bipartisan agreement. That means leadership. That means
involvement, not just of a couple or three who may be in some respects
not reflective of the whole 41 Republican Members of the Senate.
Maybe we have to go back to square one. Maybe we should go back to
the beginning because it was flawed when it began, when the authors of
this legislation from the House said: We won, so we wrote the bill.
That is not bipartisanship.
I urge both Senator McConnell and Senator Reid to appoint a group of
Senators to sit down together and hash this out. We share the same
goal, the same goal of stimulating this economy and creating jobs. We
realize we have to spend money to do it. But we also realize--most of
us should realize--that if we mortgage our children's future, they
already have a $10 trillion debt; this is another trillion. There is
going

[[Page S1779]]

to be an Omnibus appropriations bill coming down the pike. There is
going to have to be a TARP 3. We are looking at spending as far as we
can see for which we do not have revenues.
We can have a modest--I say modest, I take that back. We can have a
bill that is $400 or $500 billion. We can have a bill that truly
stimulates this economy, with tax cuts that, in the view of economists,
do create jobs, not a one-time injection of sending people a check.
That didn't work the last time we did it under the previous
administration.
I urge colleagues not to send a message to the American people that
we have come out with a bill with 3 or 4 Republicans out of 535 Members
of Congress. Let's try to sit down one more time, all of us, and come
out with something that truly creates jobs, truly stimulates the
economy, and restores the faith and confidence and trust of the
American people in the Congress, which has badly eroded and is at
historic lows. These are tough times. Let's act tough for a change and
get something done, rather than have some partisan result which the
American people--certainly a significant percentage--will resoundingly
reject because it does not have fiscal responsibility.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Montana.
Mr. BAUCUS. I yield 5 minutes to the Senator from North Dakota.
Mr. CONRAD. I thank the chairman for his extraordinary effort and the
effort of the chairman of the Appropriations Committee.
Maybe now is the time we need to have calm reflection on where we are
and where we are headed. All of us know this economy is in desperately
serious trouble. We had a report this morning. Nearly 600,000 jobs were
lost in the previous month. That means in the last 4 months we have
lost more than 2 million jobs. All indications are that we will lose
millions more jobs in this economy.
What must be done? Clearly, we need an economic recovery package.
There would be virtually unanimous agreement on that fundamental point.
What works? Allen Sinai of Decision Economics ran models with his
well-regarded econometric model that showed the things that work the
best. The fastest is government purchases of goods and services. The
second thing that worked the best was transfer payments to States
because States are otherwise going to cut their budgets.
Why do those things work the best? Because they inject money into the
economy the most rapidly and in a way that there is the greatest
assurance that the money is spent. That is what is the key to a short-
term stimulus. Why? Because if we think about it, demand in the economy
is falling. That is why GDP is dropping. That is why joblessness is
increasing. What do we do about it? We can't expect consumers to change
course because they are worried about losing their jobs. We can't
expect corporations to increase demand because their orders are
falling. The only place to look for an increase in aggregate demand is
to the Federal Government.
That then raises the question: What is the most effective way for the
Federal Government to deploy its precious taxpayer dollars to give
short-term lift to the economy but not to burden us with increased debt
looking ahead?
That is why the first tests that were applied to this package were
that it be timely--that is, that it go into effect quickly--that it be
targeted on things that have the most bang for the buck, and that it be
temporary so it does not create a bow wave going forward that increases
deficits and debt when the economy, we hope, will be in recovery.
With that said, we also need to remember the lessons of the past. In
the Great Depression, Roosevelt took action in the 1930s to provide
stimulus to the economy. Unemployment was at 25 percent. By 1937,
unemployment was down to 12 percent. The stimulus was working. Then
they tried to balance the budget in 1937, and unemployment went back up
to 19 percent.
So we have to be very careful about when we pivot and move back to
reducing the deficit and the debt. There is nobody who is more acutely
aware of how important it is we address those long-term fiscal issues
than I am. I think anybody who has followed my career for 22 years here
would know I am very concerned about long-term debt.
Let's analyze this package. This package--now approximately $925
billion--79.3 percent of it spends out in the first 2 years. Now, that
is before we added a few things on the floor. So the numbers might
change a little bit, but that is roughly right: about 80 percent in the
first 2 years. That means 20 percent is not in the first 2 years. So I
submit to my colleagues, the first kind of test, the first kind of
screen we should apply is that one. But that is not dispositive because
there are certain investments we are going to make that have long-term
payoffs for the American people, such as computerizing the health
records of the American people, such as--and I would put this at the
top of the list--improving the electrical grid for America.
The ACTING PRESIDENT pro tempore. The Senator has used 5 minutes.
Mr. CONRAD. Mr. President, if I could have an additional 30 seconds
to close.
Mr. BAUCUS. Mr. President, I yield the Senator 30 seconds.
Mr. CONRAD. I thank the chairman.
Let me say it is critically important we take action. It has to be on
a rational basis. It has to have criteria that apply to this package,
that will stand the light of day. But at the end of the day, we must
act.
I thank the Chair and yield the floor.
The ACTING PRESIDENT pro tempore. Who yields time?
The Senator from South Dakota.
Mr. THUNE. Mr. President, as many of my colleagues have already
noted, the jobs numbers today were very bleak and should cause great
concern for all of us as we look at steps we can take to get this
economy growing again. But that is why the CBO report that came out
yesterday also is so troubling because it indicated the Democratic
proposal, the stimulus plan before us, would create as few as 1.3
million jobs--as many as 3.9 million, to be fair, but as few as 1.3
million jobs. Well, a trillion dollars is a terrible price to pay for a
bill that may create as few as 1.3 million jobs over, I might add, a 2-
year period.
It also went on to say, the CBO report did, that it would reduce the
GDP growth in the outyears. So not only does it create potentially a
very small amount of jobs--1.3 million over a 2-year period--but it
also diminishes the amount of GDP growth we would experience in later
years.
Now, if it, in fact, does create only 1.3 million jobs, if this
trillion dollar plan--again, all based on borrowing from future
generations--does create as few as 1.3 million jobs, if you do the
arithmetic on that, if you spend $1 trillion, and you only create a
little over a million jobs, that is $800,000 per job. Try and think
about how you can convince your constituents back in your home States
about the need to spend $800,000 to create a single job.
I mentioned this yesterday, but I will repeat it again: For the
people in my State of South Dakota, the average annual salary is about
$30,000 per year. So to think about spending $800,000 to create a job
is something that is going to be very hard to accept for a lot of
people around this country, which is why I believe, and so many people
around the country are rallying and saying, this is the wrong direction
in which to head.
I happen to agree with that assessment, and I think there are some
things that could be done that would make this process more fair in
terms of including ideas that Republicans have to put forward but, more
importantly, to get a product that is more effective--more effective--
at creating jobs at a lower cost.
Now, many of us have tried to improve this bill. I supported a McCain
amendment yesterday, a comprehensive approach that is much better in
terms of addressing the issue and much better focused in terms of job
creation at about half the cost of the underlying bill, the majority
bill we are debating today. So we tried to make this bill more focused
and more fiscally responsible. I think putting the focus and the
emphasis on job creation is the right place to be. But many of the
efforts we have made to that end have failed. We have also offered
amendments to cut much of the wasteful spending out of this bill, most
of which have been defeated.
So what I have sort of concluded is, as much as we tried to make this
a better bill by cutting wasteful spending,

[[Page S1780]]

by making the focus on job creation, by trying to reduce taxes on small
businesses and middle-income taxpayers, which would get more money back
into the economy, and emphasize less spending on Government programs in
Washington, DC, where the bulk of this is committed, that is a much
better approach, and many of our amendments have been focused in that
direction. But, as I said, none have been accepted.
I have one more amendment I have filed and I hope to have an
opportunity to call up. It is sort of a last-ditch effort to bring some
reason to this whole debate. But what it essentially would do is take
the total cost of the Democratic bill--about $900 billion without
interest; $900 billion, when you add in the interest costs, as I said
before, you get up to about $1.2 trillion or north of that, all of
which is borrowed money, borrowed from future generations--but take
that total amount of $900 billion and divide it by every tax filer in
this country--anybody who files an income tax in this country--and
basically write them a check.
Now, it is probably surprising to most of us here what you could do
with that. But for an average individual filing a tax return in this
country, you could write them a check for $5,143; for a couple filing
jointly, $10,286.
Now, to be fair, I also wrote the amendment so anybody making more
than $250,000 a year would not be eligible. I tried to make this so you
cannot argue this is a tax cut for the rich. So anybody who makes more
than $250,000 would not be eligible. All filers who have under $250,000
in taxable income would be eligible under this amendment. You could
actually write a check to an individual filing for $5,143 dollars; and
to a couple filing jointly, a check for $10,286.
I think that is a lot of money in most people's family incomes and it
makes a lot more sense, in my judgment, than spending $900 billion on
programs that many of us know will not work, creating new bureaucracies
in Washington, DC, at a very high cost per job. As I said, if the CBO
numbers are right on the low end--1.3 million new jobs--and you divide
that, do the arithmetic on that, you are talking, in round numbers,
about $800,000 per job. What kind of sense does that make?

It is pretty clear, in my opinion, and I think in the opinion of most
of the American people, this is very misdirected in terms of the
mission of this whole thing. The intention is great, but the substance
of this particular piece of legislation is very flawed.
I would add one last thing; that is, we talk about economic models
and analysis and methodology, but the President's own chief economic
adviser put together a methodology about a year ago--a little over a
year ago--that said for every dollar of tax cuts you get a multiplier
of 2.2 percent increase in GDP. So if you cut taxes by a dollar, GDP
increases by 2.2 times.
It seems to me, at least, that you can take that methodology--and it
seems intuitive to most Americans--when you reduce their taxes, middle-
income families' taxes and taxes on small businesses, which create the
jobs in this country, you get a much better outcome in terms of GDP
growth, in job creation, than sending a bunch of money into Government
programs here in Washington, DC, many of which, I might add, are new
programs that will not get up and be started for a very long time.
There will be a tail on them. As a consequence, you will not see the
result in the short period of time we are trying to target here--the
temporary approach to this--that actually creates jobs and helps pull
us out of the economic crisis we are in.
That is an amendment I have filed. It takes that total amount--$900
billion--breaks it down on a per-filer basis, and if you are an
individual filing, you can get a check for $5,143, and if you are a
couple filing jointly, you can get a check for $10,286.
But I wish to see us approach this in a different way. A lot of
amendments, as I said, have been offered--some good alternatives. The
McCain alternative we voted on yesterday makes a lot of sense to me. It
does it at about half the cost, and is a lot more effective at creating
jobs. That was defeated, as have been all the other amendments we have
offered to make this more fiscally responsible, more focused, and more
targeted on job creation.
With that, Mr. President, I yield the floor and thank the Chair.
The ACTING PRESIDENT pro tempore. Who yields time?
Mr. BAUCUS. Mr. President, I yield 7 minutes to the Senator from
Hawaii.
The ACTING PRESIDENT pro tempore. The Senator from Hawaii.

Amendment No. 309

Mr. INOUYE. Mr. President, I rise to express my concerns about
amendment No. 309 offered by the Senator from Oklahoma.
Senator Coburn's provision prohibits spending any of the funds in the
bill for casinos, golf courses, swimming pools, and other recreational
facilities. I think we can all agree these sound like laudable goals. I
understand on its face this amendment would seem logical. But I want
the Senate to understand what it means as it applies to this measure.
Some of my colleagues might wonder why the House included this
provision in this bill, and why we do not think it makes sense. The
House included $1 billion for the Community Development Block Grant
Program. Under that program, funds go straight to the cities, and
mayors determine how to spend the funds.
When the Conference of Mayors presented their views to the country's
leadership on how to stimulate the economy, the No. 1 program they were
hoping to have funded was CDBG. But that program does not have
sufficient safeguards. It can be used to construct recreational
swimming pools or aquariums or to support museums. On occasion, CDBG
funds have been used for programs which some would say had questionable
merit.
To ensure that the Senate would not be supporting questionable
programs, the Senate Appropriations Committee recommended no funds for
this program--no funds for CDBG. The House recognized that CDBG funds
might be used inappropriately if there were no prohibitions on
questionable programs, so it included the provision which Senator
Coburn wants attached to this bill.
We do not need to include the provision because we do not have CDBG
funding in this bill. The mayors are precluded from funding the
projects prohibited by the amendment of the Senator from Oklahoma. The
Senate is already protected from possible abuse by denying the funding
for the program.
But let me offer another example of how the committee ensured that
local funds could not be used unwisely. In the bill, the committee has
included $2.5 billion for the Neighborhood Stabilization Program which
is designed to improve blighted neighborhoods. However, it is true that
on occasion funds for this program had been used for community
development of questionable merit. To avoid that problem, the
Appropriations Committee recommended bill language under the
Neighborhood Stabilization Program which only allows the funds to be
used for replacement of housing. This limitation means the funds cannot
be used to build community centers or swimming pools.

We support the idea behind the amendment but not the amendment.
First, we have not provided funds for programs which can be used
frivolously. Second, there are no earmarks in this bill. Third, there
is no CDBG money in this bill. Fourth, the housing programs cannot be
used for frivolous purposes.
Members might argue that you could include this amendment as an
additional safeguard. Well, consider this one example: Among other
things, the amendment would prohibit construction of swimming pools--no
exceptions to that. We might all say we agree with that, but it should
be noted we do not direct the construction of any particular swimming
pool because that would be an earmark. Well, now comes the crunch.
However, this bill contains $3.4 billion for needed construction of new
and infrastructure innovation and repairs at existing VA hospitals.
Under the terms of this provision, the Veterans' Administration would
not be able to spend any of their infrastructure funding provided to
the Department on construction or renovation or therapeutic swimming
pools at spinal cord injury centers, trauma centers, and other VA
medical centers. These are very essential to the rehabilitation of
these wounded warriors.

[[Page S1781]]

The Appropriations Committee is aware the VA has plans for many
legitimate construction projects, such as pools specifically used for
medical rehabilitation of wounded soldiers. These are not swimming
pools for the VA staff, but they would nonetheless be prohibited by
this amendment.
While I am confident this was not the intent of the amendment, it
most certainly could be the result. It is not the only example. Should
our military be denied from building recreational facilities? Should
the Coast Guard be told not to build swimming pools where they practice
training exercises? We expect these men to dive into cold waters in the
Arctic Sea and rescue men and women, so they need special training. Do
we want to argue that no funds be made available for fixing aging
buildings that are ready to crumble?
This amendment is a solution in search of a problem, and let's not
forget the amendment causes problems. If adopted, this amendment would
deny our wounded veterans the physical therapy they need and deserve,
and it could deny other needed programs to support training and quality
of life for our military forces and their families. I sincerely
recommend we vote down this amendment.
The ACTING PRESIDENT pro tempore. The Senator from Alabama is
recognized.
Mr. SESSIONS. Mr. President, I see my colleague from South Carolina;
perhaps he is ahead of me. If he is, I would be pleased to yield to
him.
Mr. GRAHAM. Just for 5 minutes.
The ACTING PRESIDENT pro tempore. The Senator from South Carolina is
recognized.
The minority controls 1\1/2\ minutes at this point.
Mr. GRAHAM. A minute and a half.
Well, we are at a crossroads for a minute and a half.
Mr. McCAIN. Mr. President, I ask unanimous consent, if the
distinguished manager would agree, for 5 minutes for the Senator from
South Carolina, or we will go after the vote.
Mr. BAUCUS. Mr. President, I ask unanimous consent that the time for
debate equally divided be extended until 12 noon and add in the other
time to be equally divided, so on that basis, there is more on this
side.
The ACTING PRESIDENT pro tempore. Is there objection?
Mr. McCAIN. Reserving the right to object, I wish to thank the
manager of the bill for his generosity. I do not object.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
Mr. GRAHAM. Mr. President, I wish to thank Chairman Baucus and
Senator McCain. I don't have anything Earth shattering to say. I do
appreciate the additional time.
We are in on Friday. I think this is good for the country that we
have slowed this process a bit. It is not good for the country if we
don't act. The jobless rate is going up so we need to stimulate the
economy. Count me in for doing that. However, we don't need a headline
that says we rushed through $1 trillion in spending that would not
stimulate the economy in an effective way but will run up the debt,
which is already way too high.
I think we are at a crossroads, if I may say so, about how we
proceed, not just on this bill but as a Congress and as a nation. I
think there are plenty of people over here--I can't give you a number;
people asked me about numbers--who would like to find a way through a
better process to create a bill that would stimulate the economy in a
real way, through spending and tax cuts, and if it doesn't help the
economy in 2 years from a tax cut point of view or a spending point of
view, then I would argue it doesn't meet the goal of stimulating the
economy. The spending may be worthwhile, but if it hits 3, 4, 5 years
from now, then I think we missed the boat because we are not here to
spend money blindly. We are here to stimulate the economy so the
jobless rates don't go up.
I think my dear friend from North Dakota gets this. There are tax
cuts that may need to be looked at. I believe we need to do more than
cut taxes, but we need a strategy. To me, the goal should be to get it
into the economy within 2 years. If you can do that through tax cuts
and spending, that is the place to start. There are some items that are
long-term investments that would fit within 2 years but maybe could be
taken out and put in a separate bill because what is going to happen
next is the administration is going to ask us for hundreds of billions
of dollars on top of the TARP money to generate support for the banking
and financial sector, and they would be right to do so. So every dollar
we can focus in this bill to creating jobs in the short term through
tax cuts and spending, and take these other long-term items out, is
more money we can put into housing and banking.
I don't think most Americans realize this is a three-legged approach
in that the stimulus package is just one piece of the puzzle. Quite
frankly, it is the piece of the puzzle that is hard politically that
does probably the least for our overall economic problems. If we don't
fix housing and get credit flowing, we can flow all the money in the
world into a stimulus package. Let's don't throw any more good money
after bad.
We know we have to fix housing. We know we have to do something with
banking. When we talk about banking, we are talking about a hard sell,
given the reputation of what has happened in TARP, for any Republican
or Democrat to come back to the public and say: Give us some more money
to fix banking. They are going to say: What the heck did you do with
the money we gave you before? We have a crisis of confidence growing.
So we are at a crossroads. I want bipartisanship. I couldn't agree
more with Senator McCain. He is a man who has walked the walk when it
comes to bipartisanship. He has taken a lot of criticism--so have I--
for reaching across the aisle on emotional issues to find common
ground. We don't have a process in place that reflects a way to get
true bipartisanship. Just picking off a few votes is not going to solve
our Nation's problems. We need strong bipartisan support for a stimulus
package that is targeted and focused on creating jobs in the near term
because we are going to need strong bipartisan support to ask for more
money for banking and housing.
Let's don't blow it here. Let's don't spend this goodwill that this
new administration has. I want to help this new President be successful
in areas where our country needs to be successful. I am not talking
about tax cuts ideologically; I am talking about a focused plan to
jumpstart the economy through a stimulus bill that will draw
bipartisanship. That is not where we are. The public wants us to be
smart, and they want us to work together. The product we have now is,
in my opinion, not smart, and the process we created beginning in the
House is not allowing us to work together. We have a chance to turn it
around. Let's take advantage of it. Let's get it right so we can come
back together to the public and fix housing and banking. If we mess it
up with the stimulus package, if we split in different camps and we
create a bill the public doesn't support on the stimulus package, we
are going to ruin our ability as Members of Congress and the new
administration to fix the entire economy.
We are at a crossroads. Slow down, get it right. I yield back.
Mr. BAUCUS. Mr. President, I yield 5 minutes to the Senator from New
Mexico.
The ACTING PRESIDENT pro tempore. The Senator from New Mexico is
recognized.
Mr. BINGAMAN. Mr. President, I thank my colleague and the chairman of
the committee very much. I wish to talk today about an amendment I am
hoping to offer. It is amendment No. 480. It relates to the funding of
our national public land management agencies so they can create jobs
and do the important work that needs to be done in their various
jurisdictions.
We have had a lot of talk about how it is important that we focus the
funds we have in this legislation on jobs that can be created quickly.
We have had lots of talk about how we need to focus these resources on
the real needs of the country and jobs where we can actively monitor
the decisions that are made so we know that the money is not being
wasted. In my view, this amendment does all of those things. It is a
proposal to add an additional $2.5 billion to funding for the National
Park Service, for the Forest Service, for the Fish and Wildlife
Service, for the Bureau of Land Management, and for the Bureau of
Indian Affairs to carry out the critical land and resource management

[[Page S1782]]

projects they have identified that need to be carried out on our public
lands.
Fourteen Senators joined me in cosponsoring the amendment: my
colleague, Senator Udall of New Mexico, Senator Boxer, Senator Wyden,
Senator Merkley, Senator Cantwell, Senator Murray, Senator Baucus,
Senator Tester, Senator Levin, Senator Stabenow, as well as Senators
Kerry, Leahy, Schumer, and Senator Udall from Colorado.
Now, the estimates we have from the various public land management
agencies are that this additional funding would allow them to create an
additional 45,000 jobs between now and the end of the next fiscal year;
that is, the end of September of 2010. I have heard a lot of criticism
that the cost per job of this proposed legislation is too much, and I
have heard the $800,000-per-job figure thrown around. When you look at
this, all the figures I have indicated that we are talking about
$56,000 per job for this next 2-year period. These jobs are vitally
needed and can be carried out quickly.
Let me give some examples of what I am talking about and what I think
could be done with this extra funding. One example in the National Park
Service is we need to complete the stabilization construction for the
seawall at Ellis Island and the asbestos removal at the Statue of
Liberty National Monument. These are projects that are underway but
don't have adequate funding to be completed. We need to repair trails
at Olympic National Park. We need to replace substandard employee
housing at Grand Canyon National Park. I am sure my colleagues from
Arizona will recognize, having seen that substandard housing, that
would be a good use of public funds. We need funding for road repair
and replacement at Bandelier National Monument in my home State of New
Mexico.
As far as Forest Service funding goes, much more funding is needed to
thin the forests to reduce wildfire fuels and restore forest health.
This thinning work is labor intensive. It is work that requires
chainsaw crews and heavy-equipment operators. These people are out of
work today. These people can be put to work very quickly doing this
important work, and this forest thinning work protects our communities
that are located near these national forests from wildfires.
The Bureau of Land Management has a tremendous amount of work that
needs to be done with regard to reclaiming abandoned oil and gas wells
and mine sites. In my State alone, we have 8,000 acres that are covered
with abandoned oil wells and hundreds of abandoned mines waiting for
reclamation funding. Again, there are contractors and there are workers
who are anxious to have this work, if we would just fund it.

Regarding State and tribal wildlife grants, there are examples in my
home State where we need to install fish screens, replace culverts, and
we need to work in the Rio Grande area to restore cutthroat trout
habitat, and much work can be accomplished there.
Mr. President, let me conclude by saying that if we want to put
public funds into work that is important to the public and if we want
to put public funds into projects that can create jobs quickly and
stimulate the economy through that effort, I believe this amendment is
ideally designed to accomplish that. I hope very much that my
colleagues will support it.
There has been a lot of talk about how we need to reduce the size of
this overall legislation. I don't agree with that. Virtually all of the
economists--conservative and liberal--have all said, if anything, this
legislation is too small as it currently stands. But whatever the size
of the legislation, this is the kind of job-creation funding in which
we ought to be engaging. I urge my colleagues to support the amendment.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Alabama is
recognized.
Mr. SESSIONS. Mr. President, I ask unanimous consent to be recognized
for 7 minutes.
The ACTING PRESIDENT pro tempore. The Senator may proceed.
Mr. SESSIONS. I ask to be notified at 7 minutes.
The ACTING PRESIDENT pro tempore. The Senator will be notified.
Mr. SESSIONS. Mr. President, unemployment is rising, and it was not a
good month. We saw those numbers today, but it was not higher than
people have been expecting. But it is a very serious thing to have
unemployment rising as it is, and we know it will continue to rise. I
believe there are things we in Congress can do to help confront this
problem.
My Democratic colleagues are so committed to this legislation and
saying this bill will save and create jobs and it must be passed now
and there can be no serious alteration in it. The question really is,
for the American people, what is in the national interest? What will
serve this country best both now and in the long run? What is the best
information we have to make realistic decisions? Finally, will the
projections we are hearing here actually work? Just to say the bill
will create jobs is not enough for us in Congress. We are not experts
in all of this. We do have some experts we rely on, but we need to look
at it carefully.
According to our Congressional Budget Office, in a letter written to
Budget Committee Ranking Member Judd Gregg, whom the President has
asked to serve as his Secretary of Commerce--dated February 4--
remember, this is a bipartisan organization, and we rely on it for
reliable data. We depend on it for objective advice. The new leader of
CBO was selected in a bipartisan way. Our Democratic colleagues clearly
have a majority in the Senate, and they would not have approved the
nominee if they didn't think he was a qualified person.
What did he say just yesterday? This is the truth, I think:

The Senate legislation would raise output and lower
unemployment for several years.

We certainly hope so. We don't want to spend a lot of money and not
get any unemployment easing.
Then it goes on to say:

In the longer run, the legislation would result in a slight
decrease in the gross domestic product (GDP), compared with
CBO's baseline economic forecast.

The baseline economic forecast is without any stimulus package. We
don't have any stimulus package under current law. The baseline without
the stimulus package indicates it would do better over 10 years than if
we passed this bill. I know we are not running for election 10 years
from now; we are running for election today, some people seem to think.
But I believe we have a responsibility to the long-term interests of
this country. It is stunning to me that this report says that over 10
years, it would be a net negative. And GDP means jobs. If GDP is down--
gross domestic product, which is all the goods and services produced in
the country--if that is down, jobs are down. If GDP is up, jobs are up.
What else does the letter say? It says this:

The macroeconomic impact of any economic stimulus program
is very uncertain.

So we don't know for certain whether we will get any impact at all.
It goes on to say:

For those reasons, some economists remain skeptical that
there would be any significant effects, while others expect
very large ones.

Quoting from the letter again:

According to these estimates, implementing the Senate
legislation . . . would also increase employment at that
point of time [the fourth quarter of 2010, when we would
expect the results to be most pronounced] by 1.3 to 3.9
million jobs.

Well, Senator McCain has already explained to us that he has run the
numbers on that. This is what it would be. The bill is scored at $1.2
trillion-plus, and with additions, we think it is $1.27 trillion, one
and a quarter, which is the largest spending package in the history of
this country or any country, in the history of the world, and much
larger than anything that has ever been approached. The entire 5-year
Iraq war has cost around $500 billion, just to give some perspective.
How much would that be per job? It would add 1.3 million jobs,
according to CBO. That is on the low end of the estimate. At that
number and a $1.2 trillion deficit--remember, the bill is about $888
billion, but with the CBO scoring, the interest on that over the 10-
year budget window, that means it would be $1.2 trillion-plus. So
Senator McCain worked it out at $1.2 trillion. If you divide that out
at 1.3 million jobs, it turns out to be about $765,000 per job. That is
just plain mathematics. They

[[Page S1783]]

say we are going to create jobs and the cost will come out on the lower
end to about $765,000 per job. If you assume it creates jobs on the
high end, 3.9 million jobs, it would be $255,000 per job.
This is just not good legislation, Mr. President.
The ACTING PRESIDENT pro tempore. The Senator has used 7 minutes.
Mr. SESSIONS. Mr. President, I ask unanimous consent to speak for 1
additional minute.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
Mr. SESSIONS. Mr. President, the problem here is that this is not
good legislation. For the rest of our lifetime, this $1.2 trillion
debt--I think now really $1.27 trillion--will be a burden on our
children for years to come, indefinitely. Every penny of this spending
is debt. We are already in debt, so we are spending on top of our debt.
There is no way we can deny that. It is just not responsible. A
smaller, more targeted program, designed to spend out in 2 years,
create jobs in an effective way, is something I think we can all
support. This legislation--I truly believe we should not do it. I urge
my colleagues to study it.
The ACTING PRESIDENT pro tempore. The Senator has used his time.
Mr. BAUCUS. Mr. President, I yield 4 minutes to the Senator from
Minnesota.
Mr. McCAIN. Mr. President, parliamentary inquiry: Am I correct that,
for the benefit of our colleagues, now the votes will be put off until
1?
Mr. BAUCUS. Mr. President, it is my understanding that we may have to
put off votes until 1 o'clock. That is not determined yet, but there is
a high probability of that. Around noon, we will ask for an agreement
to speak for another hour.
Mr. McCAIN. I thank the manager. I tell my colleagues that if it
looks as if we will not vote until 1, there will be time to come over
and speak.
Mr. BAUCUS. That will be the case.
The ACTING PRESIDENT pro tempore. The Senator from Minnesota is
recognized.
Ms. KLOBUCHAR. Mr. President, I thank the chairman. I thank him for
his good work on this legislation.
I have come to the floor to ask that the pending amendment be set
aside, and I ask for consideration of my amendment No. 201, which I
have at the desk.
The ACTING PRESIDENT pro tempore. Is there objection?
Mr. BAUCUS. I object.
The ACTING PRESIDENT pro tempore. Objection is heard.
Ms. KLOBUCHAR. Mr. President, despite the objection, I hope to have
the opportunity later in the day to include this important amendment in
the bill. This amendment is cosponsored by Senator Bennett, Senator
Hatch, and Senator Kohl.
I first note that my amendment doesn't cost anything. It doesn't add
any money to this bill. In fact, it saves money in the long term. My
amendment represents a bipartisan effort to strengthen an important
part of the bill, which is the health information technology part of
the bill.
As we know, technology has transformed our country. I am encouraged
that this legislation we are working on would develop a national health
information technology system and create over 200,000 new jobs doing
it. If implemented thoughtfully, health information technology has the
potential to reduce waste, rein in costs, stimulate innovation, and
improve quality.
As you know, Mr. President, Minnesota is a leader in the health care
community across this country, with the Mayo Clinic and countless other
hospitals and clinics in our State. We have been recognized for the
measured quality outcomes that have resulted from effective information
technology implementation. So we know what we are doing in Minnesota.
In this bill, there are, as I mentioned, very good provisions for the
development of health information technology. There are also some
privacy provisions, which are necessary and which I support. We
recently had a hearing on these provisions in the Judiciary Committee.
Out of that hearing came this amendment. One of the things we
recognized was that one of the privacy provisions, which is well-
meaning, would have the effect of making it hard to collect data to
improve the quality of care, which is something Mayo Clinic does so
well. One example: You will save $50 billion in 4 years in this country
in taxpayer Medicare spending if every hospital used the protocol Mayo
Clinic has used for the last 4 years for chronically ill patients. The
reason they can do that is they collect data, so they know what the
protocol should be.
My amendment ensures that the quality assessment research necessary
to improving our health care system is preserved.
As the bill currently stands, all forms of health care operations are
subject to regulations to be put forth by the Secretary of Health and
Human Services. These regulations have the potential to impose varying
levels of restriction on the ability of doctors and nurses to share
information.
While I support requiring authorization and the use of de-
identifiable data in many areas of the health care system, subjecting
quality assessment activities to these regulations has the potential to
limit patient care and clinic research. That is the last thing we want
to do now, as we are looking at collecting that information to spread
these protocols across the country to get better assessments of what
high-quality care means. That is why Senator Hatch and Senator Bennett
are cosponsoring this amendment with me.
I also note that this is supported by the American Hospital
Association, as well as the Association of Medical Colleges.
With the United States spending $2.3 trillion per year on health
care, we must bring an end to the inefficiencies of the system. We need
the information--well-intentioned in the bill--but we must make sure
the work going on to share information continues.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Arizona.
Mr. KYL. Mr. President, at the conclusion of my remarks, I am going
to ask unanimous consent to print in the Record some recent op-eds. I
would like to quote from some of them because they reflect the emerging
consensus of experts around the country as to what this so-called
stimulus package is all about and what the results of it will be.
A couple of these I wish to talk about because they are from unlikely
sources in the political spectrum. One might assume, for example, that
the Washington Post would be very supportive of moving forward with a
so-called stimulus bill. But this morning in the Washington Post, there
is a pretty significant question raised and a concern raised about
whether the bill should move forward as it is.
I am advised that because of the division of the time, rather than 15
minutes remaining, the Republicans have only 1 minute. That probably
means I have about 30 seconds. What I will do, if we do extend the time
as the manager indicated after noon, I will conclude my remarks at that
time, or if the Senator has some time now.
The ACTING PRESIDENT pro tempore. The Senator from Illinois.
Mr. DURBIN. Mr. President, I ask unanimous consent that the time
between 12 p.m. and 1 p.m. be equally divided between Democrats and
Republicans for debate only.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
The Senator may continue.
Mr. KYL. Mr. President, I appreciate the Democratic whip getting that
cleared for everybody's sake and also for permitting me to continue to
speak. I appreciate it.
This Washington Post editorial quotes the President, first of all,
contending that the opponents of this bill are peddling the same failed
theories that helped lead us into this crisis.
I am one who is very skeptical about this bill. I am not quite sure
what the President is accusing me of. What we asked is that a program
be built from the bottom up that would be targeted at helping people
who are in need, that would be targeted at helping to create jobs in a
quick way, that will actually quickly create jobs that could stimulate
the economy and that will not put a burden on future budgets and on
future taxpayers by creating new permanent programs and mandatory
spending that takes a long time to spend out.
The Post then goes on to criticize the attempt of the President to
pin on all

[[Page S1784]]

of the opponents some ideological objection. As it notes:

. . . Ideology is not the only reason that senators--from
both parties--are balking at the president's plan. As it
emerged from the House, it suffered from a confusion of
objectives.

Here is the point I wish to emphasize. When the President talked not
merely of a prescription for short-term spending but a strategy for
long-term economic growth, here is what the Post says:

This is precisely the problem. As credible experts,
including some Democrats, have pointed out, much of this
``long-term'' spending either won't stimulate the economy
now, is of questionable merit, or both. Even potentially
meritorious items, such as $2.1 billion for Head Start, or
billions more to computerize medical records, do not belong
in this legislation, whose reason for being is to give U.S.
economic growth a ``jolt,'' as Mr. Obama himself has put it.
All other priorities should pass through the normal budget
process, which involves hearings, debate and--crucially--
competition with other programs.

I think that is right. That is one of the things Republicans have
been saying. Some of the spending in the bill may be perfectly
meritorious, but since this is emergency spending, it does not have to
be accounted for in either reduced spending elsewhere or new tax
receipts. It is simply added onto the budget deficit.
What the Post and what we and others have been saying is that
spending with long-term consequences is nothing more than the kinds of
items we pass every year in the appropriations process, and it should
be subjected to that process.
The so-called stimulus bill should be reserved for those items that
stimulate quickly. We have all heard the phrase ``timely, targeted, and
temporary.'' Part of the problem with the bill is that because it
creates new mandatory spending and it creates new permanent programs,
it is not temporary. In the discretionary account, more than half the
money does not even begin to be spent until the year 2011. I know all
of us hope by 2011 we are out of this recession.
I think the Post's criticism is very valid. I urge my colleagues to
look at this a slightly different way. Rather than spending on programs
that seem like a good idea and may have long-term, positive
consequences, let's remove those items from this bill and focus
strictly on the items that would actually stimulate the economy.
There is a second op-ed piece that was written in my hometown
newspaper, the Arizona Republic, on February 6, by Bob Robb, a
columnist there who is very erudite and a good economist. He criticizes
both Democratic and Republican ideas. He is an equal opportunity
criticizer. We all benefit from that critique of his from time to time.
Here is what he says about the Democratic proposal:

The Democratic stimulus proposals are based upon a false
premise and a deceit.
The false premise is that all Americans are construction
workers.
The Democrats propose that the federal government build new
stuff for virtually everyone.
The Congressional Budget Office has already noted the
constraints that exist on government's ability to get
hundreds of billions of dollars of construction money out the
door quickly. But even that ignores the constraint from those
who would need to do the work.
Residential construction is, of course, in a deep slump.
Commercial construction not so much. And residential
construction workers are not easily redeployed to do
commercial and heavy construction. The skill sets are
different.
The deceit is that all this spending requires suspending
ordinary budget constraints to jumpstart the economy. Most of
the spending is actually in pursuit of long-term Democratic
economic growth strategies.
Democrats believe that the economy will perform better
long-term with significant additional government investments
in alternative energy sources, education, health care and
social welfare programs.

And we have heard that during this debate.
He goes on to conclude:

Democrats won the election and certainly have the right to
try to advance their long-term strategies. But there is
nothing about fighting the recession that justifies exempting
these long-term strategies from the most basic of budget
considerations: How are you going to pay for them?
Even without the stimulus package, the federal government
has already reached post-World War II records for spending
and the deficit as percent of GDP.
The primary economic effect of the Democrat's stimulus
proposals will be to inflate private sector commercial
construction costs and give the country an even more severe
fiscal headache.

That leads into the third op-ed by George Melloan in today's Wall
Street Journal that I will have printed in the Record. He is a
respected commentator and economist in these matters. I am not going to
quote very much of his op-ed. The title of it is: ``Why `Stimulus' Will
Mean Inflation.''

He concludes, as did Bob Robb, that will be the result of all of this
spending which is declared emergency but is not distinguishable from
most of the spending that we do in the ordinary appropriations process.
But his concern is that as we inflate the currency of our country, it
will be more and more difficult to get people to buy our debt, and the
net result could be increasingly costly debt financing.
As he notes, too, the credit for the rest of the economy will become
more dear as well and entitlements will go up instead of being brought
under control under this legislation. He predicts this will require the
Fed to create more dollars, and the end result will be severe inflation
in our economy.
That is borne out by the fact that even though the legislation
purports to end some of the mandatory spending programs after 2 years,
the cost of 10 years for these programs that will supposedly expire is
well over $1.3 trillion. I don't think very many of us believe that
after 2 years we are going to stop this mandatory spending. My
colleague, John McCain, offered a proposal. In fact, there were two.
The Senator from South Dakota, Mr. Thune, offered another one. The idea
was, once we are out of the recession, once we have had two quarters of
economic growth, then surely that is the time to stop all this so-
called stimulus spending. That is, in effect, what the proposal said.
It was rejected by our Democratic colleagues. The reason is very clear:
They don't intend to stop. They intend to continue it, and that is
another $1.3 trillion that is not even factored into the cost of this
$1 trillion-plus bill.
Take the $1 trillion deficit we have now, $1.3 trillion on the bill
before us, another $1.3 trillion, and as Everett Dirksen said on this
floor a long time ago, pretty soon you are talking big money. We are
talking trillions of dollars, and we should not be in that position
today.
Recently, the President spoke to some of our Democratic colleagues.
He said the Republicans criticize this bill as a spending bill. I am
paraphrasing. He said: Of course, it is a spending bill; that is the
whole point. I understand what he was getting at. Many believe
Government spending can stimulate economic growth, and I suspect in
certain ways that can be done. A lot of us believe those benefits are
limited and that there are better ways to stimulate economic growth.
But that is the Keynesian theory.
When the President says: Of course, that is a spending bill, that is
the whole point; he is acknowledging what we have been saying on this
floor for a week now, which is that this is a spending bill.
He would say: But it also stimulates. What I said yesterday was that
is kind of a trickle-down theory. The Government spends $1 trillion,
throws it against the wall, and hopes some of it trickles down to
actual families who need the support so they can then get their own
budgets in balance and, hopefully, have something left over to spend.
That is where ideas, such as those in the alternative proposed by my
colleague, Senator McCain, come into play because they actually help
families in a way that could also have a way of stimulating economic
growth. That is what this package should be all about.
I will summarize it this way. This bill spends far too much money for
far too long a period of time without any requirement that it be offset
in any way by reductions in spending or tax receipts, which is the
normal appropriations process and will inevitably result in inflation
which robs every American and, in particular, retired Americans who
have to rely on their savings.
We have to consider the long-term consequences, and I hope the better
Republican ideas that have been, so far, pretty much rejected by our
colleagues

[[Page S1785]]

on the Democratic side can be brought to the floor as amendments and
will be supported so there can be broader support for this legislation.
If it is adopted on virtually a party-line basis, that is not going to
be good for the country, and the end result will not stimulate the
economy.
Mr. President, I ask unanimous consent to have printed in the Record
three items. The first is an editorial in the Washington Post, February
5, called ``The Senate Balks.'' The second is a column in the Arizona
Republic, dated February 6, ``Bad Stimulus Ideas All Around.'' The
third is a Wall Street Journal, February 6, George Melloan column,
``Why `Stimulus' Will Mean Inflation.''
There being no objection, the material was ordered to be printed in
the Record, as follows:

[From the Washington Post, Feb. 5, 2009]

The Senate Balks

Today in The Post, President Obama challenges critics of
the $900 billion stimulus plan that was taking shape on
Capitol Hill yesterday, accusing them of peddling ``the same
failed theories that helped lead us into this crisis'' and
warning that, without immediate action, ``Our nation will
sink deeper into a crisis that, at some point, we may not be
able to reverse.'' A thinly veiled reference to Senate
Republicans, this is a departure from his previous emphasis
on bipartisanship. Still, as a matter of policy, Mr. Obama is
justified in signaling that the plan should not be tilted in
favor of tax cuts--and that the GOP should not waste valuable
time trying to achieve this.
However, ideology is not the only reason that senators--
from both parties--are balking at the president's plan. As it
emerged from the House, it suffered from a confusion of
objectives. Mr. Obama praised the package yesterday as ``not
merely a prescription for short-term spending'' but a
``strategy for long-term economic growth in areas like
renewable energy and health care and education.'' This is
precisely the problem. As credible experts, including some
Democrats, have pointed out, much of this ``long-term''
spending either won't stimulate the economy now, is of
questionable merit, or both. Even potentially meritorious
items, such as $2.1 billion for Head Start, or billions more
to computerize medical records, do not belong in legislation
whose reason for being is to give U.S. economic growth a
``jolt,'' as Mr. Obama himself has put it. All other policy
priorities should pass through the normal budget process,
which involves hearings, debate and--crucially--competition
with other programs.
Sen. Susan Collins of Maine is one of the moderate
Republicans whose support the president must win if he is to
garner the 60 Senate votes needed to pass a stimulus package.
She and Democrat Ben Nelson of Nebraska are working on a plan
that would carry a lower nominal price tag than the current
bill--perhaps $200 billion lower--but which would focus on
aid to states, ``shovel-ready'' infrastructure projects, food
stamp increases and other items calculated to boost business
and consumer spending quickly. On the revenue side, she would
keep Mr. Obama's priorities, including a $500-per-worker tax
rebate.
To his credit, Mr. Obama continues to seek bipartisan
input, and he met individually with Ms. Collins for a half
hour yesterday afternoon. We hope he gives her ideas serious
consideration.
____

Bad Stimulus Ideas All Around

The Democrats have some bad ideas for the stimulus bill.
The Republicans also have some bad ideas.
Unfortunately, the compromise might be to combine the bad
ideas of both parties.
The Democratic stimulus proposals are based upon a false
premise and a deceit.
The false premise is that all Americans are construction
workers.
The Democrats propose that the federal government build new
stuff for virtually everyone.
The Congressional Budget Office has already noted the
constraints that exist on government's ability to get
hundreds of billions of dollars of construction money out the
door quickly. But even that ignores the constraint from those
who would need to do the work.
Residential construction is, of course, in a deep slump.
Commercial construction not so much. And residential
construction workers are not easily redeployed to do
commercial and heavy construction. The skill sets are
different.
The deceit is that all this spending requires suspending
ordinary budget constraints to jumpstart the economy. Most of
the spending is actually in pursuit of long-term Democratic
economic growth strategies.
Democrats believe that the economy will perform better
long-term with significant additional government investments
in alternative energy sources, education, health care and
social welfare programs.
Democrats won the election and certainly have a right to
try to advance their long-term strategies. But there is
nothing about fighting the recession that justifies exempting
these long-term strategies from the most basic of budget
considerations: How are you going to pay for them?
Even without the stimulus package, the federal government
has already reached post-World War II records for spending
and the deficit as a percentage of GDP.
The primary economic effect of the Democrat's stimulus
proposals will be to inflate private sector commercial
construction costs and give the country an even more severe
fiscal headache.
The Republicans counter that our financial difficulties are
rooted in housing and that's where the fix needs to start.
Certainly the bursting of the housing bubble was a
proximate contributor to the economic downturn. But the heart
of the problem was an overinvestment in housing, partially
induced by government subsidies. That was compounded by
imprudent lending to people without skin in the game in the
form of a substantial down payment.
So, what do Republicans propose? New, more massive federal
subsidies. Under their proposal, the federal government would
guarantee new mortgage rates of 4 percent. And don't sweat
that down payment. The federal government will give you a tax
credit of $15,000.
In the first place, existing mortgage rates are already
historically low. Moreover, home sales are trending up,
induced by deeply discounted prices.
The federal government could usefully reduce foreclosures
by guaranteeing the refinancing of existing mortgages so that
payments don't exceed a certain percentage of income.
By massively subsidizing new home purchases, however,
Republicans are basically proposing to reinflate the housing
bubble.
Republicans also propose to reduce the income tax rates on
the two lowest brackets. Rather than truly help low-income
Americans, who don't pay much in income taxes, the benefits
will primarily flow to the upper middle class, while
increasing the marginal tax rate increase faced by the middle
class.
Truly providing income support to low-income Americans, who
are most vulnerable in an economic downturn, would be
something useful the federal government could do, through
such things as temporary payroll tax relief and extended
unemployment benefits. But there's only a little over $100
billion in such short-term assistance in the stimulus bills.
The country would be fortunate if Congress would just enact
those provisions and then call it a day.
____

[From the Wall Street Journal, Feb. 6, 2009]

Why ``Stimulus'' Will Mean Inflation

(By George Melloan)

As Congress blithely ushers its trillion dollar
``stimulus'' package toward law and the U.S. Treasury
prepares to begin writing checks on this vast new
appropriation, it might be wise to ask a simple question:
Who's going to finance it?
That might seem like a no-brainer, which perhaps explains
why no one has bothered to ask. Treasury securities are
selling at high prices and finding buyers even though yields
are low, hovering below 3% for 10-year notes. Congress is
able to assure itself that it will finance the stimulus with
cheap credit. But how long will credit be cheap? Will it
still be when the Treasury is scrounging around in the
international credit markets six months or a year from now?
That seems highly unlikely.
Let's have a look at the credit market. Treasurys have been
strong because the stock market collapse and the mortgage-
backed securities fiasco sent the whole world running for
safety. The best looking port in the storm, as usual, was
U.S. Treasury paper. That is what gave the dollar and
Treasury securities the lift they now enjoy.
But that surge was a one-time event and doesn't necessarily
mean that a big new batch of Treasury securities will find an
equally strong market. Most likely it won't as the global
economy spirals downward.
For one thing, a very important cycle has been interrupted
by the crash. For years, the U.S. has run large trade
deficits with China and Japan and those two countries have
invested their surpluses mostly in U.S. Treasury securities.
Their holdings are enormous: As of Nov. 30 last year, China
held $682 billion in Treasurys, a sharp rise from $459
billion a year earlier. Japan had reduced its holdings, to
$577 billion from $590 billion a year earlier, but remains a
huge creditor. The two account for almost 65% of total
Treasury securities held by foreign owners, 19% of the total
U.S. national debt, and over 3o% of Treasurys held by the
public.
In the lush years of the U.S. credit boom, it was
rationalized that this circular arrangement was good for all
concerned. Exports fueled China's rapid economic growth and
created jobs for its huge work force, American workers could
raise their living standards by buying cheap Chinese goods.
China's dollar surplus gave the U.S. Treasury a captive pool
of investment to finance congressional deficits. It was
argued, persuasively, that China and Japan had no choice but
to buy U.S. bonds if they wanted to keep their exports to the
U.S. flowing. They also would hurt their own interests if
they tried to unload Treasurys because that would send the
value of their remaining holdings down.
But what if they stopped buying bonds not out of choice but
because they were out of money? The virtuous circle so much
praised would be broken. Something like that seems to be
happening now. As the recession deepens, U.S. consumers are
spending less,

[[Page S1786]]

even on cheap Chinese goods and certainly on Japanese cars
and electronic products. Japan, already a smaller market for
U.S. debt last November, is now suffering what some have
described as ``free fall'' in industrial production. Its two
champions, Toyota and Sony, are faltering badly. China's
growth also is slowing, and it is plagued by rising
unemployment.
American officials seem not to have noticed this abrupt and
dangerous change in global patterns of trade and finance.
The new Treasury secretary, Timothy Geithner, at his Senate
confirmation hearing harped on that old Treasury mantra about
China ``manipulating'' its currency to gain trade advantage.
Vice President Joe Biden followed up with a further lecture
to the Chinese but said the U.S. will not move
``unilaterally'' to keep out Chinese exports. One would hope
not ``unilaterally'' or any other way if the U.S. hopes to
keep flogging its Treasurys to the Chinese.
The Congressional Budget Office is predicting the federal
deficit will reach $1.2 trillion this fiscal year. That's
more than double the $455 billion deficit posted for fiscal
2008, and some private estimates put the likely outcome even
higher. That will drive up interest costs in the federal
budget even if Treasury yields stay low. But if a drop in
world market demand for Treasurys sends borrowing costs
upward, there could be a ballooning of the interest cost line
in the budget that will worsen an already frightening
outlook. Credit for the rest of the economy will become more
dear as well, worsening the recession. Treasury's Wednesday
announcement that it will sell a record $67 billion in notes
and bonds next week and $493 billion in this quarter weakened
Treasury prices, revealing market sensitivity to heavy
financing.
So what is the outlook? The stimulus package is rolling
through Congress like an express train packed with goodies,
so an enormous deficit seems to be a given. Entitlements will
go up instead of being brought under better control, auguring
big future deficits. Where will the Treasury find all those
trillions in a depressed world economy?
There is only one answer. The Obama administration and
Congress will call on Ben Bernanke at the Fed to demand that
he create more dollars--lots and lots of them. The Fed
already is talking of buying longer-term Treasurys to support
the market, so it will be more of the same--much more.
And what will be the result? Well, the product of this sort
of thing is called inflation. The Fed's outpouring of dollar
liquidity after the September crash replaced the liquidity
lost by the financial sector and has so far caused no
significant uptick in consumer prices. But the worry lies in
what will happen next.
Even when the economy and the securities markets are
sluggish, the Fed's financing of big federal deficits can be
inflationary. We learned that in the late 1970s, when the
Fed's deficit financing sent the CPI up to an annual rate of
almost 15%. That confounded the Keynesian theorists who
believed then, as now, that federal spending ``stimulus''
would restore economic health.
Inflation is the product of the demand for money as well as
of the supply. And if the Fed finances federal deficits in a
moribund economy, it can create more money than the economy
can use. The result is ``stagflation,'' a term coined to
describe the 1970s experience. As the global economy slows
and Congress relies more on the Fed to finance a huge
deficit, there is a very real danger of a return of
stagflation. I wonder why no one in Congress or the Obama
administration has thought of that as a potential consequence
of their stimulus package.

Mr. KYL. Mr. President, again, I thank the manager of the bill and my
colleague Senator Durbin for allowing me to give these remarks.
The ACTING PRESIDENT pro tempore. The Senator from Montana.
Mr. BAUCUS. Mr. President, I want everybody to remember these two
numbers: 99 percent, 79 percent; 99 percent, 79 percent. What are those
two numbers? If you take the Finance Committee bill, the bill that is
in this stimulus bill that the Senate Finance Committee wrote--the
Senate Finance Committee wrote the tax portion of the underlying bill
and also the aid to States portion.
Ninety-nine percent of the spending and the taxes combined in the
Finance Committee portion of the bill will be spent out in the first 2
years. Ninety-nine percent of the Finance Committee bill will be spent
in the first 2 years.
For those who didn't quite get it, it didn't quite compute, I will
say it again. Ninety-nine percent of the Finance Committee bill is
spent in the first 2 years--99 percent. Actually, if you want to break
it down, it is a little more than that for taxes only because some
reach to future years. Ninety-nine percent of the Finance Committee
bill is spent in the first 2 years.
What is my authority on that? Some economists? It is the Joint
Committee on Tax and CBO, if you look at their numbers and combine
them, the Joint Committee on Tax and the Congressional Budget Office,
that is what it calculates to: 99 percent of the Finance Committee bill
is spent in the first 2 years, according to the Joint Committee on Tax
and according to the CBO, combining the two.
That is my first figure, 99 percent. What is my second figure? Does
anybody remember it? What was my second figure? It was 79 percent. What
does 79 percent represent? Seventy-nine percent represents the total
spending of this bill in the first 2 years. The total spending, if you
take the Appropriations Committee and the Finance Committee and add
them together--79 percent of the total spending--in this bill is in the
first 2 years, 79 percent. Now, what is my authority? The Congressional
Budget Office and the Joint Committee on Taxation. So I ask Senators to
go look at the Joint Committee on Taxation data, go to the
Congressional Budget Office data. It is right there.

There are a lot of allegations and a lot of statements that are made
on the Senate floor by lots of Senators on both sides, and one of our
goals, clearly, is to try to get the facts. One of our goals is to
listen to the music as well as the words, to separate the wheat from
the chaff, and to get to what is really going on. What are the right
numbers?
Now, of course, no numbers are perfect, but what is close to being
right or as close as we can tell as we seek the truth? I will tell you,
the Joint Committee on Taxation is probably one of the most unbiased,
most reputable bodies here. Now, some don't like their numbers. They
wish their calculations would be different. But, clearly, they try
their best. They do their best. It is a bipartisan organization that
works for both bodies of Congress, and they work for both political
parties. They work for the Congress. It is not biased.
The Congressional Budget Office is not biased, and the Joint
Committee on Taxation is not biased. For those who are not familiar
with Washington speak, the Joint Committee on Taxation is an
independent professional group which advises the Congress on tax
matters and does tax calculations for the Congress on tax matters. The
Congressional Budget Office basically issues lots of reports and
advises the Congress on spending items that are nontax items and
calculations and so forth. Again, it is bipartisan. It serves both
bodies--the Congressional Budget Office. It is a very reputable body,
as is the Joint Committee on Taxation.
So, again, I want to repeat those numbers so it sinks in a little
more. The Congressional Budget Office and the Joint Committee on Tax,
add the figures together, 99 percent of the Finance Committee bill,
which is a large portion of the bill--I think it is about 60 percent of
the bill--is spent in the first 2 years. That is 99 percent--almost all
in the first 2 years. If you take it all together, the Finance
Committee bill and add in the appropriations portion of the bill, 79
percent--almost 80 percent or almost four-fifths--is spent in the first
2 years.
Now, Mr. President, we have to get moving. Our country is in deep,
deep, deep trouble. The American people want us to do something
responsible about all of this. We all know there are three parts to the
problem. One is the credit crisis--that is, credit is all frozen; banks
aren't lending--and there are lots of ways to address that. The second
part of the problem is housing. We are struggling to get even more
stimulus to housing. But a third major part of the problem is demand
and spending. There is about a $1 trillion gap between our potential
economy in America and the real economy--$1 trillion. If we don't
address that gap between spending and demand, we are going to find
ourselves in such deep difficulty, with so many jobs lost, it may be
equal to the Great Depression. We are not there yet, clearly, but we
could get pretty close if we don't take some pretty important actions
here.
Now, I have heard all kinds of speeches on this matter, whether the
roughly $800 billion stimulus package is right or not right. I have
been in rooms with conservative economists and liberal economists and
middle-of-the-road economists, and they all agree $800 billion is about
right, and it is needed--and it is needed. Some may quibble about some
parts, and there have been a lot of Senators on the floor,
respectfully, Mr. President, who have been quibbling. They have not
been seeing

[[Page S1787]]

the forest for the trees. But I submit, if we keep our eye on the ball
and keep our eye on the forest, we can get this bill passed and get it
passed pretty quickly.
I just want to urge those Senators who say not very much is being
spent out in the first years to go look at the Joint Committee on
Taxation and the Congressional Budget Office and do the calculations.
Again, 99 percent of the Finance Committee package is spent in the
first 2 years, and 79 percent of the total underlying bill is spent in
the first 2 years. I think that is pretty good. It is not perfect, but
it is pretty good.
Mr. President, I yield the floor, and I ask unanimous consent that
the time during the quorum call, if there is a quorum call, be equally
divided.
Frankly, I see the Senator from Tennessee is seeking recognition.
The ACTING PRESIDENT pro tempore. Who yields time?
The Senator from Tennessee is recognized.
Mr. CORKER. Mr. President, my colleagues on both sides of the aisle
have come down to speak on this stimulus package before us, and I want
to thank especially the colleagues on this side of the aisle for
talking about this particular package. I think most people in the
country realize that housing and credit are the foundations of this
country which need to be stabilized so that we can build our economy
again.
I know there are a number of people on both sides of the aisle who
are working in a gang mentality right now, if you will, to try to make
this package better, and I certainly applaud people who work together
in a bipartisan way to try to solve problems. In this particular case,
though, this stimulus package is nothing short of a disaster. I think
to try to make it 10 percent better, while admirable, is not really
doing our country the justice it deserves.
I am one of those people, I guess, who likes to understand all the
problems together we are facing before taking action on one specific
aspect. I want to understand everything as it is. And I know the
administration is coming forth in the next week or so to talk about
their solution to our financial crisis. I know there are many people in
this country who believe we have trillions of dollars of losses still
left in our financial system before we hit bottom. I think everybody in
our country realizes that as housing continues to drop, it is not just
hurting our economy directly, it is also dragging our financial system
down.
So, again, I appreciate those folks who are trying to work together
to make this bill, which is a disaster, in my opinion, slightly better.
I wonder if it wouldn't make more sense for us as a country to just
wait for a week or two to hear the rest of the administration's plan as
it relates to solving this problem. I think for us to rush out and put
forth $1 trillion on spending on top of a projected $1 trillion
deficit, without fully understanding the other issues our country faces
and how the administration plans to deal with these other issues, is
incredibly imprudent.
It would be like a business person in a company knowing they have a
crisis at hand, and not fully understanding what all those components
are, and sort of throwing the whole shooting match into one of those,
knowing there are other things coming they haven't thought about.
We have Governors around the country from both sides of the aisle who
are talking with us about what this is going to do to disrupt their
States because so much of this spending is programmatic. It has nothing
whatsoever to do with creating jobs. I have to be honest, I may be
rare, but I don't understand how any of us could seriously talk about
aid to States when our Federal Government is in the situation it is
today. States, generally speaking, run their States in appropriate
ways. But, truly, Governors on both sides of the aisle are wondering
what they are going to do to the people coming after them because we
are building this big fire hose of money coming into the States that
they have to spend in stovepipe ways that are going to cause their
successors to truly be in a very difficult situation.
Look, there are people on both sides of the aisle uneasy about this.
That is why this gang has been formed because there is tremendous
unease, even on the other side of the aisle, on this package. Most
people support this--well, I will not say that--many people, I believe,
are supporting this package to show support for this new President whom
we all want to see do well. We all want to see him be successful.

I have had friends in life who out of friendship to me supported
something I was doing, when I would have much preferred, after the
fact, their sharing with me that what I was about to do was a really
terrible idea. Instead, they just went along, and I ended up probably
not doing as well as I might have done. I think there is tremendous
unease in this body with this package, and I think there are a lot of
people who are holding their nose and supporting it out of support for
this President whom we all want to lead our country and this world
successfully.
I just urge people on both sides of the aisle to think about this, to
vote their conscience, and not to just go along but, in fact, to stop
and pause and look at all the issues we are going to be dealing with.
Let's ask the administration to come forth and talk to us about the
pricetag of dealing appropriately with the credit markets, with
housing, and with, maybe, some directed spending on infrastructure or
something that is not programmatic and would not disrupt the way State
governments run.
Mr. President, I thank you for the time, but I feel as though our
country is getting ready to do something we will regret and generations
after us will regret. So I am concerned about where we are as a country
with our economy, and I feel as if we are using resources today so
inappropriately when we are going to need those resources down the
road.
Mr. President, I yield the floor.
The PRESIDING OFFICER (Mr. Begich). Who yields time?
Mr. BAUCUS. Mr. President, I wonder if anybody on our side is seeking
time?
The Senator from Connecticut, Mr. Lieberman, seeks 5 minutes.
The PRESIDING OFFICER. The Senator from Connecticut is recognized.
Mr. LIEBERMAN. I thank the Chair and my friend, the Senator from
Montana, the chairman of the Finance Committee. I thank him for his
leadership and, frankly, for his strength of character and patience
throughout the long journey we have taken as a Chamber on this bill.
When we get it done--and I think we need to get it done quickly--it
will be in no small measure because of his steadfastness in this time
of national need.
Mr. President, one of the favorite metaphors that is used in time of
crisis is of a burning house. I wish I could find a different metaphor
because that one is used so frequently. But, frankly, I can't find one
that better expresses what I would like to express in a few moments
this afternoon.
The fact is obvious: America's economic house is burning. A lot of
people are being hurt--600,000 people unemployed last month, the second
month in a row that went over a half million people losing their jobs.
From one report I heard, it was the largest number of people losing
jobs in 1 month in America in 35 years. I could go on with a lot of
statistics, but we don't need them. We have heard them in the debate
before.
America's economic house is on fire. But I want to extend the
metaphor to us, those who are privileged to serve in the Senate. We are
the firefighters, if you will. And I fear there is a danger that what
may be happening is, while the house is burning, and we are on our way
to try to put out the fire, we have stopped the truck because we are
arguing over what is the best way to get to the fire most quickly. In
the meantime, we are leaving the house burning and more people are
being hurt.
Some people have suggested we go back to the beginning and start
again or that we wait, as my friend from Tennessee just said, until the
administration comes in with all its ideas for all of the responses to
the economic crisis we are in before we act on this one. That simply
cannot happen because the need and the urgency of the need is too
great. It is felt in individual lives, it is felt in macroeconomic
statistics, it is felt in the reports we hear, one after the other, of
great American businesses doing worse than they did last year and
terribly worse than they did 2 years ago. It is felt in the growing
signs of a deep global recession.

[[Page S1788]]

It is clear that demand from the private and personal sector has
dropped dramatically. Economists estimate about a $1 trillion hole in
our economy. The proposal President Obama has made comes to us from the
House. It is not all perfect, believe me, as I will say in a moment,
but it is $800 billion over 2 years. In fact, it is $800 billion over
more than 2 years. That means it is less than $400 billion the
Government is injecting into the economy now, because the private
sector will not, to try to kick-start the economy and protect people's
jobs and create new ones. That $400 billion into an economy that is $1
trillion short is simply necessary and it is urgently necessary.
Here we are. H.R. 1 is before us. It is larger than some people want
it to be. It contains items in it that do not appear, on first look, to
be directly related to economic recovery, stimulating the economy. I
preferred originally--I said I thought the stimulus bill should be big,
as big as the problem is; it should be as clean as possible; that is,
it would be mostly job creating--public works, that kind of
investment--and then it should be quick because the house is on fire
and every day we do not do anything, more people suffer and it will be
harder to get out of it. That is the challenge we have. Yet we, as the
firefighters, seem to be falling into some old habits, where we are
argue about how to get to the fire when the house keeps burning.
In the midst of this, two of our colleagues, Ben Nelson of Nebraska
and Susan Collins of Maine, have come together to form a bipartisan
group, a gang--that gives a good name to the term gang--whatever you
want to call them, moderates, centrists, Independents--basically a
bipartisan group that wants to find common ground so we can get the 60
votes we need to pass this so we can get to the fire and help put it
out so more Americans do not suffer. As part of this--and I have been
part of this group--we have worked well together and we have been very
open and honest with one another. We have talked about cuts--I have--in
programs that I support deeply.
But I have two things in mind here. One is the urgency of the moment.
I am going to have to yield on some things I wish to see in that bill
to make sure we get something done quickly.
The PRESIDING OFFICER. The time of the Senator has expired.
Mr. LIEBERMAN. I wonder if I could ask unanimous consent for 3
additional minutes?
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Would the Senator be OK with 2?
Mr. LIEBERMAN. Two? It is a deal. See, that is in the spirit of
compromise, in this case not bipartisan.
Mr. BAUCUS. It is compromising toward the intentions of the other
side.
Mr. LIEBERMAN. I am happy to do it.
Tough decisions had to be made by this bipartisan group. Why did we
make them? One, because the urgency is to get to 60. I wish we could
get to 80 but it doesn't seem to be in the offing so I am going to do
everything I can to get to 60 and hopefully a little over so we can get
help to the American economy, American businesses, the American people.
Second, this is not the last appropriations bill. We have an omnibus
bill coming. We have the regular appropriations process. We can come
back and find other ways to deal with some of the real needs that will
not get quite as much as they get now in H.R. 1, to achieve results
quickly.
That is my appeal to my colleagues. Let's not get dug in. This is not
a perfect bill, but it clearly is a very good bill and, most important
of all, it is a proposal that will pump money into the American
economy, into the pockets of working Americans and businesses
throughout this country, that will kick-start the economy, protect
millions of jobs, and create millions of other jobs. There is nothing
more important than doing that right now.
Let's get together, let's support the bipartisan effort, let's shoot
for 80 but get over 60 so we can get to the fire together and put it
out.
I yield the floor.
The PRESIDING OFFICER. Who yields time?
Mr. BAUCUS. Mr. President, I yield time to the Senator from Michigan,
5 minutes to the Senator from Michigan.
The PRESIDING OFFICER. The Senator from Michigan is recognized.
Mr. BAUCUS. Mr. President, I apologize, I think Senator Lincoln was
here earlier. I didn't turn around far enough.
Mrs. LINCOLN. That is fine.
The PRESIDING OFFICER. The Senator from Michigan is recognized.
Ms. STABENOW. Mr. President, I thank the distinguished chairman of
the Finance Committee who I know is working so hard. There are so many
different pieces of this that are so important to the American people.
I want to take a moment, after listening to colleagues--today and
throughout the week--on the other side of the aisle, to talk about the
fact that this package is strongly supported by the majority of our
caucus and I believe the majority of the American people who know we
have to do something different than what has been done for the last 8
years.
We have been debating whether to go back to policies that have been
in place for 8 years--tax policies that have been passed on a number of
occasions, over the last 8 years, under President Bush and when our
colleagues were in the majority. We have seen those policies in place.
We have seen the results of those, and they didn't work. I wish they
had. My State of Michigan has the highest unemployment rate in the
country, over 10.6 percent, heading up to 11 very quickly. I wish they
had worked because people in my State then would be working.
But that is not what has happened. The American people know that. The
American people understand we have to do something different. I
remember in those debates in the last 8 years when we came forward
saying we need to put people to work by focusing on jobs directly, jobs
rebuilding America, making sure we are focusing on jobs for roads and
bridges and rebuilding water and sewer systems and rebuilding our
schools and doing things that would directly stimulate the economy. But
those were rejected with the same arguments we are hearing now, the
same arguments.
We have talked over the last 8 years about the need to aggressively
move to the new green economy so we are not only tackling our
dependence on foreign oil but creating jobs in this new green energy
revolution. There were the same arguments in opposition, on the other
side of the aisle. We have put forward proposals to invest in our
people, proposals to make sure that people who are hurt by this
devastating financial and economic crisis--those who are unemployed or
fearful of being unemployed, who cannot put food on the table and pay
the bills and pay their mortgage--can get help. Too many times that has
been rejected.
We now find ourselves here. There was an election where those
policies were debated for a long time--not 1 year but 2 years. Those
policies the American people took a look at, both sets of policies, and
they said no. They said no to the policies of the last 8 years. They
said no to inaction.
We all know we were talking 2 years ago about the fact that we had to
address the housing problem, subprime lending, or we were going to see
a rippling effect in the financial markets. There was inaction. Nothing
happened. We find ourselves in a position today where we are seeing
some 600,000 people now--that is the unemployment number for January;
500,000 the previous month, 500,000 the previous month. It is only
getting worse and worse. Eleven million people in this country do not
have a job and that is only the people we are counting.
We come to this point where, yes, there is a difference. I commend
colleagues who are working together to get to the necessary 60 votes
and are working in good faith. But fundamentally we have a difference
in philosophy of how our economy should operate and, frankly, whom it
should help. Our proposal, this President's proposal, is to make sure
the majority of Americans, the overwhelming number of Americans who
have been left out of this economy in the policies of the last 8 years
get an opportunity to participate with job, jobs rebuilding America,
jobs in the green economy, keeping our police officers on the streets,
our teachers in the schools, retraining for the new economy and making
sure people who have been hurt, devastated so much, get the help they
need.

[[Page S1789]]

I urge us to join together in a new direction.
The PRESIDING OFFICER. The time of the Senator has expired. Who
yields time?
Mr. BAUCUS. Mr. President, 5 minutes to the Senator from----
The PRESIDING OFFICER. The Senator from Montana is recognized.
Mr. BAUCUS. Unless Senator Alexander seeks recognition. We want to go
back and forth to even things out.
Mr. ALEXANDER. I seek recognition for 5 minutes.
Mr. BAUCUS. I yield to the Senator on his time, on Republican time.
The PRESIDING OFFICER. The Senator from Tennessee is recognized.
Mr. ALEXANDER. Mr. President, will you please let me know when 60
seconds remains.
The PRESIDING OFFICER. The Chair will notify the Senator.
Mr. ALEXANDER. I have been listening to the debate as well. I think
it is important that all our colleagues and the American people
understand what we mean by bipartisanship, because there is a
disconnect between the tone I have been hearing for the last week from
the administration and from the majority and from the substance I have
been hearing. Here is what I heard. I heard we are going to work
together to try to deal with this economy. First we are going to have
to stimulate the economy. We all know next week the Secretary of the
Treasury is coming forward to do something about banking and then maybe
about housing. Then there is an appropriations bill, and then we have
health care, which the Senator from Montana has been hard at work on.
We have a great many things to do.
So what do we mean by bipartisan? I thought what we meant, we thought
what we meant, was that the President would define an agenda and then
we would sit down together and take our best ideas. The President put
his out there. We think we have a better idea. We said fix housing
first. Housing got us into this mess. Housing can get us out of it.
So we offered a way to offer up to 40 million Americans a 4- or 4.5-
percent mortgage, 30-year rate, saving them an average of $400 a month.
We brought it up. Senator Ensign proposed it. Not one single Democratic
vote.
Senator Isakson has been offering an amendment for the last year and
a half to give $15,000 in tax credits to home buyers. That was
accepted. I hope it survives the conference.
But the tone has changed overnight. Suddenly the President, instead
of inviting us to work with him, is saying basically: We won the
election, we will write the bill. The attitude seems to be: Let's see
if we can pick off one Republican or two Republicans or three
Republicans. Then the tone is, well, suddenly: The tired old ideas. I
didn't hear the President talk about his tax cut proposal for 2 years
during his campaign as a tired old idea. It is still a part of his
proposal. It is also a part of our proposal.
We have offered ways to fix housing first. No. 1, we suggest letting
people keep more of their own money, as the President has suggested.
Senator McCain's own bill, which received not one single Democratic
vote, offered to spend $420 billion, and it included a cut in the
payroll tax for 1 year and a cut in the lower rates of taxation.
Then we would like to do as Alice Rivlin, the former head of the
Budget Office, suggested. We would like to take all of the spending
that does not create jobs now and put it off and do it later. If we are
going to borrow money at a time when we are heavily in debt, it ought
to be targeted, timely, and temporary.
Senator McCain yesterday offered legislation that received almost
every Republican vote but no Democratic votes, that would have made it
temporary. It would have said whatever spending we have, we will have
it until the economy recovers. But once it starts to recover for 2
quarters--the gross domestic product goes up for 2 quarters, then the
spending stops.
What has happened? This is the easy piece of legislation. This is one
that most of us agree needs to be done. What we were expecting in this
era of bipartisanship, given the President's campaign and his comments,
was that he would offer his idea, we would offer ours, and we would put
them together and come up with a result.
Ours are: Fix housing first. That is not in the bill. Ours are: Make
it temporary. They rejected that without a Democratic vote yesterday.
The PRESIDING OFFICER. The Senator has 1 minute left.
Mr. ALEXANDER. Ours are: Let's get the spending off the bill that
does not create jobs now.
My staff finds that only about $135 billion of the $900 billion goes
to things that happen in the first couple of years--building roads,
improving national parks, other things that create jobs now.
The American people did not hear in the last campaign that the kind
of change they were voting for was that the first thing we would do
when we got to Washington is borrow $1 trillion, add it to the debt,
and then take the position: We won the election, we will write the
bill. If that is the tone, if that is the substance for the next
several years, that will not make a very successful Presidency. That
will not be good for our country. We want this President to be
successful because we need him to be successful for our country to
recover.
Mr. BINGAMAN. Mr. President, I intended to offer an amendment to this
bill to appropriate $1 billion to the Department of Energy Federal
Energy Management Program, FEMP. The funds would have been used to
expand the scope of energy savings performance contracts, ESPCs, and
utility energy savings contracts, UESCs. In the last 10 years, 195
ESPCs and UESCs have invested about $3 billion in Federal facilities
and have produced about 28,500 jobs. The costs of these projects have
been entirely repaid from savings.
The amendment was necessary and consistent with our stimulus goals
because it would have multiplied the job creation and the energy
savings from every dollar of Treasury investment. In addition to
providing significant financial leverage, ESPC and UESC projects comply
with the standards the Congress established in section 432 of EISA--42
U.S.C. section 8253 (f)(1) through (f)(7)--for energy projects in
Federal facilities: comprehensive energy and water conservation and
efficiency measures, full utilization of renewable energy technologies,
and transparency and accountability through long-term monitoring of
project savings.
The amendment I intended to offer would have given FEMP the incentive
to quickly clear its pipeline of about $2.2 billion of shovel-ready
projects, to accelerate the pace of new project development so that we
would have another $3 billion of projects implemented in the next 2
years, and enabled FEMP to expand the scope of the ESPC and UESC
projects by paying for the advanced metering and monitoring systems
that the Congress has mandated but not yet funded.
Based on the history of the ESPC and UESC projects, my amendment
would have assured that about $6 billion of projects would be
implemented, creating almost 60,000 jobs, at a cost to the Treasury of
$1 billion. I, therefore, urge the Federal agencies that are receiving
substantial new appropriations for energy projects to use the ESPC and
UESC projects as models of what the Congress wants to see accomplished
with the taxpayers' dollars.
Mr. INOUYE. Mr. President, this morning we learned that another
598,000 jobs were lost in the month of January. Our unemployment rate
now stands at 7.6 percent and will no doubt be higher still in the
coming months.
With that in mind, I would like to have printed in the Record an
opinion piece authored by Steven Pearlstein that appeared in today's
Washington Post. The piece does a much better job than I could hope to
do of explaining the basic economics of why increased Government
spending in a time of recession is a good thing.
I encourage my colleagues to take a serious look at this opinion
piece. In his final sentence, Mr. Pearlstein gives us all a crib sheet
that I think we all might want to pay a bit more attention to.

Spending is stimulus, no matter what it's for and who does
it. The best spending is that which creates jobs and economic
activity now, has big payoffs later and disappears from
future budgets.

As I have been saying all week, the $365.6 billion in spending that
we include in the American Recovery and Reinvestment Act meets these
simple

[[Page S1790]]

criteria. I again urge my colleagues to set aside partisan differences
and work together on this legislation.
Mr. President, I ask unanimous consent to have the opinion piece
authored by Steven Pearlstein printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

[From the Washington Post, Feb. 6, 2009]

Wanted: Personal Economic Trainers--Apply at Capitol

(By Steven Pearlstein)

As long as we're about to spend gazillions to stimulate the
economy, I'd like to suggest we throw in another $53.5
million for a cause dear to all business journalists:
economic literacy. And what better place to start than right
here in Washington.
My modest proposal is that lawmakers be authorized to hire
personal economic trainers over the coming year to sit by
their sides as they fashion the government's response to the
economic crisis and prevent them from uttering the kind of
nonsense that has characterized the debate over the stimulus
bill during the last two weeks.
At a minimum, we'd be creating jobs for 535 unemployed
PhDs. And if we improved government economic policy by a mere
1 percent of the trillions of dollars we're dealing with, it
would pay for itself many times over.
Let's review some of the more silly arguments about the
stimulus bill, starting with the notion that ``only'' 75
percent of the money can be spent in the next two years, and
the rest is therefore ``wasted.''
As any economist will tell you, the economy tends to be
forward-looking and emotional. So if businesses and
households can see immediate benefits from a program while
knowing that a bit more stimulus is on the way, they are
likely to feel more confident that the recovery will be
sustained. That confidence, in turn, will make them more
likely to take the risk of buying big-ticket items now and
investing in stocks or future ventures.
Moreover, much of the money that can't be spent right away
is for capital improvements such as building and maintaining
schools, roads, bridges and sewer systems, or replacing
equipment--stuff we'd have to do eventually. So another way
to think of this kind of spending is that we've simply moved
it up to a time, to a point when doing it has important
economic benefits and when the price will be less.
Equally specious is the oft-heard complaint that even some
of the immediate spending is not stimulative.
``This is not a stimulus plan, it's a spending plan,''
Nebraska's freshman senator, Mike Johanns (R), said Wednesday
in a maiden floor speech full of budget-balancing orthodoxy
that would have made Herbert Hoover proud. The stimulus bill,
he declared, ``won't create the promised jobs. It won't
activate our economy.''
Johanns was too busy yesterday to explain this radical
departure from standard theory and practice. Where does the
senator think the $800 billion will go? Down a rabbit hole?
Even if the entire sum were to be stolen by federal employees
and spent entirely on fast cars, fancy homes, gambling
junkets and fancy clothes, it would still be an $800 billion
increase in the demand for goods and services--a pretty good
working definition for economic stimulus. The only question
is whether spending it on other things would create more
long-term value, which it almost certainly would.
Meanwhile, Nebraska's other senator, Ben Nelson (D), was
heading up a centrist group that was determined to cut $100
billion from the stimulus bill. Among his targets: $1.1
billion for health-care research into what is cost-effective
and what is not. An aide explained that, in the senator's
opinion, there is ``some spending that was more stimulative
than other kinds of spending.''
Oh really? I'm sure they'd love to have a presentation on
that at the next meeting of the American Economic
Association. Maybe the senator could use that opportunity to
explain why a dollar spent by the government, or government
contractor, to hire doctors, statisticians and software
programmers is less stimulative than a dollar spent on hiring
civil engineers and bulldozer operators and guys waving
orange flags to build highways, which is what the senator
says he prefers.
And then there is Sen. Tom Coburn (R-Okla.), complaining in
Wednesday's Wall Street Journal that of the 3 million jobs
that the stimulus package might create or save, one in five
will be government jobs, as if there is something inherently
inferior or unsatisfactory about that. (Note to Coburn's
political director: One in five workers in Oklahoma is
employed by government.)
In the next day's Journal, Coburn won additional support
for his theory that public-sector employment and output is
less worthy than private-sector output from columnist Daniel
Henninger. Henninger weighed in with his own list of horror
stories from the stimulus bill, including $325 million for
trail repair and remediation of abandoned mines on federal
lands, $6 billion to reduce the carbon footprint of federal
buildings and--get this!--$462 million to equip, construct
and repair labs at the Centers for Disease Control and
Prevention.
``What is most striking is how much `stimulus'' money is
being spent on the government's own infrastructure,'' wrote
Henninger. ``This bill isn't economic stimulus. It's self-
stimulus.''
Actually, what's striking is that supposedly intelligent
people are horrified at the thought that, during a deep
recession, government might try to help the economy by buying
up-to-date equipment for the people who protect us from
epidemics and infectious diseases, by hiring people to repair
environmental damage on federal lands and by contracting with
private companies to make federal buildings more energy-
efficient.
What really irks so many Republicans, of course, is that
all the stimulus money isn't being used to cut individual and
business taxes, their cure-all for economic ailments, even
though all the credible evidence is that tax cuts are only
about half as stimulative as direct government spending.
Many, including John McCain, lined up this week to support
a proposal to make the sales tax and interest payments on any
new car purchased over the next two years tax-deductible,
along with a $15,000 tax credit on a home purchase. These tax
credits make for great sound-bites and are music to the ears
of politically active car salesmen and real estate brokers.
Most economists, however, have warned that such credits will
have limited impact at a time when house prices are still
falling sharply and consumers are worried about their jobs
and their shrinking retirement accounts. Even worse, they
wind up wasting a lot of money because they give windfalls to
millions of people who would have bought cars and houses
anyway.
What adds insults to injury, however, is that many of the
senators who supported these tax breaks then turned around
and opposed as ``boondoggles'' much more cost-effective
proposals to stimulate auto and housing sales, such as having
the government replace its current fleet of cars with hybrids
or giving money to local housing authorities to buy up
foreclosed properties for use as low-income rental housing.
Personal economic trainers would confirm all this. Until
they're on board, however, here's a little crib sheet on
stimulus economics:
Spending is stimulus, no matter what it's for and who does
it. The best spending is that which creates jobs and economic
activity now, has big payoffs later and disappears from
future budgets.

Mr. DODD. Mr. President, I was recently approached, along with my
colleague Senator Shelby and leaders of the House Financial Services
Committee, by the Chairman of the Federal Deposit Insurance
Corporation, Sheila Bair, with a request to increase the FDIC's
borrowing authority from Treasury from the current $30 billion to $100
billion, for use by the FDIC's Deposit Insurance Fund, and for
temporary additional borrowing authority to weather the economic
crisis.
The FDIC's Deposit Insurance Fund, DIF, absorbs losses that result
from the Corporation's obligation to protect insured deposits when
FDIC-insured financial institutions fail. Insured financial
institutions pay premiums that support the DIF and under current law
those premiums can be increased to cover any losses to the fund. At the
end of the third quarter of last year, the fund held approximately $35
billion.
Legislation to substantially and permanently increase this borrowing
authority has already passed the House, as part of the TARP legislation
passed in January. A scaled back version of it was also incorporated
into financial services legislation ordered reported by the House
Financial Services Committee earlier this week. Treasury Secretary
Geithner and Chairman Bernanke of the Federal Reserve Board have also
recently written to me underscoring their support for this request.
Since the FDIC's borrowing authority was last increased in 1991, the
asset size of banks has tripled. Even more important, the financial
system is under considerable stress, and the level of thrift and bank
failures has been rising. This line of credit is designed strictly to
serve as a backstop to cover potential losses to the Deposit Insurance
Fund.
Though this statutory borrowing authority has historically never been
tapped, and Chairman Bair has made clear she does not anticipate doing
so, I agree with Chairman Bair, Secretary Geithner and Chairman
Bernanke that under current economic circumstances such an increase in
borrowing authority is both prudent and necessary. While the current
fund has substantial reserves, it is important that we increase this
line of borrowing authority so that the FDIC has the funds available
which might be needed to meet its obligations to protect insured
depositors and to reassure the public that the government continues to
stand firmly behind the FDIC's insurance guarantee.
I had intended to try to incorporate a provision to increase FDIC
borrowing authority into the Economic Recovery legislation, with
certain protections to

[[Page S1791]]

require concurrence from other federal officials--including ultimately
the President--in exigent circumstances, and at least on a temporary
basis. I sought to do this yesterday. Unfortunately, my Republican
colleagues made clear that they would object to this proposal at this
time. And, for this reason, I will not offer it today. However, I
intend to work with them and those in the administration to craft a
proposal that satisfies their concerns in order to ensure that the FDIC
as the borrowing authority that it needs going forward.
I ask unanimous consent that copies of the letters from FDIC Chairman
Bair, Treasury Secretary Geithner, and Fed Chairman Bernanke be printed
in the Record. I will continue to work to ensure that the FDIC has
sufficient borrowing authority going forward to deal with a wide range
of contingencies.
There being no objection, the material was ordered to be printed in
the Record, as follows:

Federal Deposit

Insurance Corporation,

Washington, DC, January 26, 2009.
Hon. Christopher J. Dodd,
Chairman, Committee on Banking, Housing, and Urban Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: Thank you for your willingness to meet
with me to discuss a proposed increase in the borrowing
authority of the Federal Deposit Insurance Corporation to
cover losses from failed financial institutions.
As you know, the FDIC's Deposit Insurance Fund (DIF)
absorbs losses that result from the Corporation's obligation
to protect insured deposits when FDIC-insured financial
institutions fail. Insured financial institutions pay
premiums that support the DIF and those premiums can be
increased to cover losses to the DIF from failed bank
activity.
At the end of the third quarter of 2008, the DIF had a
balance of $35 billion available to absorb losses from the
failures of insured institutions. In addition, the FDIC has
announced premium increases that are designed to return the
DIF reserve ratio to within its statutory range in the coming
years. Because of our ability to adjust premiums, the FDIC
has never needed to draw on its $30 billion line of credit
with the Treasury Department to cover losses. Based on our
current assumptions, the FDIC should not need to draw on its
statutory line in the future. If it ever became necessary to
exercise this borrowing authority, the FDIC would ensure
repayment of any borrowing over time through assessments on
the banking industry.
Nevertheless, the events of the past year have demonstrated
the importance of contingency planning to cover unexpected
developments in the financial services industry. Assets in
the banking industry have tripled since 1991--the last time
the line of credit was adjusted in the FDIC Improvement Act
(from $5 billion to $30 billion). The FDIC believes it would
be appropriate to adjust the statutory line of credit
proportionately to ensure that the public has no confusion or
doubt about the government's commitment to insured
depositors. Therefore, we are requesting the borrowing
authority be increased to $100 billion. We also believe it
would be prudent to provide that the line of credit could be
adjusted further in exigent circumstances by a request from
the FDIC Board requiring the concurrence of the Secretary of
the Treasury.
As I stated above, the FDIC has never used its statutory
borrowing authority to cover losses and does not anticipate
doing so. However, the banking industry has grown
substantially since the current borrowing authority was
established. Appropriate adjustments to the current statute
would ensure that the FDIC is fully prepared to address any
contingency. I respectfully request that Congress increase
the FDIC's borrowing authority to provide additional
reassurance to depositors that the government stands behind
the FDIC's insurance guarantee.
If you have any questions regarding this issue, please do
not hesitate to contact me or Eric Spitler, Director of
Legislative Affairs.
Sincerely,
Sheila C. Bair,
Chairman.
____

Board of Governors

of the Federal Reserve System,

Washington, DC, February 2, 2009.
Hon. Christopher J. Dodd,
Chairman, Committee on Banking, Housing, and Urban Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: I am writing to join the Secretary of
the Treasury in expressing my agreement that the authority of
the Federal Deposit Insurance Corporation (FDIC) to borrow
from the Treasury Department should be increased to $100
billion from its current level of $30 billion. While the FDIC
has substantial resources in the Deposit Insurance Fund, the
line of credit with the Treasury Department provides an
important back-stop to the fund and has not been adjusted
since 1991. An increase in the line of credit is a reasonable
and prudent step to ensure that the FDIC can effectively meet
potential future obligations during periods such as the
difficult and uncertain economic climate that we are
currently experiencing.
I also support legislation that would allow the Secretary
of the Treasury, in consultation with the Chairman of the
Board of Governors of the Federal Reserve System if Congress
believes that to be appropriate, to increase the FDIC's line
of credit with the Treasury in exigent circumstances. This
mechanism would allow the FDIC to respond expeditiously to
emergency situations that may involve substantial risk to the
financial system.
The Federal Reserve would be happy to work with your staff
on this matter, as well as on the other amendments under
consideration that would allow the FDIC more flexibility in
the timing and scope of assessments that it charges to
recover costs to the Deposit Insurance Fund in the event that
the systemic risk exception in the Federal Deposit Insurance
Act has been invoked.
Sincerely,
Ben S. Bernanke,
Chairman.
____

Department of the Treasury,

Washington, DC., February 2, 2009.
Hon. Christopher J. Dodd,
Chairman, Committee on Banking, Housing & Urban Affairs, U.S.
Senate, Washington, DC.
Dear Mr. Chairman: I am writing to express my support for
the Federal Deposit Insurance Corporation's (FDIC's) current
request to increase its permanent statutory borrowing
authority under its line of credit with the Treasury
Department from $30 billion to $100 billion. Since the last
increase in that authority in 1991, the banking industry's
assets have tripled. More importantly, the financial and
credit markets continue to be under acute stress, and the
level of thrift and bank failures has been rising. Although
the FDIC's Deposit Insurance Fund remains substantial at $35
billion, and the FDIC has never needed to tap the existing
line of credit with the Treasury Department in the past, the
proposed increase in the limit is a reasonable and prudent
step to ensure that the FDIC can effectively meet any
potential future obligations.
The Treasury Department also supports the FDIC's request to
make future adjustments to the line of credit based on
exigent circumstances, but recommends that such future
adjustments require the concurrence of both the Secretary of
the Treasury and the Chairman of the Board of Governors of
the Federal Reserve System. This future adjustment mechanism
would provide an additional layer of protection for insured
depositors and enhance the confidence of financial markets
during this turbulent period.
The Treasury Department also supports the FDIC having
authority to determine the time period for recovering any
loss to the insurance fund resulting from actions taken after
a systemic risk determination by the Secretary of the
Treasury.
I hope that you find our views useful in the Committee's
consideration of the FDIC's request. Thank you for the
opportunity to share these views.
Sincerely,
Timothy F. Geithner,
Secretary of the Treasury.

Amendment No. 427

Mr. DODD. Mr. President, I rise today to talk about an amendment,
amendment No. 427, that Senators Bingaman, Isakson, and I offered to
help mitigate the foreclosure crisis, which is at the root of our
economic downturn. Currently, foreclosures are being filed at the rate
of nearly 10,000 a day; one in six homeowners are underwater; and a
recent study shows that U.S. homeowners lost a cumulative $3.3 trillion
in home equity during 2008. Addressing the foreclosure crisis is key to
restoring growth to the economy.
According to Federal Reserve Chairman Bernanke, the most effective
way to reduce foreclosures is to restore positive equity by writing
down mortgage principal. In fact, the HOPE for Homeowners program
requires principal write-down for participation.
Yet, under current tax law, most people who get loan modifications
involving principal reductions would have to pay taxes on the amount of
the loan forgiven. This is a significant barrier to people
participating in effective loan modifications and a terrible burden to
put on struggling families.
In 2007, the Mortgage Forgiveness Debt Relief Act provided a tax
exemption for forgiven mortgage debt if that mortgage debt was used
exclusively to purchase or substantially improve the home.
However, many homeowners, including a majority of subprime borrowers,
did not get their current loans to buy a home. Rather, in many cases,
they were steered by unscrupulous mortgage brokers into high-cost
refinance loans with hidden features that they did not understand. In
some cases, these funds were used to pay health care costs, educational
or other expenses. Many of these borrowers are now delinquent and
seeking loan modifications. Too many will end up in foreclosure.

[[Page S1792]]

These borrowers do not qualify for this current exemption. The threat
of a large tax bill has dissuaded many homeowners from getting loan
modifications.
In fact, in their 2008 Annual Report to Congress, the IRS National
Taxpayer Advocate wrote ``[we] recommend that Congress pass legislation
to make it easier for financially distressed taxpayers to exclude
cancelled [forgiven debt] from gross income.''
This amendment, by eliminating the income tax on all forgiven
mortgage debt, would remove a significant obstacle to loan
modifications at a cost of $98 million over the next 10 years. This
benefit would still expire, as it currently stands, at the end of 2012.
In addition, I urge the IRS to ease the burden of complying with the
reporting requirements that taxpayers face when claiming this
exclusion.
In its 2008 Annual Report to Congress, the IRS's Office of the
National Taxpayer Advocate stated that current reporting requirements
``are so complex that many and probably most taxpayers who qualify to
exclude [QPRI] from their gross income do not do so.'' QPRI or
qualified principle residence indebtedness is the technical term the
IRS uses for tax exempt forgiven mortgage debt. One way the IRS can
ease this burden, is by allowing taxpayers claiming the exemption to
calculate the fair market value based on the appraisal value of the
originating loan, which should ease the tax filing burden on the
millions of Americans who were tricked by predatory lenders. In
addition, the IRS should simplify the reporting requirement to claim
this tax exemption. Right now, taxpayers who claim the QPRI exclusion
must file a form, Form 982, that is not well known, is not supported by
most tax software programs or Volunteer Income Tax Assistance--VITA--
programs, and is extremely complicated. The IRS estimates that it takes
the average business taxpayer 10 hours and 43 minutes to complete this
form.
The goals of this amendment are both to expand the definition of QPRI
to include home equity indebtedness and also to relieve taxpayers from
the burden of filing any forms that they would not otherwise need to
file but for receiving the benefit of the QPRI exclusion. Specifically,
I urge the IRS to change Form 1099-C, used for all cancelled debts, not
just mortgage debts, to include ``check boxes'' for lenders to check
off when they are forgiving debt that is ``QPRI'' under the new
definition. These check boxes--similar to the check box currently
provided for debts discharged in bankruptcy should identify whether the
taxpayer is receiving QPRI debt forgiveness and should indicate whether
the taxpayer has lost their home, due to a foreclosure, short sale, or
deed-in-lieu-of-foreclosure, or will continue to own the home as a
result of a loan modification.
Check boxes that make clear whether the taxpayer has lost the home
are important because a taxpayer should not be required to make
adjustments to the tax basis of the home that they no longer live in.
If the homeowner continues to live in their home and the appropriate
box is checked, the Form 1099-C will provide the IRS with complete
information about the basis adjustments that will be required due to
the QPRI exclusion at the time of the property's sale or disposition.
Thus, as in the case of bankruptcy, the Form 1099-C should provide the
IRS with sufficient information so that the taxpayer will not be
required to fill out a Form 982 or use the long form 1040 to claim the
QPRI, and taxpayers who are exempt from filing tax returns will not
have to file returns solely to claim this exclusion.
Mr. SPECTER. Mr. President, I seek recognition to comment on my
cosponsorship of an amendment to H.R. 1, the Economic Recovery Act,
which would increase funding in the bill for mass transit by $6.5
billion. I am cosponsoring this amendment, offered by Senator Schumer,
because it will increase funding for ready-to-go public transit
projects that will create both jobs and transportation options. While
the underlying bill contains $8.4 billion for transit, public transit
agencies across the Nation identified over $50 billion worth of
projects that could be put under contract within a 2-year economic
recovery bill, and $12.2 billion which could be implemented within 90
days of Federal funding being allocated. I have heard from transit
agencies across Pennsylvania that are ready to put people to work and
improve transportation options in their communities if Federal stimulus
funding is provided. An investment in public transit would also have
the benefit of reducing oil consumption and vehicle emissions in
instances where increased public transit capacity encourages a shift
from automobiles.
However, despite my cosponsorship of this amendment due to its
potential for stimulus and for improving transportation systems across
Pennsylvania and the Nation, I am not committed to voting for it
without an offset. Since adopting this amendment would add $6.5 billion
to the size of the bill and to the national deficit, an offset to
reduce spending elsewhere in the bill by an equal amount would be
preferable. We should make every effort to identify offset to reduce
the total size of the economic recovery bill.

Amendment No. 390

Ms. SNOWE. Mr. President, as ranking member of the Senate Committee
on Small Business and Entrepreneurship, I wish to speak to amendment
No. 390 which would hold recipients of the Troubled Asset Relief
Program, TARP, funds accountable for the promises they have made to
American taxpayers. This amendment would require that financial
institutions, without major capital shortfalls, that receive TARP
funds, must increase lending to individuals and businesses--including
small businesses--above their lending levels at the time they received
Federal assistance.
This is a timely and vital amendment for those who are still unable
to get financing for home and car purchases, business expenses, student
loans and credit lines, including credit cards. Despite an investment
of $700 billion in taxpayer funds for the purpose of addressing our
country's major capital shortfalls, our citizens are still struggling
to access capital. Recent reports from the Government Accountability
Office and TARP's Congressional Oversight Panel have indicated that
banks are not using TARP funds for lending, and more specifically, that
lending to businesses and individuals has not experienced a noticeable
increase since Congress passed TARP late last year. Further, the
Federal Reserve's Senior Loan Officer Survey for January indicated that
U.S. lending institutions have further tightened their business lending
stance in the past 3 months.
Congress's intent was for TARP to restore credit and liquidity to the
financial system so that individuals and businesses can access the
capital upon which our system of commerce depends. It is vital to our
country's economic recovery that TARP funds be used to spur lending and
get capital flowing through our economy quickly, effectively and
transparently.
On January 29, 2009, I sent a letter to Treasury Secretary Timothy
Geithner to express my concerns about TARP recipients not using Federal
funds for its intended use. I also expressed to Secretary Geithner my
disappointment in the Department's opposition to explicitly requiring
firms that received Federal funds in the first tranche of TARP
distributions to increase lending above baseline levels. The Treasury
Department has refused to apply these conditions to TARP fund
recipients retroactively, despite an assurance by National Economic
Council Director Lawrence Summers in a January 15, 2009, letter to
Congress that, ``As a condition of federal assistance, healthy banks
without major capital shortfalls will increase lending above baseline
levels.''
By taking Federal dollars and not adhering to Congress's intent,
recipients are adding to an already dire economic situation. We must
demand that TARP funds be used to spur new lending. Our amendment will
mandate that as a condition of receiving TARP funds, financial
institutions without major capital shortfalls must increase their
lending above baseline levels. Additionally, the amendment contains a
provision requiring such financial institutions to immediately repay
assistance provided under the TARP if the Secretary of the Treasury
determines that they have not made sufficient progress toward achieving
these requirements.
I look forward to working with my colleagues in the Senate to have
this amendment included in the stimulus bill to help ensure that
taxpayer funds

[[Page S1793]]

are used to judiciously rebuild our Nation's economy.

Amendment No. 525

Mrs. FEINSTEIN. Mr. President, I rise to speak in support of Senator
Reid's amendment 525, which I cosponsored.
This amendment will improve renewable energy permitting and give
renewable energy companies grants to replace the renewable energy tax
credits.
Specifically, Senator Reid's amendment would appropriate $25 million
to the Department of Energy and the Department of Interior to assist in
renewable energy permitting; establish pilot offices in Western States
to focus on renewable energy permitting, to be funded with oil and gas
royalties; allow projects utilizing new renewable energy technology,
not just ``commercial'' technology, to apply for Federal renewable
energy loan guarantees; and establish a DOE grant program for renewable
energy development, to substitute for the solar investment tax credit
and the renewable production tax credit.
Let me explain why this amendment is needed.
First, let me discuss permitting.
First, Senator Reid and I propose $25 million to assist in renewable
energy permitting. In California, BLM has more than 200 solar
applications pending, and it has yet to complete a single application
review.
The Bureau is overwhelmed, and it needs a relatively small investment
in resources to ensure that it can quickly analyze how these project
proposals impact water resources, endangered species habitat, and
wilderness areas. Without these resources, we simply will not build the
renewable energy projects that we need in the West.
In addition to adding financial resources, the amendment would
establish pilot offices in Western States to focus on renewable energy
permitting.
Senator Tester and I introduced legislation to establish these
offices, and BLM established them administratively in January. The
offices would be funded with oil and gas royalties, to assure that they
have the resources necessary to process the rapid influx of
applications.
Second, let me discuss financing.
The amendment would also modify the title 17 renewable loan guarantee
program so that it may guarantee loans for emerging renewable
technology, not just ``commercial'' technology.
Solar thermal facilities, the most advanced wind turbines, and
enhanced geothermal projects are often the most economical renewable
projects available, but they are considered emerging because they are
the first of their type in the world.
The loan guarantee program in this legislation would exclude them.
This change allows them to compete with wind projects.
Finally, let me explain the need for a grant program to replace the
current tax credit system.
The amendment would establish a DOE grant program for renewable
energy development. Grants would equal the value of the solar
investment tax credit or the renewable production tax credit, which it
would replace. For the next 2 years, renewable projects could claim the
grants at a time when tax equity markets simply cannot support
significant renewable energy production.
Last year Congress made a significant investment in solar and other
renewable energy by passing a long term extension to the renewable
energy investment and production tax credits.
But renewable energy companies must go to big banks--JP Morgan, Wells
Fargo, or Bank of America--in order to use these tax credits, and today
those banks don't have profits and are sending renewable developers
away emptyhanded.
The ``tax equity'' market has gone from $5 billion to $2 billion in 1
year. One good wind developer recently told me he went to 42 banks and
couldn't find a partner.
The few banks still in the business are increasing their profit
margin. This is all transaction costs, benefiting the bankers and the
lawyers who write these contracts but not renewable energy development.
As the bank's cut goes up, the cost of renewable energy goes up as
well.
As a result, solar and wind companies are contracting. Some have shut
down, some have scaled back, but no one is building renewable energy
infrastructure. We are losing both green jobs and the fight against
climate change.
The DOE grants program in this amendment would replace the tax
credits.
The shrinking tax equity market would no longer harm renewable energy
developers, who could get back to the business of shifting the United
States away from coal and gas towards renewable energy.
According to a study by Navigant Consulting in 2008, the 8-year
extension to the solar investment tax credit should produce 276,000
jobs by 2016.
Mr. President, 150,000 of these jobs were forecast to be located in
California. If the freeze in the available credit for solar project
development is allowed to continue, not only will these jobs not
materialize, but current ``green jobs'' will be lost.
This legislation provides some assistance to renewable energy, but
without this amendment, I fear the bill will not have its intended
effect of spurring immediate construction of renewable energy projects.
Right now renewable energy projects--which are massive capital
investments--are not being built. Developers face a series of problems:
Many projects await permits from DOE, the Forest Service, and the
Department of Interior. Developers cannot use tax equity markets in
order to utilize Federal tax credits, and without these tax credits,
projects cannot secure private financing.
This amendment--put simply--addresses these three major challenges
that prevent us from building renewable energy projects in the United
States.
To address permitting, it establishes offices at BLM whose only job
will be to evaluate and issue permit decisions.
To address the tax issue, this amendment creates a DOE grant program
that should cost the Treasury nothing we didn't already expect to
spend. But it will allow projects to proceed that would not be able to
without it.
Finally, to address the credit crisis, this amendment modifies the
loan guarantee program to assure that innovative ideas also qualify.
I strongly encourage my colleagues to support it.
(At the request of Mr. Reid, the following statement was ordered to
be printed in the Record.
Mr. KENNEDY. Mr. President, as we consider the provisions of
this legislation that provide significant incentives for the adoption
of health information technology I would like to take this opportunity
to explain a seemingly technical element of the language. The term
``qualified electronic health record,'' as defined in section 3000 of
the Public Health Service Act, as added by section 13101 of the
American Recovery and Reinvestment Act of 2009 is intended to include
computerized provider order entry systems. Such systems are electronic
records of health information on an individual. They include patient
demographic data and health information, such as medical history and
problem lists, including patient age, gender and allergy information as
well as laboratory reports. Computerized provider order entry systems
also have the capacity to provide clinical decision support such as
medication dosing and interaction alerts, to capture and query
information related to health care quality such as changes in
laboratory values, and responses and reaction to medications, and to
exchange electronic health information with, and integrate such
information from other sources such as medication lists from a pharmacy
or clinical information from a provider practice. Of course, the end
goal is development and implementation of comprehensive, integrated
electronic health records, and computerized provider order entry
systems are an important intermediate step.
Ms. SNOWE. Mr. President, I rise today, at this most consequential of
times, in support of the amendment that I have submitted, together with
Senator Pryor, on behalf of our Nation's struggling communities that
are negatively affected by base closures or realignments. During even
the best of economic times, the closure or realignment of a military
base can devastate a local economy. With the gravity of our economic
circumstances--the most dire we have witnessed since the Great
Depression--it is more difficult than ever for these communities to
redevelop and stem job losses.

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My amendment would recognize that communities affected by base
closures and realignments face particular challenges in this dismal
economy and therefore special consideration should be given to provide
assistance and relief under this stimulus act to those communities. I
must point out that this amendment would not create a preference or
entitlement, but would remind all of the critical need to help
communities impinged by the closure or realignment of military
installations.
For instance, with the closure of Naval Air Station Brunswick, NASB,
in my home State of Maine, the entire midcoast region of Maine will
experience profoundly negative economic consequences attributable to an
estimated loss of 6,500 jobs and $140 million in annual income. Given
these challenging economic times, it is imperative that we make every
effort to foster redevelopment in communities affected by base
closures.
I respectfully ask my colleagues to support this amendment.
Mr. President, I wish to speak about an issue of regional equity with
regard to the recovery package and specifically about our forestry
programs. I strongly believe that in order for our forest economies to
work we must collaborate on national forestry whether it is Federal
lands, or private lands. I am concerned that this proposal will
strongly benefit one region with Federal lands over those with private
lands and strongly urge leadership to overhaul the structure of this
proposal with regard to our forest economies.
Our Nation's forests are a strategic national resource which span
from Maine to California and Alaska to Puerto Rico. Over 60 percent are
in private ownership. In order to provide regional equity, it is
important that within the broad categories of construction and wildland
fire management, flexibility will be provided to address a wide range
of actions all aimed at stimulating the Nation's economy. These include
maintaining and enhancing the Nation's forest products industry;
hazardous fuels reduction; improvements in forest health; wood-to-
energy grants; rehabilitation and restoration activities on Federal,
State, and private lands; assisting State and local fire agencies
responsible for wildfire preparedness and suppression, and urban and
community forest enhancements.
These activities can be accomplished through existing State and
private forestry authorizations and programs. In order to address
current economic conditions, I believe this economic stimulus bill
should not require any matching funds and shall seek to maximize
economic activity, job retention, and creation.
I look forward to working with the Appropriations Committee chair on
this critical issue.
Mr. President, as ranking member of the Senate Committee on Small
Business and Entrepreneurship, I wish today, with Senator Landrieu, to
file this bipartisan and commonsense amendment that would strengthen
the innovative opportunities of small businesses who participate in the
Small Business Innovation Research, SBIR, and Small Business Technology
Transfer, STTR, programs and help them receive funding provided in the
American Recovery and Reinvestment Act of 2009, H.R. 1.
Our amendment would require that any qualifying participating Federal
agency allocate a percentage of its research and development funding
gained from this economic stimulus bill to their respective SBIR or
STTR programs. The SBIR and STTR programs award Federal research and
development funds to small businesses to encourage them to innovate and
commercialize new technologies, products, and services. These programs
provide more than $2 billion in Federal research and development
funding each year to small businesses, and the benefit to my State of
Maine cannot be overstated. According to the most recent data, in
fiscal year 2005, Maine's technology-based small businesses received
more than $4.5 million in SBIR total awards.
Since the SBIR program was created, small hi-tech firms have
submitted more than 250,000 proposals, resulting in more than 60,000
awards worth approximately $19 billion. At a time when our national
economy is flagging due to failing financial markets and a correcting
housing market, the SBIR program is more essential than ever, if we are
to capitalize on the groundbreaking capacities of our Nation's
pioneering small businesses.
Now, more than ever, we in Congress must do everything within our
power to help small businesses drive the recovery of our economy. It is
imperative that we do everything we can to stimulate our economy and
the small-tech firms of this Nation can help lead the way.
Mr. President, I urge my colleagues on both sides of the aisle to
support this amendment and to provide all innovative small businesses
with opportunities to grow our Nation's innovative infrastructure.
Mr. President, the Tax Code currently requires small business owners
to prepay their income taxes on a quarterly basis. To determine what is
owed, the owners calculate 110 percent of the previous year's tax
liability and then pay one-fourth of that amount each quarter of the
following year.
The purpose of requiring businesses to pay 110 percent of the
previous year's tax liability is so that the government is sure to
collect the taxes owed, even when businesses are growing.
Unfortunately, our economy has been in a recession and climbing out of
it is not likely to be quick. We are in a credit crunch and the cash
flow of American businesses is slow. Because of the recession and the
credit crunch, the overpayment of quarterly income taxes by America's
small businesses is both unnecessary and harmful.
It is unnecessary because in this recession there will be few
businesses that meet the hurdle of a 10-percent rate of growth to match
a 10-percent overpayment of taxes. Perhaps bankruptcy lawyers will be
able to meet or exceed this growth target, but having the Tax Code push
more customers their way is what I would like to avoid. Having small
business owners pay 110 percent of their 2008 tax liability imposes one
more cash flow burden that I fear could push small businesses into dire
straits.
Paying 10 percent more taxes than were owed for 2008 imposes a
significant cash flow burden on small business. This additional tax is
likely to end up as an interest free loan to the U.S. Government
because the excess tax will be refunded after the 2009 return is filed.
It makes no sense for small businesses to be floating the government an
interest free loan at a time when we are trying to find ways to
alleviate their cash flow troubles and find ways to create or maintain
jobs.
I will offer an amendment to help small businesses with their cash
flow and not require them to give the government an interest-free loan
in 2009. The amendment is written so that on a quarterly basis,
individuals who earned less than $500,000 in 2008 and, earned more than
half of their income from a business with 500 or fewer employees, would
certify to this information on their quarterly return. Then they would
be allowed to make quarterly payments of only 75 percent of their 2008
tax liability, rather than 110 percent. There are small business owners
who make less than $150,000 who are required to prepay 100 percent of
the previous year's liability who will also be allowed to make
quarterly payments of 75 percent of the previous year's liability.
Small business owners are most often taxed as sole proprietorships,
subchapter S corporations or partnerships. In any of these forms of
ownership, the business income is reflected on each individual owner's
taxes. The amendment helps small business cash flow by not forcing the
business to make bigger distributions to help pay bigger quarterly tax
bills. Not every investor in a partnership or a subchapter S
corporation is making their living running the business but this
amendment tries to get to those who need it most by requiring more than
half of a taxpayer's income must be from businesses that have fewer
than 500 employees.
For businesses, like bankruptcy lawyers, who know they are having a
banner year, my amendment is silent. I do not require that they
withhold only 75 percent. They are free to continue voluntarily sending
more to the IRS to cover their expected good earnings and increased tax
liability.
I do not have an estimate of the cost of this amendment from the
Joint Committee on Taxation. However, I

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would expect the revenue estimate to be modest since this is a 1-year
cash flow difference between taxes due quarterly during 2009 and the
final tax bill that is due in 2010. Since the 110 percent payments
would have likely resulted in tax refunds in 2010, I wouldn't expect
there to be much revenue lost.
I urge my colleagues to support this amendment.
Mr. President, I wish to speak on amendment No. 539 I am offering
which could help to steer our economy toward economic recovery. There
is no question that America's small businesses are the engine that
drives our Nation's economy, constituting 99.7 percent of all employer
firms, employing nearly half of the private sector workforce, and
create three-quarters of net new jobs annually over the last decade. If
an economic stimulus plan is to succeed, it must include a sharp focus
on job creation by small businesses. To that end, I humbly request that
my colleagues support this noncontroversial amendment that will ensure
small businesses--our Nation's true job generators--will not be
shortchanged at a time when the economy is struggling to grow and
create jobs.
Mr. President, my amendment builds upon this initiative to underscore
the economic value of small businesses in Federal agencies across the
board. This measure would mobilize existing Federal loan guarantee
programs by requiring the heads of key agencies, including the
Department of Agriculture; the Department of Energy; the Department of
Homeland Security; the Department of Labor; and the Environmental
Protection Agency, to work with the Administrator of the SBA to the
maximum extent practicable, to guarantee robust small business
participation in each agency's respective loan programs.
As ranking member of the Senate Committee on Small Business and
Entrepreneurship, I wholeheartedly believe that small businesses play a
central role in our economy and that the Federal Government should
foster a nurturing entrepreneurial environment that fully equips our
small businesses with the tools not just to mitigate and stem this
economic crisis, but to be a catalyst for helping to address and
ultimately solve it.
That is why Senator Landrieu, the new chair of the Small Business
Committee, and I have called on President Obama, in a joint letter we
sent on January 29, 2009, to sign an Executive order to elevate the
Administrator of the Small Business Administration, SBA, to Cabinet-
level status within the first 100 days of his administration.
This designation will send a clear signal that small business will
drive our Nation out of this recession. The SBA is the primary agency
within the Federal Government tasked with the responsibility of
assisting small businesses, and it should have a seat at the table when
it comes to revitalizing the economy, a top national priority. Frankly,
in the past, the Federal Government has neglected to place enough
emphasis on the resources and programs that could benefit America's 26
million small businesses.
The present economic crisis presents an opportunity to get capital
now to small businesses so they can create jobs now. This amendment
would take the swiftest path by mobilizing presently existing,
presently funded Federal programs that have already been authorized by
Congress, to include the interests of small business in their loan
programs.
I respectfully ask my colleagues on both sides of the political aisle
to support this amendment to facilitate the strength of small
businesses in helping our Nation create jobs and grow during this
economic crisis.
(At the request of Mr. Reid, the following statement was ordered to
be printed in the Record.)

Health Information Technology

Mr. HATCH. Mr. President, I would like to ask a question
through the Chair to my good friend from Massachusetts, Senator
Kennedy. Is my friend aware that the legislation before us today, the
Economic Recovery and Reinvestment Act of 2009, contains a provision
which would establish the Office of the National Coordinator for Health
Information Technology within the Department of Health and Human
Services and instruct the National Coordinator to support and
facilitate the use of electronic health records for Americans?
Mr. KENNEDY. That is correct. There are a few provisions in the
legislation that address this issue directly. Subsection
3001(c)(3)(A)(ii) of the bill tasks the national coordinator with
updating the Federal Health IT Strategic Plan to include specific
objectives, milestones, and metrics with respect to ``the utilization
of an electronic health record for each person in the United States by
2014.'' Subsection 3001(c)(6)(E) requires the national coordinator to
``estimate and publish resources required annually to reach the goal of
utilization of an electronic health record for each person in the
United States by 2014, including the required level of Federal funding,
expectations for regional, State, and private investment, and the
expected contributions by volunteers to activities for the utilization
of such records.'' In addition, subsection 3002(b)(2)(B)(iii) of the
bill designates the Health Information Technology Policy Committee with
the task of making recommendations to the national coordinator for the
``utilization of a certified electronic health record for each person
in the United States by 2014.''
Mr. HATCH. It will come as no surprise to anyone to know that many
Americans will be skeptical of the creation of a national database and
central repository of health records. Indeed, one group which is
particularly concerned with this provision would be those who do not
use medical treatment or interact with the health deliver services in
this country. Therefore, I would again ask my friend, through the
chair, does the language in these subsections attempting to establish
``the utilization of an electronic health record for each person in the
United States by 2014'' require those who do not use medical treatment
to go to a doctor for a physical examination in order to have an
electronic health record created?
Mr. KENNEDY. No, it does not. Nothing in this bill should be
interpreted as requiring those who do not use medical care to have an
electronic health record, or requiring any individual to have an
electronic record. The intention is that the national coordinator will
work towards the goal of having all patients that utilize the services
of ``health care providers,'' as defined in this act, to have available
to them records in an interoperable electronic format instead of merely
in paper form by the year 2014. Those who do not receive care and
services from ``health care providers'' will not be required to have an
electronic health record, nor will any individual be required to have
an electronic medical record. This bill does not require the use of
electronic medical records, but seeks to make such records more broadly
available.

Direct and Guaranteed Farm Ownership and Operating Loans

Mr. FEINGOLD. Mr. President, while the current economic downturn did
not begin in rural America, the full brunt of the impact is certainly
being felt by many of our farmers and small rural communities now. The
dairy sector has been especially hard hit in Wisconsin and across the
Nation as evidenced by a call last week for the USDA to take additional
actions to help remove a surplus of dairy products from our markets in
a letter led by the senior Senator from Wisconsin and myself and signed
by 33 other Members including the distinguished chairman of the
Agriculture Committee. A provision in the current legislation also
takes another important step to help soften the landing for farmers
facing drops in the prices they receive of approximately 50 percent as
we are seeing in dairy over the recent months. I am very appreciative
of the fact that the Appropriations Committee includes critically
needed farm loan funding for direct and guaranteed ownership and
operation loans for our Nation's family farmers who are struggling
along with everyone else through this economic recession. It is
critical they get access to the financing they need to stay in business
and keep their operations intact. It is my assumption that the interest
of both the Appropriations and the authorizing committee in having this
farm loan funding in the bill is to ensure that current farming
operations and facilities can continue to operate and that small family
farms and beginning and minority farmers have access to capital to
secure new farming opportunities. I also think it is important to

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ensure that USDA loan programs such of these do not inadvertently
encourage expanded production in sectors of agriculture, including
dairy, where prices are depressed and farmers are trying to cope with
revenues below the cost of production prices. I hope to continue to
work with the chairman of both the Agriculture Committee and
Agriculture Appropriations Subcommittee to oversee the utilization of
these funds to minimize any inadvertent negative effects if they exist.
Mr. KOHL. I appreciate my colleague's remarks. I was pleased to
collaborate with him on the dairy letter he just referenced, and I am
glad to note his support for the work the committee has done to address
the credit demands confronting family farmers. My expectation is that
the USDA will utilize these resources in accordance with the programs
and priorities set forth in the farm bill. Family farming and ranching
businesses are facing many of the same challenges confronting our
broader economy and the operating and farm loans contemplated under the
bill are extremely important.
Mr. HARKIN. I would like to first thank the distinguished chairman of
the Agriculture Appropriations Subcommittee for working to include Farm
Service Agency loan program money in this bill. In the coming months
farmers will be applying for operating loans for the spring planting
season. They will face tighter credit standards from lenders. Some
farmers who were eligible for commercial credit last year may not be
eligible this year.
Access to adequate and affordable credit is vital to our Nation's
farmers and ranchers--particularly now. Like many people across the
Nation, farmers are feeling the impact of the economic downturn. The
decline in commodity prices, high input costs, and declining exports
have significantly strained producers' fiscal circumstances. It is
important the money provided in this bill be used in accordance with
the priorities established in the farm loan programs and focus on those
eligible borrowers who are struggling to maintain their farming
operations.
Regarding the recent sharp decline in dairy prices, I was pleased to
work my colleagues on the letter to Secretary Vilsack to help remove a
surplus of dairy products from the markets which they have both
mentioned.

Comparative Effectiveness Research Funds

Mr. BAUCUS. I understand Senator Enzi has comments regarding the
provisions for comparative clinical effectiveness research included in
The American Recovery and Reinvestment Act of 2009 which is being
considered in the Senate this week.
Mr. ENZI. I thank the Senator. It is my understanding that the
American Recovery and Reinvestment Act of 2009 has in its health
provisions $1.1 billion in new funds for comparative clinical
effectiveness research. This is an important issue to me as HELP
Committee ranking member. I am pleased to see that in its consideration
of this bill, the Appropriations Committee made sure this research will
evaluate comparative clinical effectiveness, not comparative cost-
effectiveness. In addition, the committee's report language references
provisions of the existing comparative effectiveness research program
at HHS that ensure that the agency developing comparative information
does not use it to set national practice standards or coverage
restrictions. I also believe that comparative effectiveness research
must be conducted using an open and transparent process, and must
consider differences in how people respond to treatment. It is my
understanding that the Comparative Effectiveness Research Act of 2008,
which you introduced with Senator Conrad last Congress, is consistent
with these principles. I would like to see the $1.1 billion used
consistently with these principles, and ask that you advocate for these
principles in conference.
Mr. BAUCUS. I thank the Senator for his support of these principles.
I agree with the Senator's summary of S. 3408, the Comparative
Effectiveness Research Act of 2008, which would create a permanent
institute to prioritize and provide for comparative clinical
effectiveness research for the U.S. I support including short-term
funds for such research in the American Recovery and Reinvestment Act.
I applaud the Appropriations Committee for clarifying that research
should evaluate comparative clinical effectiveness, not cost-
effectiveness. And I agree that the $1.1 billion should be used
consistently with the principles in S. 3408 from the 110th Congress.
Senator Conrad and I plan to reintroduce our bill because we still need
a long-term framework for this type of research in the U.S.
Mr. CONRAD. I thank Senator Enzi for his support of these principles.
Comparative clinical effectiveness research needs to be a permanent
part of our health system. It is one of the ways we will improve health
care for all Americans. I look forward to working with him on this
effort.
Mr. MENENDEZ. I appreciate the remarks of Senator Enzi. Comparative
effectiveness research should focus on clinical outcomes and produce
information that patients and providers can use to make better
decisions about their treatment options. I look forward to working with
my colleagues on this important issue.
Mr. CARPER. Like my colleagues, I support comparative effectiveness
research that builds on the principles set forth in S. 3408 from the
110th Congress. Clinical comparative effectiveness research has the
capability of improving health care quality by advancing evidence-based
decisionmaking in our health care system. I look forward to working
with my colleagues on this important issue.
Mr. HATCH. I agree that the primary focus of comparative
effectiveness research should be clinical effectiveness not cost. We
can all agree that the ``one size fits all'' approach is the wrong
approach for the American health care system. Based on our own personal
experiences we all know that what works best for one person, does not
always work the same for another. I look forward to working in a
bipartisan and inclusive manner to come up with prudent legislation
that will not only help us realize the true potential of comparative
effectiveness but also preserve patient choice and innovation--the two
hallmarks of our health care system.
Mr. ROBERTS. I would associate myself with the remarks of Senator
Enzi, and would underscore that it is very important to require full
openness, transparency and accountability in how research priorities
are set and how studies are conducted and communicated. Without this
openness, patients have no assurance that their voice will be heard in
the process, and no ability to understand how results are being used in
decisions that directly affect their health. I look forward to working
with my colleagues to ensure that strong provisions for openness,
transparency, and accountability are put in place.
Mrs. FEINSTEIN. I thank my colleagues for their efforts on this
issue. I agree that comparative effectiveness research holds great
promise to improve medical care by giving physicians and patients
valuable information on treatment options.
It is my understanding that the new Federal coordinating council
included in the language is intended to coordinate the comparative
effectiveness research efforts taking place across Federal agencies and
with funds we are providing in this bill. However, there is some
concern that the language, as currently written, allows the council to
expand its activities beyond mere coordination. I think my colleagues
would agree that the purpose of the council is to coordinate
comparative effectiveness research activities with the goal of reducing
duplicative efforts and encouraging coordinated and complementary use
of resources.
Mr. BAUCUS. I thank Senator Feinstein for pointing that out. I agree.
The coordinating council should look across agencies to coordinate
resources and activities of the federal government with respect to
comparative effectiveness research. Its charge should not go beyond
that. The language of the bill could be clarified to make that point
clear. And I will support clarification of it in conference.

Workforce training

Mrs. MURRAY. Mr. President, I would like to engage my good friend,
the Senator from Iowa and the chairman of the Subcommittee on Labor,
HHS, and Education Appropriations in a colloquy.
I would like to take this opportunity to commend my good friend on
his strong support for the education and

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training of America's workers. As you know, I serve as chairman of the
Senate Subcommittee on Employment and Workplace Safety. The Senator and
I have worked together on many initiatives on behalf of our workforce.
That is why I would like to clarify certain provisions contained in the
bill before us today that pertain to job training for U.S. workers.
First, is it the Senator's understanding that the additional funding
provided through the Workforce Investment Act formula grants for adults
and dislocated workers will be used predominantly for the direct
delivery of services to those who are the most heavily impacted by this
recession--the unemployed and the underemployed?
Mr. HARKIN. Yes, the Senator's understanding is correct. I included a
provision in this recovery bill that reinforces the requirement in the
WIA to use adult State grant funding to serve certain priority
populations, such as those with low incomes or on public assistance. I
believe that we should target these funds on the delivery of services
to those who have been adversely impacted by our recent economic
crisis. I also believe local workforce boards should utilize existing
authority to support needs-related payments to help engage individuals
in training, if such support is appropriate and effective.
Mrs. MURRAY. Is it also the Senator's understanding that the most
innovative strategies with proven effectiveness in putting people back
to work in high demand occupations, including sector-based and career
pathways initiatives that are focused on green jobs, health care and
other viable industries, should be utilized to the extent possible in
carrying out the delivery of these employment and training services?
Mr. HARKIN. Absolutely, it is essential that the workforce services
provided through this legislation, are delivered through the most
effective means possible, ensuring that the unemployed and
underemployed are provided with relevant employment and training
assistance that will enable them to find good, family sustaining jobs.
It is also essential that these programs provide the skills that are
relevant to local and regional employers that will help to rebuild our
regional and U.S. economies.
Mrs. MURRAY. As my friend from Iowa knows, older workers have been
particularly devastated by our current economic downturn. A recent
Urban Institute publication reported that job loss for older workers is
at a 31-year high. Is it the intent of this legislation that older
workers will be a key population targeted for services with these
additional resources?
Is it further the understanding of the chairman that funding under
the adult formula grants will focus on serving individuals with
multiple barriers to employment, particularly those with low skill
levels, to obtain the education, skills training and support services
they need to obtain jobs in high demand occupations, particularly in
green jobs, healthcare, and other viable industries?
Mr. HARKIN. The Senator is correct. As chairman of the Labor
Appropriations subcommittee, I supported the $120 million in the
recovery bill for the senior community service employment program.
These funds will support employment and training opportunities for low-
income, older Americans. The funds benefit both older Americans hurt by
the current economic crisis and community service organizations
struggling to keep up with increased demand under decreasing budgets.
Individuals with multiple barriers to employment, including older
workers, those with low skill levels, and individuals with
disabilities, should indeed be an important focus of services for the
funding provided to the Department of Labor. Offering these workers,
particularly low skilled workers, the tools they need to secure good
jobs in new or growing industry sectors can help them enhance their
quality of life and achieve economic self-sufficiency as a member of
the middle class.
Mrs. MURRAY. With regard to the funding for youth activities under
the legislation, is it the Senator's understanding that in addition to
summer and year-round employment opportunities, this funding may be
used to provide related educational enrichment, including remediation,
skills training, and supportive services that enable participants to
work in high demand occupational areas, such as in the green jobs and
health care industries, with the goal that such employment and
enrichment activities will lead to further education or employment?
Mr. HARKIN. The Senator is correct. While the primary purpose of this
funding is to provide meaningful paid work experiences for at risk
youth, educational enrichment, necessary skills training, and support
services that enable young people to participate and succeed in these
and future endeavors are necessary and fully support the intent of the
legislation.
Mrs. MURRAY. In the workforce provisions under consideration, we
provide that training may be provided for jobs in high-demand
occupations, through the award of contracts to institutions of higher
education, as long as a customer's choice is not limited. Is it the
Senator's understanding that such training may include the provision of
adult basic education or English language education services, as long
as these services are provided in connection with a job for which the
individual is preparing? Is it the Senator's further understanding that
these services may be provided through community colleges and other
high quality public programs that offer postsecondary education and
training within a community or region?
Mr. HARKIN. My colleague is correct. This provision was included in
the recovery bill to facilitate the use of funds provided to train
individuals in the areas needed in their local community. It would be
my expectation that a very significant portion of the funds provided
would be spent quickly and effectively in training individuals in
health care and other high-demand occupations, as well as emerging
``green'' industries.

Investing in America's Workers

Ms. STABENOW. Mr. President, I would like to engage my friend and
colleague, the Senator from Washington State, in a colloquy.
I want to commend my good friend's work on behalf of America's
workers, including the growing number of workers who have lost their
jobs and need skill training and other services to secure good jobs in
new or viable industries, including those that are retrofitting
themselves to improve longer term global competitiveness. These
industries promote energy efficiency, energy conservation, and
environmental protection in such industries as advanced manufacturing,
auto, aerospace, health care, and others.
As Senator Murray has rightly stated during conversations on this
recovery bill, investing in job creation should be accompanied by
investments in workers, an essential component to strengthening our
Nation's productivity and long-term competitiveness. These workers
include the increasing number unemployed or underemployed individuals
across the country and the thousands of manufacturing workers who have
lost their jobs, such as those in the aerospace industry and the
automotive industry. In her role as chairman of the Senate Subcommittee
on Employment and Workplace Safety, we have worked together to help
workers, particularly those in distressed industries, acquire the
skills they need to secure family-supporting jobs in viable and
emerging industries including the energy efficient and advanced drive
train vehicle industry, the biofuels industry, and the energy-efficient
building, construction, and retrofits industries. That is why I would
like to clarify several provisions contained in the bill before us
today that pertain to job training for workers. As the Senator knows,
my home State of Michigan has experienced major economic dislocations
from manufacturing plant closures and industry layoffs.
I would like to first ask the esteemed Senator from Washington State
if it is her understanding that worker training in these industries
would be eligible for consideration by the Secretary of Labor under the
national emergency grant and competitive grant funding sections of the
workforce provisions of this bill?
Mrs. MURRAY. Yes, the Senator from Michigan State is correct. It is
my understanding that the Secretary of Labor will use these funds to
help retool workers who have lost their jobs due to the recession and
declining industries, including those in the green-

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collar industries the Senator mentioned.
Ms. STABENOW. Is it also the Senator's understanding that the most
effective strategies in helping workers maintain and secure new jobs in
emerging and viable industries, including the energy efficient and
advanced drive train vehicle industry, the biofuels industry, the
energy-efficient building, construction, and retrofits industries, and
the aerospace industry are those supported by strategic partnerships
among State and local workforce boards; institutions of higher
education, including community colleges and other training providers;
labor organizations; industry; and economic development entities that
use sector or cluster-based training approaches for developing job
training strategies and career pathway initiatives that lead to
economic self-sufficiency?
Mrs. MURRAY. The Senator from Michigan is correct and makes an
important point. Effective strategies for helping workers retool for
jobs in viable industries should be informed by the critical
stakeholders she noted. It is my hope that when distributing these
funds, the Secretary of Labor gives due deference to those eligible
entities with strategic partnerships among representatives from the
affected industries, labor organizations, workforce investment boards,
elected officials, and institutions of higher education, including
community colleges and other training providers.
Ms. STABENOW. I would like to thank my distinguished colleague from
Washington. I look forward to working with her in the future to ensure
that investing in America's workers remains a critical component of our
national economic recovery and growth strategy.

Long-Term Care

Mr. WYDEN. Mr. President, I wish to enter a colloquy with my good
friend, the Senator from Montana, and the senior Senator from
Wisconsin, one of the chief authors of this amendment and the
distinguished chair of the Special Committee on Aging. I would like to
talk about the importance of investing in the long-term care workforce
in order to provide good care for seniors and the disabled.
Specifically, I would like to discuss the inclusion of long-term care
reforms in the health reform bill.
Chairman Kohl and I have worked together on the Long-Term Care Worker
Recruitment and Investment Demonstration Program Amendment to the
American Recovery and Reinvestment Act of 2009 because direct care jobs
are a 21st century growth industry. With the aging of the baby boomer
generation, this workforce will need to grow substantially if we are to
meet the coming demand for both medical and nonmedical support services
delivered in the home and in small community residences, as well as in
more traditional nursing homes and assisted living facilities. However,
today, we are not on track to achieve this goal.
In order to meet the future health needs of older adults and recruit
and retain a stable and competent long-term care workforce, the
Congress, State governments, and the Obama administration need to work
together.
Mr. KOHL. We already have a shortage of health care workers who are
trained and devoted to caring for older Americans and those with
disabilities--a fact that is well documented in the report issued by
the Institute of Medicine last year. This shortage is one that will
only grow more desperate as our country ages rapidly. The United States
will not be able to meet the approaching demand for health care and
long-term care without a workforce that is prepared for the job.
Between 2005 and 2030, it is estimated that the number of adults aged
65 and older will almost double from 37 million to over 70 million,
increasing from 12 percent of the population of the United States to
almost 20 percent of the population. So it is not surprising that the
Department of Labor's Bureau of Labor Statistics predicts that personal
or home care aides and home health aides will represent the second and
third fastest growing occupations between 2006 and 2016.
Only last week, the New York Times published an editorial concluding
that, ``With more jobs being lost all the time across the board--more
than 71,000 layoffs in the United States were announced on Monday and
Tuesday alone--there should be comfort in the fact that one sector,
health care, continues to add jobs.'' I will ask to have this editorial
printed in the Record.
Government has a special obligation to care for vulnerable
populations. Inadequate training in geriatrics, gerontology, chronic
care management, and long-term care is known to cause misdiagnoses,
medication errors, and inadequate coordination of services and
treatments that result in poor care and are costly for the health care
system as a whole. Yet personal and home care aides are not subject to
any Federal requirements related to training or education, and States
have very different requirements for this key part of the direct care
workforce. Furthermore, Federal training requirements for nurse aides
and home health aides have not been updated for more than 20 years. It
is time to review and improve training standards for all direct care
workers. Current training protocols focus too much on tasks and too
little on teaching how workers can deliver person-centered care.
Further, often training does not reflect the increasingly complex needs
of the frail elderly. Inadequate training has been found to be a major
contributor to high turnover rates among direct care workers, while
more training is correlated with better staff recruitment and
retention.
Equally important, the IOM report recommends that State Medicaid
programs increase pay and fringe benefits for direct care workers.
Investment in direct care jobs would significantly benefit our economy
by providing greater economic opportunity to low-income workers, while
also strengthening health services for our aging and disabled family
members and friends.
Mr. WYDEN. Long-term care is in need of rethinking. Right now it is a
form of Russian roulette for many Americans who pray they can avoid it,
and with it a fatal financial bullet. Under the current system, we are
sending older Americans into a long-term care system that is more
fragile than they are. States are staggering under the weight of
projected Medicaid long-term care costs and fear that they will face
economic calamity as their baby boom population begins to need
services. Similarly, the staggering weight of family caregiving for
many ``sandwiched'' adult children, who are caring for their children
as well as their elderly parents with serious health problems, makes
some family members feel like they are staggering too.
Every 15 years, since the days of Harry Truman, health care advocates
have woken up, looked around, and said, ``This is the moment. This time
my dream of universal health care will be achieved.'' Then something
goes wrong. That vision is not returned by the powers that be, and the
dream of finding a health care solution is dashed on the rocks of harsh
reality.
That 15-year reawakening is upon us again, but this time I believe
this story might have a different ending because of the leadership of
the Senator from Montana and the commitments of Chairmen Kennedy and
Kohl and President Obama.
As we work together to tackle health reform and entitlement reform, I
want to work with you and Chairman Kohl to include thoughtful health
care workforce reforms. Long-term care has been too often overlooked as
the health care stepchild, and as we move into what I and many experts
think will be our next real window for health reform this year, it will
be important to make sure that long-term care is not left behind in the
health reform debate.
Mr. BAUCUS. I agree with my distinguished colleagues that as we work
to reform our health care system it is important to consider how the
health care workforce fits into these efforts. Creating a strong, well-
trained workforce is a critical part of adequately addressing the needs
of older adults and individuals with disabilities. An estimated 69
percent of people turning 65 years old will need some form of long-term
assistance as they age. Most individuals that need long-term care
services and supports prefer to receive assistance in their homes or
communities. This demand and the need for direct care professionals
will only grow as the baby boom population turns 65.
Various studies suggest present and future shortages of
paraprofessionals and health care professionals. Effective recruitment
and retention strategies are needed. Training programs should be
designed that address the competencies required of a 21st century

[[Page S1799]]

workforce. As part of this effort we also should look at the skills of
those currently delivering long term care services.
The purpose of health reform is to achieve a high-performing health
system. Achieving this goal requires an investment in our health
professional and paraprofessional workforce.
Mr. WYDEN. I thank the chairman for his recognition of this important
issue. I look forward to working with him during our consideration of
health care reform this year.
Mr. KOHL. I thank Senator Wyden and Senator Baucus for their
attention to these important policies and look forward to working with
them in the weeks ahead.
Mr. President, I ask unanimous consent that the editorial to which I
referred be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

[From the New York Times; Jan. 28, 2009]

Caring for the Caregivers

With more jobs being lost all the time across the board--
more than 71,000 layoffs in the United States were announced
on Monday and Tuesday alone--there should be comfort in the
fact that one sector, health care, continues to add jobs. In
December, employers added 32,000 health-related positions.
Unfortunately, one of the fastest-growing areas within the
health care field--home care for the elderly--also is one of
the lowest paid and most exploitable.
Outdated labor rules from 1975 allow home care aides to be
defined as companions, which exempts their employers, usually
private agencies, from federal standards governing overtime
and minimum wages. As the population has aged, however,
demand for home care has grown and the work has evolved far
beyond companionship. It is not uncommon for home care
workers to perform significant housekeeping chores and to
help their elderly clients move, dress and eat, make sure
they take their medicines and go to doctors' appointments.
In its last days in office in 2001, the Clinton
administration proposed a revision to the labor rules to
allow federal protections to apply to personal home care
aides, but the Bush administration promptly threw that out
and reasserted the status quo. A 2007 Supreme Court ruling
upheld the rules, and a push that year by House and Senate
Democrats to pass a bill to update the law went nowhere.
According to the Labor Department, personal and home care
aides are expected to be the second fastest-growing
occupation in the United States from 2006-2016, increasing by
51 percent, slightly behind the expected growth in systems
and data communications analysts.
Most home care aides are women, low income and minority,
and many of them are immigrants. Some states have taken steps
to provide them with basic labor protections. Efforts to
unionize home care workers in some states also has led to
wage gains and better conditions. But the progress is
incomplete without a federal law to recognize and protect the
home care work force. It is unconscionable that workers who
are entrusted with the care of some of the nation's most
vulnerable citizens are themselves unprotected by basic labor
standards.
It is also unwise, because poor pay for long hours leads to
high turnover, which undermines the quality of care. Turnover
also drives up the cost of providing home care--a needless
drain on Medicaid, which pays for many home care services.
And that is not the only way that poor quality home care jobs
end up costing taxpayers. Nearly half of home care workers
rely on food stamps or other public assistance, so taxpayers
ultimately compensate for their low pay and inadequate
benefits.
Of necessity, job creation and job quality will be the
focus of the Obama administration in 2009, and, most likely,
for many years. The Department of Labor could rewrite the
rules to extend federal protections to home care workers. Or
Congress and the White House could work together to pass a
law granting those protections. Either way, the point is to
ensure that home care, a 21st-century growth industry,
creates good jobs.

trial projects

Mr. LEVIN. Mr. President, as the Senate works to boost our ailing
economy, I want to clarify that funding provided to the National Park
Service for trail projects would not be limited to only certain trails.
The bill provides $158 million for the operation of the National Park
System, of which $23 million is recommended in the report for deferred
maintenance of trails. I understand this funding could be used for any
trails in the National Park System, including the eight National Scenic
Trails. Is that correct?
Mrs. FEINSTEIN. That is accurate. The $23 million in funding for
trail maintenance could be used for any of the eight National Scenic
Trails in this country. Many of these trails are in disrepair, have
unsafe crossings and uncompleted sections that could be repaired with
this funding, creating jobs and generating economic value for
surrounding communities.
Mr. LEVIN. The North Country National Scenic Trail, the longest
scenic trail designed in America, traversing seven States including the
State of Michigan, has great needs and could use the funding provided
in this economic recovery package. In Michigan alone, the North Country
National Scenic Trail has maintenance needs totaling $2.5 million that
have been postponed for too many years. These trail upgrades and
maintenance projects would put people to work right away and spur
additional economic activity. I was concerned the report accompanying
the economic recovery bill could be misinterpreted to limit this
funding to so-called units of the National Park System. Only three of
the eight National Scenic Trails have unit status, and limiting funding
in that way would be arbitrary and unfair. I believe this funding
should be available for any NPS-administered National Scenic Trail,
whether designated as a unit or not, for trail construction,
rehabilitation and maintenance. Is that the Senator's intent as
chairman of the Interior Appropriations Subcommittee, and I believe the
sponsor of the language?
Mrs. FEINSTEIN. Yes, that is our intent. All of the National Scenic
Trails would be eligible for this funding, which would create jobs,
generate economic value, and provide healthy recreational
opportunities.
Mr. LEVIN. I thank Chairman Feinstein for including this funding and
clarifying its use.

wastewater infrastructure funding

Mr. BROWN. Mr. President, at this time I would like to discuss a
letter Senators Wyden, Feingold, McCaskill, Schumer, Levin, Stabenow,
and I sent to the Appropriations Committee arguing for an increase in
wastewater infrastructure funding in this legislation. My colleagues
and I believe it necessary to pay special attention to projects that
are known as combined sewage overflows, or CSOs. As Senator Feinstein
knows, combined sewage overflows are very expensive projects that many
of our nation's older sewer systems are required to complete in order
to separate storm water run-off from sanitary sewer systems. In fact,
our hard-pressed cities and small towns are facing billions of dollars
in costs to address this problem.
We supported the infrastructure amendment offered by Chairman
Feinstein and Chairman Murray to add an additional $7 billion to the
bill for clean and drinking water projects. We also strongly support
the $4 billion included in the underlying bill for clean water
infrastructure. Would Chairman Feinstein agree that the U.S.
Environmental Protection Agency should make funding for CSO projects
one of its Recovery Act priorities?
Mrs. FEINSTEIN. First, I would like to commend my colleagues for
bringing this important matter before the Senate. EPA estimates that
combined sewage overflows are responsible for releasing more than a
trillion gallons of untreated and undertreated wastewater into our
Nation's water bodies every year. I believe that additional funding
provided through the Recovery Act for the Clean Water State Revolving
Funds program will help alleviate the combined sewage overflow problem.
I share the Senator's belief that the EPA should strongly encourage the
completion of combined sewage overflow projects and I look forward to
working with the Senator to address this serious problem in the years
ahead.
Mr. BROWN. We sincerely appreciate the Senator's leadership on this
matter. In my State of Ohio over 80 communities, from small towns like
Mingo Junction and Defiance, to big cities like Akron and Cincinnati,
must invest over $6 billion to complete combined sewage overflow
projects. Without assistance, ratepayers will be faced with
skyrocketing bills, public health is at risk, and our lakes, streams,
and rivers will remain polluted.
The PRESIDING OFFICER. Who yields time? The Senator from Montana.
Mr. BAUCUS. Mr. President, I ask unanimous consent that at 1 p.m.
today, the Senate proceed to vote in relation to the following
amendments in the order listed; that no amendments

[[Page S1800]]

be in order to these amendments prior to the vote; with 2 minutes of
debate prior to each vote, equally divided and controlled; with 10-
minute vote limitations after the first vote in the sequence: Sanders
amendment No. 330, as modified; Coburn amendment No. 309; Udall
amendment No. 359; Coburn amendment No. 176.
Further, that upon disposition of the above-listed amendments, the
Senate then consider the following amendments and that they be
considered in rotating fashion back and forth to each side; that no
amendments be in order to these amendments prior to a vote in relation
to the amendments: Conrad-Graham No. 501; Dodd No. 145, and that when a
vote is scheduled in relation to amendments Nos. 501 and 145, the vote
would occur first on 501; Cantwell amendment No. 274, with the
modification which is at the desk; Feingold amendment No. 485; Grassley
amendment No. 297; Enzi amendment No. 293; Vitter amendment No. 107;
Bunning amendment No. 531; Wyden amendment No. 468; and Thune amendment
No. 538.
The PRESIDING OFFICER. Is there objection?
Mr. COCHRAN. Mr. President, there is no objection on this side. We
appreciate the accommodations of the manager of the bill.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mrs. LINCOLN. Mr. President, I wish to a say special thanks to
Chairman Baucus as well as Chairman Inouye. Having been given the task
of working hard, their staffs have been amazing in coming together and
trying to produce a package that will be a job creator, a stimulus to
our economy, a recovery to the economic crisis we face in this great
Nation. They have done a tremendous job with the time they have been
given.
Of course, we are all here because we believe we have something to
add to that process and to that solution. I come today to speak briefly
about a couple of amendments I have.
Mr. President, I ask unanimous consent that Senator Vitter of
Louisiana be added as a cosponsor of my amendment No. 199.
The PRESIDING OFFICER. Without objection, it is so ordered.

Amendment No. 199

Mrs. LINCOLN. The amendment I will be offering here today, along with
Senators Cornyn, Murray, Pryor, and Vitter, will bring relief to the
forest products industry, which has been devastated by the downturn in
the housing market.
My colleague from Tennessee has just spoken about the housing issue,
the concerns we have there. Well, it has had a devastating effect on
our timber industry as well. This industry is an integral part of the
economy of many Southern and Northwestern States. In my home State of
Arkansas, the forest products industry is a foundation of our economy,
our culture, our way of life, and particularly those living in rural
America.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. I thank my good friend from Mississippi for that kind
statement.
Mr. KERRY. Mr. President, would the Senator yield for purposes of a
question?
Mr. BAUCUS. Absolutely.
Mr. KERRY. Mr. President, would it be in order at this point to lock
in a time to speak after the tranche of votes?
Mr. BAUCUS. Mr. President, I suggest that we agree to 5 minutes in
rotating fashion for each side and that Senator Kerry be first
recognized after the votes.
Mr. KERRY. Are we limited to 5? Would it be possible to get 10
minutes?
Mr. BAUCUS. I will say 10 minutes. I want to hold it to four speakers
until we get a better handle on what is going on.
Mr. KERRY. I appreciate that.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, I yield 5 minutes to the Senator from
Arkansas.
The PRESIDING OFFICER. The Senator from Arkansas is recognized.
More than 50 percent of Arkansas land is forested. Much of this is
sustainably managed to create products we use every single day. In
addition, there are jobs associated with the growing of the forests and
the manufacture of these great products we manufacture here at home.
More than 32,000 Arkansas men and women work in our woods and at our
sawmills and our paper mills. These are good jobs located in our small
rural communities, making a huge part of the fabric of this country.
These are jobs that we must protect.
During this economic crisis, the forest products industry has
suffered immensely. Since 2006, the industry has lost more than 181,000
jobs or roughly 14 percent of its workforce. The lumber side has been
particularly hard hit, with a 20-percent drop in employment. In
Arkansas, the impact has been even greater.
Our amendment will help our domestic timber industry remain
competitive and will help ensure against further domestic timber
manufacturing job losses. We are talking about job creation. We are
talking about job recovery. We are talking about ensuring that we do
not lose any more of these vital jobs in rural America that sustain
this country.
It would extend provisions enacted in the farm bill set to expire
this year which help large integrated and small family-owned companies,
as well as the shareholders of timber REITs. In short, the amendment
would provide a uniform 15-percent rate for cutting timber and
additionally would reform the timber REIT rules.
This policy change has strong bipartisan support. It has passed the
Senate in the past and will do a great deal to protect our timber jobs
right here at home.
I urge my colleagues to join me in support of this amendment to
protect the jobs we have in rural America in our timber and forest
products industry.

Amendment No. 249

Mr. President, I would also like to touch on the second amendment I
will offer. It is a 2-year, 5-percent rural home health add-on.
Access to health care, particularly in home health services that help
keep chronically ill and disabled adults out of institutions, is a
critical issue facing rural America. We put a benefit add-on to rural
home health back in early 2000. We have lowered that add-on. But the
fact is, it expired again on December 31, 2006, and has not been
reinstated.
The National Association for Home Care and Hospice estimates that the
5-percent rural add-on would create approximately 2,500 jobs in rural
America, not to mention the people who would be served.
In many rural areas, home health agencies are the primary caregivers
for homebound beneficiaries who have limited access to transportation
and other supportive resources. The negative effects of losing the
rural home health add-on include agencies having to reduce their
service areas and some agencies having to turn away high-resource-use
patients.
Rural home health agencies are at a greater disadvantage than their
urban counterparts. Rural agencies are often smaller, they have fewer
patients. This means they have fixed costs that are spread over a
smaller number of patients and visits, increasing overall per-patient
and per-visit operational cost, not to mention the travel expenses, the
input costs they have getting to these patients. With what we have seen
in the increase in the roller coaster ride of gasoline prices, that
also is added in. Rural agencies also have more difficulties hiring or
contracting with rehabilitative therapists, requiring the use of nurses
to provide these vital services. Given the nationwide nursing workforce
shortages, rural agencies must offer competitive wages compared with
hospitals and agencies located in urban areas in order to recruit and
retain qualified workers.
This is about keeping jobs, making sure these jobs are in rural
areas, but also servicing patients who truly need these types of
services. These are great job creators, job sustainers, and great
services to the people of this country.
The PRESIDING OFFICER. The Senator's time has expired.
The Senator from Montana is recognized.
Mr. BAUCUS. Mr. President, how much time is remaining?
The PRESIDING OFFICER. There is 14 minutes remaining.
Mr. BAUCUS. Mr. President, I yield 4 minutes to the Senator from
California.
The PRESIDING OFFICER. The Senator from California is recognized.

[[Page S1801]]

Mrs. FEINSTEIN. Mr. President, I thank the distinguished chairman of
the Finance Committee. I have had very little to do with this bill in
the sense of writing it. I think most of us feel somewhat the same way.
I am growing increasingly concerned about the bill, as to whether it is
really going to be a stimulus. I come from a State which has more
people unemployed today than the population of a dozen States; a State
where the breadlines are growing, where the need for assistance is
growing, where the State has a huge deficit, where counties are unable
to fund their operating maintenance, where all capital projects have
stopped, and where the State is now furloughing employees. I think
while we dither, Rome burns. This crisis is so multidimensional and the
dominoes are falling so much more rapidly than any of us thought and
they are pushed from so many different points.
The fact is that people cannot get credit--credit for your big
corporations to open a new hotel; credit, if you are a small employer,
to pay your payroll. Credit remains frozen. The housing crisis
continues to work its problems.
What, in my view, a stimulus is not, candidly speaking, is a tax
package. I do not believe in this economy tax cuts are stimulus. The
current state of the package, as I understand it, is that tax cuts are
roughly 40 percent of the package; 20 percent is local assistance,
State and local assistance; 15 percent is safety net spending; 15
percent is infrastructure spending--that is all--and 10 percent is
other spending.
I do not know how many jobs are going to come out of this because it
is my belief that people's buying patterns have changed.
This morning, a number of my colleagues talked about a report from
the Congressional Budget Office, and what they did not do is they did
not quote from certain parts of it. I would like to quote on what they
found. Here it is:

A dollar's worth of a temporary tax cut would have a
smaller effect on GDP than a dollar's worth of direct
purchase or transfers, because a significant share of the tax
cut would probably be saved.

As a matter of fact, we have evidence of that. Last year, we approved
more than $130 billion in tax cuts, primarily through a $600-per-person
tax refund. After all of that money was spent in two tranches going
out, there was little or no perceptible impact on the economy.
But we do not learn. In fact, study after study shows that upper
income taxpayers are less likely to spend the refund checks they
receive than those with low incomes.
According to a recent CRS analysis, tax cuts are likely to have a
``diminished stimulus effect.''
The PRESIDING OFFICER. The Senator's time has expired.
Mr. BAUCUS. Mr. President, I yield 1 additional minute.
The PRESIDING OFFICER. The Senator is recognized for 1 additional
minute.
Mrs. FEINSTEIN. I point out that at the end of the day, I think there
have been some significant layoffs. All along the retail industry,
whether it is Starbucks or whether it is various retail establishments;
like Gottschalks department stores--38 stores in California--going into
bankruptcy; whether you have banks closing; whether you have Macy's
laying off 10,000 people, buying patterns have changed. I read a study
where people are not buying as much toothpaste. That is an indication
that there is an angst out there, a worry about this economy.
The point of this package is to get jobs out to people. I reserve the
right, at the end of the day, to vote against a package that I don't
think puts those jobs out there. That is my point.
The PRESIDING OFFICER. Who yields time?
Mr. BAUCUS. Mr. President, in order to clarify some confusion that
may exist as to what the proceedings are after the first group of
votes, let me ask unanimous consent that the request I further
propounded with respect to that period be vitiated. Instead, I ask
unanimous consent that following the next group of votes, there be 20
minutes available, equally divided in the usual form, for debate only.
The PRESIDING OFFICER. Without objection, it is so ordered.
Who yields time?
The Senator from Montana.
Mr. BAUCUS. Mr. President, the Senator from Iowa questioned State aid
provisions in our substitute so I wish to take a few moments to explain
them. When our country was founded, there was a great debate about the
roles of the Federal and State governments, and our Founding Fathers
debated which should be more powerful. Should it be the States or the
Federal Government? Which should retain what privileges and how to
ensure an effective union of the States? Alexander Hamilton, the first
Secretary of the Treasury, advocated for the Federal Government to buy
the States' Revolutionary War debt. The idea was controversial, but the
merits of the proposal have proven sound.
In the year 1790, there were two main reasons he suggested the
Federal Government assume State debt. First, the Federal Government was
in a better position to issue and sell bonds to satisfy the debt.
Second, the assumption of State debt would serve to rally local
economic interests to promote broader national goals.
Many things have changed since 1790, but some things remain the same.
During recessionary periods, State revenue suffers. Unlike the Federal
Government, States must balance their budgets. Just as in 1790, the
Federal Government was still in a better position to assume the debt.
These difficult times also call for unity among the States. Every
State is suffering, but we must band together to help those among us
who are worse off. We need to hold back our personal interests and
focus instead on our national interests.
In addition to the arguments set forth by Hamilton over 200 years
ago, modern economists tell us that State fiscal relief is an effective
means to stimulate the economy. Economists also advise that targeted
relief to those most in need--not based on circumstances of States' own
making but based on true measures of distress--is the best measure of
distribution. The bill before us today provides much-needed relief to
every State with a temporary increase in the Federal match rate for
Medicaid expenses. The bill also provides additional aid targeted to
States facing the most precarious fiscal situations, measured by an
increase in unemployment. This temporary assistance will help States
avoid having to make tough choices, like whether to make significant
budget cuts or raise taxes, both of which could make this economic
crisis worse.
It is important we strike a balance in this bill between spending too
little and too much. Some of my colleagues are worried that we are
spending beyond what is needed and will end up passing along too much
debt to future generations. This package is significant, but the risk
of doing too little has been overlooked. In fact, I think the risk of
too little is worse than the risk of too much. During times of economic
distress, Medicaid suffers from the blows of a one-two punch; that is,
when State revenues are lowest, the demand for Medicaid is the highest.
If we do not give States enough money, States won't be able to protect
their Medicaid programs against the blows thrown by the economy. That
means fewer services will be available to fewer people at a time when
the need is increasing. We are talking about low-income health care.
This is about people who are thrown off Medicaid because States are
finding that is the best way to balance their budgets. That is not
right.
Giving States more money than they need won't stimulate the economy.
In order to stimulate the economy, this money must be spent quickly,
and it must go toward job creation or protection of vulnerable
populations. To be stimulative and get the economy moving again, State
fiscal relief must prevent any exacerbation of an already bad
situation. By preventing Medicaid cuts, this bill does that.
This bill makes sure we will not see a big increase in the number of
Americans without health insurance. We must remember that having so
many uninsured Americans is not without cost, let alone the personal
tragedy. Instead, the cost of caring for the uninsured has shifted to
the insured. It is in all our best interests to prevent more Americans
from losing their health insurance. This package, I believe, has the
right balance--it is not perfect, but it is pretty close--giving States
enough support without giving them too much.

[[Page S1802]]

The State fiscal relief provisions will not eliminate State budgetary
difficulties. That is for sure. But they will provide a cushion, not a
full cushion but a partial cushion. This package will not fix
everything, but it is a big step in the right direction.
While not all States have responded to the economic downturn in the
same way, no State is immune to the impact of a national recession.
Looking back on past recessionary periods, we can see that some States,
often those with large commerce-based economies, feel the blow faster
and earlier than others. The impact on States with commodity-based
economies, on the other hand, is often delayed. The difference between
commerce-based States and commodity-based States is more delay in
commodity-based States. Because no two States will experience the
impact of the recession at precisely the same time or to exactly the
same extent, it is important the relief be targeted to those States
that are most in need and when they need it.
In 1790, some States had already paid off their Revolutionary War
debt. But it was important to the Nation as a whole that all States be
relieved. On top of a generous across-the-board increase for all
States, this package provides additional aid to those States with high
unemployment. The basic formula is based upon the wealth of the State,
but the bonus on top of it is based on unemployment.
If a State's unemployment continues to increase, the State may
qualify for even more relief. Unemployment is an effective measure of a
State's fiscal condition. Often when people lose their jobs, they also
lose their health insurance. This places a higher demand on Medicaid.
It is estimated that a 1-percent increase in unemployment increases
enrollment in Medicaid and the Children's Health Insurance Program by 1
million people. Let me repeat that. A 1-percent increase in
unemployment increases enrollment in Medicaid and the Children's Health
Insurance Program by 1 million people. Increasing the FMAP
percentages--that is the Federal share--is the quickest way to get
relief to the States. In addition to preventing cuts to Medicaid, this
aid will provide for much-needed economic activity. People will be more
productive. Jobs will be saved. Industries that rely on and contribute
to the strength of our health care system will remain sound. This
provision will not only improve the health of Medicaid beneficiaries,
but it will also improve the fiscal health of each State. This is a key
element of any attempt to pull the national economy out of its
recession.
We have done this before, and we know it is effective. In the year
2003, we provided $20 billion in State fiscal relief, evenly split
between grants and an FMAP increase. That is the Federal Medicaid
share. The FMAP increase proved successful in preventing planned
Medicaid cuts and restoring some previous cutbacks. However, an
analysis by the Urban Institute found we could have done a better job
back in the year 2003.

The PRESIDING OFFICER. The time of the chairman has expired.
Mr. BAUCUS. I ask unanimous consent to proceed for an additional 2
minutes.
Mr. McCAIN. If the other side is granted 2 minutes.
Mr. BAUCUS. I ask unanimous consent for 5 more minutes, evenly
divided.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BAUCUS. However, an analysis by the Urban Institute found we
could have done a better job back in the year 2003. Despite the
immediacy and complexity of the situation, the fiscal relief was
delayed and uniform. Some States were forced to take action before
relief was available. Because the economic downturn of each State
varied, some States didn't get enough assistance, and some States got
assistance at the wrong time.
Let's learn from our mistakes. The partially targeted approach of
this package will be better. It will give all States some assistance, a
method that is effective and simple. But it will also give more money
to States with the greatest need, which will help ensure we get the
biggest bang for our buck.
These are difficult times, but our country is resilient. We are proud
as Americans of our resiliency. We must draw on the wisdom of our
Founding Fathers and stick together. We are more than a country. We are
a union of States. Let us remember the good judgment of Alexander
Hamilton and come together as a nation to help each of our States.
Over the Presiding Officer is our national motto, ``e pluribus
unum.'' It could not be more appropriate than at this moment.
The PRESIDING OFFICER. Who yields time?
The Senator from Arizona.
Mr. McCAIN. How much time do I have?
The PRESIDING OFFICER. Nine minutes.
Mr. McCAIN. Mr. President, I wish to return to the Congressional
Budget Office report in response to the remarks of the Senator from
Montana again to the Congressional Budget Office. It says the
legislation would result in a slight decrease in gross domestic
product. It said it would increase employment at the end of the fourth
quarter of 2010 by 1.3 million to 3.9 million jobs. I urge my
colleagues to do the math. This is a $1.2 trillion bill. If it creates
1.3 million jobs, that is $923,000 per job. If it creates 3.9 million
jobs, that is $307,000 of taxpayer dollars.
As the President stated last night, this is a spending bill. He is
right. I agree with him. It is a spending bill. Most of us were under
the impression that what we wanted was a job creation and economic
stimulus bill. We can pass spending bills all the time. We do it all
the time. We have laid a $10 trillion debt on future generations of
Americans. Very interestingly, the report continues:

Senate legislation would reduce output slightly in the long
run, CBO estimates, as would other similar proposals. The
principal channel for this effect is that the legislation
would result in an increase in government debt. To the extent
that people hold their wealth as government bonds rather than
in a form that can be used to finance private investment, an
increased debt would tend to reduce the stock of productive
capital. In economic parlance, the debt would ``crowd out''
private investment. CBO's basic assumption is that in the
long run, each dollar of additional debt crowds out about a
third of a dollar's worth of private domestic capital.

This is something that has been abundantly clear for years and the
reason why we don't have socialism in this country, because the
Government is less efficient in using dollars than the private
enterprise system is. Perhaps more alarming than anything else, the
reason why it was so disappointing is we did not pass the trigger. That
was an amendment we voted down, actually with a couple of Democratic
votes, that provided that once the economy recovers, we have to be on a
path to a balanced budget. CBO estimates that by 2019, the Senate
legislation would reduce gross domestic product by .1 percent to .3
percent. In other words, we will not grow the economy in the long run
unless we get our fiscal house in order.
Why are the American people unhappy? Why is it that my office and
others are inundated with phone calls? Because we put in unnecessary
and even wasteful and nonproductive programs to the tune of billions
and billions of dollars: $300 million dollars for Violence Against
Women Act grants to the Department of Justice because ``as job losses
loom and the economy worsens, service providers across the country are
reporting an increase in calls related to domestic violence.'' I am
glad to fund any program that would help address the issue of domestic
violence. But it is not creating jobs. We will hear from the other side
about how worthwhile this long list of porkbarrel projects is, but the
fact is, they don't create jobs. That is what we are supposed to be
doing in a ``stimulus'' bill.

I want to comment again: We all know there are negotiations going on
now of the called ``Gang of 18.'' I was one of the Gang of 14. That was
7 Republicans, 7 Democrats. That is bipartisan. Now it is 15 Democrats,
3 Republicans. That is not bipartisan. If they come up with an
agreement, then it will mean 3 Republicans out of 535 Members of
Congress have supported this unnecessary, wasteful bill that could have
been so much better.
It started out wrong, when the Speaker of the House said: We won, so
we write the bill. And it is ending up wrong because we have not done
what we need to do and has been the product of a true bipartisan
agreement, and

[[Page S1803]]

that is to sit down together, Republican and Democrat.
Mr. President, I want to close by pointing out, again, we want to
have legislation that stimulates this economy. But we want it to
stimulate the economy and not mortgage the future of our children and
our grandchildren by the kind of fiscal profligate spending that is
embodied in this legislation to the tune--it goes higher as we speak--
of over $1 trillion.
I am told Monday we are going to have another TARP proposed--another
one. How many trillions? We are setting some kind of record, and there
is no fiscal discipline.
Mr. President, I urge my colleagues to consider carefully--consider
carefully--this legislation. The American people have figured it out.
Let's figure it out.
(Disturbance in the Visitors' Galleries.)
The PRESIDING OFFICER. Expressions of approval or disapproval are not
allowed in the Chamber.
Mr. McCAIN. Mr. President, I reserve the remainder of my time.
Mr. President, how much time remains?
The PRESIDING OFFICER. There remains 2\1/2\ minutes.
Mr. McCAIN. For my side?
The PRESIDING OFFICER. Yes, for the Senator from Arizona.
Mr. McCAIN. Mr. President, I yield to the Senator from Oklahoma the
remaining 2\1/2\ minutes.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. COBURN. Mr. President, the question we need to ask ourselves is,
What is the real problem we have in the economy? And what is the best
way of fixing it? Not whether somebody looks good or looks bad. How do
we do what is in the best long-term interest of the country?
The problem with this bill, once you really see it--and even a $100
billion smaller bill--is, it does not address the real problem. We are
going to be treating symptoms, and we are going to be highly
inefficient as we do that. We say we want to have a stimulus bill. Yet
what we are going to do is stimulate a baseline increase in the budget
every year from now on of at least $124 billion, probably closer to
$300 billion, because we have not done what we say we are doing with
this bill.
The other thing is, the fear that is driving this bill and what might
happen if we do not hurry up and get a bill is probably the worst
motivation we could have. The real fear we ought to have is, have we
done it right and have we not created a situation in which generations
that follow us, especially the next two, will say: What were they
thinking? Why didn't they do it right? Why didn't they target the money
truly to stimulus instead of creating this worst of all habits--which
we are now going to ensure that the States pick up and learn from us.
It is a virus. It is a virus we have that says: You do not have to
worry about what it costs in the long run. You do not have to target
it. You do not have to be efficient. You do not have to look at
programs and make sure they are working. You do not have to have
metrics.
Now that the States are in trouble, we are going to absorb a portion
of the problems the States have because they have not been fiscally
prudent, and we are going to say: We are going to bail you out. Well,
think about what that says to State legislators all across the country.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. COBURN. Mr. President, I yield back.
The PRESIDING OFFICER. Who yields time?
The Senator from Montana has 1 minute.
Mr. BAUCUS. Mr. President, I do not see any speakers here. I will
yield back that time, unless the Senator from Vermont wishes to speak.
I yield back that time so we can get to the vote.
I yield back the time.

Amendment No. 306, as Modified

The PRESIDING OFFICER. Under the previous order, there is now 2
minutes of debate on the amendment No. 306, as modified, offered by the
Senator from Vermont, Mr. Sanders.
The Senator from Vermont.
Mr. SANDERS. Thank you, Mr. President.
This amendment, as modified, is being cosponsored by Senator Grassley
and has been cleared by both sides. This amendment simply requires
recipients of TARP funding to meet strict H-1B worker hiring standards
to prevent displacement of U.S. workers.
I thank Chairman Baucus for working with me on changes to my original
amendment, and I urge its adoption.
The PRESIDING OFFICER. Is there further debate on the amendment?
The Senator from Montana.
Mr. BAUCUS. Mr. President, I urge Senators to accept this amendment.
The PRESIDING OFFICER. The question is on agreeing to the amendment,
as modified.
The amendment (No. 306), as modified, was agreed to.

Amendment No. 309

The PRESIDING OFFICER. Under the previous order, there is now 2
minutes of debate on amendment No. 309, offered by the Senator from
Oklahoma.
The Senator from Oklahoma.
Mr. COBURN. Mr. President, this is a simple amendment that says we
ought to have a priority of what we do. It is not about being against
swimming pools, zoos, museums, or anything else. It is about saying to
the American people we are going to prioritize the spending on this
legislation.
What this amendment does is prohibit money to go to low-priority,
low-infrastructure things. We have 233,000 bridges in this country that
are in trouble--233,000. Instead of spending money planting trees along
a causeway, what we ought to be doing is fixing the bridge that is on
that causeway.
So this amendment is designed to prohibit money going into these
areas so we will have money next year and the year after that, or maybe
redirect money within the bill to actually do something we are going to
have to spend money on anyhow, rather than do something that is
optional and low priority.
Mr. INOUYE. Mr. President, I rise to express my concerns about
amendment No. 309, introduced by the Senator from Oklahoma. Senator
Coburn's amendment would add a provision to this bill which was
included in the House-passed bill.
The provision prohibits spending any of the funds in this bill on
casinos, golf courses, swimming pools, and other specified recreational
facilities. I think we can all agree these sound like laudable goals.
And I understand that on its face this amendment may seem logical, but
I want the Senate to understand what it means as it applies to this
bill.
Some of my colleagues might wonder why the House included this
provision in their bill and why we don't think it makes sense.
The House included $1 billion for the Community Development Block
Grant, CDBG, program. Under that program, funds go straight to the
cities and mayors determine how to spend the funds. When the Conference
of Mayors presented their views to the country's leadership on how to
stimulate the economy, the No. 1 program they were hoping to have
funded was CDBG. But the CDBG Program does not have sufficient
safeguards. It can be used to construct recreational swimming pools or
aquariums or to support museums. On occasion CDBG funds have been used
for programs which some would say were of questionable merit.
To ensure that the Senate would not be supporting questionable
programs, the Senate Appropriations Committee recommended no funds for
this program. The House recognized that CDBG funds might be used
inappropriately if there were no prohibitions on questionable programs,
so it included the provision which Senator Coburn wants to attach to
the Senate bill.
We do not need to include the provision because we do not have CDBG
funding in this bill. The mayors are precluded from funding the
projects prohibited by the amendment of the Senator from Oklahoma. The
Senate is already protected from possible abuse by denying the funding
for the program.
Let me offer a second example of how the committee ensured that local
funds could not be used unwisely. In the bill, the committee has
included $2.5 billion for the Neighborhood Stabilization Program which
is designed to improve blighted neighborhoods. However, it is true that
on occasion funds for this program have been used for community
development that was of questionable

[[Page S1804]]

merit. To avoid that problem, the Appropriations Committee recommended
bill language under the Neighborhood Stabilization Program which only
allows the funds to be used for the replacement of housing. This
limitation means the funds cannot be used to build community centers or
swimming pools.
We support the idea behind the amendment but not the amendment.
First, we have not provided funds for programs which can be used
frivolously. Second, there are no earmarks in this bill. Third, there
is no CDBG money in this bill. Fourth, the housing programs cannot be
used for frivolous purposes.
Members might argue you could include the amendment as an additional
safeguard. Well, consider just this one example. Among other things,
the amendment would prohibit the construction of swimming pools no
exceptions. It should be noted that we do not direct the construction
of any particular swimming pool that would be an earmark.
However, this bill contains $3.4 billion for needed construction of
new and infrastructure renovation and repairs at existing VA hospitals.
Under the terms of this provision the VA would not be able to spend any
of the infrastructure funding provided to the Department on
construction or renovation of therapeutic swimming pools at spinal cord
injury centers, trauma centers, or other VA medical centers.
The Appropriations Committee is aware that the VA has plans for many
legitimate construction projects such as pools specifically used for
medical rehabilitation of wounded soldiers. These are not swimming
pools for VA staff, but they would nonetheless be prohibited by this
amendment.
While I am confident this was not the intent of the amendment, it
most certainly could be the result. It is not the only example. Should
our military be denied from building recreational facilities? Should
the Coast Guard be told not to build swimming pools where they practice
training exercises? Do we want to argue that no funds should be
available for fixing aging buildings?
This amendment is a solution in search of a problem. But, Mr.
President, let's not forget that the amendment causes problems. If
adopted, this amendment could deny our wounded veterans the physical
therapy they need and deserve, and it could deny other needed programs
to support training and quality of life for our military forces and
their families.
I recommend that you vote against this amendment.
The PRESIDING OFFICER. Who yields time?
Mr. BAUCUS. Mr. President, I yield back the time.
The PRESIDING OFFICER. The time is yielded back.
The question is on agreeing to the amendment.
Mr. COBURN. Mr. President, I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There appears to be a sufficient second. The clerk will call the
roll.
The assistant legislative clerk called the roll.
Mr. DURBIN. I announce that the Senator from Massachusetts (Mr.
Kennedy) is necessarily absent.
Mr. KYL. The following Senator is necessarily absent: the Senator
from New Hampshire (Mr. Gregg).
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 73, nays 24, as follows:

[Rollcall Vote No. 51 Leg.]

YEAS--73

Alexander
Barrasso
Baucus
Bayh
Begich
Bennet
Bennett
Bingaman
Bond
Brown
Brownback
Bunning
Burr
Byrd
Cantwell
Cardin
Carper
Casey
Chambliss
Coburn
Cochran
Collins
Conrad
Corker
Cornyn
Crapo
DeMint
Dorgan
Ensign
Enzi
Feingold
Feinstein
Graham
Grassley
Hatch
Hutchison
Inhofe
Isakson
Johanns
Johnson
Klobuchar
Kohl
Kyl
Lincoln
Lugar
Martinez
McCain
McCaskill
McConnell
Merkley
Mikulski
Murkowski
Murray
Nelson (FL)
Nelson (NE)
Pryor
Risch
Roberts
Schumer
Sessions
Shelby
Snowe
Specter
Stabenow
Tester
Thune
Udall (CO)
Udall (NM)
Vitter
Voinovich
Warner
Wicker
Wyden

NAYS--24

Akaka
Boxer
Burris
Dodd
Durbin
Gillibrand
Hagan
Harkin
Inouye
Kaufman
Kerry
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Menendez
Reed
Reid
Rockefeller
Sanders
Shaheen
Webb
Whitehouse

NOT VOTING--2

Gregg
Kennedy

The amendment (No. 309) was agreed to.
Mrs. BOXER. Mr. President, I voted against Senate amendment No. 309
because the language of this amendment was too broad and would have
excluded funding for important projects in California that will create
jobs, help our veterans, promote tourism, protect our natural
resources, and stimulate the economy.
If the Coburn amendment had prevented economic recovery money from
going to casinos, I would have supported the amendment. Gaming
facilities and casinos do not deserve to receive funding in this bill.
But by prohibiting funds for parks, highway beautification projects,
and other community projects, the Coburn amendment would have
eliminated from funding consideration important job-creating
initiatives throughout California.
It is important to note that there are no earmarks in this bill. No
parks, community centers, casinos, swimming pools, or similar projects
receive direct funding in the recovery bill.
But there are some important investments that the Coburn amendment
would prevent Federal, State, and local leaders from allocating
resources to, such as construction and rehabilitation projects in State
parks--which create jobs and protect natural resources--and highway
beautification projects--which create jobs and help stimulate local
economies.
One example of how the Coburn amendment would prevent funding for
worthy projects involves disabled veterans. There is $3.4 billion in
this bill for construction and renovation of Veterans Administration
hospitals. Because of the Coburn amendment, the VA will not be able to
spend any of the funding it receives on construction of therapeutic
recovery pools at trauma centers, spinal cord injury centers, and other
medical centers for disabled veterans to use when recovering from
traumatic injuries.

Amendment No. 359

The PRESIDING OFFICER. Under the previous order, there is now 2
minutes of debate on amendment No. 359, offered by the Senator from New
Mexico, Mr. Udall.
Mr. UDALL of New Mexico. The current language in the substitute
amendment provides a tax incentive to employers hiring veterans who
have been discharged from the armed services in 2008, 2009, and 2010.
My amendment would expand this tax incentive to employers to include
veterans discharged from the armed services between September 2001 and
December 2010, including veterans of Operation Enduring Freedom and
Operation Iraqi Freedom.
This group of veterans has a 6.1-percent rate of unemployment.
Expanding the tax incentive to employers will help ensure that we do
not leave these veterans out in the cold. It ensures that employers are
encouraged to hire these men and women and to put them back to work. I
hope my colleagues will join me in adopting this amendment. I thank
both sides for working with me on this.
I yield the floor.
The PRESIDING OFFICER. The time has expired.
The Senator from Montana is recognized.
Mr. BAUCUS. Mr. President, we have looked at this amendment and think
it is a good one. We are prepared to accept it.
The PRESIDING OFFICER. Is there further debate on the amendment? If
not, the question is on agreeing to the amendment.
The amendment (No. 359) was agreed to.

Amendment No. 176

The PRESIDING OFFICER. Under the previous order, there is now 2
minutes of debate on amendment No. 176 offered by the Senator from
Oklahoma, Mr. Coburn.
Mr. COBURN. I yield back my time.
The PRESIDING OFFICER. The Senator's time is yielded back.

[[Page S1805]]

Who yields time in opposition?
Mr. BAUCUS. Mr. President, I yield back the remainder of our time.
Mr. COBURN. Mr. President, I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The question is on agreeing to the amendment. The clerk will call the
roll.
The assistant legislative clerk called the roll.
Mr. DURBIN. I announce that the Senator from Massachusetts (Mr.
Kennedy) is necessarily absent.
Mr. KYL. The following Senator is necessarily absent: the Senator
from New Hampshire (Mr. Gregg).
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 97, nays 0, as follows:

[Rollcall Vote No. 52 Leg.]

YEAS--97

Akaka
Alexander
Barrasso
Baucus
Bayh
Begich
Bennet
Bennett
Bingaman
Bond
Boxer
Brown
Brownback
Bunning
Burr
Burris
Byrd
Cantwell
Cardin
Carper
Casey
Chambliss
Coburn
Cochran
Collins
Conrad
Corker
Cornyn
Crapo
DeMint
Dodd
Dorgan
Durbin
Ensign
Enzi
Feingold
Feinstein
Gillibrand
Graham
Grassley
Hagan
Harkin
Hatch
Hutchison
Inhofe
Inouye
Isakson
Johanns
Johnson
Kaufman
Kerry
Klobuchar
Kohl
Kyl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Lincoln
Lugar
Martinez
McCain
McCaskill
McConnell
Menendez
Merkley
Mikulski
Murkowski
Murray
Nelson (FL)
Nelson (NE)
Pryor
Reed
Reid
Risch
Roberts
Rockefeller
Sanders
Schumer
Sessions
Shaheen
Shelby
Snowe
Specter
Stabenow
Tester
Thune
Udall (CO)
Udall (NM)
Vitter
Voinovich
Warner
Webb
Whitehouse
Wicker
Wyden

NOT VOTING--2

Gregg
Kennedy

The amendment (No. 176) was agreed to.
The PRESIDING OFFICER. Under the previous order, there will now be 20
minutes equally divided for debate only.
The Senator from Montana.
Mr. BAUCUS. Mr. President, the next Senator to speak is on his way
here, Senator Kerry of Massachusetts. Is there someone on the other
side who wishes to speak? We have 10 minutes equally divided.
Mr. McCAIN. Mr. President, the Senator from Nebraska, followed by the
Senator from Iowa, will have 5 minutes. If I can ask the distinguished
manager, my understanding is that after the 20 minutes, there will then
be a period for filing amendments and debate.
Mr. BAUCUS. After the 20 minutes, there then is a period during which
Senators can call up their amendments, but they are only amendments
that have been agreed to by an earlier UC.
Mr. McCAIN. I thank the manager.
The PRESIDING OFFICER. The Senator from Nebraska.
Mr. JOHANNS. Mr. President, I rise to elaborate on a couple points I
made a day or so ago on this stimulus package.
Many in this body and constituents across Nebraska know I am a former
mayor, a former city counsel person, a former county commissioner, and
a former Governor. I have had the opportunity to govern during very
good times when the revenues were available. I have had the opportunity
to govern during very tough times, where we were trying to figure out
how to balance our budget.
I point out, again, that in the State I come from, we not only have
to balance the budget, but we are prohibited by our Constitution from
borrowing money. So the State has no debt.
I have been in those positions, the beneficiary of programs such as
this package but much smaller programs. I have never been, nor has
anyone else been in the history of this country, the beneficiary of a
spending bill this large. To describe this as large is not to do
justice to the discussion. This is enormous.
I am sure what is happening across the country in mayors' offices and
Governors' offices as they try to figure out how to deal with this
massive amount of money that is being dedicated to what I would argue
are valuable programs in the normal budget process--Medicaid,
education, special education, parks facilities, whatever it is,
although we addressed that with an amendment--what is happening is
this: mayors and Governors are looking at their budgets and they are
recognizing that there is money that is going to come in huge amounts
from the Federal Government. So they are looking at their capital
improvements process in their budget and they are saying: What is it
that I can now take my local dollars or my State dollars and set to the
side and fund with this massive amount of Federal spending that is
occurring that is going to rain down on my local government or my State
government?
As I said, these are valuable programs, there is no doubt about that.
I funded all these programs at one point in my life. What I suggest to
this body is you are not going to get any kind of stimulative impact
from what you are trying to accomplish. The Governor or the mayor is
simply going to look at these dollars as found money, and they are
going to take their State and local dollars, set them to the side, and
spend the Federal dollars, and no stimulation will happen to the
economy. No new jobs will be created. In fact, I would even suggest you
will be very hard pressed in the year or 2 years of this stimulus
package to even find a new project that would not have otherwise been
funded through the normal State or local process.
I also wish to talk about one last piece of this that is very
important, and we acted on this with an amendment. But I need to say
something that is very important because this needs to survive whatever
process is left, and that is this whole issue of competitive bidding.
This is a massive amount of money. The temptation to ignore the
transparency of the bidding process is simply going to be too great
unless we act, not only today but as this process goes forward. The
temptation to allocate this money with the transparency of the bidding
process will take control and literally we will be looking back and we
will be fighting this and recognizing that money got doled out, it got
handed out without any kind of transparency in the competitive bidding
process.
I have been there in those offices, where I have had members of the
administration come in and say: Governor or mayor, we need to waive the
bidding process.
Let me wrap up with this thought. These are valuable programs. I have
funded these programs.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. JOHANNS. I thank the Chair.
The PRESIDING OFFICER. Who yields time?
The Senator from Montana.
Mr. BAUCUS. Mr. President, I yield 10 minutes to the Senator from
Massachusetts. Actually, I prefer they use the remaining 5 minutes on
the other side.
The PRESIDING OFFICER. The Senator from Iowa is recognized.
Mr. GRASSLEY. Mr. President, many folks on the other side of the
aisle claim that spending is better stimulus than tax relief for
working men and women. This is certainly not a unanimous opinion among
economists, so I would share some recent economic research that
analyzes data--not building models--to answer the question of whether
spending or tax relief is more effective for economic stimulus.
Christina Romer, who is the Obama administration's Chair of the
Council of Economic Advisers, and David Romer, from the University of
California at Berkeley, find that $1 of tax relief raises the gross
domestic product by about $3. Robert Hall, from Stanford, and Susan
Woodward, who is chair of Sand Hill Econometrics, find that $1 of
Government spending raises gross domestic product by about $1. Andrew
Mountford, from the University of London, and Harold Uhlig, from the
University of Chicago, conclude that deficit-financed tax relief works
better than either deficit-financed or balanced-budget Government
spending increases to improve the gross domestic product. These experts
calculate that each $1 of tax relief amounts to $5

[[Page S1806]]

of additional gross domestic product 5 years after the shock of
recession. Olivier Blanchard, who is the chief economist at the IMF,
and Roberto Perotti, from IGIER University, assert that a combination
of both tax increases and Government spending increases has a strong
negative impact on private investment spending.
In addition to the opinions of these economic experts, a look back at
the picture that developed following the 2003 tax relief is also very
instructive.
After the 2001 recession ended, both the economy and labor markets
continued to sputter. But a significant turnaround occurred soon after
the passage of the 2003 tax relief bill. Following nine straight
quarters of decline, business investment grew at an annual rate of 6.6
percent between the enactment of the 2003 tax bill and the start of the
current recession. Similarly, a period of job growth following the 2003
tax relief was the longest streak of monthly job growth on record.
We have spent a lot of time in this body discussing the balance
sheets of financial institutions. The balance sheets of families and
individuals throughout the country have been suffering significantly as
well. From the third quarter of 2007 to the third quarter of 2008, the
net worth of households and nonprofit organizations has dropped by $7.1
trillion, or 8.9 percent.
Families and individuals who receive tax reductions will likely save
some of their tax cut to pay down household debt. Some erroneously
suggest that this is bad for the economy. Quite to the contrary. When
people pay down their debt, their credit improves. Improved credit
leads to freeing up bank lending. Reduced debt for families and
individuals also increases the amount of long-term income available for
spending. So we should not look at households improving their balance
sheets as a bad thing economically.
Finally, evidence suggests that permanent tax reductions are more
likely to be spent by consumers than one-time stimulus checks or
credits. Our focus should be on permanent tax relief to get the engine
of our economy running.
Our economy is like the Titanic, and while it continues to go down,
the only proposal on the other side is to spend over $700 billion to
buy new deck chairs.
Mr. President, I yield the floor, and I reserve the remainder of the
time.
The PRESIDING OFFICER. Time has expired.
Who wishes to yield time? The Senator from Montana.
Mr. BAUCUS. Mr. President, I yield 10 minutes to the Senator from
Massachusetts.
The PRESIDING OFFICER. The Senator from Massachusetts is recognized.
Mr. KERRY. Mr. President, I thank the distinguished chairman for his
efforts on this bill and on this issue as a whole.
I have been listening for the last few days to our colleagues on the
other side of the aisle talk as if the last 8 years hasn't happened, as
if they have no responsibility for it, and then come back to the floor
of the Senate today, and in the last few days, with proposals that have
already been tested and, frankly, proven hollow and empty and
inadequate. It is kind of surprising to me to see the absence of common
sense that has been at the center of the arguments over the course of
the last couple of days.
Let me give an example. We keep hearing about how the spending,
spending, spending is too big and it is a problem. In fact, spending
itself, we have heard in the arguments, is not going to solve this
problem. Well, over 40 States in this country now have budget
shortfalls--40 States--and the Governors in those States are already
cutting essential services. They face the choice of cutting police,
fire, teachers, and other critical services. The fact is that as they
cut, those people are not able to pay mortgages, not able to go to the
store and buy whatever it was they planned to buy, because they are out
of a job and therefore lacking cash. They may even become at risk for
foreclosure on their homes. So if you want to contribute to toxic
assets, the best way to do it is to continue to adopt the policy that
you don't put cash into the hands of Americans.
Now, that alone is not going to solve the problem. The normal debt
ratio of a household in our country is about--income to household
debt--50 percent. Right now, the average household in America is
carrying a debt-to-income ratio of about 150 percent. And if all you do
is give a tax cut that puts cash into the hands of people--which I
understand, incidentally, our proposal does give a tax cut--if that is
all you do, a large percentage of that is going to simply go to paying
for past acquisitions, for past services provided. It is going to be
used by taxpayers to pay off their credit card bills, to pay their
debt, but it isn't going to create the kind of spending and consumption
that is at the heart of the American economy.
Mr. President, 72 percent of American GDP comes from consumption.
Unless we recognize how you stop the tailspin and begin to turn things
around, we are ignoring reality. I have heard a lot of talk about we
ought to do a tax cut, we ought to do a tax cut. I have supported many
tax cuts during my years here, and there are tax cuts in this proposal.
But a tax cut is nontargeted. If you put a tax cut into the hands of
either a business or an individual today, there is no guarantee they
are going to invest their money. There is no guarantee they are going
to invest their money in the United States. They are free to invest
anywhere they want, if they choose to invest.
Let's look at that. When you have a tailspin in the economy, as we do
today, and confidence is declining, as it is today, if you are a banker
and if somebody comes in to borrow money from you, you have to look at
the prudent lending practices and standards by which you are going to
make that loan. In today's climate, the inclination of a prudent banker
is not to make the loan. Why? Because they see consumerism contracting,
because they see the tailspin in housing, because they see the lack of
new building, new contracts, and you are locked into a vicious cycle--
not a virtuous cycle, a vicious cycle, a downward cycle. This effort is
to break that cycle.
Almost every major economist has suggested that it is going to take a
very significant component of that ugly word ``spending'' in order to
prime the pump and begin to shift the psychology and turn things
around. Now, is that all we need to do? No. And President Obama has
said that is not all we need to do.
To the Senator from Tennessee, who has been talking about housing and
you have to stop the housing slide first, let me say to him
respectfully that I sat in the White House a year ago with Secretary
Paulson, President Bush, and Vice President Cheney, and I was the only
person in the room who said: Mr. President, if you are going to do a
stimulus now, you ought to put housing into this package. And I turned
to the Secretary and I said: Mr. Secretary, you could be negotiating
right now to keep people in their homes at a fixed mortgage rate and a
new valuation, and you should do it. And their heads nodded, and they
said: That sounds like a good idea.
Gordon Smith and I came back to the Senate, and we put in a $15
billion provision in the Finance Committee, which passed the Finance
Committee 20 to 1. It came to the floor of the Senate, and guess what.
The very people who are here on the floor now saying we have to do
housing stripped it out of that provision. The President and the
administration opposed it. And for 9 months they sat there while 10,000
homes a day were being foreclosed, and they allowed us to slide into
where we are today. So when I hear my colleagues come and say we have
to fix housing now, they are about 10 months to a year late on that
effort. They have created, because of their indifference a year ago, a
situation where it is out of control. Every major economist in the
country is now telling us: You have to stop the fall.

If 40 States in our country are facing a predicament, it is incumbent
on us to help those States not lay off those firefighters, not lay off
those teachers, and help them go with a readymade project.
I have heard colleague after colleague say: Well, what job is going
to be created through this spending? Well, let me tell you very
directly. If you have a shovel-ready project, we can put that into
place tomorrow. There are thousands of them across the country ready to
go.
We have a $1.6 trillion infrastructure deficit. While other countries
have

[[Page S1807]]

been investing in high-speed rail transportation, schools, and other
parts of their economy, we haven't. We have been giving tax cuts to the
wealthiest people in the country. And the price of that is that today
we have the largest gap between the middle class and the wealthy that
we have ever had in this country. The fact is, none of those people are
guaranteed to invest that money in any of the new projects the way we
are. So Government--yes, Government--has the ability to be able to make
a decision that the private sector won't necessarily make today.
I have supported almost every private sector effort through here over
the years. I have supported 100 percent a zero capital gains reduction
so that we could excite investment and venture capital into new
enterprises with respect to energy and alternative fuel and new
materials and nanotechnology and communications and artificial
intelligence--all the things that would provide the high value-added
job base of the future for our country. And most economists will tell
each of my colleagues, without a party label, that if we were to invest
now in those future efforts, we would be creating a much stronger base
for our jobs in the future.
That is what this seeks to do. This bill, this stimulus effort, seeks
to break the downward cycle and encourage investment in those kinds of
products that provide a high value-added job and strengthen America's
economy for the long run.
The fact is that doing the stimulus and doing housing aren't going to
fix this crisis either. The truth is that the majority of our banks in
this country are fundamentally insolvent. Paul Krugman has referred to
a number of large banks as zombie banks because their assets and
liabilities are almost either even or negative. But if you look at
those assets in many of them, they are in the toxic category. And if
they legitimately mark their books today at the value of the
marketplace, they would not be, according to most standards, solvent.
So we are going to visit on this floor within a short period of time
how we are going to recapitalize the banks. This effort will not be
satisfied with what we are doing here alone. But I guarantee you, every
day that we dawdle, every day we keep this going, forgetting about
reality and debating what are old and, frankly, discredited approaches
to the economy, we are going to create more toxic assets, more people
are going to lose their jobs, and more confidence will be lost as we
continue to go down.
Frankly, the difference between $50 billion on this bill or $100
billion--let's get it moving--that is not going to make the difference
to the economy. What will make the difference to the economy is whether
we express on this floor a real understanding of what is happening and
a real concentrated effort across party lines to address it. That is
what the American people are waiting for.
Mr. President, how much time do I have remaining?
The PRESIDING OFFICER. The Senator has 6 seconds.
Mr. KERRY. I thank the Chair.
I hope we are going to get to the common sense that is at the center
of this and do what we need to do for the American people quickly.
The PRESIDING OFFICER. The time of the Senator has expired. The
Senator from Louisiana is recognized.

Amendment No. 107

Mr. VITTER. Mr. President, I rise to speak in support of the second
Vitter amendment I have at the desk, which I am very hopeful will be
voted on later in the day. As I have explained on the floor of the
Senate several times in this debate, I am one of those folks, very
concerned that overall this so-called stimulus bill is just a long
laundry list of Washington big government spending programs, not
anything focused or disciplined that will really create jobs in the
short term in this economy. But my amendment I am discussing now is
focused on a very specific item in that long laundry list that I
believe is not only unproductive but is truly offensive, given the
history of the last several years. That is an item of almost $2.25
billion in the present underlying Senate bill that could go toward
neighborhood stabilization, that would be available for nonprofit
groups, including ACORN, to access. I might add, that figure in the
House bill is $4.2 billion with at least $100 million virtually
earmarked for nonprofit groups such as ACORN.
Why do I find this so objectionable and so offensive? Two simple
reasons. No. 1, this would further part of the Government policy that
got us in this mess to begin with, that started on the housing side by
encouraging so much subprime lending that led to enormous, and in fact
predictable, defaults that started this decline. No. 2, I believe with
regard to a group such as ACORN, this is little more than a political
payoff because ACORN acted as a truly partisan organization in their
campaign activities for the last several years, including this fall,
and was guilty of egregious fraud with regard to voter registration
activities.
Let me take point No. 1 first. We all know many factors led us to
this current economic crisis. But one of them, one big one, was
certainly Government policy and Government programs--and there was a
lot of it--that built up and encouraged the subprime lending mess.
Certainly, major funding over several years that went to ACORN and
similar groups was exactly part of that. Are we going to learn from our
experience and at least stop that policy, stop that encouragement of
subprime lending that could not be supported, that led to more and more
foreclosures and a plummeting housing market, eventually a plummeting
economy overall? Are we going to stop that and correct it? With this
sort of money in the stimulus bill available to a group such as ACORN,
in fact, we would be advancing even more of that bad policy.
Make no mistake about it, that is exactly the sort of housing
activity ACORN focuses on, what they are known for, what they are proud
of. Let me give one clear example to make the point, which is from the
New Mexico chapter of ACORN, New Mexico ACORN Fair Housing. They
received a grant of about $100,000, among others, in 2007. They got
this grant for a very specific program with the title, ``How To Take
Advantage Of Subprime Mortgages.''
I give them an A for truth in advertising. That is exactly what they
were about in New Mexico and across the country, how to take advantage
of subprime mortgages which encourages stuff--let's build it up--and,
in fact, they helped build it up and, in fact, it cratered. As you
know, that has been ACORN's housing mission in communities around the
country.
My second point is perhaps even more fundamental, which is that ACORN
has been guilty of egregious fraud and politicization of what they do
with taxpayer funds for several years, including the last election
cycle. We should not be sending more taxpayer dollars to them in light
of this history. I would go so far as to say the effort by some to do
that is little more than political payoff.
What am I talking about? I think we have heard these stories from the
past campaign: registering thousands of voters who were either asked to
register multiple times or people who were registered without their
knowledge or the registering of voters who outright did not exist. That
was a very common practice by this organization. ACORN employees have
admitted to it, who told sad stories of feeling incredible pressure to
register voters to meet completely unrealistic quota numbers. That is
sad indeed.
A good example is Washington State where felony charges were actually
filed against seven persons for committing the single largest case of
voter fraud in the State's history. This was in response to the King
County Canvassing Board's revocation of 1,762 allegedly fraudulent
voter registrations submitted by ACORN. In this case the prosecuting
attorney told the board that six ACORN workers had admitted to filling
out registration forms with names they found in phone books the
previous October. ACORN further actually agreed to reimburse King
County $25,000 for all the investigative and other costs they had to
bring to that case. Not exactly innocent mistakes but outright voter
registration fraud.
Fraud and criminality are nothing new to the organization. As we have
read in 1999 and 2000, nearly $1 million was embezzled by Dale Rathke,
brother of the ACORN founder, through faulty credit card charges and
other means.
Given this very clear history, a history of promoting one of the main
problems that led us to this mess in

[[Page S1808]]

the subprime market, a history of being a political organization and in
a very partisan way committing outright voter and voter registration
fraud, I do not think we should be putting taxpayer dollars in this
stimulus bill which can go to and benefit ACORN.
My amendment is very plain and very simple. It says no money in the
stimulus bill can go to--will go to, under any circumstances, ACORN.
I look forward to a debate and vote on this amendment. I will be
asking for a rollcall vote on this amendment so we can get a strong
sense of the Senate on the record, particularly if this issue proceeds
to conference.
Mr. President with that, before I yield the floor, I ask that the
amendment be made pending.
Mr. BAUCUS. Objection.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Objection. That is not allowed in this agreement. I am
sorry.
I misunderstood. I thought you wanted a queue for a vote.
Mr. VITTER. No, I would like the amendment pending.
Mr. BAUCUS. You can call up your amendment and it will be made
pending.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
Mr. VITTER. I thank the Chair.
The PRESIDING OFFICER. The clerk will report the amendment.
The legislative clerk read as follows:

The Senator from Louisiana [Mr. Vitter] proposes an
amendment numbered 107 to amendment No. 98.

Mr. VITTER. I ask unanimous consent the reading of the amendment be
dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: Prohibiting direct or indirect use of funds to fund the
Association of Community Organizations for Reform Now (ACORN))

On page 431, between lines 8 and 9, insert the following:

SEC. __. PROHIBITION ON USE OF FUNDS BY OR FOR ACORN.

None of the funds appropriated or otherwise made available
by this Act may be used directly or indirectly to fund the
Association of Community Organizations for Reform Now
(ACORN).

The PRESIDING OFFICER. The Senator from Montana is recognized.
Mr. BAUCUS. Mr. President, there are a series of amendments under the
order under which Senators can call up specified amendments. I would
like to go back and forth, Republican and Democrat and so forth. I also
urge Senators to enter into time agreements for their speeches when
they call up their amendments. I urge us now to move to amendment No.
501, called up by Senators Conrad and Graham.
Let me ask Senator Conrad what kind of time agreement might be
reasonable for him.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. I ask my colleague, Senator Graham, how much time would
he need?
Mr. GRAHAM. Ten minutes.
Mr. CONRAD. Ten minutes each?
Mr. BAUCUS. Mr. President, I make that request.
The PRESIDING OFFICER. Will the Senator from Montana please repeat
the agreement?
Mr. BAUCUS. I ask unanimous consent the time on the Conrad-Graham
amendment be limited to 10 minutes.
Mr. LEAHY. Mr. President, reserving the right to object, and I shall
not, I wonder if the distinguished senior Senator from Montana could
give me some idea regarding the broadband amendment which I had
pending, when it would be coming up.
Mr. BAUCUS. I might say to my good friend from Vermont, there is a
previous order entered into which listed amendments under which
Senators could call up their amendments. I think it is about 10 or 12,
roughly. I do not see the name of the Senator on this list.
Following disposition of this list, we will then enter a different
period when different action can be taken by the Senate. I would have
to consult with the leader to see what he wants to do following
disposition of this list.
Mr. LEAHY. Mr. President, as I said, I shall not object, but I note I
have been trying for several days, since the time I submitted that
amendment, to bring it up. It will require a slight modification,
agreed to by both the Republican and Democratic side. I just want to
have some idea when it might come. I have no objection to the unanimous
consent request.
Mr. SESSIONS. Mr. President, reserving the right to object, I also
have an amendment on the E-Verify system that I believe very strongly
should be voted on or perhaps accepted. It is in the House bill. I
wonder what kind of confidence Senator Baucus can give us. That would
be a matter that would be voted on. It is not in the next group of
amendments.
The PRESIDING OFFICER. The Senator from Montana is recognized.
Mr. BAUCUS. I say to my friend, there are many Senators who
approached me, asking if we could take up their amendment following
this list of amendments now. I cannot give a specific answer to any
Senator at this point except to say that we will go through this list
we are on right now under which Senators can call up amendments, and I
will be consulting with the leader to try to figure out what is the
next order of business. I will make it as fair as possible. I think the
Senator will acknowledge that all day long--yesterday--we have gone
back and forth to try to make it fair for both sides. But I cannot say
what the exact procedure will be following the disposition of these
amendments. I will try my very best to accommodate the Senator, as I
will every other Senator, but I have to consult with the leader first
to know what that is.
Mr. SESSIONS. I thank Senator Baucus. I know he has an incredibly
difficult job in working through all of this. I would say, I am uneasy
about this. I will not object now, but I do want to have some assurance
this very important amendment would at least have a right to have a
vote.
Mr. BAUCUS. I appreciate that very much.
The PRESIDING OFFICER. The Senator from Montana is recognized.
Mr. BAUCUS. I renew my request that the time on the Conrad-Graham
amendment be limited to 10 minutes.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered. The Senator from North Dakota is recognized.
Mr. CONRAD. Mr. President, I think we had 10 minutes each.
Mr. BAUCUS. I misunderstood. Ten each. That is the request.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DODD. Reserving the right to object, is there some time in
opposition to the amendment?
Mr. BAUCUS. That is a good question.
Five minutes to the Senator from Connecticut to speak in opposition
to the amendment.
The PRESIDING OFFICER. Is there objection to the request as modified?
Without objection, it is so ordered. The Senator from South Carolina is
recognized.

Amendment No. 501, as Modified, to Amendment No. 98

Mr. GRAHAM. Mr. President, I believe we have a modification of the
amendment at the desk. I ask that be incorporated. It is amendment No.
501. I ask it be called up.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered. The clerk will report the amendment as modified.
The legislative clerk read as follows:

The Senator from South Carolina, [Mr. Graham], for himself
and Mr. Conrad, proposes an amendment numbered 501, as
modified, to amendment No. 98.

Mr. GRAHAM. I ask unanimous consent that the reading of the amendment
be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To limit wasteful spending, to fund a systematic program of
foreclosure prevention, to be administered by the Federal Deposit
Insurance Corporation, and for other purposes)

On page 6, strike lines 1 through 4.
On page 37, strike lines 1 through 5.
On page 37, line 10, strike ``$9,000,000,000'' and insert
``$8,800,000,000''.
On page 37, line 13, strike ``not'' and all that follows
through ``libraries:'' on line 16.
On page 44, line 18, strike ``$300,000,000'' and insert
``$275,000,000''.
On page 44, line 25, after the semicolon insert ``and''.
On page 45, line 2, strike ``; and'' and insert a period.
On page 45, strike lines 3 through 5.
On page 57, line 10, strike ``$1,169,291,000'' and insert
``$1,069,291,000''.

[[Page S1809]]

On page 57, line 14, strike ``$571,843,000'' and insert
``$531,843,000''.
On page 57, line 18, strike ``$112,167,000'' and insert
``$92,167,000''.
On page 57, line 22, strike ``$927,113,000'' and insert
``$887,113,000''.
On page 92, strike lines 1 through 20.
On page 93, line 7, strike ``$9,048,000,000'' and insert
``$8,048,000,000''.
On page 93, line 12, strike ``$6,000,000,000'' and insert
``$5,000,000,000''.
On page 93, line 23, strike ``$7,000,000,000'' and insert
``$6,000,000,000''.
On page 95, strike lines 1 through 8.
On page 123, line 9, strike ``$3,250,000,000'' and insert
``$2,050,000,000''.
On page 123, strike line 18 and all that follows through
page 124, line 9.
On page 124, line 10, strike ``(3)'' and insert ``(2)''.
On page 124, line 13, strike ``(4)'' and insert ``(3)''.
On page 124, line 15, strike ``(5)'' and insert ``(4)''.
On page 125, line 1, strike ``(6)'' and insert ``(5)''.
On page 127, line 23, strike ``$1,088,000,000'' and insert
``$1,000,000,000''.
On page 127, line 24, strike ``of which'' and all that
follows through ``and'' on page 128, line 3.
On page 128, strike lines 8 through 22.
On page 130, strike lines 4 through 10.
On page 213, line 22, strike ``$64,961,000'' and insert
``$59,476,000''.
On page 213, line 25, strike ``; and'' and all that follows
through ``initiatives'' on lines 25 and 26.
On page 137, line 17, strike ``$5,800,000,000'' and insert
``$5,325,000,000''.
On page 139, line 22, after ``funds:'' insert ``Provided
further, That none of the amounts available under this
paragraph may be used for the screening or prevention of any
sexually transmitted disease or for any smoking cessation
activities.''
On page 391, line 5, strike ``$79,000,000,000'' and insert
``$62,150,000,000''.
At the end of division A, add the following:

TITLE XVII--FORECLOSURE PREVENTION MORTGAGE MODIFICATIONS

SEC. 1701. DEFINITIONS.

In this title--
(1) the term ``Corporation'' means the Federal Deposit
Insurance Corporation;
(2) the term ``Chairperson'' means the Chairperson of the
Board of Directors of the Corporation;
(3) the term ``Secretaries'' means the Secretary of the
Treasury and the Secretary of Housing and Urban Development,
jointly;
(4) the term ``program'' means the foreclosure prevention
and mortgage modification program established under this
section; and
(5) the term ``eligible mortgage'' means an extension of
credit that is secured by real property that is the primary
residence of the borrower.

SEC. 1702. LOAN MODIFICATION PROGRAM.

(a) Establishment.--The Chairperson shall establish a
systematic foreclosure prevention and mortgage modification
program, in consultation with the Secretaries, that--
(1) provides lenders and loan servicers with compensation
to cover administrative costs for each eligible mortgage
modified according to the required standards; and
(2) provides loss sharing or guarantees for certain losses
incurred if a modified eligible mortgage should subsequently
redefault.
(b) Program Components.--The program established under
subsection (a) shall include the following components:
(1) Exclusion for early payment default.--To promote
sustainable mortgages, loss sharing or guarantees under the
program shall be available only after the borrower has made a
specified minimum number of payments on the modified
mortgage, as determined by the Chairperson.
(2) Standard net present value test.--In order to promote
consistency and simplicity in implementation and auditing
under the program, the Chairperson shall prescribe and
require lenders and loan servicers to apply a standardized
net present value analysis for participating lenders and loan
servicers that compares the expected net present value of
modifying past due mortgage loans with the net present value
of foreclosing on such mortgage loans. The Chairperson shall
use standard industry assumptions to ensure that a consistent
standard for affordability is provided, based on a ratio of
the borrower's mortgage-related expenses to gross monthly
income specified by the Chairperson.
(3) Systematic loan review by participating lenders and
servicers.--
(A) Requirement.--Any lender or loan servicer that
participates in the program shall be required--
(i) to undertake a systematic review of all of the eligible
mortgage loans under its management;
(ii) to subject each such eligible mortgage loan to the
standard net present value test prescribed by the Chairperson
to determine whether it is suitable for modification under
the program; and
(iii) to offer modifications for all eligible mortgages
that meet such test.
(B) Disqualification.--Any lender or loan servicer that
fails to undertake a systematic review and to carry out
modifications where they are justified, as required by
subparagraph (A), shall be disqualified from further
participation in the program, pending proof of compliance
with subparagraph (A).
(4) Modifications.--Modifications to eligible mortgages
under the program may include--
(A) reduction in interest rates and fees;
(B) term or amortization extensions;
(C) forbearance or forgiveness of principal; and
(D) other similar modifications, as determined appropriate
by the Chairperson.
(5) Loss share calculation.--In order to ensure the
administrative efficiency and effective operation of the
program and to provide adequate incentive to lenders and loan
servicers to modify eligible mortgages and avoid unnecessary
foreclosures, the Chairperson shall define appropriate
standardized measures for loss sharing or guarantees.
(6) De minimis test.--The Chairperson shall implement a de
minimis test to exclude from loss sharing under the program
any modification that does not lower the monthly loan payment
to the borrower by at least 7 to 15 percent, at the
determination of the Chairperson.
(7) Time limit on loss sharing payment.--At the
determination of the Chairperson, a loss sharing guarantee
under the program shall terminate between 5 and 15 years
after the date on which the mortgage modification is
consummated, as determined by the Chairperson.

SEC. 1703. ALTERNATIVE COMPONENTS.

(a) In General.--The Chairperson may, with the approval of
the Secretaries, and after making the certifications to
Congress required by subsection (b), implement foreclosure
prevention and mitigation actions other than those authorized
under section 1702.
(b) Certification to Congress.--The Chairperson shall
certify to Congress that the Chairperson believes the
alternative foreclosure mitigation actions would provide
equivalent or greater impact or have a more cost-effective
impact on foreclosure mitigation than those authorized under
section 1702. Such certification shall contain quantitative
projections of the benefit of pursuing the alternative
actions in place of or in addition to the actions authorized
under section 1702.

SEC. 1704. TIMELY IMPLEMENTATION.

The Chairperson shall begin implementation of, and shall
allow lenders and loan servicers to begin participation in,
the mortgage modification program under this title not later
than 1 month after the date of enactment of this Act.

SEC. 1705. SAFE HARBOR FOR LOAN SERVICERS.

(a) Loan Modifications and Workout Plans.--Notwithstanding
any other provision of law, and notwithstanding any
investment contract between a loan servicer and a
securitization vehicle or investor, a loan servicer that acts
consistent with the duty set forth in section 129A(a) of
Truth in Lending Act (15 U.S.C. 1639a) shall not be liable
for entering into a loan modification or workout plan under
the program established under this title, or with respect to
any mortgage that meets all of the criteria set forth in
subsection (b)(2), to--
(1) any person, based on that person's ownership of a
residential mortgage loan or any interest in a pool of
residential mortgage loans or in securities that distribute
payments out of the principal, interest, and other payments
on loans in the pool;
(2) any person who is obligated to make payments determined
in reference to any loan or any interest referred to in
paragraph (1); or
(3) any person that insures any loan or any interest
referred to in paragraph (1) under any provision of law or
regulation of the United States or of any State or political
subdivision of any State.
(b) Ability to Modify Mortgages.--
(1) In general.--Notwithstanding any other provision of
law, and notwithstanding any investment contract between a
loan servicer and a securitization vehicle or investor, with
respect to any mortgage loan that meets all of the criteria
set forth in paragraph (2), or which is modified in
accordance with the loan modification program established
under this title, a loan servicer--
(A) shall not be limited in the ability to modify
mortgages, the number of mortgages that can be modified, the
frequency of loan modifications, or the range of permissible
modifications;
(B) shall not be obligated to repurchase loans from or
otherwise make payments to the securitization vehicle on
account of a modification, workout, or other loss mitigation
plan for a residential mortgage or a class of residential
mortgages that constitute a part or all of the mortgages in
the securitization vehicle; and
(C) shall not lose the safe harbor protection provided
under subsection (a) due to actions taken in accordance with
subparagraphs (A) and (B).
(2) Criteria.--A mortgage loan described in this paragraph
is a mortgage loan with respect to which--
(A) default on the payment of such mortgage has occurred or
is reasonably foreseeable;
(B) the property securing such mortgage is occupied by the
mortgagor; and
(C) the loan servicer reasonably and in good faith believes
that the anticipated recovery on the principal outstanding
obligation of the mortgage under the particular modification
or workout plan or other loss mitigation action will exceed,
on a net present value basis, the anticipated recovery on the
principal outstanding obligation of the mortgage to be
realized through foreclosure.

[[Page S1810]]

(c) Applicability.--This section shall apply only with
respect to modifications, workouts, and other loss mitigation
plans initiated before July 1, 2010.
(d) Reporting.--Each loan servicer that engages in loan
modifications or workout plans subject to the safe harbor in
this section shall report to the Chairperson on a regular
basis regarding the extent, scope, and results of the loan
servicer's modification activities, subject to the rules of
the Chairperson regarding the form, content, and timing of
such reports.
(e) Definition of Securitization Vehicles.--For purposes of
this section, the term `securitization vehicle' means a
trust, corporation, partnership, limited liability entity,
special purpose entity, or other structure that--
(1) is the issuer, or is created by the issuer, of mortgage
pass-through certificates, participation certificates,
mortgage-backed securities, or other similar securities
backed by a pool of assets that includes residential mortgage
loans; and
(2) holds such mortgages.

SEC. 1706. FUNDING.

There is appropriated to the Secretary of the Treasury to
cover the costs incurred by the Corporation in carrying out
the mortgage modification program established under this
title, $22,725,000,000. Funds that are unused by July 1,
2010, shall be returned to the General Fund of the Treasury
of the United States, unless otherwise directed by Congress.

SEC. 1707. FDIC COSTS AND AUTHORITY.

(a) Transfer From Secretary.--The Chairperson shall, from
time to time, request payment of the anticipated costs of
carrying out the program, including any administrative costs,
and the Secretary of the Treasury shall immediately pay the
amounts requested to the Corporation from the funds made
available under section 1706.
(b) Corporation Authority.--In carrying out its
responsibilities under this title, the Corporation may
exercise its authority under section 9 of the Federal Deposit
Insurance Act.

SEC. 1708. REPORT.

Before the end of the 2-month period beginning on the date
of enactment of this Act and every 3 months thereafter, the
Chairperson shall submit a report to the Congress detailing
the implementation results and costs of the mortgage
modification program, and containing such recommendations for
legislative or administrative action as the Chairperson may
determine to be appropriate.

The PRESIDING OFFICER. The Senator from South Carolina is recognized.

Amendment No. 501

Mr. GRAHAM. Mr. President, I will try to make this as quick as
possible. This is as a result of the ``gang of two.'' I would encourage
everybody here to form your own gang and see if you can save some money
and do some good for the taxpayer. But it has been a real pleasure
working with Senator Conrad, who is the chairman of the Budget
Committee, who knows more than I will ever hope to know about this, and
has probably forgotten more than most of us know about budgeting and
spending.
We have looked at this bill, and we have similar concerns. One of the
things we agree on, I think pretty strongly, is that no amount of
stimulus package, no matter how well constructed, is going to solve the
Nation's problems unless you do something about housing and banking.
We found some common ground on the housing part. Sheila Bair, who is
the Director of the Federal Deposit Insurance Corporation, who was
allowed to stay in her position by President Obama--and I compliment
him for doing that; she is a very smart lady--she has been telling
people throughout the country that there is a way to get ahead of the
foreclosure problem if she had some money to modify mortgages that are
troubled. So what we have done is we have answered her call. She has
indicated to us, through a letter, and what we have done is taken
$22.725 billion, transferred it to her organization, and she will be
able to use that money to deal with service providers to renegotiate
mortgage loans that are underwater or about to go into default, make
sure that the overall payments of the mortgageholder are no more than
31 percent so people can afford it. The lender and investors would be
required to achieve reductions through a combination of interest rate
reduction, extended amortization, and principal forbearance.
In other words, she tells us if we gave her this amount of money, she
could sit down with the private sector and do the following:

This proposal is no silver bullet. But we do estimate that
it could reduce projected foreclosures by some 1.5 million,
assuming the program would last around 14 months.

Now, let me say that again. Some 1.5 million Americans, with this
amount of money, in her opinion, could avoid having their homes
foreclosed on. I don't have names and faces, but imagine for a moment
people you know. That is a very big deal to me. And the money, $26-plus
billion, is taken out of the underlying bill. We offset it. And as a
compliment to my friend from North Dakota, it took us about 3 minutes
to find offsets in this bill.
What we are able to do is we took a $75 billion fund for States that
was undesignated spending, no real rhyme or reason how it will
stimulate the economy in the near term, and we said, wait a minute, we
know $16.85 billion, if given to the FDIC organization, Ms. Bair, if
they got $16 billion of that pot of money, they could save 1.5 million
people from foreclosure. If we would do that, it would help the housing
market in general.
Again, my colleagues, we can print money until the press breaks. If
you do not deal with housing and banking, we are never going to shore
up this economy. This is, I think, a very responsible amendment. We
could do a lot more with this bill. But we have the ability to transfer
funds from the underlying bill to the FDIC that could be used in a way
to work with the private sector financial managers to help 1.5 million
people from going into foreclosure in the next 14 months.
I am very proud of the amendment. I am sure it is no silver bullet,
as she indicates, but it shows you what we can do around here if we
keep our eye on the ball. At the end of the day, whatever amount this
bill comes out to be, we have done very little for housing and nothing
for banking.
Our dear friend, Senator Dodd, on the Banking Committee, knows, and
the rest of us should know, that if you do not get credit flowing, if
you do not shore up housing, there is no amount of stimulus in the
world that is going to bring this economy back.
I urge all of my colleagues to support this amendment, because it
will help Americans in the near term save their home from foreclosure.
It is responsibly spent, and the offsets, I think, are reasonable.
I will let my friend from North Dakota tell you about the stimulative
effect of the offsets to our economy versus the stimulative effect of
the protection of housing of our amendment.
With that, I yield to my friend from North Dakota.
The PRESIDING OFFICER. The Senator from North Dakota is recognized.
Mr. CONRAD. I thank Senator Graham from South Carolina for teaming up
on this amendment. I think it is critically important that this
amendment be adopted, because it goes right to the heart of the
financial crisis we are facing.
Housing is right at the center of the economic meltdown that is
occurring, and precious little is being done in this economic recovery
bill to address it.
I salute Senator Isakson for his amendment the other night, because
that is the other half of a package I think makes sense for housing.
The Isakson amendment broadens the credit, an amendment that I offered
in the Finance Committee that was adopted. Now we have the second piece
of the puzzle, that is, to address foreclosures.
Some will say, we will wait. We will do this in the TARP. Well, No.
1, there is not sufficient funding in TARP to deal with housing and the
financial sector. In fact, the testimony before the Budget Committee--
Senator Graham heard it, I heard it--said we are going to need $300 to
$500 billion more in the TARP for the financial sector, without
addressing at all the housing crisis.
I say to my colleagues, I urge my colleagues to think very carefully
about this prospect. We know this economy cannot recover without
housing being healthier, and without the financial sector being
healthier.
This amendment addresses housing, and it does it by reallocating
funding, not adding more money to this package, but reallocating money
within the

[[Page S1811]]

package. It is fully paid for, $22.8 billion that is needed to have the
FDIC go forward with its plan to reduce foreclosures in America.
The Senator from South Carolina said it well. The letter from Sheila
Bair makes it clear. This amendment, under her estimate, would avert
1.5 million home foreclosures in this country. I do not think we should
wait. I do not think we should count on a TARP plan that is already
underfunded to deal with the financial crisis as the basis for funding
this approach. I think we should do it here. I think we should do it
now. And I think we should do it in a way that is paid for.
There is a certain level of expectation that occurs when a package
comes over from the House, and various allocations are made. The
problem is, that is not going to be the final bill leaving this
Chamber. That is clear. So adjustments are going to have to be made.
Priorities are going to have to be determined.
I assert to my colleagues, housing ought to be certainly one of the
highest priorities to be addressed in any economic recovery package.
There are other things in this legislation that may be meritorious, may
be good, some of them stimulative, some of them less so. We have tried
to focus on those things that are of questionable value in terms of
stimulus. We started with the so-called stabilization fund. Now
Governors are going to get several hundred billion dollars under this
plan. But one part of it, the economic stabilization fund, constitutes
a slush fund if ever there was one.
There are absolutely no strings attached. Governors can use it for
any purpose. We have reduced that by some 70 percent. That is the
biggest pay-for here. Then we have taken other items that have become
the object of ridicule, $400 million for sexually transmitted diseases,
$75 million for smoking cessation, and on it goes, things that are of
questionable value with respect to stimulus, things that, some of them,
have very slow spend-out rates. In one of them, only 17 percent of the
money is spent in the first 2 years, so 83 percent is beyond 2 years.
We have tried to be careful and judicious with respect to the pay-
fors to fund what I think has to be a critical priority.
Mr. President, how much time have I consumed?
The PRESIDING OFFICER. The Senator has used 5 minutes.
Mr. CONRAD. Mr. President, I want to say this before we give Senator
Graham another chance, and then we are happy to hear Senator Dodd's
concern. This is a critical moment for this bill. Are we going to
address one of the two major crises facing this country, or are we
going to largely say wait for another day? Wait for another day. Wait
for the TARP funds that are already oversubscribed.
There is about $300 billion left in TARP funds. The testimony before
the Budget Committee was crystal clear, from economists across a broad
spectrum, Republicans and Democrats, that you are going to need another
$300 to $500 billion in the TARP to deal with the financial crisis.
I say to my colleagues, if we want to deal with something fundamental
with respect to housing, here is our opportunity to do so.
I yield the floor and retain the remainder of my time.
The PRESIDING OFFICER. The Senator from South Carolina has 4\1/2\
minutes remaining.
Mr. GRAHAM. Mr. President, as I understand the TARP funding
situation, we are somewhere in the $310 billion range in terms of funds
left. I voted for TARP. It was a very tough vote for all of us. And the
first $350 billion, let's put it this way, I do not think inspired a
lot of confidence in the American people. I was told we were going to
buy toxic assets with the money, that we were going to get those bad
debts off the balance sheets so people could lend money. Unfortunately,
most of the money went to banks. And I do not have any idea what bank
got what, and I have no idea what they did with the money. I know the
chairman of the Banking Committee is trying to figure that out.
The confidence level of the American people in us is pretty low right
now. Do we understand what we are doing and how are we going to get
there? I can assure you there is going to be more money requested for
housing and banking.
Every dollar we spend in the stimulus package that is off the mark is
borrowed money, and it is going to make it harder to get new money for
housing and banking. So, dear colleague, the next time we go to the
American people and ask them to trust us with more of their money to
fix banking and housing, they are going to judge us by TARP and this
stimulus package. I am afraid we are not doing very well in their
sight. This amendment will help in a small way. We can do a lot more.
Mr. President, I ask unanimous consent that Senator Bond be added as
a cosponsor.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. GRAHAM. Mr. President, I ask unanimous consent to have printed in
the Record the letter from Sheila Bair to me and Senator Conrad about
what this would do for housing: 1.5 million people would avoid
foreclosure if this program were enacted for 14 months. That is a
pretty good use of money.
There being no objection, the material was ordered to be printed in
the Record, as follows:

Federal Deposit

Insurance Corporation,

Washington, DC, February 4, 2009.
Hon. Lindsey Graham,
U.S. Senate,
Washington, DC.
Dear Senator Graham: This letter is in response to your
inquiry regarding the Federal Deposit Insurance Corporation
proposal to reduce unnecessary foreclosures by providing
partial guarantees against future loss for distressed
mortgages that are restructured to provide affordable
payments over the life of the loan. We believe the best way
to address the problem of unnecessary foreclosures in scale
is to provide appropriate economic incentives for the
systematic restructuring of unaffordable mortgages into
affordable, sustainable obligations.
Specifically, our proposal would require lenders and
mortgage investors to restructure unaffordable mortgages into
loans with payments no greater than 31 percent of the
borrower's income. Lender and investors would be required to
achieve these reductions through a combination of interest
rate reductions, extended amortization, and principal
forebearance. In return, the government would agree to share
a portion of the losses if the loan later defaulted. In
developing this proposal, we have drawn from our long
experience in restructuring the troubled loans of failed
banks into performing assets, thereby enhancing their value
on sale. As millions of unnecessary foreclosures drag down
home prices and harm our economy, we believe there is an
urgent need for a federal program to provide appropriate
incentives for loan modifications as an alternative. More
widescale loan restructuring would help our economy and
preserve homeownership, while making good business sense as
the value of a performing mortgage will generally be greater
than that of a foreclosed home.
This proposal is no silver bullet, but we do estimate that
it could reduce projected foreclosures by some 1.5 million,
assuming the program would last around 14 months. The
projected costs of the program are $24.4 billion or less.
The enclosed document from our website provides additional
details about our loss sharing proposal. Please let me know
if we can provide additional information.
Sincerely,
Sheila C. Bair,
Chairman.
Enclosure.

FDIC Loss Sharing Proposal to Promote Affordable Loan Modifications

Background

Although foreclosures are costly to lenders, borrowers and
communities, the pace of loan modifications continues to be
extremely slow (around 4 percent of seriously delinquent
loans each month). It is imperative to provide incentives to
achieve a sufficient scale in loan modifications to stem the
reductions in housing prices and rising foreclosures.
Modifications should be provided using a systematic and
sustainable process. The FDIC has initiated a systematic loan
modification program at IndyMac Federal Bank to reduce first
lien mortgage payments to as low as 31% of monthly income.
Modifications are based on interest rate reductions,
extension of term, and principal forebearance. A loss share
guarantee on redefaults of modified mortgages can provide the
necessary incentive to modify mortgages on a sufficient
scale, while leveraging available government funds to affect
more mortgages than outright purchases or specific incentives
for every modification. The FDIC would be prepared to serve
as contractor for Treasury and already has extensive
experience in the IndyMac modification process.

Basic Structure and Scope of Proposal

This proposal is designed to promote wider adoption of such
a systematic loan modification program:
1. by paying servicers $1,000 to cover expenses for each
loan modified according to the required standards; and

[[Page S1812]]

2. sharing a proportion of losses incurred if a modified
loan should subsequently re-default
We envision that the program can be applied to the
estimated 1.4 million non-GSE mortgage loans that were 60
days or more past due as of June 2008, plus an additional 3
million non-GSE loans that are projected to become delinquent
by year-end 2009. Of this total of approximately 4.4 million
problem loans, we expect that about half can be modified,
resulting in some 2.2 million loan modifications under the
plan.

Details on Program Design

Eligible Borrowers: The program will be limited to loans
secured by owner-occupied properties.
Exclusion for Early Payment Default: To promote sustainable
mortgages, government loss sharing would be available only
after the borrower has made a minimum number of payments on
the modified mortgage.
Standard NPV Test: In order to promote consistency and
simplicity in implementation and audit, a standard test
comparing the expected net present value (NPV) of modifying
past due loans compared to the strategy of foreclosing on
them will be applied. Under this NPV test, standard
assumptions will be used to ensure that a consistent standard
for affordability is provided based on a 31% borrower
mortgage debt-to-income ratio.
Systematic Loan Review by Participating Servicers:
Participating servicers would be required to undertake a
systematic review of all of the loans under their management,
to subject each loan to a standard NPV test to determine
whether it is a suitable candidate for modification, and to
modify all loans that pass this test. The penalty for failing
to undertake such a systematic review and to carry out
modifications where they are justified would be
disqualification from further participation in the program
until such a systematic program was introduced.
Simplified Loss Share Calculation: In order to ensure the
administrative efficiency of this program, the calculation of
loss share basis would be as simple as possible. In general
terms, the calculation would be based on the difference
between the net present value of the modified loan and the
amount of recoveries obtained in a disposition by
refinancing, short sale or REO sale, net of disposal costs
as estimated according to industry standards. Interim
modifications would be allowed.
De minimis Test: To lower administrative costs, a de
minimis test excludes from loss sharing any modification that
did not lower the monthly payment at least 10 percent.
Eight-year Limit on Loss Sharing Payments: The loss sharing
guarantee ends eight years of the modification.

Impact of the Program

The table below outlines some of the basic assumptions
behind the scale of the plan and its expected costs. To
summarize, we expect that about half of the projected 4.4
million problem loans between now and year-end 2009 can be
modified. Assuming a redefault rate of 33 percent, this plan
could reduce the number of foreclosures during this period by
some 1.5 million at a projected program cost of $24.4
billion.

Projected Number of Cost of Loan Modifications Under FDIC Loss Sharing
Proposal

1.6 million total loans 60+/90+ past due now
GSE loans make up about 13 percent of problem loans at
present
Net: 1.4 million non-GSE problem loans at present
3.8 million new total loans 60+/90+ past due by y.e. 2009
Assume: GSE loans make up 20 percent of new problem loans
through y.e. 2009
Net 3.04 million new non-GSE problem loans through y.e.
2009
Total non-GSE problem loans through y.e. 2009: 4.44 million
Modify 1/2, or 2.22 million loans
Avg. loan size $200,000
Total book value of loans modified = $444 billion
Avg. program cost (FDIC assumptions) = 5.5 percent
Est. total program cost = $24.4 billion
Assuming redefault rate of 33 percent, almost 1.5 million
foreclosures avoided

The PRESIDING OFFICER. The Senator from Connecticut is recognized.
Mr. DODD. First, let me begin by thanking both of my colleagues from
North Dakota and South Carolina for their interest in the subject
matter.
Now, as I pointed out, 2 years ago tomorrow, I think it was, February
7, 2007, as the new chairman of the Banking Committee, I held my first
hearings, and the first hearings were on the foreclosure crisis.
At that time, a fellow by the name of Eakes testified before the
committee and predicted 2.2 million foreclosures in the country. He was
scoffed at all across the country for having such an outrageous
prediction.
In fact, the criticism was correct. It was an outrageous prediction,
because it was not 2.2 million, it is now 8 million.
I see my friend from New Jersey, Bob Menendez, who was at that
hearing 2 years ago today. And he predicted a tsunami, were his words--
I will never forget them--of how foreclosures were occurring in the
country. And again, people laughed and ridiculed and suggested that we
were somehow predicting things that were never going to happen.
We have all learned, painfully, the results. We are in the pickle we
are in today because we didn't respond to the foreclosure crisis at the
time. This is a major problem that deserves major attention. When we
wrote the so-called TARP legislation in September, we required four
things. I won't bother with the first three; they were accountability,
taxpayer issues. One of the four points was to mitigate against
foreclosures. We have learned, painfully over the last number of weeks,
that virtually nothing was done about foreclosure mitigation with the
original $350 billion tranche.
My concerns--and I appreciate immensely the effort we are finally
getting some attention to this issue and looking for resources--are the
following: One, I am not sure foreclosure mitigation ought to be a part
of a stimulus package. You can make a case for doing something about
foreclosures, but that is why we have the TARP program. It is not only
the financial system. They are, of course, interrelated. It is not like
there is a housing issue and a financial system at risk that are
separate issues. They are the same issue, the foreclosure issue and the
financial mess.
I am going to be offering shortly, along with Senators Reid and
Martinez, legislation that requires that of the $310 to $350 billion in
the second tranche, that $50 billion be dedicated to foreclosure
mitigation because that was what the intention was originally. While I
am attracted to the proposal made by Sheila Bair at FDIC--and I mention
that in the amendment as one of the ideas, but there are a number of
ideas. I say, respectfully, to both my good friends, Senators Graham
and Conrad, as I read the amendment, it would require the adoption of
the Sheila Bair approach. To me, that is worrisome because it is one
idea but not the only idea, to allocate $20-some-odd billion to one
idea at a time when we ought to be looking at various ideas that might
actually work to mitigate foreclosures. She believes $25 billion would
do 1.2. She thinks $50 would double that number to 2.2 or close to 3.
We have a lot of numbers that get thrown around here.
My point is, it ought to be something we try not to congressionally
mandate. We are good at a lot of things in the Congress, but when we
start micromanaging ideas such as this, we get ourselves into trouble.
That is why, hopefully, we have smart people out there who will
consider ideas and manage them well. But up here, when you try to set
accounting standards or rigidly determine a particular formulation, I
get uneasy.
The amendment we will offer goes beyond foreclosure mitigation. We
also clean up HOPE for Homeowners, which we all supported last summer--
almost all of us did--as a way to try and also deal with foreclosure
mitigation. My concern would be that the adoption of this amendment
would preclude the adoption of the second amendment. I, respectfully,
suggest that what we have offered as our second amendment is a more
comprehensive approach.
I have held 82 hearings. I see my friend from Kentucky, Senator
Bunning, a member of the committee. We spent a lot of time over the
last 2 years on these issues. We haven't all agreed every time on
everything--but 82 hearings and meetings, a third of which were on this
subject matter alone. I know we all respect each other for doing the
jobs we try to do. But having spent this much time trying to figure out
what is the best answer, it seems to me TARP resources ought to be
used, stimulant money ought to be used for job creation. Not that I
wouldn't like to have extra resources to deal with this. We ought to
have a broad approach so we are not rigidly locked into a
congressionally mandated formula.
I won't bother to address offsets. My colleagues are trying very hard
to do what we all ought to do and that is to pay for various things. I
will let others go down the list and whether they like or dislike the
various offsets.
The PRESIDING OFFICER. The time of the Senator has expired.

[[Page S1813]]

Mr. DODD. I ask unanimous consent for 1 additional minute.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DODD. I find myself sort of in an awkward position. I don't want
to be in the position of disagreeing with trying to do something about
foreclosure mitigation. But we end up doing this and the next and we
get to 75 or in excess of $75 billion for this particular issue, we are
getting excessive, it seems to me, without knowing whether a smaller
amount might achieve the job. If we are mandating it with two
provisions, then we are excluding resources that could be used for
other things, including job creation, which is the debate about the
stimulus package. My friend from North Dakota and I have talked about
this privately, and I thank my colleagues for raising the issue. I
truly have mixed emotions about this because I like what they are doing
on the one hand, but I am concerned that as between the two choices--
the one Senators Martinez, Reid, and I will offer and this one--I think
we offer a more comprehensive one, one that relies on greater
flexibility and uses TARP money rather than stimulant money to achieve
the result.
Mr. SCHUMER. Will my colleague yield for a question?
The PRESIDING OFFICER. The time of the Senator has expired.
Mr. SCHUMER. I ask unanimous consent for 2 minutes to ask a question.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. SCHUMER. Mr. President, I agree completely with my colleague's
sentiments. Why, in this hard fought bill, where we don't have enough
money for everything else and we are all worried about it and we know
we have money from the TARP, $50 to $100 billion promised to deal with
housing, why take the money out of here when we need it for
infrastructure and for middle-class tax cuts and all the other things.
I ask my colleague, in effect, to the people being foreclosed upon, is
there any difference if we take the money out of TARP or take the money
out of this stimulus, even though we know there is a huge difference to
all the other people who will suffer $20 billion in cuts? Is there any
difference, in effect, on their lives and on how we can help them?
Mr. DODD. There is only in this sense. This bill has a specific
requirement that a particular plan be adopted and funded with this
proposal. I admire Sheila Bair's proposal, but we also recognize there
are others. At the same time, if we are dealing with foreclosure
mitigation but not getting that person who is probably in foreclosure
because they may have lost a job, if we don't make it possible for them
to get back to work because we minimize the resources in the stimulus,
saving their home but not saving their job ends up with sort of a very
mixed message.
Mr. SCHUMER. Excellent point.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Mr. President, I submit we will not save people's jobs or
their homes unless we have a comprehensive strategy to address both.
The problem with the economic recovery package is there is precious
little in here that does anything about the housing crisis. We hear the
assurance that we can take the money from the TARP. The problem is the
TARP, by testimony before the Budget Committee, is oversubscribed as it
is.
Let's do the math. There is about $300 billion left in the TARP. The
testimony before the Budget Committee is, we need $300 to $500 billion
on top of that $300 billion just to deal with the financial crisis.
That doesn't leave any money for the housing crisis. Here we have
before us a vehicle to face up to foreclosures. Senator Dodd is
absolutely right. I remember well his holding a hearing on
foreclosures. I remember well his coming to this floor with
legislation. I remember well filibuster after filibuster against
dealing with it. Now is the time. We should not wait to take on the
foreclosure crisis in America. More foreclosures, more homes lost, more
people unable to pay, more banks have their capital impaired, fewer
loans being made, more jobs lost. This is an opportunity to deal with
the housing crisis and to have it paid for and to have it paid for out
of economic recovery funds.
I don't know how I would explain to my constituents that housing
wasn't a key part of an economic recovery package.
How much time do I have remaining?
The PRESIDING OFFICER. The Senator has 2 minutes remaining.
Mr. CONRAD. I retain that time.
The PRESIDING OFFICER. The Senator from South Carolina.
Mr. GRAHAM. If I believed we could fix housing and the banking
situation with $310 billion, I would sit down and withdraw the
amendment. I don't think we can. I am trying to help. As to my friend
from New York, if you think it is more important to spend $400 million
to deal with sexually transmitted diseases than it is to save 1.5
million homes, vote against us. I have an offset here. Go through this.
If you think this is a better use of money than allocating money to
save people from losing their homes, vote no. We are not in a perfect
world. We are in a miserable world. We have a stimulus package that has
very little to do with stimulating the economy and a lot to do with
growing the Government. We have a housing problem and a banking problem
that are going to cost a lot more than $300 billion. That is what we
are trying to say to our colleagues. The problems are massive. The
spending bill is too large. We are trying to create some sense of
priorities and urgency. So the $16 billion slush fund that is not going
to create any job, if you think it is better to have that than it is to
save 1.5 million homes from foreclosure with a program that Sheila Bair
thinks will work, let's do it.
I wish to work with Senator Dodd to improve the funding available to
deal with foreclosures. This is not a silver bullet, but it will help.
We have our priorities mixed up. We have a spending bill that doesn't
create jobs. It grows the Government. We don't have enough money to fix
housing and the underlying banking problem because we have been
incompetent with the first $350 billion. I am not blaming anybody. I am
telling America the worst is yet to come, and we are wasting money and
wasting time. This is not a perfect world. This is a Congress making it
up as we go. I would like to get some rhyme or reason as to what we are
doing. This amendment has a rhyme or reason about what we are doing.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. I ask unanimous consent that 10 more minutes be allocated
to the Conrad-Graham amendment, equally divided, because there are some
who still want to speak in opposition to the amendment.
The PRESIDING OFFICER. Without objection, it is so ordered. Who
yields time?
The Senator from North Dakota.
Mr. CONRAD. Mr. President, I thank the chairman of the committee who
is managing the bill. Maybe I will just take a few minutes. I
understand we have another colleague who is on his way and wants to
speak.
The comment was made that this amendment requires us to use the
Sheila Bair approach. Let me say, in this whole crisis, the Government
official who shines the brightest and the best has been Sheila Bair.
She is the person who has warned us that this tsunami of foreclosures
was coming. She is the one who warned us of the financial crisis. She
is the one who had the most consistent track record about dealing with
it and dealing with it effectively. Institution after institution she
has taken over, under the rules and the law, have been dealt with in
the most economically rational way.
Now she has come forward with a plan that observers and economists of
every stripe have said is outstanding. It has the best prospects for
success at preventing people from losing their homes.
This is much more than numbers on a page. When we talk about 1.5
million people not going through foreclosure if our amendment is
adopted, according to Sheila Bair and her professional staff, 1.5
million people, this is much more than that number. Think of what is
happening in those families, when they have the sense they are going to
lose their homes and start through a legal process that sucks them
down. I read yesterday what was happening in courts locally as people
went in facing foreclosure, the absolute desperation of the people, the
confusion, the chaos in their lives. With this amendment, we have a
chance to avert 1.5 million

[[Page S1814]]

American families from going through foreclosure. It is paid for. It is
paid for in the least painful way.
Let me conclude on the notion of waiting for TARP. The TARP funds are
simply insufficient to deal with the financial crisis and the housing
crisis. There can be no question. I predict right here, right now, this
administration will be coming to us in the weeks ahead asking for
between $400 and $500 billion more of TARP funds just to deal with the
financial crisis. Senator Graham was there. We had three of the most
outstanding economists in the country, Democrats and Republicans,
telling us exactly that. To hope and pray that somehow the TARP funds
are going to be the savior for housing foreclosure is not something I
would want to count on.
Mr. GRAHAM. Will the Senator yield for a question?
Mr. CONRAD. I am happy to yield.
Mr. GRAHAM. Does the Senator agree with me that whether we can get
the public to buy into $500 billion, $400 billion more, has a lot to do
with their confidence level in how we are spending their money through
the TARP and through the stimulus package? We are trying to improve
their confidence level by having offsets that make sense; does he agree
that is the purpose?
Mr. CONRAD. I think it is just fundamental that one way to build
confidence with the American people is to show them we are using their
precious taxpayer dollars in the highest priority areas and we are
doing it in a responsible way--not adding to deficits and debt, not
creating a huge bow wave for the Federal budget going forward. Some of
the items we have taken out only spend out 17 percent in the next 2
years; 83 percent is beyond.
So I hope my colleagues are listening carefully to this debate
because this one really matters. Mr. President, 1.5 million homes can
avoid foreclosure.
Let me say, we have not locked in a rigid approach on the FDIC
proposal on dealing with foreclosures. We have allowed them to make
modifications in their plan so it can take in the best ideas of others.
But I think every observer, every economist who has looked at the FDIC
plan has confirmed what Sheila Bair has told us in writing today: that
this amendment, voted on today, could help prevent 1.5 million people
from losing their homes and creating a further downdraft in this
economy--more foreclosures, more banks cannot lend, more jobs lost.
That is exactly what an economic recovery package should be about.
Mr. President, how much time do I retain?
The PRESIDING OFFICER. There is 2 minutes for the proponents of the
amendment.
Mr. CONRAD. Mr. President, I am happy to yield.
The PRESIDING OFFICER. The Senator from Connecticut.
Mr. DODD. Mr. President, I yield whatever time my colleague from New
York would need.
Mr. SCHUMER. Three minutes.
The PRESIDING OFFICER. The Senator from New York.
Mr. SCHUMER. Thank you, Mr. President, and I thank my friend from
Connecticut, our leader and chairman of the Banking Committee, for his
time and his words.
Let me be clear to my colleagues, this is not about whether you want
to help people who face foreclosure. It has been a fight I have been
making since a year and a half ago, when Senators Brown and Casey and I
put money into the appropriations bill of 2008 for counselors. Nor is
it about the priorities of where you should cut that specifically are
laid out by my friend and great chairman of the Budget Committee,
Senator Conrad. This is very simple common sense. We are sitting here.
A bill may not even pass because we cannot decide where we can make
cuts. We have some who want a number lower. We have some who want a
number higher. The fights are over important issues such as education
and health care and roads and broadband and all of the things we think
we need to get this economy working again--some short term, some long
term.
We all agree with that. We all agree with helping those who need help
because their homes may be foreclosed upon. However, the reason I think
we should have an overwhelming vote against the amendment of my good
friend from North Dakota is simple: The money comes from the wrong
place.
We have $50 billion to $100 billion in the TARP--the second half of
the TARP--that has been committed by President Obama to do the very
things my colleague wishes to take out of the stimulus bill. Why don't
we wait? We are going to have an announcement early next week about
those moneys. Wouldn't it be foolish to take those moneys out of this
bill when we are so hurting and we have so limited money? It is as if
we have seven children in a bed and enough blanket for five and there
is a struggle as to whose feet are going to be stuck out or who is not
going to be covered? Wouldn't it be embarrassing if next week the
administration announces they are taking this very money out of the
TARP? It just does not make any sense, in my judgment, in my humble
judgment.
So I urge my colleagues to reject this amendment, whatever side they
are on. If they think the money should not be taken out of the specific
list Senator Conrad has compiled, if they think it should go to
foreclosure and come from something else----
The PRESIDING OFFICER (Mr. Burris). The Senator's time has expired.
Mr. SCHUMER. Mr. President, would my colleague have 2 more minutes?
Are we limited in time?
Mr. BAUCUS. We are limited, Mr. President.
I am sorry. The Senator is managing the time.
The PRESIDING OFFICER. The Senator from Connecticut.
Mr. DODD. Mr. President, this is, obviously, a discussion that has
provoked a bit more discussion than I think any of us anticipated, and
it is a worthwhile discussion. So I ask unanimous consent that there be
an additional 10 minutes because I know there are several other Members
who want to be heard on this amendment, and certainly my colleague from
North Dakota may request some additional time as well. We may not use
it all, but to give us enough time to flesh this out, if we can, I ask
for 10 additional minutes.
Mr. CONRAD. Is that equally divided?
Mr. DODD. Yes, equally divided. I do not know how much time we will
need, but just to--and I will yield whatever time my colleague from New
York needs. Two minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from New York.
Mr. SCHUMER. Mr. President, I thank my colleague.
So under the amendment of my friend from North Dakota, the money
would not come from the banks but come from all these programs we like.
Under the next amendment that will be offered by the chairman of the
Banking Committee, the Senator from Connecticut, the money will come--
instead of going to banks, it will go directly into foreclosure. If we
do what the Senator from North Dakota wants, there is going to be $150
billion to $100 billion more going to the banks.
I think many of us think that money that was in the first $350
billion was not wisely spent. If we do what the Senator from
Connecticut will propose shortly, the money will not come out of
education and health care and broadband, but it will come out of giving
more money to the banks. So if you want extra money for the banks, the
amendment from the Senator from North Dakota is in order.
Mr. GRAHAM. Mr. President, will the Senator yield for a question?
Mr. SCHUMER. Mr. President, I am happy to yield to my friend from
South Carolina.
The PRESIDING OFFICER. The Senator from South Carolina.
Mr. GRAHAM. The point I am trying to make, I say to the Senator, is,
I may be wrong, but I do not believe the remaining amount of money in
TARP--$310 billion, I believe it is--will take care of what we need to
do with our banking problem and our housing problem. Am I wrong?
Mr. SCHUMER. Mr. President, I think my colleague may not be wrong.
But I would add this, given that it is my time: Whether we only need
$200 billion or $310 billion or $500 billion or $600 billion more,
let's take the money we have out of this pocket, which is not being
spent well, from the banks, and use it instead of money out of this
hardly fought economic recovery bill. That is my basic point.

[[Page S1815]]

I thank my colleague for yielding.
I hope, with a great deal of respect, we will reject the amendment
offered by the Senator from North Dakota and then do the same thing but
take the money from the banks by supporting the amendment offered by
the Senator from Connecticut.
I yield the floor and yield back my time.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Mr. President, I have heard now from the Senator from New
York that we should wait to deal with foreclosures--we should wait.
Well, that is the opportunity that is before us. We can make a choice
on this amendment. We can wait some more to deal with foreclosures or
we can take action today.
Sheila Bair, the much respected head of the FDIC, has said that if
our amendment passes, we can avert 1.5 million Americans from being
foreclosed upon. You want to wait on that? What are you going to wait
for? You are going to wait to take the money out of the TARP when there
is insufficient money in the TARP to deal with the financial crisis,
much less the housing crisis and the financial crisis?
Look, this is the curious sort of Washington math that has us in deep
trouble. We talk about using money that has already been spoken for,
and somehow we are supposed to use it twice, maybe three times. I
suggest it is much better to act now and to use real money to pay for
it rather than be counting on a fund that is already oversubscribed.
Now, this notion of waiting leaves me cold. Mr. President, 1.5
million people are out there facing foreclosure, and those families
could have the foreclosure averted if we act. This is not the time to
wait. This is the time to act.
Mr. GRAHAM. Mr. President, will the Senator yield for a question?
Mr. CONRAD. Mr. President, I am happy to yield.
The PRESIDING OFFICER. The Senator from South Carolina.
Mr. GRAHAM. If our colleagues looked at the items we are using to
offset, do you agree with me, I say to the Senator, not only could most
of these items wait, it would be probably good we never spent the money
at all?
So when you talk about priorities between 1.5 million people who
could be saved from foreclosure in 14 months with this money versus
what we are offsetting--and only 17 percent of the offset money, I say
to the Senator, I believe, is spent in the first year--the $22 billion
we give to the FDIC to manage foreclosures would save 1.5 million homes
in 14 months.
So I would argue we are not shortchanging anyone by offsetting this
money, that what is in the offset not only could wait, a lot of it
could wait till hell froze over because it makes no sense to spend it
to begin with.
So it is not as if we are robbing somebody with a useful program. We
have looked into this $800 billion, $900 billion--whatever it is--bill,
I say to the Senator, and we are astonished to find that maybe there is
some money in here that does not make a whole lot of sense in terms of
stimulating the economy, saving housing or banking, and I think we have
done a pretty good job of offsetting it.
I would ask my colleagues one simple question, and I will end with a
question to the Senator from North Dakota. If you assume we are going
to be asking the American people for more money to fix their housing
problem and their banking problem, the question I have is, one, why
wait when we can do something now? And why would you put what is in
this bill in this offset ahead of housing? I just do not understand
that. Do you, as the Senator from North Dakota?
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. I thank the Chair.
I really do not. I really do not understand the logic of waiting. We
could take action today, action that is paid for, and save money out of
the TARP fund that is already oversubscribed. It is as clear as it can
be, there are not sufficient funds in the TARP to do all that is being
demanded of it. I do not know how anything makes more sense or is of a
higher priority in an economic recovery program than to avert
foreclosure. It ties directly to jobs because if a house is foreclosed
on, all the houses in the neighborhood lose value. Then what happens?
Then more homes are upside down.
Already, one in every four or one in every five homes in America is
upside down. They owe more than the house is worth. If more houses go
through foreclosure, more homes lose value, more people start not to
make their payments, the banks have less capital, they are less able to
lend, businesses are less able to carry on their activity, more jobs
are lost, and more foreclosure occurs.
The critical thing is to break the chain. That is the opportunity
this amendment presents.
Mr. President, how much time remains on our side?
The PRESIDING OFFICER. Two minutes.
The Senator from Connecticut.
Mr. DODD. Mr. President, first of all, acting now or acting later--
assuming we vote on this amendment offered by my friends from South
Carolina and North Dakota, within minutes after that, I will be
offering the amendment that would require that the $50 billion come out
of the TARP money. I do not know what delay we are talking about.
We are promoting the same piece of legislation. The money has already
been appropriated to deal TARP, so it is there. So the question is not
about delaying one in favor of the other. The question is, Which pot do
you want to draw from?
This is sort of a disconnect amendment. We were debating a stimulus
package, I thought. Maybe we are not. I know there is some debate about
that in the Chamber.
Mr. GRAHAM. Mr. President, I hate to do this because I hate it when
people do it to me, but I just want to ask a question, if I could.
The PRESIDING OFFICER. The Senator from South Carolina.
Mr. DODD. Mr. President, I yield to my colleague for a question.
The PRESIDING OFFICER. The Senator yields.
The Senator from South Carolina.
Mr. GRAHAM. I think the Banking Committee chairman has a major
dilemma on his hands, at no fault of his own. If I thought $310 billion
would do it, I would not be here. I think you are going to need more
money, and if you take 50 out of the TARP, you are going to have
whatever the math is left, and that is still not enough.

So what we are trying to do is get money for housing and taking it
out of a bill that I think has a lot of room to be offset. I am trying
to help, not hurt. I think you are going to need both.
Mr. DODD. Mr. President, I appreciate the remarks of my colleague. I
only have 1 minute. I have not been directly involved in the Finance or
Appropriations Committees, but I have listened to the debate over the
last several days, and I think the debate is this: Is this bill a
stimulus bill? If it is a stimulus bill, we are talking about job
creation. Is it a foreclosure bill? Maybe we changed the debate. If it
is a foreclosure debate, I thought I was on something else. So if we
want to talk about putting people to work and simultaneously now we are
going to take $23 billion out of the stimulus bill and put it in
foreclosure mitigation, it seems to me this is a different debate.
I would just say to my colleagues as someone who has chairmanship
with jurisdiction over TARP at this point: No, the money has not been
allocated. In fact, we have the Secretary of the Treasury coming to our
committee on Tuesday to describe exactly what their intentions are with
the $310 billion to $350 billion, and I don't know what it is yet.
This much I will tell you. I went through all the debate and the
discussion last fall with the previous administration, and we as a body
said: We want you to do three or four things with that money, one of
which is foreclosure mitigation. I got the commitments, all the
handshakes, and not a nickel of it was spent on it. I am assuming this
new crowd may be a bit different on that subject matter. But if you
were to ask me whether I have a commitment that any of that $310
billion or $350 billion is going to be spent on housing, my answer is I
don't know.
I have an amendment with Senator Martinez and Senator Reid in a
minute that mandates that $50 billion go to foreclosure mitigation out
of the TARP funds. No debate any longer, you have to do it. You know,
burn me once, burn me twice--we all know the expression. So I am not
going to run the risk

[[Page S1816]]

of watching another TARP come along and end up going to Citi and Bank
of America and everyone else and nothing happening on foreclosure
mitigation.
So it is a choice we have to make. We have a stimulus bill to do
something about job creation. That is the debate over the last week.
Many of my colleagues on the other side have raised issues about
whether we are spending money to actually create jobs in the country.
That is a legitimate debate. But you can't on the one hand complain
about this bill because it doesn't create jobs and then offer a $24
billion amendment that doesn't do anything about jobs. It deals with
foreclosure.
Now, if you are going to take $75 billion and dedicate it to a
subject matter that can be handled with a lot less, that is a waste of
money. So it is a matter of choices. We are bypassing each other. The
debate is about stimulus.
Now, $16 billion, $17 billion of the money comes out of one fund for
States. My colleagues ought to look at this. There is a lot of other
spending. I am not going to pretend to understand this; I don't serve
on the committee. I respect those who think some of this is unnecessary
spending. But $17 billion going back to the States for job creation, I
would remind my colleagues, is what they cut out of the bill if this
amendment is adopted. I suspect the States all across this country may
be counting on some of that for job creation, maybe not.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. DODD. I ask unanimous consent for 1 additional minute.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. CONRAD. Equally divided.
Mr. DODD. Well, then 2 minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DODD. We are going round and round on this, but I find this
debate--again, I want to make the point that I am grateful to both of
my colleagues for raising the issue of foreclosures in housing. I find
myself somewhat at cross-purposes because, on the one hand I agree with
what they are trying to do; on the other hand--I say this
respectfully--I think we are undermining our cause by approaching it
this way. We are diminishing the effect of the stimulus bill by doing
something on housing, which is a legitimate issue but is not the
subject of the debate of the underlying bill, and we are simultaneously
potentially denying our opportunity to mandate that this new
administration dedicate resources within the TARP to deal exactly with
the underlying cause of the economic crisis.
So that is the real choice involved. Again, I say it is an awkward
debate and argument. I know Senator Inouye and others wish to be heard
on these appropriations issues and, particularly, I suspect the $16
billion to the States. I will let my colleagues make that case. I know
Senator Inouye would like some time on that to address that issue. But
that is the real point in a sense. I have listened to my colleagues say
this bill is loaded up with things that don't effect job creation, and
I would say, respectfully, by insisting upon foreclosure mitigation in
this bill, it seems to me we are just contributing to the very
arguments being made about the underlying criticism of the legislation.
I yield the floor.
The PRESIDING OFFICER. The Senator's time has expired.
The Senator from North Dakota is recognized.
Mr. CONRAD. Mr. President, there are very few Members for whom I have
higher regard or greater affection than the Senator from Connecticut.
So I say that I could not more profoundly disagree when I hear him say
foreclosure mitigation has nothing to do with jobs.
Why is this economy in free fall? Well, one central reason is the
housing crisis. Foreclosures are a symptom of the underlying disease,
and if you don't treat it, this body is getting sicker and sicker and
sicker. The Senator offers as an alternative to take $50 billion out of
the existing TARP fund. The problem is the existing TARP fund doesn't
have enough money for the purpose for which it was created, which was
to deal with the fiscal crisis.
So this has everything to do with economic recovery. It has
everything to do with jobs. It has everything to do with strengthening
the economy. I know Senator Graham is seeking recognition.
The PRESIDING OFFICER. The Senator from South Carolina is recognized.
Mr. GRAHAM. Mr. President, I think the Senator from Connecticut has
asked a very good question. What are we doing here? Are we trying to
spend TARP money? Well, apparently we are going to do that next. I
thought we were stimulating the economy.
The President said this is a spending bill. Well, all spending
doesn't stimulate the economy: $400 million for sexually transmitted
disease research and $75 million to get people to quit smoking--those
things don't stimulate the economy in the near term. They may be very
worthwhile. You have issues with TARP. I didn't think we were going to
come over here and divide TARP. I am with you, Senator Dodd, I don't
think you have enough money.
What I want to do with my colleague from North Dakota is to let the
body know we are spending a lot of money--more than any American can
appreciate--on things that don't stimulate the economy. If you want to
get our economy back on its feet, take some of the money we are going
to waste in this bill and put it into a program that will save 1.5
million people from foreclosure. I think it is smart to do that now. I
think it is smart to look at TARP and maybe grow the fund if it is
necessary.
That is the point. This bill has lost focus. For one person it is
spending. For the other person it is rearranging TARP. For us it is
trying to save housing. I don't think we know what we are doing. I
think we need to understand we don't have enough money in TARP to fix
America's problems with housing and banking, and every dollar we waste
here and what we are taking out of this bill is purely waste, in my
opinion.
To help housing is smart. If you don't think it is smart, vote no. I
will respect you. But this whole process has gotten out of hand.
The PRESIDING OFFICER. The Senator from Arizona is recognized.
Mr. McCAIN. Mr. President, I would like to remind my colleagues there
are a number of Senators waiting to propose amendments, and I think
this amendment has been very much debated. I look forward to Senator
Bunning and Senator Grassley and other Senators who are waiting to
present amendments.
Mr. BAUCUS. Mr. President, the Senator from Arizona is absolutely
correct. It has been a good debate we have had on the Dodd-Conrad-
Graham issue.
The next amendment that can be called up on the list would be on the
Republican side of the aisle. I don't know who wants to call up his
amendment next, but someone on the Republican side of the aisle should
do so, and I am hoping perhaps we could enter into some kind of time
agreement.
Mr. GRASSLEY. Mr. President, 5 minutes for me.
Mr. BAUCUS. Say 10 minutes equally divided; is that all right?
Mr. GRASSLEY. Yes.
The PRESIDING OFFICER. Is there objection?
Mr. MENENDEZ. Mr. President, reserving the right to object, which
amendment are we talking about?
Mr. BAUCUS. Grassley No. 297. There would be a time limit for debate
only, no vote on the amendment.
Mr. MENENDEZ. How much time?
Mr. BAUCUS. Ten minutes equally divided has been the suggestion.
Mr. MENENDEZ. Could we move that to 20 minutes equally divided?
Mr. BAUCUS. We could, equally divided.
Mr. GRASSLEY. Mr. President, I would just as soon leave it at 5
minutes because we have all of these other colleagues. We just spent an
hour on one amendment, and we have plenty of people on both sides of
the aisle. I think we ought to be tolerant toward our colleagues and
make this debate very short. If you want me to do it in 4 minutes, I
will do it in 4 minutes.
Mr. BAUCUS. I appreciate that, but unfortunately there are Senators
on this side of the aisle who want to speak in opposition, and the
total time they want to use is more than 4 minutes. I will hold it to
20 minutes equally divided.
The PRESIDING OFFICER. Is there objection?
Mr. McCAIN. Reserving the right to object, I think 5 minutes on this
side and 10 minutes on your side.

[[Page S1817]]

Mr. BAUCUS. I appreciate that, but if we don't get an agreement, it
is going to be longer. So discretion being the better part of valor, I
suggest 20 minutes equally divided.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Iowa is recognized.

Amendment No. 297 to Amendment No. 98

Mr. GRASSLEY. Mr. President, amendment No. 297 is an FMAP amendment.
This amendment is about $2.3 billion of the $87 billion that is in this
bill for Medicare. There will be no less money spent in Medicare
overall. It will still be $87 billion. We are talking about the $87
billion and the formula as to how it is divided.
Let me ask my colleagues a question: If Congress is going to give
States $87 billion in Medicaid funds, shouldn't the formula be fair?
The exceedingly complex formula in this bill is simply not fair to
certain States. It is not fair to States with low unemployment rates or
States that have not seen the recession hit full force yet, and for
those States where the recession hasn't hit, it is just around the
corner. For instance, in the Midwest agricultural areas, we tend to be
countercyclical. We tend to be lagging when we hit recession. Yet we
will be coming along into recession when the other parts of the country
are recovering.
Now, those States I just mentioned that have low unemployment, as an
example, will see less of the $87 billion than other States. My
amendment gives each State a flat 9.5-percent increase in their FMAP
payments, and the States can choose which 9 consecutive quarters in any
11-quarter period best fits the economic needs of their State. That is
a better, more fair way to spend the $87 billion.
This amendment is budget neutral. According to data provided by the
Government Accountability Office, my amendment redistributes about $2.3
billion of FMAP spending in the bill. Almost 75 percent of that
redistribution comes from four States: California, Illinois,
Massachusetts, and New York. With a redistribution, nearly 75 percent
of which comes from four States, 34 States will receive more Medicaid
FMAP funds under this amendment.
If Congress is going to spend $87 billion on States through Medicaid
FMAP, I believe we have to do it more fairly.
I wish to quickly run through the States that will do better so you
can decide if you want your State to have more money or less money.
More money will go to Alabama, Alaska, Arizona, Arkansas, the District
of Columbia, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky,
Louisiana, Maine, Maryland, Mississippi, Missouri, Montana, Nebraska,
New Hampshire, New Mexico, North Carolina, North Dakota, Ohio,
Oklahoma, Oregon, South Carolina, South Dakota, Tennessee, Texas, Utah,
Vermont, West Virginia, Wisconsin, and Wyoming.
Before I yield the floor and reserve my time, under the unanimous
consent agreement that has been entered into, I call up my amendment
No. 297 and make it pending.
The PRESIDING OFFICER. The clerk will report.
The bill clerk read as follows:

The Senator from Iowa [Mr. Grassley] proposes an amendment
numbered 297.

The amendment is as follows:

(Purpose: To provide the same temporary increase in the FMAP for all
States and to permit States to choose the period through June 2011 for
receiving the increase)

Beginning on page 714, strike line 1 and all that follows
through page 725, line 14, and insert the following:

SEC. 5001. TEMPORARY INCREASE OF MEDICAID FMAP.

(a) Permitting Maintenance of Fmap.--Subject to subsections
(d), (e), (f), and (g) if the FMAP determined without regard
to this section for a State for--
(1) fiscal year 2009 is less than the FMAP as so determined
for fiscal year 2008, the FMAP for the State for fiscal year
2008 shall be substituted for the State's FMAP for fiscal
year 2009, before the application of this section;
(2) fiscal year 2010 is less than the FMAP as so determined
for fiscal year 2008 or fiscal year 2009 (after the
application of paragraph (1)), the greater of such FMAP for
the State for fiscal year 2008 or fiscal year 2009 shall be
substituted for the State's FMAP for fiscal year 2010, before
the application of this section; and
(3) fiscal year 2011 is less than the FMAP as so determined
for fiscal year 2008, fiscal year 2009 (after the application
of paragraph (1)), or fiscal year 2010 (after the application
of paragraph (2)), the greatest of such FMAP for the State
for fiscal year 2008, fiscal year 2009, or fiscal year 2010
shall be substituted for the State's FMAP for fiscal year
2011, before the application of this section, but only for
the first, second, and third calendar quarters in fiscal year
2011.
(b) General 9.5 Percentage Point Increase.--Subject to
subsections (d), (e), (f), and (g), for each State for
calendar quarters during the recession adjustment period (as
defined in subsection (h)(2)), the FMAP (after the
application of subsection (a)) shall be increased (without
regard to any limitation otherwise specified in section
1905(b) of the Social Security Act) by 9.5 percentage points.
(c) Increase in Cap on Medicaid Payments to Territories.--
Subject to subsections (e), (f), and (g), with respect to
entire fiscal years occurring during the recession adjustment
period and with respect to fiscal years only a portion of
which occurs during such period (and in proportion to the
portion of the fiscal year that occurs during such period),
the amounts otherwise determined for Puerto Rico, the Virgin
Islands, Guam, the Northern Mariana Islands, and American
Samoa under subsections (f) and (g) of section 1108 of the
Social Security Act (42 6 U.S.C. 1308) shall each be
increased by 9.5 percent.
(d) Scope of Application.--The increases in the FMAP for a
State under this section shall apply for purposes of title
XIX of the Social Security Act and shall not apply with
respect to--
(1) disproportionate share hospital payments described in
section 1923 of such Act (42 U.S.C. 1396r-4);
(2) payments under title IV of such Act (42 U.S.C. 601 et
seq.) (except that the increases under subsections (a) and
(b) shall apply to payments under part E of title IV of such
Act (42 U.S.C. 670 et seq.));
(3) payments under title XXI of such Act (42 U.S.C. 1397aa
et seq.);
(4) any payments under title XIX of such Act that are based
on the enhanced FMAP described in section 2105(b) of such Act
(42 U.S.C. 1397ee(b)); or
(5) any payments under title XIX of such Act that are
attributable to expenditures for medical assistance provided
to individuals made eligible under a State plan under title
XIX of the Social Security Act (including under any waiver
under such title or under section 1115 of such Act (42 U.S.C.
1315)) because of income standards (expressed as a percentage
of the poverty line) for eligibility for medical assistance
that are higher than the income standards (as so expressed)
for such eligibility as in effect on July 1, 2008.
(e) State Ineligibility.--
(1) Maintenance of eligibility requirements.--
(A) In general.--Subject to subparagraphs (B) and (C), a
State is not eligible for an increase in its FMAP under
subsection (a) or (b), or an increase in a cap amount under
subsection (c), if eligibility standards, methodologies, or
procedures under its State plan under title XIX of the Social
Security Act (including any waiver under such title or under
section 1115 of such Act (42 U.S.C. 1315)) are more
restrictive than the eligibility standards, methodologies, or
procedures, respectively, under such plan (or waiver) as in
effect on July 1, 2008.
(B) State reinstatement of eligibility permitted.--Subject
to subparagraph (C), a State that has restricted eligibility
standards, methodologies, or procedures under its State plan
under title XIX of the Social Security Act (including any
waiver under such title or under section 1115 of such Act (42
U.S.C. 1315)) after July 1, 2008, is no longer ineligible
under subparagraph (A) beginning with the first calendar
quarter in which the State has reinstated eligibility
standards, methodologies, or procedures that are no more
restrictive than the eligibility standards, methodologies, or
procedures, respectively, under such plan (or waiver) as in
effect on July 1, 2008.
(C) Special rules.--A State shall not be ineligible under
subparagraph (A)--
(i) for the calendar quarters before July 1, 2009, on the
basis of a restriction that was applied after July 1, 2008,
and before the date of the enactment of this Act, if the
State prior to July 1, 2009, has reinstated eligibility
standards, methodologies, or procedures that are no more
restrictive than the eligibility standards, methodologies, or
procedures, respectively, under such plan (or waiver) as in
effect on July 1, 2008; or
(ii) on the basis of a restriction that was directed to be
made under State law as of July 1, 2008, and would have been
in effect as of such date, but for a delay in the request
for, and approval of, a waiver under section 1115 of such Act
with respect to such restriction.
(2) Compliance with prompt pay requirements.--No State
shall be eligible for an increased FMAP rate as provided
under this section for any claim submitted by a provider
subject to the terms of section 1902(a)(37)(A) of the Social
Security Act (42 U.S.C. 1396a(a)(37)(A)) during any period in
which that State has failed to pay claims in accordance with
section 1902(a)(37)(A) of such Act. Each State shall report
to the Secretary, no later than 30 days following the 1st day
of the month, its compliance with the requirements of section
1902(a)(37)(A) of the Social Security Act as they pertain to
claims made for covered services during the preceding month.
(3) No waiver authority.--The Secretary may not waive the
application of this subsection or subsection (f) under
section 1115 of the Social Security Act or otherwise.
(f) Requirements.--

[[Page S1818]]

(1) In general.--A State may not deposit or credit the
additional Federal funds paid to the State as a result of
this section to any reserve or rainy day fund maintained by
the State.
(2) State reports.--Each State that is paid additional
Federal funds as a result of this section shall, not later
than September 30, 2011, submit a report to the Secretary, in
such form and such manner as the Secretary shall determine,
regarding how the additional Federal funds were expended.
(3) Additional requirement for certain states.--In the case
of a State that requires political subdivisions within the
State to contribute toward the non-Federal share of
expenditures under the State Medicaid plan required under
section 1902(a)(2) of the Social Security Act (42 U.S.C.
1396a(a)(2)), the State is not eligible for an increase in
its FMAP under subsection (b), or an increase in a cap amount
under subsection (c), if it requires that such political
subdivisions pay for quarters during the recession adjustment
period a greater percentage of the non-Federal share of such
expenditures, or a greater percentage of the non-Federal
share of payments under section 1923, than the respective
percentage that would have been required by the State under
such plan on September 30, 2008, prior to application of this
section.
(g) State Selection of Recession Adjustment Relief
Period.--The increase in a State's FMAP under subsection (a)
or (b), or an increase in a State's cap amount under
subsection (c), shall only apply to the State for 9
consecutive calendar quarters during the recession adjustment
period. Each State shall notify the Secretary of the 9-
calendar quarter period for which the State elects to receive
such increase.
(h) Definitions.--In this section, except as otherwise
provided:
(1) FMAP.--The term ``FMAP'' means the Federal medical
assistance percentage, as defined in section 1905(b) of the
Social Security Act (42 U.S.C. 1396d(b)), as determined
without regard to this section except as otherwise specified.
(2) Poverty line.--The term ``poverty line'' has the
meaning given such term in section 673(2) of the Community
Services Block Grant Act (42 U.S.C. 9902(2)), including any
revision required by such section.
(3) Recession adjustment period.--The term ``recession
adjustment period'' means the period beginning on October 1,
2008, and ending on June 20, 2011.
(4) Secretary.--The term ``Secretary'' means the Secretary
of Health and Human Services.
(5) State.--The term ``State'' has the meaning given such
term for purposes of title XIX of the Social Security Act (42
U.S.C. 1396 et seq.).
(i) Sunset.--This section shall not apply to items and
services furnished after the end of the recession adjustment
period.

The PRESIDING OFFICER. The Senator from Kentucky is recognized.
Mr. BUNNING. Mr. President, I wish to submit a question to the
Senator from Iowa.
Mr. GRASSLEY. I yield, Mr. President.
Mr. BUNNING. I ask Senator Grassley, is it accurate to say that my
State of Kentucky will get an additional $92 million in Medicare funds
if the Senator's amendment passes; if the amendment fails, that money
would go to California, Illinois, Massachusetts, and New York?
Mr. GRASSLEY. Yes, from the figures I have, the Senator is absolutely
right. That number is that amount.
Mr. BUNNING. Thank you very much.
The PRESIDING OFFICER. Who yields time?
Mr. BAUCUS. Mr. President, I yield 3 minutes to the Senator from West
Virginia.
The PRESIDING OFFICER. The Senator from West Virginia is recognized.
Mr. ROCKEFELLER. Mr. President, I first would point out that in the
Grassley amendment the amount of Medicaid money--not Medicare money but
Medicaid--is not affected. What is affected and what is at stake is the
formula.
Do you give it across the board to every State equally or do you give
the majority of it across the board but you keep a part of it, which
goes to States that are particularly distressed?
In 2006, the GAO issued a report that said two major things: 1, the
best measure of Medicaid distress is unemployment; 2, it is more
efficient to target funding to States with the greatest need. That is a
fact. We all know that.
This bill accomplishes those very clear recommendations made by the
GAO. It ties Medicaid relief to unemployment and it targets relief to
States that need it the most.
The Grassley amendment would make Medicaid relief less efficient and
prolong the budget woes in States experiencing the greatest economic
distress. I think it is a matter of fairness and not complicated. It
doesn't attack the integrity of the Medicaid Program itself.
I urge my colleagues to oppose the Grassley amendment.
The PRESIDING OFFICER. Who yields time?
Mr. BAUCUS. Mr. President, I yield 2 minutes to the Senator from
Minnesota.
The PRESIDING OFFICER. The Senator from Minnesota is recognized.
Ms. KLOBUCHAR. Mr. President, I rise today in strong opposition to
Senator Grassley's amendment, which removes the targeted assistance for
the temporary increase in Federal Medicaid funding contained in this
bill.
It is well established that Medicaid enrollment increases in direct
relation to unemployment growth. For every percentage increase in
unemployment, States see an additional 1 million people seeking
Medicaid assistance. I find it deeply troubling that at a point when
health care is most needed, Minnesota and other States will not be
given the assistance the situation demands.
By eliminating the portion of assistance that is targeted based on
States' unemployment rates, Senator Grassley's amendment would
significantly reduce assistance for States facing the largest increases
in their unemployment rates and the largest budget deficits.
Instead of providing aid to those who need it most, his amendment
provides relief for States that are, in some cases, even enjoying a
budget surplus. Nineteen of the 20 States facing the smallest increase
in unemployment would get more assistance under this amendment. Is that
an effective use of Federal money? At a time when we should be focusing
all our efforts on ways we can best spend taxpayer dollars, sending aid
to States that have less need doesn't make sense.
I ask my colleagues to consider this. This is about accountability to
the people of this country. This is about targeted assistance. We have
heard a lot about targeting spending, putting spending where we need
it. This is also about targeted assistance to the States that need it
most.
I yield the floor.
The PRESIDING OFFICER. The Senator from Montana is recognized.
Mr. BAUCUS. Mr. President, I yield 5 minutes to the Senator from New
Jersey.
The Presiding officer. The Senator from New Jersey is recognized.
Mr. MENENDEZ. Mr. President, I rise in very strong opposition to this
amendment. It is interesting--I guess the arguments for and against
this bill move, depending upon your point of view, especially those who
are against the bill overall. They have certain standards, and then
they obliterate those standards when it doesn't work for them. For
example, targeting. What does the Government Accountability Office say?
They say targeting is important.
According to a letter from the GAO--Members of Congress implied that
it is more efficient to target funding to States with what? Greater
need. That larger amounts of funding are needed to get the same
stimulative effect if an across-the-board approach is used. With less
targeting, more funding goes to States with less need; less funding
goes to States that need it the most. So much for it being targeted.
The Government Accountability Office says targeting means you want to
do it the way that was devised originally--by the way, this came over
from the House with a 50/50 proposition. Then the chairman of the
Finance Committee said, well, let's try to work that out in a more
conciliatory way and put it at 60/40. Amendments were offered that made
it 80/20. We are talking about States that have higher unemployment,
more people who don't have a job, who cannot put food on the table, and
at the end of the day find themselves in desperate need. So States with
higher unemployment clearly have a greater need for assistance. The
higher the State's unemployment, the more people qualify for Medicaid
and the less revenue a State has to pay for those increased Medicaid
rolls.
Therefore, increases in unemployment, which is where the underlying
bill is, and was even in a greater way, is the recognition. It is not
about just spreading the wealth across the process and, more
importantly, spreading the amount of taxpayer money across the

[[Page S1819]]

process; this is about targeting where greater numbers of people are
unemployed. States like my own that have high percentages of
unemployment, would be happy to give you the unemployment in your
States and not realize it in our States at higher levels. But it seems
to me the way this is being pursued--this particular amendment--by
eliminating targeting, that reduces assistance to the States with the
worst economic problems and thus the greatest need for relief.
So by eliminating the portion of assistance targeted based on a
State's unemployment rates, the amendment significantly reduces
assistance for States facing the largest increases in their
unemployment rate. That doesn't make sense. In addition, this
amendment, at a time in which we are saying we want it to be
stimulative--and I have heard arguments on how the money doesn't get
out there quickly enough--well, this amendment permits the States to
delay by 6 months, potentially reducing the stimulative effect of this
portion of the legislation.
Finally, 19 of the 20 States facing the smallest increase in
unemployment would get more assistance under this amendment--a little
counterintuitive. If the State has more unemployment, it would get less
money. For all of those reasons, and because this is already
dramatically shifted in the way my colleague from Iowa wants, this
amendment should be defeated both in the Nation's interest, in the
pursuit of targeted and stimulative and, at the same time, basic
fairness.
I reserve whatever time I have remaining.
The PRESIDING OFFICER. The Senator from Iowa is recognized.
Mr. GRASSLEY. Mr. President, I am going to tell the Senator from New
Jersey that I agree with him totally on part of the money that is in
this $87 billion. He is absolutely right on his argument for $10.8
billion of the money that is in there. That is the money we have had
the CBO say is going to be spent for Medicaid for the unemployed. But
what about the other $75 billion or $76 billion? We don't apologize for
it somehow. It is a slush fund to States.
There is no rationale for that part of the money to go out under the
same circumstances as the result of the recession--the fact that people
are going to need more medical care. I ask him to consider that the
Senator is right for a small part of this $87 billion--$10.8 billion of
it--but wrong about the remaining amount of it. So that is why I have
my amendment as a matter of fairness for money being distributed to the
States, unrelated to unemployment, or medical care that is needed
because of unemployment.
I want to spend my few minutes telling you what States benefit:
Alabama, $41 million; Alaska, $45 million; Arizona, $58 million;
Arkansas, $99 million; District of Columbia, $43 million; Georgia, $31
million; Idaho, $16 million; Indiana, $29 million; Iowa, $128 million;
Kansas, $61 million; Kentucky, $92 million; Louisiana, $158 million;
Maine, $23 million; Maryland, $1 million; Mississippi, $102 million;
Missouri, $51 million; Montana, $25 million; Nebraska, $52 million; New
Hampshire, $22 million; New Mexico, $86 million; North Carolina, $54
million; North Dakota, $25 million; Ohio, $78 million; Oklahoma, $86
million; Oregon, $4 million; South Carolina, $47 million; South Dakota,
$24 million; Tennessee, $32 million; Texas, $547 million; Utah, $59
million; Vermont, $2 million; West Virginia, $86 million; Wisconsin,
$55 million; Wyoming, $13 million.
I think what we are talking about here is a matter of fairness for
those States--for the portion of the FMAP that doesn't need to be
needed except for medical care for the unemployed. The part going to
States under the FMAP formula needs a more fair distribution.
I will yield back my time.
Mr. MENENDEZ. I reserved the remainder of my time.
Mr. GRASSLEY. Then I will not yield back my time.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. MENENDEZ. How much time do I have?
The PRESIDING OFFICER. Two minutes.
Mr. MENENDEZ. Mr. President, I appreciate what my distinguished
colleague from Iowa is trying to do--bring more money to his State. The
question is whether it is fundamentally fair. The answer is no.
Let me tell you the States that will get hit pretty badly here:
California, Colorado, Connecticut, Delaware, Florida, Illinois,
Massachusetts, Minnesota, Nevada, New Jersey, New York, Pennsylvania,
Rhode Island, Virginia, and Washington, to name a few.
The fundamental question is whether we are going to live to this
credo of whether targeted is important or whether timely is important.
Well, we have the Government Accountability Office saying that the way
we are doing it--the way that would be undone by the Senator from Iowa
would undo the targeted; it would undo the ability to have the greatest
impact to be stimulative. In essence, it would hurt States that have
the greatest need. We are one country. I often have voted for issues
that have very little benefit for my State, but I understand that at a
given moment in time, they are in the greatest interest of the country.
Agriculture is one example, and there are others. The bottom line is
that we have rising numbers of people, higher unemployment rates, more
demand on Medicaid, and less opportunity for individuals to be able to
get the resources in States that are already cash strapped. I have
listened to moral hazard. There has been no talk about that. We want to
teach the States a lesson now. There was no talk about moral hazard
when the regulators were asleep at the switch and Wall Street was
getting billions. You want to teach States a lesson now? You are going
to hurt people. This amendment will hurt people who otherwise would
have resources under the bill that have already been adjusted to give
States such as my colleagues' more research.
I yield the floor.
The PRESIDING OFFICER. The Senator from Iowa is recognized.
Mr. GRASSLEY. Mr. President, GAO's argument about targeting applies
to decreases in Medicaid due to the recession. This isn't about
targeting. This is seven times more than is needed for Medicaid. I will
agree to targeting for that $10.8 billion. The rest should be more
fairly targeted.
This amendment should be a simple vote. The complex funding formula
for spending the $87 billion in Medicare in this bill is not fair. It
should be a flat increase to all States.
That is what my amendment does. Thirty-four States do better with the
formula under my amendment. So you can vote to give your State its fair
share or, if you vote against it, you are voting not to give them that
fair share.
I yield the floor. As long as the other side's time is used up, I
yield back the remainder of my time.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, in the spirit of agreement, there will now
be an amendment on the Democratic side. I suggest Senator Cantwell be
recognized for the purpose of calling up her amendment. I ask the
Senator to agree to a time agreement of 10 minutes equally divided. I
think it is going to be accepted.
Ms. CANTWELL. Five minutes equally.
Mr. BAUCUS. Ten minutes equally divided.
The PRESIDING OFFICER. Without objection, it is so ordered.

Amendment No. 274, as Modified, to Amendment No. 98

Ms. CANTWELL. I call up amendment No. 274, as modified.
The PRESIDING OFFICER. The clerk will report.
The bill clerk read as follows:

The Senator from Washington [Ms. Cantwell], for herself,
Mr. Bingaman, Mr. Carper, Mr. Schumer and Mr. Hatch, proposes
an amendment numbered 274, as modified, to amendment No. 98.

The amendment is as follows:

(Purpose: To improve provisions relating to energy tax incentives and
provisions relating manufacturing tax incentives for energy property)

On page 457, line 15, strike ``Section'' and insert the
following:
(a) In General.--Section
On page 457, between lines 16 and 17, insert the following:
(b) Clarification With Respect to Green Community
Programs.--Clause (ii) of section 54D(f)(1)(A) is amended by
inserting ``(including the use of loans, grants, or other
repayment mechanisms to implement such programs)'' after
``green community programs''.
Beginning on page 457, line 18, strike all through page
458, line 16, and insert the following:

[[Page S1820]]

SEC. 1121. EXTENSION AND MODIFICATION OF CREDIT FOR
NONBUSINESS ENERGY PROPERTY.

(a) In General.--Section 25C is amended by striking
subsections (a) and (b) and inserting the following new
subsections:
``(a) Allowance of Credit.--In the case of an individual,
there shall be allowed as a credit against the tax imposed by
this chapter for the taxable year an amount equal to 30
percent of the sum of--
``(1) the amount paid or incurred by the taxpayer during
such taxable year for qualified energy efficiency
improvements, and
``(2) the amount of the residential energy property
expenditures paid or incurred by the taxpayer during such
taxable year.
``(b) Limitation.--The aggregate amount of the credits
allowed under this section for taxable years beginning in
2009 and 2010 with respect to any taxpayer shall not exceed
$1,500.''.
(b) Modifications of Standards for Energy-Efficient
Building Property.--
(1) Electric heat pumps.--Subparagraph (B) of section
25C(d)(3) is amended to read as follows:
``(B) an electric heat pump which achieves the highest
efficiency tier established by the Consortium for Energy
Efficiency, as in effect on January 1, 2009.''.
(2) Central air conditioners.--Subparagraph (C) of section
25C(d)(3) is amended by striking ``2006'' and inserting
``2009''.
(3) Water heaters.--Subparagraph (D) of section 25C(d)(3)
is amended to read as follows:
``(E) a natural gas, propane, or oil water heater which has
either an energy factor of at least 0.82 or a thermal
efficiency of at least 90 percent.''.
(4) Wood stoves.--Subparagraph (E) of section 25C(d)(3) is
amended by inserting ``, as measured using a lower heating
value'' after ``75 percent''.
(c) Modifications of Standards for Oil Furnaces and Hot
Water Boilers.--
(1) In general.--Paragraph (4) of section 25C(d) is amended
to read as follows:
``(4) Qualified natural gas, propane, and oil furnaces and
hot water boilers.--
``(A) Qualified natural gas furnace.--The term `qualified
natural gas furnace' means any natural gas furnace which
achieves an annual fuel utilization efficiency rate of not
less than 95.
``(B) Qualified natural gas hot water boiler.--The term
`qualified natural gas hot water boiler' means any natural
gas hot water boiler which achieves an annual fuel
utilization efficiency rate of not less than 90.
``(C) Qualified propane furnace.--The term `qualified
propane furnace' means any propane furnace which achieves an
annual fuel utilization efficiency rate of not less than 95.
``(D) Qualified propane hot water boiler.--The term
`qualified propane hot water boiler' means any propane hot
water boiler which achieves an annual fuel utilization
efficiency rate of not less than 90.
``(E) Qualified oil furnaces.--The term `qualified oil
furnace' means any oil furnace which achieves an annual fuel
utilization efficiency rate of not less than 90.
``(F) Qualified oil hot water boiler.--The term `qualified
oil hot water boiler' means any oil hot water boiler which
achieves an annual fuel utilization efficiency rate of not
less than 90.''.
(2) Conforming amendment.--Clause (ii) of section
25C(d)(2)(A) is amended to read as follows:
``(ii) any qualified natural gas furnace, qualified propane
furnace, qualified oil furnace, qualified natural gas hot
water boiler, qualified propane hot water boiler, or
qualified oil hot water boiler, or''.
(d) Modifications of Standards for Qualified Energy
Efficiency Improvements.--
(1) Qualifications for exterior windows, doors, and
skylights.--Subsection (c) of section 25C is amended by
adding at the end the following new paragraph:
``(4) Qualifications for exterior windows, doors, and
skylights.--Such term shall not include any component
described in subparagraph (B) or (C) of paragraph (2) unless
such component is equal to or below a U factor of 0.30 and
SHGC of 0.30.''.
(2) Additional qualification for insulation.--Subparagraph
(A) of section 25C(c)(2) is amended by inserting ``and meets
the prescriptive criteria for such material or system
established by the 2009 International Energy Conservation
Code, as such Code (including supplements) is in effect on
the date of the enactment of the American Recovery and
Reinvestment Tax Act of 2009'' after ``such dwelling unit''.
(e) Extension.--Section 25C(g)(2) is amended by striking
``December 31, 2009'' and inserting ``December 31, 2010''.
(f) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to taxable years
beginning after December 31, 2008.
(2) Efficiency standards.--The amendments made by
paragraphs (1), (2), and (3) of subsection (b) and
subsections (c) and (d) shall apply to property placed in
service after December 31, 2009.

On page 461, strike lines 8 to 10 and insert the following:
(b) Ensuring Consumer Accessibility to Alternative Fuel
Vehicle Refueling Property in the Case of Electricity.--
Section 179(d)(3) is amended by striking subparagraph (B) and
inserting the following:
``(B) for the recharging of motor vehicles propelled by
electricity, but only if--
``(i) the property complies with the Society of Automotive
Engineers' connection standards,
``(ii) the property provides for non-restrictive access for
charging and for payment interoperability with other systems,
and
``(iii) the property--

``(I) is located on property owned by the taxpayer, or
``(II) is located on property owned by another person, is
placed in service with the permission of such other person,
and is fully maintained by the taxpayer.''.

SEC. 1124. RECOVERY PERIOD FOR DEPRECIATION OF SMART METERS
AND SMART GRID SYSTEMS.

(a) 5-Year Recovery Period.--
(1) In general.--Subparagraph (B) of section 168(e)(3) is
amended by striking ``and'' at the end of clause (vi), by
striking the period at the end of clause (vii) and inserting
``, and'', and by adding at the end the following new
clauses:
``(viii) any qualified smart electric meter, and
``(ix) any qualified smart electric grid system.''.
(2) Conforming amendments.--Subparagraph (D) of section
168(e)(3) is amended by inserting ``and'' at the end of
clause (i), by striking the comma at the end of clause (ii)
and inserting a period, and by striking clauses (iii) and
(iv).
(b) Technical Amendments.--Paragraphs (18)(A)(ii) and
(19)(A)(ii) of section 168(i) are each amended by striking
``16 years'' and inserting ``10 years''.
(c) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to property
placed in service after the date of the enactment of this
Act.
(2) Technical amendment.--The amendments made by subsection
(b) shall take effect as if included in section 306 of the
Energy Improvement and Extension Act of 2008.

On page 467, strike lines 1 through 18, and insert the
following:

PART VI--MODIFICATION OF CREDIT FOR CARBON DIOXIDE SEQUESTRATION

SEC. 1151. APPLICATION OF MONITORING REQUIREMENTS TO CARBON
DIOXIDE USED AS A TERTIARY INJECTANT.

(a) In General.--Section 45Q(a)(2) is amended by striking
``and'' at the end of subparagraph (A), by striking the
period at the end of subparagraph (B) and inserting ``,
and'', and by adding at the end the following new
subparagraph:
``(C) disposed of by the taxpayer in secure geological
storage.''.
(b) Conforming Amendments.--
(1) Section 45Q(d)(2) is amended--
(A) by striking ``subsection (a)(1)(B)'' and inserting
``paragraph (1)(B) or (2)(C) of subsection (a)'',
(B) by striking ``and unminable coal seems'' and inserting
``, oil and gas reservoirs, and unminable coal seams'', and
(C) by inserting ``the Secretary of Energy, and the
Secretary of the Interior,'' after ``Environmental Protection
Agency''.
(2) Section 45Q(e) is amended by striking ``captured and
disposed of or used as a tertiary injectant'' and inserting
``taken into account in accordance with subsection (a)''.
(c) Effective Date.--The amendments made by this section
shall apply to carbon dioxide captured after the date of the
enactment of this Act.

Beginning on page 467, strike line 21 and all that follows
through page 470, line 23, and insert the following:

SEC. 1161. MODIFICATION OF CREDIT FOR QUALIFIED PLUG-IN
ELECTRIC MOTOR VEHICLES.

[[Page S1821]]

``(A) In general.--The term `specified vehicle' means--
``(i) any 2- or 3-wheeled motor vehicle, or
``(ii) any low-speed motor vehicle,
which is placed in service after December 31, 2009, and
before January 1, 2012.
``(B) 2- or 3-wheeled motor vehicle.--The term `2- or 3-
wheeled motor vehicle' means any vehicle--
``(i) which would be described in section 30(c)(2) except
that it has 2 or 3 wheels,
``(ii) with motive power having a seat or saddle for the
use of the rider and designed to travel on not more than 3
wheels in contact with the ground,
``(iii) which has an electric motor that produces in excess
of 5-brake horsepower,
``(iv) which draws propulsion from 1 or more traction
batteries, and
``(v) which has been certified to the Department of
Transportation pursuant to section 567 of title 49, Code of
Federal Regulations, as conforming to all applicable Federal
motor vehicle safety standards in effect on the date of the
manufacture of the vehicle.
``(C) Low-speed motor vehicle.--The term `low-speed motor
vehicle' means a motor vehicle (as defined in section
30(c)(2)) which--
``(i) is placed in service after December 31, 2009, and
``(ii) meets the requirements of section 571.500 of title
49, Code of Federal Regulations.''.
(d) Effective Dates.--
(1) In general.--The amendment made by subsections (a) and
(c) shall take effect on the date of the enactment of this
Act.
(2) Other modifications.--The amendments made by subsection
(b) shall apply to property placed in service after December
31, 2009, in taxable years beginning after such date.

SEC. 1162. CONVERSION KITS.

(a) In General.--Section 30B (relating to alternative motor
vehicle credit) is amended by redesignating subsections (i)
and (j) as subsections (j) and (k), respectively, and by
inserting after subsection (h) the following new subsection:
``(i) Plug-In Conversion Credit.--
``(1) In general.--For purposes of subsection (a), the
plug-in conversion credit determined under this subsection
with respect to any motor vehicle which is converted to a
qualified plug-in electric drive motor vehicle is 10 percent
of so much of the cost of the converting such vehicle as does
not exceed $40,000.
``(2) Definitions and special rules.--For purposes of this
subsection--
``(A) Qualified plug-in electric drive motor vehicle.--The
term `qualified plug-in electric drive motor vehicle' means
any new qualified plug-in electric drive motor vehicle (as
defined in section 30D(c), determined without regard to
paragraphs (4) and (6) thereof).
``(B) Plug-in traction battery module.--The term `plug-in
traction battery module' means an electro-chemical energy
storage device which--
``(i) which has a traction battery capacity of not less
than 2.5 kilowatt hours,
``(ii) which is equipped with an electrical plug by means
of which it can be energized and recharged when plugged into
an external source of electric power,
``(iii) which consists of a standardized configuration and
is mass produced,
``(iv) which has been tested and approved by the National
Highway Transportation Safety Administration as compliant
with applicable motor vehicle and motor vehicle equipment
safety standards when installed by a mechanic with
standardized training in protocols established by the battery
manufacturer as part of a nationwide distribution program,
``(v) which complies with the requirements of section 32918
of title 49, United States Code, and
``(vi) which is certified by a battery manufacturer as
meeting the requirements of clauses (i) through (v).
``(C) Credit allowed to lessor of battery module.--In the
case of a plug-in traction battery module which is leased to
the taxpayer, the credit allowed under this subsection shall
be allowed to the lessor of the plug-in traction battery
module.
``(D) Credit allowed in addition to other credits.--The
credit allowed under this subsection shall be allowed with
respect to a motor vehicle notwithstanding whether a credit
has been allowed with respect to such motor vehicle under
this section (other than this subsection) in any preceding
taxable year.
``(3) Termination.--This subsection shall not apply to
conversions made after December 31, 2012.''.
(b) Credit Treated as Part of Alternative Motor Vehicle
Credit.--Section 30B(a) is amended by striking ``and'' at the
end of paragraph (3), by striking the period at the end of
paragraph (4) and inserting ``, and'', and by adding at the
end the following new paragraph:
``(5) the plug-in conversion credit determined under
subsection (i).''.
(c) No Recapture for Vehicles Converted to Qualified Plug-
in Electric Drive Motor Vehicles.--Paragraph (8) of section
30B(h) is amended by adding at the end the following: ``,
except that no benefit shall be recaptured if such property
ceases to be eligible for such credit by reason of conversion
to a qualified plug-in electric drive motor vehicle.''.
(d) Effective Date.--The amendments made by this section
shall apply to property placed in service after December 31,
2008, in taxable years beginning after such date.

Beginning on page 518, strike line 1 and all that follows
through page 521, line 23, and insert the following:
``(2) Certain qualified progress expenditures rules made
applicable.--Rules similar to the rules of subsections (c)(4)
and (d) of section 46 (as in effect on the day before the
enactment of the Revenue Reconciliation Act of 1990) shall
apply for purposes of this section.
``(3) Limitation.--The amount which is treated for all
taxable years with respect to any qualifying advanced energy
project shall not exceed the amount designated by the
Secretary as eligible for the credit under this section.
``(c) Definitions.--
``(1) Qualifying advanced energy project.--
``(A) In general.--The term `qualifying advanced energy
project' means a project--
``(i) which re-equips, expands, or establishes a
manufacturing facility for the production of property which
is--

``(I) designed to be used to produce energy from the sun,
wind, geothermal deposits (within the meaning of section
613(e)(2)), or other renewable resources,
``(II) designed to manufacture fuel cells, microturbines,
or an energy storage system for use with electric or hybrid-
electric motor vehicles,
``(III) designed to manufacture electric grids to support
the transmission of intermittent sources of renewable energy,
including storage of such energy,
``(IV) designed to capture and sequester carbon dioxide
emissions,
``(V) designed to refine or blend renewable fuels or to
produce energy conservation technologies (including energy-
conserving lighting technologies and smart grid
technologies), or
``(VI) other advanced energy property designed to reduce
greenhouse gas emissions as may be determined by the
Secretary, and

``(ii) any portion of the qualified investment of which is
certified by the Secretary under subsection (d) as eligible
for a credit under this section.
``(B) Exception.--Such term shall not include any portion
of a project for the production of any property which is used
in the refining or blending of any transportation fuel (other
than renewable fuels).
``(2) Eligible property.--The term `eligible property'
means any property which is part of a qualifying advanced
energy project and is necessary for the production of
property described in paragraph (1)(A)(i).
``(d) Qualifying Advanced Energy Project Program.--
``(1) Establishment.--
``(A) In general.--Not later than 180 days after the date
of enactment of this section, the Secretary, in consultation
with the Secretary of Energy, shall establish a qualifying
advanced energy project program to consider and award
certifications for qualified investments eligible for credits
under this section to qualifying advanced energy project
sponsors.
``(B) Limitation.--The total amount of credits that may be
allocated under the program shall not exceed $2,000,000,000.
``(2) Certification.--
``(A) Application period.--Each applicant for certification
under this paragraph shall submit an application containing
such information as the Secretary may require during the 3-
year period beginning on the date the Secretary establishes
the program under paragraph (1).
``(B) Time to meet criteria for certification.--Each
applicant for certification shall have 2 years from the date
of acceptance by the Secretary of the application during
which to provide to the Secretary evidence that the
requirements of the certification have been met.
``(C) Period of issuance.--An applicant which receives a
certification shall have 5 years from the date of issuance of
the certification in order to place the project in service
and if such project is not placed in service by that time
period then the certification shall no longer be valid.
``(3) Selection criteria.--In determining which qualifying
advanced energy projects to certify under this section, the
Secretary--
``(A) shall take into consideration only those projects
where there is a reasonable expectation of commercial
viability, and
``(B) shall take into consideration which projects--
``(i) will provide the greatest domestic job creation (both
direct and indirect) during the credit period,
``(ii) will provide the greatest net impact in avoiding or
reducing air pollutants or anthropogenic emissions of
greenhouse gases,
``(iii) have the greatest readiness for commercial
employment, replication, and further commercial use in the
United States,
``(iv) will provide the greatest benefit in terms of
newness in the commercial market,
``(v) have the lowest levelized cost of generated or stored
energy, or of measured reduction in energy consumption or
greenhouse gas emission (based on costs of the full supply
chain), and
``(vi) have the shortest project time from certification to
completion.

On page 524, after line 3, insert the following:

[[Page S1822]]

SEC. 1303. INCENTIVES FOR MANUFACTURING FACILITIES PRODUCING
PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES AND
COMPONENTS.

(a) Deduction for Manufacturing Facilities.--Part VI of
subchapter B of chapter 1 (relating to itemized deductions
for individuals and corporations) is amended by inserting
after section 179E the following new section:

``SEC. 179F. ELECTION TO EXPENSE MANUFACTURING FACILITIES
PRODUCING PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES
AND COMPONENTS.

``(a) Treatment as Expenses.--A taxpayer may elect to treat
the applicable percentage of the cost of any qualified plug-
in electric drive motor vehicle manufacturing facility
property as an expense which is not chargeable to a capital
account. Any cost so treated shall be allowed as a deduction
for the taxable year in which the qualified manufacturing
facility property is placed in service.
``(b) Applicable Percentage.--For purposes of subsection
(a), the applicable percentage is--
``(1) 100 percent, in the case of qualified plug-in
electric drive motor vehicle manufacturing facility property
which is placed in service before January 1, 2012, and
``(2) 50 percent, in the case of qualified plug-in electric
drive motor vehicle manufacturing facility property which is
placed in service after December 31, 2011, and before January
1, 2015.
``(c) Election.--
``(1) In general.--An election under this section for any
taxable year shall be made on the taxpayer's return of the
tax imposed by this chapter for the taxable year. Such
election shall be made in such manner as the Secretary may by
regulations prescribe.
``(2) Election irrevocable.--Any election made under this
section may not be revoked except with the consent of the
Secretary.
``(d) Qualified Plug-In Electric Drive Motor Vehicle
Manufacturing Facility Property.--For purposes of this
section--
``(1) In general.--The term `qualified plug-in electric
drive motor vehicle manufacturing facility property' means
any qualified property--
``(A) the original use of which commences with the
taxpayer,
``(B) which is placed in service by the taxpayer after the
date of the enactment of this section and before January 1,
2015, and
``(C) no written binding contract for the construction of
which was in effect on or before the date of the enactment of
this section.
``(2) Qualified property.--
``(A) In general.--The term `qualified property' means any
property which is a facility or a portion of a facility used
for the production of--
``(i) any new qualified plug-in electric drive motor
vehicle (as defined by section 30D(c)), or
``(ii) any eligible component.
``(B) Eligible component.--The term `eligible component'
means any battery, any electric motor or generator, or any
power control unit which is designed specifically for use
with a new qualified plug-in electric drive motor vehicle (as
so defined).
``(e) Special Rule for Dual Use Property.--In the case of
any qualified plug-in electric drive motor vehicle
manufacturing facility property which is used to produce both
qualified property and other property which is not qualified
property, the amount of costs taken into account under
subsection (a) shall be reduced by an amount equal to--
``(1) the total amount of such costs (determined before the
application of this subsection), multiplied by
``(2) the percentage of property expected to be produced
which is not qualified property.
``(f) Election to Receive Loan in Lieu of Deduction.--
``(1) In general.--If a taxpayer elects to have this
subsection apply for any taxable year--
``(A) subsection (a) shall not apply to any qualified plug-
in electric drive motor vehicle manufacturing facility
property placed in service by the taxpayer,
``(B) such taxpayer shall receive a loan from the Secretary
in an amount and under such terms as provided in section
1303(b) of the American Recovery and Reinvestment Tax Act of
2009, and
``(C) in the taxable year in which such qualified loan is
repaid, each of the limitations described in paragraph (2)
shall be increased by the qualified plug-in electric drive
motor vehicle manufacturing facility amount which is--
``(i) determined under paragraph (3), and
``(ii) allocated to such limitation under paragraph (4).
``(2) Limitations to be increased.--The limitations
described in this paragraph are--
``(A) the limitation imposed by section 38(c), and
``(B) the limitation imposed by section 53(c).
``(3) Qualified plug-in electric drive motor vehicle
manufacturing facility amount.--For purposes of this
paragraph--
``(A) In general.--The qualified plug-in electric drive
motor vehicle manufacturing facility amount is an amount
equal to the applicable percentage of any qualified plug-in
electric drive motor vehicle manufacturing facility which is
placed in service during the taxable year.
``(B) Applicable percentage.--For purposes of subparagraph
(A), the applicable percentage is--
``(i) 35 percent, in the case of qualified plug-in electric
drive motor vehicle manufacturing facility property which is
placed in service before January 1, 2012, and
``(ii) 17.5 percent, in the case of qualified plug-in
electric drive motor vehicle manufacturing facility property
which is placed in service after December 31, 2011, and
before January 1, 2015.
``(C) Special rule for dual use property.--In the case of
any qualified plug-in electric drive motor vehicle
manufacturing facility property which is used to produce both
qualified property and other property which is not qualified
property, the amount of costs taken into account under
subparagraph (A) shall be reduced by an amount equal to--
``(i) the total amount of such costs (determined before the
application of this subparagraph), multiplied by
``(ii) the percentage of property expected to be produced
which is not qualified property.
``(4) Allocation of qualified plug-in electric drive motor
vehicle manufacturing facility amount.--The taxpayer shall,
at such time and in such manner as the Secretary may
prescribe, specify the portion (if any) of the qualified
plug-in electric drive motor vehicle manufacturing facility
amount for the taxable year which is to be allocated to each
of the limitations described in paragraph (2) for such
taxable year.
``(5) Election.--
``(A) In general.--An election under this subsection for
any taxable year shall be made on the taxpayer's return of
the tax imposed by this chapter for the taxable year. Such
election shall be made in such manner as the Secretary may by
regulations prescribe.
``(B) Election irrevocable.--Any election made under this
subsection may not be revoked except with the consent of the
Secretary.''.
(b) Loan Program.--
(1) In general.--The Secretary of the Treasury (or the
Secretary's delegate) shall provide a loan to any person who
is allowed a deduction under section 179F of the Internal
Revenue Code and who makes an election under section 179F(f)
of such Code in an amount equal to the qualified plug-in
electric drive motor vehicle manufacturing facility amount
(as defined in such section 179F(f)).
(2) Term.--Such loan shall be in the form of a senior note
issued by the taxpayer to the Secretary of the Treasury,
secured by the qualified plug-in electric drive motor vehicle
manufacturing facility property (as defined in section 179F
of the Internal Revenue Code of 1986) of the taxpayer, and
having a term of 20 years and interest payable at the
applicable Federal rate (as determined under section 1274(d)
of the Internal Revenue Code of 1986).
(3) Appropriations.--There is hereby appropriated to the
Secretary of the Treasury such sums as may be necessary to
carry out this subsection.
(c) Clerical Amendment.--The table of sections for part VI
of subchapter B of chapter 1 is amended by adding at the end
the following new item:

``Sec. 179F. Election to expense manufacturing facilities producing
plug-in electric drive motor vehicle and components.''.
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after the date of the
enactment of this Act.

Amendment No. 274, as Further Modified

Ms. CANTWELL. I ask that the amendment be further modified with the
changes at the desk.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

SEC. 1121. EXTENSION AND MODIFICATION OF CREDIT FOR
NONBUSINESS ENERGY PROPERTY.

[[Page S1823]]

``(B) an electric heat pump which achieves the highest
efficiency tier established by the Consortium for Energy
Efficiency, as in effect on January 1, 2009.''.
(2) Central air conditioners.--Subparagraph (C) of section
25C(d)(3) is amended by striking ``2006'' and inserting
``2009''.
(3) Water heaters.--Subparagraph (D) of section 25C(d)(3)
is amended to read as follows:
``(E) a natural gas, propane, or oil water heater which has
either an energy factor of at least 0.82 or a thermal
efficiency of at least 90 percent.''.
(4) Wood stoves.--Subparagraph (E) of section 25C(d)(3) is
amended by inserting ``, as measured using a lower heating
value'' after ``75 percent''.
(c) Modifications of Standards for Oil Furnaces and Hot
Water Boilers.--
(1) In general.--Paragraph (4) of section 25C(d) is amended
to read as follows:
``(4) Qualified natural gas, propane, and oil furnaces and
hot water boilers.--
``(A) Qualified natural gas furnace.--The term `qualified
natural gas furnace' means any natural gas furnace which
achieves an annual fuel utilization efficiency rate of not
less than 95.
``(B) Qualified natural gas hot water boiler.--The term
`qualified natural gas hot water boiler' means any natural
gas hot water boiler which achieves an annual fuel
utilization efficiency rate of not less than 90.
``(C) Qualified propane furnace.--The term `qualified
propane furnace' means any propane furnace which achieves an
annual fuel utilization efficiency rate of not less than 95.
``(D) Qualified propane hot water boiler.--The term
`qualified propane hot water boiler' means any propane hot
water boiler which achieves an annual fuel utilization
efficiency rate of not less than 90.
``(E) Qualified oil furnaces.--The term `qualified oil
furnace' means any oil furnace which achieves an annual fuel
utilization efficiency rate of not less than 90.
``(F) Qualified oil hot water boiler.--The term `qualified
oil hot water boiler' means any oil hot water boiler which
achieves an annual fuel utilization efficiency rate of not
less than 90.''.
(2) Conforming amendment.--Clause (ii) of section
25C(d)(2)(A) is amended to read as follows:
``(ii) any qualified natural gas furnace, qualified propane
furnace, qualified oil furnace, qualified natural gas hot
water boiler, qualified propane hot water boiler, or
qualified oil hot water boiler, or''.
(d) Modifications of Standards for Qualified Energy
Efficiency Improvements.--
(1) Qualifications for exterior windows, doors, and
skylights.--Subsection (c) of section 25C is amended by
adding at the end the following new paragraph:
``(4) Qualifications for exterior windows, doors, and
skylights.--Such term shall not include any component
described in subparagraph (B) or (C) of paragraph (2) unless
such component is equal to or below a U factor of 0.30 and
SHGC of 0.30.''.
(2) Additional qualification for insulation.--Subparagraph
(A) of section 25C(c)(2) is amended by inserting ``and meets
the prescriptive criteria for such material or system
established by the 2009 International Energy Conservation
Code, as such Code (including supplements) is in effect on
the date of the enactment of the American Recovery and
Reinvestment Tax Act of 2009'' after ``such dwelling unit''.
(e) Extension.--Section 25C(g)(2) is amended by striking
``December 31, 2009'' and inserting ``December 31, 2010''.
(f) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to taxable years
beginning after December 31, 2008.
(2) Efficiency standards.--The amendments made by
paragraphs (1), (2), and (3) of subsection (b) and
subsections (c) and (d) shall apply to property placed in
service after December 31, 2009.
On page 461, strike lines 8 to 10 and insert the following:
(b) Ensuring Consumer Accessibility to Alternative Fuel
Vehicle Refueling Property in the Case of Electricity.--
Section 179(d)(3) is amended by striking subparagraph (B) and
inserting the following:
``(B) for the recharging of motor vehicles propelled by
electricity, but only if--
``(i) the property complies with the Society of Automotive
Engineers' connection standards,
``(ii) the property provides for non-restrictive access for
charging and for payment interoperability with other systems,
and
``(iii) the property--

SEC. 1124. RECOVERY PERIOD FOR DEPRECIATION OF SMART METERS.

(a) Temporary 5-Year Recovery Period.--
(1) In general.--Subparagraph (B) of section 168(e)(3) is
amended by striking ``and'' at the end of clause (vi), by
striking the period at the end of clause (vii) and inserting
``, and'', and by adding at the end the following new clause:
``(viii) any qualified smart electric meter which is placed
in service before January 1, 2011.''.
(2) Conforming amendment.--Clause (iii) of section
168(e)(3)(D) is amended by inserting ``which is placed in
service after December 31, 2010'' after ``electric meter''.
(b) Technical Amendments.--Paragraphs (18)(A)(ii) and
(19)(A)(ii) of section 168(i) are each amended by striking
``16 years'' and inserting ``10 years''.
(c) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to property
placed in service after the date of the enactment of this
Act.
(2) Technical amendment.--The amendments made by subsection
(b) shall take effect as if included in section 306 of the
Energy Improvement and Extension Act of 2008.
On page 467, strike lines 1 through 18, and insert the
following:

PART VI--MODIFICATION OF CREDIT FOR CARBON DIOXIDE SEQUESTRATION

SEC. 1151. APPLICATION OF MONITORING REQUIREMENTS TO CARBON
DIOXIDE USED AS A TERTIARY INJECTANT.

SEC. 1161. MODIFICATION OF CREDIT FOR QUALIFIED PLUG-IN
ELECTRIC MOTOR VEHICLES.

(a) Increase in Vehicles Eligible for Credit.--Section
30D(b)(2)(B) is amended by striking ``250,000'' and inserting
``500,000''.
(b) Exclusion of Neighborhood Electric Vehicles From
Existing Credit.--Section 30D(e)(1) is amended to read as
follows:
``(1) Motor vehicle.--The term `motor vehicle' means a
motor vehicle (as defined in section 30(c)(2)), which is
treated as a motor vehicle for purposes of title II of the
Clean Air Act.''.
(c) Credit for Certain Other Vehicles.--Section 30D is
amended--
(1) by redesignating subsections (f) and (g) as subsections
(g) and (h), respectively, and
(2) by inserting after subsection (e) the following new
subsection:
``(f) Credit for Certain Other Vehicles.--For purposes of
this section--
``(1) In general.--In the case of a specified vehicle, this
section shall be applied with the following modifications:
``(A) For purposes of subsection (a)(1), in lieu of the
applicable amount determined under subsection (a)(2), the
applicable amount shall be 10 percent of so much of the cost
of the specified vehicle as does not exceed $40,000.
``(B) Subsection (b) shall not apply and no specified
vehicle shall be taken into account under subsection (b)(2).
``(C) In the case of a specified vehicle which is a 2- or
3-wheeled motor vehicle, subsection (c)(1) shall be applied
by substituting `2.5 kilowatt hours' for `4 kilowatt hours'.
``(D) In the case of a specified vehicle which is a low-
speed motor vehicle, subsection (c)(3) shall not apply.
``(2) Specified vehicle.--For purposes of this subsection--
``(A) In general.--The term `specified vehicle' means--
``(i) any 2- or 3-wheeled motor vehicle, or
``(ii) any low-speed motor vehicle,
which is placed in service after December 31, 2009, and
before January 1, 2012.
``(B) 2- or 3-wheeled motor vehicle.--The term `2- or 3-
wheeled motor vehicle' means any vehicle--
``(i) which would be described in section 30(c)(2) except
that it has 2 or 3 wheels,
``(ii) with motive power having a seat or saddle for the
use of the rider and designed to travel on not more than 3
wheels in contact with the ground,
``(iii) which has an electric motor that produces in excess
of 5-brake horsepower,
``(iv) which draws propulsion from 1 or more traction
batteries, and
``(v) which has been certified to the Department of
Transportation pursuant to section 567 of title 49, Code of
Federal Regulations, as conforming to all applicable Federal
motor vehicle safety standards in effect on the date of the
manufacture of the vehicle.
``(C) Low-speed motor vehicle.--The term `low-speed motor
vehicle' means a motor vehicle (as defined in section
30(c)(2)) which--
``(i) is placed in service after December 31, 2009, and

[[Page S1824]]

``(ii) meets the requirements of section 571.500 of title
49, Code of Federal Regulations.''.
(d) Effective Dates.--
(1) In general.--The amendment made by subsections (a) and
(c) shall take effect on the date of the enactment of this
Act.
(2) Other modifications.--The amendments made by subsection
(b) shall apply to property placed in service after December
31, 2009, in taxable years beginning after such date.

SEC. 1162. CONVERSION KITS.

SEC. 1303. INCENTIVES FOR MANUFACTURING FACILITIES PRODUCING
PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES AND
COMPONENTS.

``SEC. 179F. ELECTION TO EXPENSE MANUFACTURING FACILITIES
PRODUCING PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES
AND COMPONENTS.

[[Page S1825]]

``(c) Election.--
``(1) In general.--An election under this section for any
taxable year shall be made on the taxpayer's return of the
tax imposed by this chapter for the taxable year. Such
election shall be made in such manner as the Secretary may by
regulations prescribe.
``(2) Election irrevocable.--Any election made under this
section may not be revoked except with the consent of the
Secretary.
``(d) Qualified Plug-In Electric Drive Motor Vehicle
Manufacturing Facility Property.--For purposes of this
section--
``(1) In general.--The term `qualified plug-in electric
drive motor vehicle manufacturing facility property' means
any qualified property--
``(A) the original use of which commences with the
taxpayer,
``(B) which is placed in service by the taxpayer after the
date of the enactment of this section and before January 1,
2015, and
``(C) no written binding contract for the construction of
which was in effect on or before the date of the enactment of
this section.
``(2) Qualified property.--
``(A) In general.--The term `qualified property' means any
property which is a facility or a portion of a facility used
for the production of--
``(i) any new qualified plug-in electric drive motor
vehicle (as defined by section 30D(c)), or
``(ii) any eligible component.
``(B) Eligible component.--The term `eligible component'
means any battery, any electric motor or generator, or any
power control unit which is designed specifically for use
with a new qualified plug-in electric drive motor vehicle (as
so defined).
``(e) Special Rule for Dual Use Property.--In the case of
any qualified plug-in electric drive motor vehicle
manufacturing facility property which is used to produce both
qualified property and other property which is not qualified
property, the amount of costs taken into account under
subsection (a) shall be reduced by an amount equal to--
``(1) the total amount of such costs (determined before the
application of this subsection), multiplied by
``(2) the percentage of property expected to be produced
which is not qualified property.
``(f) Election to Receive Loan in Lieu of Deduction.--
``(1) In general.--If a taxpayer elects to have this
subsection apply for any taxable year--
``(A) subsection (a) shall not apply to any qualified plug-
in electric drive motor vehicle manufacturing facility
property placed in service by the taxpayer,
``(B) such taxpayer shall receive a loan from the Secretary
in an amount and under such terms as provided in section
1303(b) of the American Recovery and Reinvestment Tax Act of
2009, and
``(C) in the taxable year in which such qualified loan is
repaid, each of the limitations described in paragraph (2)
shall be increased by the qualified plug-in electric drive
motor vehicle manufacturing facility amount which is--
``(i) determined under paragraph (3), and
``(ii) allocated to such limitation under paragraph (4).
``(2) Limitations to be increased.--The limitations
described in this paragraph are--
``(A) the limitation imposed by section 38(c), and
``(B) the limitation imposed by section 53(c).
``(3) Qualified plug-in electric drive motor vehicle
manufacturing facility amount.--For purposes of this
paragraph--
``(A) In general.--The qualified plug-in electric drive
motor vehicle manufacturing facility amount is an amount
equal to the applicable percentage of any qualified plug-in
electric drive motor vehicle manufacturing facility which is
placed in service during the taxable year.
``(B) Applicable percentage.--For purposes of subparagraph
(A), the applicable percentage is--
``(i) 35 percent, in the case of qualified plug-in electric
drive motor vehicle manufacturing facility property which is
placed in service before January 1, 2012, and
``(ii) 17.5 percent, in the case of qualified plug-in
electric drive motor vehicle manufacturing facility property
which is placed in service after December 31, 2011, and
before January 1, 2015.
``(C) Special rule for dual use property.--In the case of
any qualified plug-in electric drive motor vehicle
manufacturing facility property which is used to produce both
qualified property and other property which is not qualified
property, the amount of costs taken into account under
subparagraph (A) shall be reduced by an amount equal to--
``(i) the total amount of such costs (determined before the
application of this subparagraph), multiplied by
``(ii) the percentage of property expected to be produced
which is not qualified property.
``(4) Allocation of qualified plug-in electric drive motor
vehicle manufacturing facility amount.--The taxpayer shall,
at such time and in such manner as the Secretary may
prescribe, specify the portion (if any) of the qualified
plug-in electric drive motor vehicle manufacturing facility
amount for the taxable year which is to be allocated to each
of the limitations described in paragraph (2) for such
taxable year.
``(5) Election.--
``(A) In general.--An election under this subsection for
any taxable year shall be made on the taxpayer's return of
the tax imposed by this chapter for the taxable year. Such
election shall be made in such manner as the Secretary may by
regulations prescribe.
``(B) Election irrevocable.--Any election made under this
subsection may not be revoked except with the consent of the
Secretary.''.
(b) Loan Program.--
(1) In general.--The Secretary of the Treasury (or the
Secretary's delegate) shall provide a loan to any person who
is allowed a deduction under section 179F of the Internal
Revenue Code and who makes an election under section 179F(f)
of such Code in an amount equal to the qualified plug-in
electric drive motor vehicle manufacturing facility amount
(as defined in such section 179F(f)).
(2) Term.--Such loan shall be in the form of a senior note
issued by the taxpayer to the Secretary of the Treasury,
secured by the qualified plug-in electric drive motor vehicle
manufacturing facility property (as defined in section 179F
of the Internal Revenue Code of 1986) of the taxpayer, and
having a term of 20 years and interest payable at the
applicable Federal rate (as determined under section 1274(d)
of the Internal Revenue Code of 1986).
(3) Appropriations.--There is hereby appropriated to the
Secretary of the Treasury such sums as may be necessary to
carry out this subsection.
(c) Clerical Amendment.--The table of sections for part VI
of subchapter B of chapter 1 is amended by adding at the end
the following new item:

``Sec. 179F. Election to expense manufacturing facilities producing
plug-in electric drive motor vehicle and components.''.

(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after the date of the
enactment of this Act.

Ms. CANTWELL. Mr. President, I thank my colleagues, Senator Hatch and
Senator Bingaman, for helping us work on this modified language--
Senator Bingaman, particularly--related to plug-in vehicles. I thank my
colleagues who have worked on additional amendments as part of this
qualification of the ITC manufacturing credit; conservation bonds in
the underlying bill that I know my colleague, Senator Feingold, has
worked on; Senators Bingaman and Carper on a technical fix to carbon
sequestration; I know the Senators in the Northeast and the Northwest
have worked on provisions of existing modifications to the wood stove
amendment we helped in the 2007 bill; and my colleagues, Senators
Snowe, Feinstein, Bingaman, and Kerry on updates for the enhancement
effectiveness of home energy efficiency in the Tax Code.
I think all of these things make for a very important amendment for
the stimulus package because it is about immediate stimulus and it is
about job creation, both in the near term and the opportunity for
tremendous job creation in the long term.
The underlying amendment deals with the issue of creating and
expensing for those who invest in plug-in battery technology or
components. The United States currently is the leader in research and
development of battery technology. Unfortunately, the number of
manufacturing facilities in the United States that take advantage of
that R&D is zero--zero opportunities currently in manufacturing in the
United States.
What we know around the globe is that countries, such as China, have
over 250,000 people working on battery technology and over 150
partners. We know Europeans and others are quick to work on this
technology. Why? Because many people believe we are going to make this
transformation off fossil fuel and on to cars powered by our
electricity grid. So we know we are moving in that direction, but we
are not doing anything to provide incentives so that manufacturing can
take place in the United States.
I am not talking necessarily about domestic manufacturers. I am not
saying we are not talking about them. We are talking about making
sure--whether it is Toyota, whether it is Tesla Motors, or someone not
even on the horizon today, or what is happening in Detroit--that the
United States does not continue to import their battery technology but
starts manufacturing in the United States.
This is a great opportunity for us in manufacturing to complement the
ITC manufacturing credit that went to

[[Page S1826]]

other renewable energy sources, such as wind and solar, to bring some
of that manufacturing into the United States. I think that provision is
tremendously important, but I say to my colleagues on the Senate floor,
I cannot think of a bigger opportunity for job creation in the future
than helping to make this transition off fossil fuel and on to the
grid. If we fail to make this step now, we will be as dependent on
foreign battery technology as we are on Mideast fossil fuel today. We
don't want to make that mistake.
We know in the small business provisions of this bill, we are giving
expensing opportunities so that with the depreciation rate takedown,
people will make more investments now. That is the same thing we are
doing here, making investments in plug-in technology to stimulate job
creation around this technology and help us with millions of long-term
jobs and an opportunity to get off fossil fuel and deliver for our
constituents a cheaper source of transportation in the future.
I thank the Chair and yield the floor.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, I support the Cantwell amendment. Frankly,
in the regular order, somebody who opposes the Cantwell amendment
should be speaking. I will take a little of her time. It is a good
amendment, and I hope it gets adopted. I don't think anybody wants to
speak in opposition.
The PRESIDING OFFICER. The Senator from Alabama.
Mr. SESSIONS. Mr. President, I ask the manager if I might have 2
minutes. Just 2 minutes. I would like to respond.
Mr. BAUCUS. Fine.
Mr. SESSIONS. Mr. President, from what we understand so far, one part
of this bill is $9 billion. It scores at $9 billion. We have a strong
commitment to hybrid automobiles. I have supported that in the past. We
are dealing with that issue in the Energy Committee. As I understand
it, this is spending in addition to what is already in the bill. I
think that is going to cause concerns.
I ask my colleagues to be cautious about signing on to a bill that
has not gone through committee and represents such a huge expenditure
of money that is unpaid.
I thank the Chair and yield the floor.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Does the Senator from Washington have time remaining?
Ms. CANTWELL. Mr. President, in response to my colleague, the notion
of plug-in technology was discussed in the Finance Committee. We
decided to offer this amendment on the floor instead. We know the
economic opportunity we are going to lose by not making this investment
is great.
What is so unique about this is that it is stimulative now, it is job
creation, and it, as the President says, puts us in a position in a key
technology area in which we know the United States wants to be
competitive. I believe it is a very winning proposition for the
stimulus bill.
The PRESIDING OFFICER. The Senator from Alabama.
Mr. SESSIONS. Mr. President, briefly, I appreciate Senator Cantwell.
I know she is one of the leaders in the effort to reduce our dependence
on foreign oil and reduce emissions. But I will note, the amount of
money going into hybrids reaches a point where we have to be careful.
Diesel engines get about 40 percent more mileage than regular
gasoline engines. Europeans have half their vehicles in diesel. We have
about 3 percent. We have to be careful when we have this kind of
incentive that it is going at the best possible thing.
I am not prepared to say this is not the best way to do it, for sure.
I believe the Energy Committee and maybe EPW ought to be able to have
hearings on this before we make such a dramatic change.
I thank the Chair and yield the floor.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, I urge the Chair to recognize Senator
Bunning to call up his amendment.
Mr. BUNNING. Mr. President, I would like 10 minutes.
Mr. BAUCUS. Ten minutes equally divided.
Mr. BUNNING. Ten minutes for Senator Bunning.
Mr. BAUCUS. Ten minutes to the Senator from Kentucky.
Mr. BUNNING. The Senator can give whatever time he chooses to the
other side.
The PRESIDING OFFICER. Without objection, it is so ordered.

Amendment No. 531 to Amendment No. 98

Mr. BUNNING. Mr. President, I call up my amendment No. 531.
The PRESIDING OFFICER (Mr. Brown). The clerk will report.
The bill clerk read as follows:

The Senator from Kentucky [Mr. Bunning] proposes an
amendment numbered 531 to amendment No. 98.

Mr. BUNNING. Mr. President, I ask unanimous consent that the reading
of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To temporarily increase the limitations on offsetting
ordinary income with capital losses and to strike the 5-year carryback
of general business credits)

On page 464, strike lines 2 and 23, and insert the
following:

SEC. 1141. TEMPORARY INCREASE IN PERSONAL CAPITAL LOSS
DEDUCTION LIMITATION.

(a) In General.--Section 1211 is amended by adding at the
end the following new subsection:
``(c) Special Rule for Taxable Years Beginning in 2009.--In
the case of a taxable year beginning after December 31, 2008,
and before January 1, 2010, subsection (b)(1) shall be
applied--
``(1) by substituting `$15,000' for `$3,000', and
``(2) by substituting `$7,500' for `$1,500'.''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2008.

Mr. BUNNING. Mr. President, our economy is ailing--everybody knows
that--and the symptoms are a sharp drop in consumer spending and a
large rise in unemployment. As many of my colleagues have already
observed, this bill treats the symptoms only and it does it so
ineffectively.
There are some Democrats, even in the White House, who agree with
this. Just the other day, one House Democrat said his leadership ``does
not care'' what is in the bill; ``they just want to pass it and they
want it to be unanimous.'' They don't care. That is just shameful.
The unemployment statistics we are seeing are just staggering. Never
in our history have we seen job cuts at the rate and severity we are
seeing today: over 500,000 losses per month for the last 5 months. Over
600,000 in losses were reported just last Tuesday.
This bill really does very little to help businesses keep people
employed. It gives the poorest Americans $500 in cash and the prospect
of a government job on a construction site, but it does not get to the
heart of the problem in the private sector.
It is our responsibility on behalf of every child who will pay for
this massive amount of spending in this bill to get the solution right,
and we can do better, much better.
One of the best economists in this country--one who predicted this
crisis in advance--said recently that he believes most U.S. banks are
insolvent. Their equity has been wiped out due to the massive leveraged
bets related to housing. Unfortunately, bank regulators, such as Tim
Geithner, Ben Bernanke, and Alan Greenspan, failed to properly assess
the danger to the economy presented by these irresponsible bets.
Many experts are now acknowledging what I have said for years: that
currency manipulation by China and other countries fueled the credit
bubble in the United States and Europe that drove up housing prices to
unsustainable levels.
As a direct result, many households are now insolvent as well. They
are carrying mortgage debts that exceed the value of their homes, and
even with the $500 from the make work pay credit, they will not go out
and spend it until the problem is addressed.
This amendment I am offering today will address a major injustice in
the Tax Code that many taxpayers will encounter for the first time this
year. This problem will drive the effective tax rates of many taxpayers
to European confiscatory levels at the worst possible time. I am
referring to the limit on capital losses.
Since the peak of the markets in 2007, investors have lost $7.5
trillion in wealth. More than half of this amount is in taxable
accounts. If we do not adjust the limits, taxpayers will be unable to
deduct real economic losses

[[Page S1827]]

from their income tax, and this will result in higher effective tax
rates.
Two respected economists have recommended my amendment as a way to
stimulate the economy. In an article in the Wall Street Journal titled
``Let's Stimulate Private Risk Taking,'' economists from Harvard
University and the University of Chicago wrote that my amendment would
stimulate risk taking by rewarding the downside of new investments and
increasing the upside.
I ask unanimous consent to have this article printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

[From the Wall Street Journal, Jan. 21, 2009]

Let's Stimulate Private Risk Taking

(By Alberto Alesina and Luigi Zingales)

In virtually all economics classes, including those taught
by the many excellent economists on the Obama team, the idea
of government spending as an engine for growth is not a
popular topic. Yet despite their skepticism of Keynesianism
in the classroom, when it comes to public policy, these
economists happily endorse a large stimulus package that
could bring our deficit to 10% of GDP. Why?
One explanation is that these economists think this
recession is an extraordinary one. In normal recessions--the
argument goes--an increase in discretionary government
spending is unnecessary and even counterproductive. But in
the event that a recession becomes a depression, a Keynesian
stimulus package might work.
There are certainly economic models that show how
government spending can shift the economy from a bad
equilibrium (where people do not search for jobs because they
do not expect to find them, and firms do not invest because
they do not expect to sell), to a good equilibrium (where
people search for jobs, and firms invest and generate demand
for their goods).
But this particular recession is unique not in its
dimensions, but in its sources. First, it is the result of a
financial crisis that severely affected stock-market
valuations. The bad equilibrium did not originate in the
labor market, but in the credit market, where investors are
reluctant to lend to risky firms. This reluctance is making
it difficult for these firms to refinance their debt, forcing
them to default on their credit, further validating
investors' fear. Thus, the problem is how to increase
investors' willingness to take risk. It's unclear how the
proposed stimulus package would help inspire investors to do
so.
The second reason this recession is unusual is that it was
caused in large part by a significant current-account
imbalance due to the low savings rate of Americans (families
and government). Even assuming that more public spending
would increase private consumption--a big if--such a measure
would cause even more imbalance.
So how do we stimulate the economy without increasing the
already large current-account deficit? It's not easy, but
here is an idea: Create the incentive for people to take more
risk and move their savings from government bonds to risky
assets. There is no better way to encourage this than a
temporary elimination of the capital-gains tax for all the
investments begun during 2009 and held for at least two
years.
If we fear this is not enough, we can temporarily increase
the size of the capital loss that is deductible against
ordinary income. This will reduce the downside of new
investments and increase the upside.
More savings need to be invested, and firms need an
incentive to invest in order to help aggregate demand in the
short term and promote long-term growth. The best way to do
this is to make all capital expenditures and research and
development investments done in 2009 fully tax deductible in
the current fiscal year.
A large temporary tax incentive may be just enough to jolt
investors from their current paralysis to take action. Such a
switch will also be fueled by the temporary capital-gains tax
cut mentioned above, which will motivate people to move their
savings from money-market funds to stocks, increasing
valuations, investments and confidence.
Many are concerned about what we can do to help the poor
weather this crisis. Unlike during the Great Depression, we
have an unemployment subsidy that protects the poor from the
most severe consequences of this recession. If we want to
further protect them, it is better to extend this
unemployment subsidy than to invest in hasty public projects.
Furthermore, tax cuts have a much better effect on job
creation than highway rehabilitation.
No doubt, it is much easier to sell the public and Congress
a plan for more public works than tax cuts, particularly
while Main Street despises Wall Street--with some good
reason. But the role of a good economic team is to
courageously propose the right economic policy, even when it
is unpopular. The role of a president is to sell it
politically, as real change we can believe in.

Mr. BUNNING. Mr. President, since 2007, investors have lost $1.7
trillion in stock market values. Nearly half these losses are taxable
accounts and their owners are subject to a $3,000 limit on capital
losses.
The way this limit works is that no matter how much money you lose in
stocks or real estate, you are only allowed to deduct $3,000 per year
against other income. The remaining loss is ignored.
Given the state of the markets, millions of taxpayers have stock
losses that far exceed $3,000. Nevertheless, the Tax Code will treat
these people as though they earned much more during the year.
For an example, a family that earns $100,000 and pays $30,000 in
Federal and State taxes has a tax rate of 30 percent. If the family
loses $40,000 in savings and it is only able to deduct $3,000, it will
push the family's effective tax rate up to 48.5 percent.
The $3,000 fixed limit on capital losses was last adjusted in 1976.
Before the midseventies, the tax writers in Congress were not as
knowledgeable about what inflation can do to savings as we are
today. It was common for Congress to write dollar limits into the Tax
Code without any thought of what inflation would do to its value in
future years. Since 1977, inflation has eroded the value of the limit
by more than 71 percent. My amendment would adjust the limit for
inflation, increasing it to $15,000 for any losses incurred this year.

When I offered this amendment in the Finance Committee, Chairman
Baucus committed to addressing the problem on a permanent basis
sometime this year. I welcome this opportunity to work with him on this
long-term overdue problem.
My amendment also reduces the cost of the bill by about $4.9 billion
because I am also striking a remarkable provision that for the first
time would allow corporations to use tax credits even if they have no
income. This is nothing more than corporate welfare and Soviet-style
industrial policy. Never before has this body endorsed a refundable tax
credit for corporations. This one costs a staggering $10.9 billion. It
is bad policy and the money should be spent on broad-based individual
tax relief that will stimulate our economy.
I urge my colleagues to vote for this amendment to ensure that
taxpayers do not experience an increase in tax rate in the depth of
this recession we are now in.
I yield the floor.
The PRESIDING OFFICER. The senior Senator from Montana is recognized.
Mr. BAUCUS. Mr. President, the Senator from Kentucky has an
interesting idea, an interesting proposition, and we did discuss it in
committee. I did say in the committee that I think it is an issue that
should appropriately be addressed, and I again thank the Senator for
bringing up this issue.
I suggest that we now go to Senator Feingold for the purposes of
offering an amendment.
The PRESIDING OFFICER (Mr. Burris). The Senator from Wisconsin is
recognized.

Amendment No. 485 to Amendment No. 98

Mr. FEINGOLD. Mr. President, I ask unanimous consent the pending
amendment be set aside so that I may call up amendment No. 485.
The PRESIDING OFFICER. Without objection, it is so ordered.
The clerk will report.
The bill clerk read as follows:

The Senator from Wisconsin [Mr. Feingold] proposes an
amendment numbered 485 to amendment No. 98.

Mr. FEINGOLD. Mr. President, I ask unanimous consent that the reading
of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To clarify that certain programs constitute a qualified
conservation purpose for qualified energy conservation bonds)

On page 457, between lines 16 and 17, insert the following:
(b) Clarification With Respect to Green Community
Programs.--Clause (ii) of section 54D(f)(1)(A) is amended by
inserting ``(including the use of loans, grants, or other
repayment mechanisms to implement such programs)'' after
``green community programs''.

Mr. FEINGOLD. Mr. President, I ask unanimous consent to add Senator
Stabenow as a cosponsor of the amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. FEINGOLD. Mr. President, this amendment is based on my Community
Revitalization Energy Conservation

[[Page S1828]]

Act, S. 222, and I am very pleased to be joined by the Senator from
Michigan in offering it.
This amendment will address our energy and economic challenges while
putting Americans to work. Supporting energy efficiency improvements to
America's homes and businesses is one of the smartest ways we can face
these challenges to create jobs and reduce our energy consumption.
The goal of this amendment is to decrease energy consumption, create
green jobs, and increase the number of energy efficient projects by
reducing the significant cost barriers, such as the prohibitive upfront
costs to homeowners and businesses who want to make improvements to
their homes and buildings.
Aggressively pursuing energy efficiency will help put us on a path
toward energy security. Presently, buildings account for 40 percent of
total U.S. energy consumption and 70 percent of U.S. electricity
consumption. In order for us to decrease our reliance on fossil-based
fuels, this has to change. We can achieve 20 to 30 percent energy
reduction through better insulation, lighting, and HVAC equipment and
controls. Potentially, we have the opportunity to save over $200
billion through building efficiency alone.
The economic recovery package increases the bond limit for the
Qualified Energy Conservation Bond Program, which supports conservation
upgrades to buildings. It does that by taking that number from $800
million to $3.2 billion. I support this provision, and the Feingold-
Stabenow amendment builds on it by modifying the Qualified Energy
Conservation Bond Program to include conservation in private buildings
using a financing mechanism that would eliminate the prohibitive
upfront costs of energy efficiency improvements between homeowners and
businesses.
Meanwhile, the amendment would allow State and local governments to
promote energy efficiency products by use of electric and water
utilities as intermediaries. By using utilities as intermediaries,
homeowners and businesses incur no upfront costs and they can then
gradually pay back the cost of the energy efficiency retrofits through
their electricity or water bills at a rate that does not exceed what
they have historically paid.
For example, if a monthly water bill before improvements is $150, and
with the improvement the energy costs are down to $110, at most a
homeowner or business would pay $40 more monthly toward paying off the
cost of the energy efficiency building retrofits which were made
possible by this program.
This has worked. Already several States and cities, including Hawaii,
Michigan, Berkeley, CA, and Babylon, NY, are beginning to tackle the
issue of energy efficiency in residential buildings. In my home State
of Wisconsin, efforts are already underway in Milwaukee to use this
novel financing mechanism to promote energy efficiency. In partnership
with the Center on Wisconsin Strategy, the city is pursuing Me2, or the
Milwaukee Energy Efficiency Program. Initial estimates from the Center
on Wisconsin Strategy suggest that if you could retrofit nearly all of
the existing housing stock in Milwaukee, an initial investment of just
under $250 million, it could result in annual energy savings of over
$80 million.
All of these efforts to conserve energy require investments in time
and money. By combining efforts on two of our greatest challenges,
energy and employment, we can create a great opportunity. Energy
efficiency and conservation are, of course, in our national interest
for our long-term economic well-being, for the health and safety of our
citizens and the world as we mitigate the effects of climate change,
and for our independence and security as well.
This amendment is endorsed by many key groups, including the Apollo
Alliance, the American Council for an Energy Efficient Economy, Air
Conditioning Contractors of America, National Electrical Contractors
Association, and the Plumbing-Heating-Cooling Contractors National
Association.
I thank the Senator from Montana, Senator Baucus, for working with me
on this amendment and for his support on the amendment. I urge my all
of my colleagues to support it. It will support green jobs and help get
our economy on the right track.
Mr. President, I yield the floor.
The PRESIDING OFFICER. The Senator from Montana is recognized.
Mr. BAUCUS. Mr. President, I suggest that Senator Thune be recognized
for the purpose of offering his amendment.
The PRESIDING OFFICER. The Senator from South Dakota is recognized.

Amendment No. 538 to Amendment No. 98

Mr. THUNE. Mr. President, I thank the Senator from Montana, the
manager of this bill, for yielding and for the opportunity to offer
this amendment.
As I have indicated, I will start by saying I am very uncomfortable
with the notion of spending almost $1 trillion--over $1 trillion if you
include interest--on this undertaking when, in my view, it is not
timely, temporary, and targeted--as has been suggested should be the
criteria for this legislation--but, rather, it is slow, unfocused, and
unending. As a consequence of that, as I said, I am very concerned
about the size of this and I am very concerned about the substance of
it.
I don't believe we ought to spend this amount. I have supported
amendments, including Senator McCain's amendment, that were
significantly smaller in terms of the size, much more, in my judgment,
fiscally responsible, much more targeted and focused on job creation,
and doing the types of things I believe will help get the economy
growing again. Unfortunately, those amendments--those amendments I have
supported, and I have even offered a substitute of my own--have all
failed.
I say that to preface my comments as I offer this amendment, to make
the point that I am not in favor of or supportive of this size of
spending and this size of borrowing from future generations in order to
accomplish what, in my judgment, are very questionable job creation
goals--frankly, I think based on the CBO study we saw yesterday, very
questionable goals in terms of what this might achieve.
I have concluded, however, that with all the amendments that have
been offered, many of which are amendments that in my view would reduce
some of the wasteful spending in this bill, some of which would refocus
it more toward tax relief, more toward infrastructure, and more toward
housing--things I think are important in this debate--I have concluded
that the way to perhaps shape this is to offer an amendment that,
frankly, will clarify what the difference is in this debate. Because I
think it all comes down to who spends this money: does Washington spend
it or do the American people spend these dollars that are going to come
in?
If we are going to commit to spending $936 billion, what my amendment
essentially would do is to say that the $936 billion ought to be
divided evenly among people who file income tax returns in this
country. There are 182 million filers, all of whom would have a
significant tax cut if you took a $936 billion pricetag and divided it
up among those 182 million filers.
My amendment I think also illustrates the simplicity of this debate,
because this is nine pages long. This amendment is nine pages long. The
underlying bill is 735 pages long. It takes 735 pages, I would argue,
to go through all the various types of spending programs that are
created in this bill, many of which are new programs that are going to
create liabilities and obligations for the taxpayers well beyond the
so-called targeted period in which this assistance is designed to take
effect. But my nine-page amendment basically spells out a clearer
option that I think we ought to rally around.

Again, as I said before, it is very straightforward. If you are a
taxpaying person in this country, if you are someone who files an
income tax return--and there are 182 million filers in America--and you
make less than $250,000--if you have $250,000 or less in terms of
adjusted gross income--then you would be eligible for, if you are a
single filer, $5,143 in terms of a tax cut or tax rebate in 2009. This
would all spend out in 2009. If you are a married couple filing a joint
return, you would get a tax cut totaling $10,286 in 2009.
One of the Democrat arguments for the $1 trillion stimulus is they
believe the GDP will shrink by that amount in the near future,
primarily because of a decrease in consumer spending, which accounts
for approximately 70 percent

[[Page S1829]]

of gross domestic product. This amendment would inject $936 billion
into the economy by the end of 2009 in the form of a recovery rebate
for middle-class tax filers. These tax cuts total approximately 6 to 7
percent of our gross domestic product.
Consumers and taxpayers, not government bureaucrats, would determine
how to spend this money. Consumers could decide to make a downpayment
on a new home, purchase a new car, get ahead of day-to-day bills, or
save and invest for the future. I suggest this is a far more efficient
way of stimulating the economy relative to improving fish barriers or
designing polar ice breakers or purchasing supercomputers for climate
research.
One of the primary arguments my colleagues on the other side, I am
sure, will make against this amendment is that most consumers decided
to save their tax rebates in 2008 rather than spend the checks they
received in the amount of $600 for a single filer and $1,200 for
married filing jointly. Well, first, this economic recovery rebate is
much larger, which increases the likelihood of a positive impact on
consumer spending.
Second, with the advent of the financial crisis, we are at a very
different situation relative to January 2008. Even if individuals
choose to save half of this tax cut, that would mean a $450 billion
infusion of capital into our banking system, which would also help
stabilize our financial institutions, and that is a critical part of
our economic recovery.
I believe the American people are tired of business as usual in
Washington. I think the stimulus package we have before us is a perfect
example of how Washington works. It is loaded with a lot of spending,
in many cases, as I said before, spending on new programs and a lot of
special interest spending. I hope my colleagues will listen to the
American people, who I think are following this debate and are,
frankly, outraged with the size of the stimulus plan and the notion
that it is going to be spent on many of the things they find
objectionable. I argue that the American people should be given the
choice between a 9-page, very simple and straightforward approach to
this, which puts money back in their pockets--in fact, a lot of money;
$5,143 if you are a single filer and $10,286 if you are a married
couple filing jointly--or a 735-page bill which includes spending for
all kinds of things that in my view are not going to be successful when
it comes to creating jobs or helping get this economy back on track.
That is the amendment. It is very straightforward. It is very simple.
It takes $936 billion and divides it by 182 million tax filers. If they
make under $250,000 year it gives them a tax rebate in the amount of
$5,143 for a single filer, $10,286 for a married filer filing jointly,
married couple filing jointly.
I yield the floor. I ask my colleagues to support the amendment.
The PRESIDING OFFICER. Has the Senator offered the amendment?
Mr. THUNE. Let me say, if I have not already, I ask it be pending. It
was filed at the desk.
The PRESIDING OFFICER. The clerk will report the amendment.
The legislative clerk read as follows:

The Senator from South Dakota [Mr. Thune)] proposes an
amendment numbered 538 to amendment No. 98.

The amendment is as follows:

(Purpose: To replace all spending and tax provisions with a direct
rebate to all Americans filing a tax return)

On page 1, beginning with line 6, strike all through page
735, line 7, and insert the following:

SEC. 2. REBATE TO ALL AMERICANS FILING A TAX RETURN.

(a) In General.--Section 6429 of the Internal Revenue Code
of 1986 is amended to read as follows:

``SEC. 6429. 2009 RECOVERY REBATES FOR INDIVIDUALS.

``(a) In General.--In the case of an eligible individual
who has filed a return of tax under chapter 1 for any taxable
year beginning in 2007, there shall be allowed a credit
against the tax imposed by subtitle A for the taxpayer's
first taxable year beginning in 2009 an amount equal to
$5,143 ($10,286 in the case of a joint return).
``(b) Limitation Based on Adjusted Gross Income.--The
amount of the credit allowed by subsection (a) (determined
without regard to this subsection and subsection (f)) shall
be zero if the taxpayer's adjusted gross income exceeds
$250,000.
``(c) Treatment of Credit.--The credit allowed by
subsection (a) shall be treated as allowed by subpart C of
part IV of subchapter A of chapter 1.
``(d) Definitions.--For purposes of this section--
``(1) Net income tax liability.--The term `net income tax
liability' means the excess of--
``(A) the sum of the taxpayer's regular tax liability
(within the meaning of section 26(b)) and the tax imposed by
section 55 for the taxable year, over
``(B) the credits allowed by part IV (other than section 24
and subpart C thereof) of subchapter A of chapter 1.
``(2) Eligible individual.--The term `eligible individual'
means any individual other than--
``(A) any nonresident alien individual,
``(B) any individual with respect to whom a deduction under
section 151 is allowable to another taxpayer for a taxable
year beginning in the calendar year in which the individual's
taxable year begins, and
``(C) an estate or trust.
``(e) Coordination With Advance Refunds of Credit.--
``(1) In general.--The amount of credit which would (but
for this paragraph) be allowable under this section shall be
reduced (but not below zero) by the aggregate refunds and
credits made or allowed to the taxpayer under subsection (e).
Any failure to so reduce the credit shall be treated as
arising out of a mathematical or clerical error and assessed
according to section 6213(b)(1).
``(2) Joint returns.--In the case of a refund or credit
made or allowed under subsection (f) with respect to a joint
return, half of such refund or credit shall be treated as
having been made or allowed to each individual filing such
return.
``(f) Advance Refunds and Credits.--
``(1) In general.--Each individual who was an eligible
individual for such individual's first taxable year beginning
in 2007, and who filed a return of tax under chapter 1 for
such first taxable year, shall be treated as having made a
payment against the tax imposed by chapter 1 for such first
taxable year in an amount equal to the advance refund amount
for such taxable year.
``(2) Advance refund amount.--For purposes of paragraph
(1), the advance refund amount is the amount that would have
been allowed as a credit under this section for such first
taxable year if this section (other than this subsection) had
applied to such taxable year.
``(3) Timing of payments.--The Secretary shall, subject to
the provisions of this title, refund or credit any
overpayment attributable to this section as rapidly as
possible. No refund or credit shall be made or allowed under
this subsection after December 31, 2009.
``(4) No interest.--No interest shall be allowed on any
overpayment attributable to this section.
``(g) Identification Number Requirement.--
``(1) In general.--No credit shall be allowed under
subsection (a) to an eligible individual who does not include
on the return of tax for the taxable year--
``(A) such individual's valid identification number, and
``(B) in the case of a joint return, the valid
identification number of such individual's spouse.
``(2) Valid identification number.--For purposes of
paragraph (1), the term `valid identification number' means a
social security number issued to an individual by the Social
Security Administration. Such term shall not include a TIN
issued by the Internal Revenue Service.
``(3) Special rule for members of the armed forces.--
Paragraph (1) shall not apply to a joint return where at
least 1 spouse was a member of the Armed Forces of the United
States at any time during the taxable year.''.
(b) Treatment of Possessions.--
(1) Payments to possessions.--
(A) Mirror code possession.--The Secretary of the Treasury
shall pay to each possession of the United States with a
mirror code tax system amounts equal to the loss to that
possession by reason of the amendments made by this section.
Such amounts shall be determined by the Secretary of the
Treasury based on information provided by the government of
the respective possession.
(B) Other possessions.--The Secretary of the Treasury shall
pay to each possession of the United States which does not
have a mirror code tax system amounts estimated by the
Secretary of the Treasury as being equal to the aggregate
benefits that would have been provided to residents of such
possession by reason of the amendments made by this section
if a mirror code tax system had been in effect in such
possession. The preceding sentence shall not apply with
respect to any possession of the United States unless such
possession has a plan, which has been approved by the
Secretary of the Treasury, under which such possession will
promptly distribute such payments to the residents of such
possession.
(2) Coordination with credit allowed against united states
income taxes.--No credit shall be allowed against United
States income taxes for any taxable year under section 6429
of the Internal Revenue Code of 1986 (as amended by this
section) to any person--
(A) to whom a credit is allowed against taxes imposed by
the possession by reason of the amendments made by this
section for such taxable year, or

[[Page S1830]]

(B) who is eligible for a payment under a plan described in
paragraph (1)(B) with respect to such taxable year.
(3) Definitions and special rules.--
(A) Possession of the united states.--For purposes of this
subsection, the term ``possession of the United States''
includes the Commonwealth of Puerto Rico and the Commonwealth
of the Northern Mariana Islands.
(B) Mirror code tax system.--For purposes of this
subsection, the term ``mirror code tax system'' means, with
respect to any possession of the United States, the income
tax system of such possession if the income tax liability of
the residents of such possession under such system is
determined by reference to the income tax laws of the United
States as if such possession were the United States.
(C) Treatment of payments.--For purposes of section
1324(b)(2) of title 31, United States Code, the payments
under this subsection shall be treated in the same manner as
a refund due from the credit allowed under section 36A of the
Internal Revenue Code of 1986 (as added by this section).
(c) Refunds Disregarded in the Administration of Federal
Programs and Federally Assisted Programs.--Any credit or
refund allowed or made to any individual by reason of section
6429 of the Internal Revenue Code of 1986 (as amended by this
section) or by reason of subsection (b) of this section shall
not be taken into account as income and shall not be taken
into account as resources for the month of receipt and the
following 2 months, for purposes of determining the
eligibility of such individual or any other individual for
benefits or assistance, or the amount or extent of benefits
or assistance, under any Federal program or under any State
or local program financed in whole or in part with Federal
funds.
(d) Authority Relating to Clerical Errors.--Section
6213(g)(2)(L) is amended by striking ``or 6428'' and
inserting ``6428, or 6429''.
(e) Conforming Amendments.--
(1) Section 6211(b)(4)(A) is amended by striking ``and
6428'' and inserting ``6428, and 6429''.
(2) Section 1324(b)(2) of title 31, United States Code, is
amended by striking ``or 6428'' and inserting ``6428, or
6429''.
(3) The table of sections for subchapter B of chapter 65 is
amended by striking the item relating to section 6429 and
inserting the following new item:

``Sec. 6429. 2009 recovery rebates for individuals.''.

(f) Effective Date.--This section, and the amendments made
by this section, shall apply to taxable years beginning after
December 31, 2008.

The PRESIDING OFFICER. The Senator from Montana is recognized.
Mr. BAUCUS. Mr. President, I am reminded of the great Baltimore Sun
journalist H.L. Menken who said for every complicated problem there is
a simple solution--and it is usually wrong.
We have a complicated problem: how to get our country going again.
With all due respect, this is a very simple solution and, with all due
respect, it has deep problems.
What are they? First of all, there are 49 million Americans who will
not get any tax break from this proposal. Who are they? They are the
Americans who are working, but they do not earn enough income to pay
income taxes. Therefore, they get no deduction. They are not paying
taxes. They are not in the 5-percent bracket. They are not in the 10-
percent bracket. They just do not earn enough to pay income taxes. So
when you talk about reducing taxes, giving rebates to those Americans
who pay taxes, those 49 million Americans who are working, who pay
payroll taxes, will get no break. Their taxes are not reduced.
I say that because the amendment strikes the whole bill. As I
understand the amendment, it takes the amount of the bill and adds it
back to taxpayers. The rebate goes to the taxpayers?
Mr. THUNE. Will the Senator yield for a clarification?
Mr. BAUCUS. I am happy to.
Mr. THUNE. I appreciate the question because I think that is one of
the arguments that have been made against a lot of the tax amendments
we have filed. This was drafted in a way so it is refundable, so all
the Americans that you are talking about would also receive that
benefit.
Mr. BAUCUS. I might say, Mr. President, reclaiming my time, this
amendment strikes the underlying bill. What about States taking people
off Medicaid, called FMAP? This bill gives about $86 billion to States
so they can keep people on Medicaid, so they are not thrown off
Medicaid. What about all the dollars in here that go to help build
roads and highways and bridges?
Earlier, I asked my colleagues to remember two figures. What were
they again--99 and 79. What is that? Just to repeat, 99 is the percent
of dollars in the Finance Committee portion of this bill that are spent
in the first 2 years; 99 percent of the whole Finance Committee bill is
spent in the first 2 years. That is CBO, and it is Joint Tax. It is
their figures. Just do the math.
The other figure I mentioned was 79--79 percent. What does 79 percent
represent? All of the dollars in the whole bill, the Finance Committee
bill and the Appropriations bill, total it all up--99 percent of the
total bill will be spent in the first 2 years; 99 percent of the
Finance Committee bill, 79 percent of the whole bill.
Next question: how efficiently are those dollars spent? I have just
established that most of the dollars, by far, are going to be spent in
the first 2 years--by far. The next question: How efficiently? To what
degree will those dollars create jobs? A day or two ago the
Congressional Budget Office released a letter that discusses the
effects of this bill on jobs, on job creation. The letter says:

For all of the categories that would be affected by the
Senate legislation, the resulting budgetary changes are
estimated to raise output [and jobs] . . . albeit by
different amounts . . . [as follows.]

What does that say? Without taking too much time, it makes it very
clear more jobs are created when we spend dollars for the purchase of
goods and services. According to CBO--that is a quote:

Direct purchases of goods and services . . . tend to have
large effects on GDP.

What tends to have less of an effect? I know it is a mantra, I know
it is ideology, but the fact is, what has less effect, to be honest
about it, is tax cuts. And the higher the income bracket, according to
CBO, the less stimulative effect on the economy.
For example, let's take AMT: 1-year tax cuts for people who pay the
alternative minimum tax. What is the stimulative effect? There is a
range. CBO does not know the exact amount, but it is a range between 10
cents on the dollar and 50 cents on the dollar. That is how much goes
out into the economy. Not very much.
What is the range for purchase of goods and services by Uncle Sam,
between $1 and $2.50; for transfers to State and local governments for
infrastructure, between $1 and $2.50; for transfers to State and local
governments not for infrastructure, between 70 cents to $1.90 on the
dollar.
Get this: unemployment benefits, between 80 cents on the dollar and
$2.20 on the dollar. Payments to persons for unemployment benefits has
a much greater stimulative effect, by far, than does reduction in
taxes. I mentioned already the effect of AMT.
My only point, it is interesting to hear what the Senator from South
Dakota is saying, and I appreciate him correcting me by saying that 49
million Americans who otherwise do not pay income tax would also get a
rebate. I am not sure the size of the rebate. I guess everybody gets
the same amount, whether you are an individual or you are married. But
we can create a lot more jobs by structuring the payment as it is in
this legislation.
A lot of time and thought has gone into it. Virtually every--I will
not say every. The bulk of economists, mainstream economists, will say
clearly that the job creation effect is much greater with
infrastructure than it is for tax cuts. You like to have tax cuts.
People like to have dollars in their pockets. But the goal is
infrastructure. It is job creation. Spend it early. I might add, I
don't know the exact percentage, but a large portion of this bill is
already tax cuts. It is large. I think it is 40 percent--40 percent of
this bill is tax cuts. I don't think all the bill should be tax cuts.
Rather, it should be spread out in a little more complicated way,
following the advice of the Baltimore Sun journalist, H.L. Menken.
The PRESIDING OFFICER. The Senator from Arizona is recognized.
Mr. McCAIN. Mr. President, I ask the manager, do we have a time
agreement on this amendment?
Mr. BAUCUS. There is no time agreement, I say to my friend.
Mr. McCAIN. Could the parties agree to a time agreement?
Mr. BAUCUS. I think we are finished on this one unless the Senator
from South Dakota wants to make some remarks.
Mr. McCAIN. I yield, Mr. President.
Mr. THUNE. Just a couple of points, if I might. I appreciate the
observations of the Senator from Montana regarding the amendment, but I
do want

[[Page S1831]]

to make a couple of corrections. One, of course, is we did apply this
in a way that it is refundable so everyone benefits from it. It is
delivered in a very straightforward way. It doesn't matter where you
are on the income scale, as long as you make under $250,000 a year. I
might add, as well, people who make above that amount, I agree,
probably are less likely to spend than are those who make under that
amount. But this was capped. Eligibility for this refund is based upon
how much you make. Your adjusted gross income has to be less than
$250,000 a year. So it is not skewed toward the rich. It does skew
toward those who are more likely to spend these dollars and put them
back into the economy.
I still believe when you start talking about over $5,000 for a single
person, over $10,000 for a couple, that is real money to most families,
and I suggest a lot of that money is going to be spent. Granted, there
will be some who will put it away and save it. As I said before, I
don't think that is necessarily a bad thing. We ought to encourage
saving, and furthermore it will help get liquidity in the banking
system. If they put half into the banks, that is $450 billion that will
go into the banking system of our country.
Just with respect to the multiplier effect--there are lots of
different analyses that have been done, spending versus tax relief. I
draw, of course, on history. If you look back, in the 1960s under
Kennedy, 1980s under Reagan, more recently under President Bush, the
impact when you reduce the marginal income tax rate, when you reduce
the taxes on investment and job creation, in most cases you get more
revenue and not less, and you also get a better return in terms of jobs
created. In fact, the President's own economist, Dr. Christina Romer,
back in March of 2007 did a study that suggested for each dollar of tax
cut, you get a 2.2 multiplier effect. In other words, for each percent
of GDP that you reduce taxes, you get 2.2 times that in terms of
economic growth.

So I simply say, again, when you are allowing American families to
keep more of what they earn, and particularly when you start talking
about the amounts that we are discussing here, and when you cap it at
$250,000 for eligibility so it is not a tax cut for the high end, for
the rich--it is for people who are actually more likely to need it, to
be able to do all the things they have to do to keep their families
going on a daily basis--and you also write it in such a way so that it
is refundable so income-tax payers on the lower end of the income scale
are also eligible for it, as the Senator from Montana noted, and it is
true--it is a very simple approach if you are going to do this--
sometimes I think the simple approach is the best approach.
Arguably, 9 pages versus 735 is in the underlying bill. It is a small
amount of ink and print by this city's standards. But it is a very
straightforward approach which I think the American people will
understand and appreciate because they are going to receive this,
rather than having this money, all this money we are going to be
borrowing from future generations, going into spending programs from
which they may not derive any benefit.
I yield the floor.
The PRESIDING OFFICER. The Senator from Montana is recognized.
Mr. BAUCUS. Mr. President, it is time to go to the next Senator. I
might say, the language of the amendment offered by the Senator from
South Dakota, the language says an eligible individual is one who has
filed a tax return. Many people who work don't file tax returns because
they don't make enough money, so a lot of people are getting left off.
Next, I suggest the Chair recognize Senator Dodd from Connecticut.
The PRESIDING OFFICER. The Senator from Connecticut is recognized.

Amendment No. 501

Mr. DODD. I see my good friend from Arizona and my friend from
Oregon. They have been patient. We debated my amendment already so I am
just going to be very brief.
Senators Conrad and Graham and I were discussing the Conrad-Graham
amendment. I talked about the alternative idea that I am proposing with
Senator Martinez and Senator Reid of Nevada, and that is to acquire in
this bill--I realize it doesn't relate to the funding in this bill--it
would require that $50 billion of TARP money that will now be allocated
be dedicated to foreclosure mitigation, including looking at the Sheila
Baird FDIC proposal, but not exclusively so. Also, as a second part of
that amendment, I suggest some alterations to the Hope For Homeowners
Program that we think would make the program far more effective than it
has been.
Despite the good intentions of its authors last summer, myself
included, it has not produced anywhere near the results we desired.
These were suggested by Treasury and others who thought it would help
make it more attractive to those in foreclosure.
At the appropriate time, myself and Senators Martinez and Reid will
offer this amendment. Again, I say to my good friend Senator Conrad and
good friend Lindsey Graham, I respect the effort they are making. I
don't think what they are talking about in the stimulus bill is
justified when we can do it out of TARP, and the money that is being
suggested should be more focused on stimulation and job creation.
For those reasons, I oppose the Conrad amendment. I remind my
colleagues this amendment that Senator Martinez and I will be offering
is the right approach for us to be taking regarding TARP funding, which
was dedicated initially, at least in part, toward foreclosure
mitigation. We are going to require it statutorily, lest there be any
doubt in the minds of those managing the program what our congressional
intention was when we passed it back late in October.
Mr. President, with that, I apologize for taking any time at all and
yield the floor.
The PRESIDING OFFICER. The Senator from Montana is recognized.
Mr. BAUCUS. I don't see Senator Enzi. He was next entitled to offer
his amendment, so I urge the Chair to recognize Senator Wyden to offer
an amendment.
Senator Enzi is on.
The PRESIDING OFFICER. The Senator from Wyoming.
Mr. McCAIN. Mr. President, I ask, again, is there a time agreement
that would be reasonable?
Mr. BAUCUS. I ask Senator Enzi if he is agreeable to, say, a 5-minute
limitation on his amendment.
Mr. ENZI. I have no problem with 5 minutes. I do not think there is
anyone in opposition. I will try and keep it under 5 minutes.
The PRESIDING OFFICER. Without objection, the Senator from Wyoming is
recognized.

Amendment No. 293, as Modified, to Amendment No. 98

Mr. ENZI. Mr. President, I call up amendment number 293, as modified.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows.

The Senator from Wyoming [Mr. Enzi] proposes an amendment
numbered 293, as modified, to amendment No. 98.

Mr. ENZI. Mr. President, I ask unanimous consent that the reading of
the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To provide for a manager's amendment)

On page 265, line 2, add at the end the following:
``community mental health center (as defined in section
1913(b)), renal dialysis facility, blood center, ambulatory
surgical center described in section 1833(i) of the Social
Security Act,''.
On page 265, line 23, strike ``means'' and insert
``includes''.
On page 266, line 2, insert ``access,'' after
``maintenance,''.
On page 270, strike lines 1 through 11, and insert the
following:
``(1) Standards.--The National Coordinator shall--
``(A) review and determine whether to endorse each
standard, implementation specification, and certification
criterion for the electronic exchange and use of health
information that is recommended by the HIT Standards
Committee under section 3003 for purposes of adoption under
section 3004;
``(B) make such determinations under subparagraph (A), and
report to the Secretary such determinations, not later than
45 days after the date the recommendation is received by the
Coordinator;
``(C) review Federal health information technology
investments to ensure that Federal health information
technology programs are meeting the objectives of the
strategic plan published under paragraph (3); and
``(D) provide comments and advice regarding specific
Federal health information technology programs, at the
request of the Office of Management and Budget.''.

[[Page S1832]]

Beginning on page 273, strike line 21, and all that follows
through line 8 on page 274, and insert the following:
``(5) Harmonization.--The Secretary may recognize an entity
or entities for the purpose of harmonizing or updating
standards and implementation specifications in order to
achieve uniform and consistent implementation of the
standards and implementation specifications.
``(6) Certification.--
``(A) In general.--The National Coordinator, in
consultation with the Director of the National Institute of
Standards and Technology, shall recognize a program or
programs for the voluntary certification of health
information technology as being in compliance with applicable
certification criteria adopted under this subtitle. Such
program shall include, as appropriate, testing of the
technology in accordance with section 14201(b) of the Health
Information Technology for Economic and Clinical Health
Act.''.
On page 276, strike lines 15 through 24, and insert the
following:
(E) Resource requirements.--The National Coordinator shall
estimate and publish resources required annually to reach the
goal of utilization of an electronic health record for each
person in the United States by 2014, including--
(i) the required level of Federal funding;
(ii) expectations for regional, State, and private
investment;
(iii) the expected contributions by volunteers to
activities for the utilization of such records; and
(iv) the resources needed to establish or expand education
programs in medical and health informatics and health
information management to train health care and information
technology students and provide a health information
technology workforce sufficient to ensure the rapid and
effective deployment and utilization of health information
technologies.
On page 277, strike lines 8 through 11, and insert the
following:
``(8) Governance for nationwide health information
network.--The National Coordinator shall implement the
recommendations made by the HIT Policy Committee regarding
the governance of the nationwide health information
network.''.
On page 282, between lines 3 and 4, insert the following:
``(vi) The use of electronic systems to ensure the
comprehensive collection of patient demographic data,
including, at a minimum, race, ethnicity, primary language,
and gender information.
``(vii) Technologies and design features that address the
needs of children and other vulnerable populations.''.
On page 283, strike lines 10 through 12, and insert the
following:
``(ix) Methods to facilitate secure access by an individual
to such individual's protected health information.
``(x) Methods, guidelines, and safeguards to facilitate
secure access to patient information by a family member,
caregiver, or guardian acting on behalf of a patient due to
age-related and other disability, cognitive impairment, or
dementia that prevents a patient from accessing the patient's
individually identifiable health information.''.
On page 283, between lines 21 and 22, insert the following:
``(4) Consistency with evaluation conducted under mippa.--
``(A) Requirement for consistency.--The HIT Policy
Committee shall ensure that recommendations made under
paragraph (2)(B)(vi) are consistent with the evaluation
conducted under section 1809(a) of the Social Security Act.
``(B) Scope.--Nothing in subparagraph (A) shall be
construed to limit the recommendations under paragraph
(2)(B)(vi) to the elements described in section 1809(a)(3) of
the Social Security Act.
``(C) Timing.--The requirement under subparagraph (A) shall
be applicable to the extent that evaluations have been
conducted under section 1809(a) of the Social Security Act,
regardless of whether the report described in subsection (b)
of such section has been submitted.''.
On page 284, strike lines 1 through 13, and insert the
following:
``(2) Membership.--The HIT Policy Committee shall be
composed of members to be appointed as follows:
``(A) One member shall be appointed by the Secretary.
``(B) One member shall be appointed by the Secretary of
Veterans Affairs who shall represent the Department of
Veterans Affairs.
``(C) One member shall be appointed by the Secretary of
Defense who shall represent the Department of Defense.
``(D) One member shall be appointed by the Majority Leader
of the Senate.
``(E) One member shall be appointed by the Minority Leader
of the Senate.
``(F) One member shall be appointed by the Speaker of the
House of Representatives.
``(G) One member shall be appointed by the Minority Leader
of the House of Representatives.
``(H) Eleven members shall be appointed by the Comptroller
General of the United States, of whom--
``(i) three members shall represent patients or consumers;
``(ii) one member shall represent health care providers;
``(iii) one member shall be from a labor organization
representing health care workers;
``(iv) one member shall have expertise in privacy and
security;
``(v) one member shall have expertise in improving the
health of vulnerable populations;
``(vi) one member shall represent health plans or other
third party payers;
``(vii) one member shall represent information technology
vendors;
``(viii) one member shall represent purchasers or
employers; and
``(ix) one member shall have expertise in health care
quality measurement and reporting.
``(3) Chairperson and vice chairperson.--The HIT Policy
Committee shall designate one member to serve as the
chairperson and one member to serve as the vice chairperson
of the Policy Committee.
``(4) National coordinator.--The National Coordinator shall
serve as a member of the HIT Policy Committee and act as a
liaison among the HIT Policy Committee, the HIT Standards
Committee, and the Federal Government.
``(5) Participation.--The members of the HIT Policy
Committee appointed under paragraph (2) shall represent a
balance among various sectors of the health care system so
that no single sector unduly influences the recommendations
of the Policy Committee.
``(6) Terms.--
``(A) In general.--The terms of the members of the HIT
Policy Committee shall be for 3 years, except that the
Comptroller General shall designate staggered terms for the
members first appointed.
``(B) Vacancies.--Any member appointed to fill a vacancy in
the membership of the HIT Policy Committee that occurs prior
to the expiration of the term for which the member's
predecessor was appointed shall be appointed only for the
remainder of that term. A member may serve after the
expiration of that member's term until a successor has been
appointed. A vacancy in the HIT Policy Committee shall be
filled in the manner in which the original appointment was
made.
``(7) Outside involvement.--The HIT Policy Committee shall
ensure an adequate opportunity for the participation of
outside advisors, including individuals with expertise in--
``(A) health information privacy and security;
``(B) improving the health of vulnerable populations;
``(C) health care quality and patient safety, including
individuals with expertise in the measurement and use of
health information technology to capture data to improve
health care quality and patient safety;
``(D) long-term care and aging services;
``(E) medical and clinical research; and
``(F) data exchange and developing health information
technology standards and new health information technology.
``(8) Quorum.--Ten members of the HIT Policy Committee
shall constitute a quorum for purposes of voting, but a
lesser number of members may meet and hold hearings.
``(9) Failure of initial appointment.--If, on the date that
is 120 days after the date of enactment of this title, an
official authorized under paragraph (2) to appoint one or
more members of the HIT Policy Committee has not appointed
the full number of members that such paragraph authorizes
such official to appoint--
``(A) the number of members that such official is
authorized to appoint shall be reduced to the number that
such official has appointed as of that date; and
``(B) the number prescribed in paragraph (8) as the quorum
shall be reduced to the smallest whole number that is greater
than one-half of the total number of members who have been
appointed as of that date.
``(10) Consideration.--The National Coordinator shall
ensure that the relevant recommendations and comments from
the National Committee on Vital and Health Statistics are
considered in the development of policies.''.
On page 287, between lines 16 and 17, insert the following:
``(5) Consideration.--The National Coordinator shall ensure
that the relevant recommendations and comments from the
National Committee on Vital and Health Statistics are
considered in the development of standards.''.
On page 288, strike lines 4 through 19 and insert the
following:
``(3) Broad participation.--There is broad participation in
the HIT Standards Committee by a variety of public and
private stakeholders, either through membership in the
Committee or through another means.
``(4) Chairperson; vice chairperson.--The HIT Standards
Committee may designate one member to serve as the
chairperson and one member to serve as the vice chairperson.
``(5) Department membership.--The Secretary shall be a
member of the HIT Standards Committee. The National
Coordinator shall act as a liaison among the HIT Standards
Committee, the HIT Policy Committee, and the Federal
Government.
``(6) Balance among sectors.--In developing the procedures
for conducting the activities of the HIT Standards Committee,
the HIT Standards Committee shall act to ensure a balance
among various sectors of the health care system so that no
single sector unduly influences the actions of the HIT
Standards Committee.
``(7) Assistance.--For the purposes of carrying out this
section, the Secretary may provide or ensure that financial
assistance is provided by the HIT Standards Committee to
defray in whole or in part any membership

[[Page S1833]]

fees or dues charged by such Committee to those consumer
advocacy groups and not for profit entities that work in the
public interest as a part of their mission.
``(d) Open and Public Process.--In providing for the
establishment of the HIT Standards Committee pursuant to
subsection (a), the Secretary shall ensure the following:
``(1) Consensus approach; open process.--The HIT Standards
Committee shall use a consensus approach and a fair and open
process to support the development, harmonization, and
recognition of standards described in subsection (a)(1).
``(2) Participation of outside advisers.--The HIT Standards
Committee shall ensure an adequate opportunity for the
participation of outside advisors, including individuals with
expertise in--
``(A) health information privacy;
``(B) health information security;
``(C) health care quality and patient safety, including
individuals with expertise in utilizing health information
technology to improve healthcare quality and patient safety;
``(D) long-term care and aging services; and
``(E) data exchange and developing health information
technology standards and new health information technology.
``(3) Open meetings.--Plenary and other regularly scheduled
formal meetings of the HIT Standards Committee (or
established subgroups thereof) shall be open to the public.
``(4) Publication of meeting notices and materials prior to
meetings.--The HIT Standards Committee shall develop and
maintain an Internet website on which it publishes, prior to
each meeting, a meeting notice, a meeting agenda, and meeting
materials.
``(5) Opportunity for public comment.--The HIT Standards
Committee shall develop a process that allows for public
comment during the process by which the Entity develops,
harmonizes, or recognizes standards and implementation
specifications.
``(e) Voluntary Consensus Standard Body.--The provisions of
section 12(d) of the National Technology Transfer and
Advancement Act of 1995 (15 U.S.C. 272 note) and the Office
of Management and Budget circular 119 shall apply to the HIT
Standards Committee.''.
On page 290, line 14, strike ``Initial Set of''.
On page 291, between lines 6 and 7, insert the following:
``(3) Subsequent standards activity.--The Secretary shall
adopt additional standards, implementation specifications,
and certification criteria as necessary and consistent with
the schedule published under section 3003(b)(2).''.
Beginning on page 293, strike line 7 and all that follows
through line 2 on page 295, and insert the following:

SEC. 3008. TRANSITIONS.

``(a) ONCHIT.--Nothing in section 3001 shall be construed
as requiring the creation of a new entity to the extent that
the Office of the National Coordinator for Health Information
Technology established pursuant to Executive Order 13335 is
consistent with the provisions of section 3001.
``(b) National EHealth Collaborative.--Nothing in sections
3002 or 3003 or this subsection shall be construed as
prohibiting the National eHealth Collaborative from modifying
its charter, duties, membership, and any other structure or
function required to be consistent with the requirements of a
voluntary consensus standards body so as to allow the
Secretary to recognize the National eHealth Collaborative as
the HIT Standards Committee.
``(c) Consistency of Recommendations.--In carrying out
section 3003(b)(1)(A), until recommendations are made by the
HIT Policy Committee, recommendations of the HIT Standards
Committee shall be consistent with the most recent
recommendations made by such AHIC Successor, Inc.''.
On page 292, strike lines 6 through 12, and insert the
following:
``(a) In General.--The National Coordinator shall support
the development and routine updating of qualified electronic
health record technology (as defined in section 3000)
consistent with subsections (b) and (c) and make available
such qualified electronic health record technology unless the
Secretary and the HIT Policy Committee determine through an
assessment that the needs and demands of providers are being
substantially and adequately met through the marketplace.''.
On page 305, strike line 5, strike ``shall coordinate'' and
insert ``may review''.
On page 320, between lines 3 and 4, insert the following:
``(10) establishing and supporting health record banking
models to further consumer-based consent models that promote
lifetime access to qualified health records, if such
activities are included in the plan described in subsection
(e), and may contain smart card functionality; and''.
On page 342, line 2, insert before the period the
following: ``in return for such payment for such offer or
maintenance''.
On page 355, line 25, insert before the period the
following: ``and the information necessary to improve patient
outcomes and to detect, prevent, and manage chronic
disease''.
Beginning on page 357, strike line 1 and all that follows
through line 12 on page 359, and insert the following:
``(1) In general.--In applying section 164.528 of title 45,
Code of Federal Regulations, in the case that a covered
entity uses or maintains an electronic health record with
respect to protected health information--
``(A) the exception under paragraph (a)(1)(i) of such
section shall not apply to disclosures through an electronic
health record made by such entity of such information; and
``(B) an individual shall have a right to receive an
accounting of disclosures described in such paragraph of such
information made by such covered entity during only the three
years prior to the date on which the accounting is requested.
``(2) Regulations.--The Secretary shall promulgate
regulations on what disclosures must be included in an
accounting referred to in paragraph (1)(A) and what
information must be collected about each such disclosure not
later than 18 months after the date on which the Secretary
adopts standards on accounting for disclosure described in
the section 3002(b)(2)(B)(iv) of the Public Health Service
Act, as added by section 13101. Such regulations shall only
require such information to be collected through an
electronic health record in a manner that takes into account
the interests of individuals in learning when their protected
health information was disclosed and to whom it was
disclosed, and the usefulness of such information to the
individual, and takes into account the administrative and
cost burden of accounting for such disclosures.
``(3) Construction.--Nothing in this subsection shall be
construed as--
``(A) requiring a covered entity to account for disclosures
of protected health information that are not made by such
covered entity; or
``(B) requiring a business associate of a covered entity to
account for disclosures of protected health information that
are not made by such business associate.
``(4) Reasonable fee.--A covered entity may impose a
reasonable fee on an individual for an accounting performed
under paragraph (1)(B). Any such fee shall not be greater
than the entity's labor costs in responding to the request.
``(5) Effective date.--
``(A) Current users of electronic records.--In the case of
a covered entity insofar as it acquired an electronic health
record as of January 1, 2009, paragraph (1) shall apply to
disclosures, with respect to protected health information,
made by the covered entity from such a record on and after
January 1, 2014.
``(B) Others.--In the case of a covered entity insofar as
it acquires an electronic health record after January 1,
2009, paragraph (1) shall apply to disclosures, with respect
to protected health information, made by the covered entity
from such record on and after the later of the following:
``(i) January 1, 2011; or
``(ii) the date that it acquires an electronic health
record.
``(C) Later date.--The Secretary may set an effective date
that is later that the date specified under subparagraph (A)
or (B) if the Secretary determines that such later date it
necessary, but in no case may the date specified under--
``(i) subparagraph (A) be later than 2018; or
``(ii) subparagraph (B) be later than 2014.''.
On page 359, line 15, strike ``shall'' and all that follows
through ``those'' on line 18, and insert the following:
``shall review and evaluate the definition of health care
operations under section 164.501 of title 45, Code of Federal
Regulations, and to the extent appropriate, eliminate by
regulation''.
On page 359, line 22, insert ``In promulgating such
regulations, the Secretary shall not require that data be de-
identified or require valid authorization for use or
disclosure for activities described in paragraph (1) of the
definition of health care operations under such section
164.501.'' after ``disclosure.''.
On page 360, line 6, insert at the end the following:
``Nothing in this subsection may be construed to supersede
any provision under subsection (e) or section 13406(a).''.
On page 361, line 2, strike ``and'' and all that follows
through ``pose'' on line 5.
On page 361, line 7, strike ``and'' and all that follows
through line 10, and insert the following: ``, subject to any
regulation that the Secretary may promulgate to prevent
protected health information from inappropriate access, use,
or disclosure.''.
On page 362, strike lines 9 through 13, and insert the
following:
(3) Regulations.--Not later than 18 months after the date
of enactment of this title, the Secretary shall promulgate
regulations to carry out this subsection. In promulgating
such regulations, the Secretary--
(A) shall evaluate the impact of restricting the exception
described in paragraph (2)(A) to require that the price
charged for the purposes described in such paragraph reflects
the costs of the preparation and transmittal of the data for
such purpose, on research or public health activities,
including those conducted by or for the use of the Food and
Drug Administration; and
(B) may further restrict the exception described in
paragraph (2)(A) to require that the price charged for the
purposes described in such paragraph reflects the costs of
the preparation and transmittal of the data for such purpose,
if the Secretary finds that such further restriction will not
impede such research or public health activities.
Beginning on page 364, strike line 1 and all that follows
through line 3 on page 365, and insert the following:

[[Page S1834]]

(2) Payment for certain communications.--A communication by
a covered entity or business associate that is described in
subparagraph (i), (ii), or (iii) of paragraph (1) of the
definition of marketing in section 164.501 of title 45, Code
of Federal Regulations, shall not be considered a health care
operation for purposes of subpart E of part 164 of title 45,
Code of Federal Regulations if the covered entity receives or
has received direct or indirect payment in exchange for
making such communication, except where--
(A) such communication describes only a health care item or
service that has previously been prescribed for or
administered to the recipient of the communication, or a
family member of such recipient;
(B) each of the following conditions apply--
(i) the communication is made by the covered entity; and
(ii) the covered entity making such communication obtains
from the recipient of the communication, in accordance with
section 164.508 of title 45, Code of Federal Regulations, a
valid authorization (as described in paragraph (b) of such
section) with respect to such communication; or
(C) each of the following conditions apply--
(i) the communication is made on behalf of the covered
entity;
(ii) the communication is consistent with the written
contract (or other written arrangement described in section
164.502(e)(2) of such title) between such business associate
and covered entity; and
(iii) the business associate making such communication, or
the covered entity on behalf of which the communication is
made, obtains from the recipient of the communication, in
accordance with section 164.508 of title 45, Code of Federal
Regulations, a valid authorization (as described in paragraph
(b) of such section) with respect to such communication.
On page 365, strike lines 4 through 7.
On page 369, lines 10 and 11, strike ``Secretary of Health
and Human Services shall'' and insert ``the Federal Trade
Commission shall, in accordance with section 553 of title 5,
United States Code,''.
On page 390, after line 21, insert the following:
(e) Report Required.--Not later than 1 year after the date
of enactment of this section, the Government Accountability
Office shall submit to Congress and the Secretary of Health
and Human Services a report on the impact of any of the
provisions of, or amendments made by, this division or
division B that are related to the Health Insurance
Portability and Accountability Act of 1996 and section 552a
of title 5, United States Code, on health insurance premiums
and overall health care costs.

Mr. ENZI. This is an extremely important bill for the section that
deals with Health IT. Senator Kennedy and I have been working on that
for 3 years as well as many others in this Chamber. If we are going to
have health care in this country that improves, we are going to have to
have Health IT, and I think everybody realizes that.
We have tried to come up with a mechanism for getting
interoperability. We have had good success on that without being able
to get the bill passed that we have been working on for 3 years.
But there is a provision that moves Health IT along in this bill, but
it needed some modifications so it actually would work. I am ever so
pleased people on both sides of the aisle, particularly Senators
Baucus, Kennedy, and Grassley, have helped and worked on this. The
reason there had to be a modification was a little while ago we were
able to clear up one more difficulty in that bill.
Without this, it will not work well. There are still other things
that ought to be done with it. There are still other things I would
like to have with Health IT. There are some things in there that I
would not like to have. But this is the part we were able to get
agreement on in order to make it work a lot better.
The Certification Commission for Health IT, or CCHIT, has done a lot
of great work to accelerate the adoption of health IT by creating a
credible, efficient certification process. Many companies have already
begun voluntarily participating in the certification process. This
system is working and is putting us on the right path to
interoperability. Unfortunately, CCHIT is concerned certain details of
the underlying bill will cause an ``unintended slowdown in the adoption
of health IT''. This amendment allows CCHIT to continue their current
mission without changing their priorities. CCHIT sent me a letter
stating ``the amended language makes the path forward much clearer, and
will build on current health IT momentum rather than disrupting it''.
This amendment puts the standards section back on the right track by
building upon the progress of Secretary Leavitt and the Bush
administration. Secretary Leavitt worked tirelessly to create the
American Health Information Community, AHIC, a public-private
partnership designed to ensure the Government and the private sector
could work together on interoperability standards. Under Secretary
Leavitt's leadership, the AHIC recently transitioned into the National
eHealth Collaborative, a voluntary consensus standards body.
I strongly support the collaborative and I want to ensure it is able
to continue. The bill before the Senate, however, threatens to ``take''
the assets of the collaborative and nationalize the collaborative. My
amendment prevents that from happening. I have been working with the
leaders of the collaborative and they ``strongly support my proposed
amendment''.
The amendment will also ensure that Federal investments in IT comply
with technology standards harmonized by the Healthcare Information
Technology Standards Panel and certified by the Certification
Commission for Health IT, and at a minimum this bill should accelerate
the work of those two entities rather than delay it.
My amendment also makes other changes that were included in the
bipartisan ``Wired for Health Care Quality Act'' that were left out of
the bill before us today. Those changes include making sure the
membership of the Health IT Standards Committee and the Health IT
Policy Committee is balanced so that no single sector of the health
care industry influences the actions of the committees. The amendment
also specifies an appointment process for the HIT Policy Committee and
adds back a lot of the other ``good government'' provisions that were
included in the ``Wired Act'' but left out of this bill.
In order for health IT to achieve this potential, however, it must be
done right. It must be interoperable, and the standards of
interoperability should be defined by standards developed by all the
stakeholders. Consensus will help prevent Government bureaucrats from
mandating the equivalent of Beta Max standards in a VHS world, while
assuring doctors and hospitals that their IT purchases will not be like
investing in compact discs the day before iTunes launched.
I strongly believe all of these changes are critical to ensuring we
don't backtrack on the progress we have made. I want to be clear
though, I would have preferred to continue working with the other bill
authors of the Wired for Health Care Quality Act. The ``Wired Act''
took a much more fiscally sustainable approach with regard to
responsibly funding health IT for providers experiencing financial
hardship. The Congressional Budget Office has estimated 90 percent of
providers will adopt health IT by 2030 without spending any Federal
dollars. This bill spends roughly 28 billion in hard-earned taxpayer's
dollars to achieve that same 90 percent adoption rate, a few years
earlier. This is not a wise use of the taxpayer's dollars and I do not
support these provisions.
I feel the ``Wired Act'' also did a better job balancing patient
privacy with proper access to health information. If information is
wrapped up in so much red tape that doctors and their staff are not
able to access it when they need it, patients will suffer and costs
will increase. It will take time and hard work, but we must find the
right balance so patient care does not suffer.
In closing, I would like urge all members to support this amendment.
I have been working on this amendment with members from both sides of
the aisle and I believe it reflects a bipartisan agreement. We need to
make sure we continue the progress we have made rather than backtrack.
The PRESIDING OFFICER. The Senator from Montana is recognized.
Mr. BAUCUS. I ask the Chair now to recognize Senator Wyden.
The PRESIDING OFFICER. The Senator from Oregon.

Amendment No. 468 to Amendment No. 98

(Purpose: To require financial institutions receiving TARP assistance
to redeem from the United States preferred stock in an amount equal to
excess bonuses for 2009 or to pay a 35 percent tax on such amount)

Mr. WYDEN. Mr. President, I ask unanimous consent to call up
amendment No. 468.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

[[Page S1835]]

The Senator from Oregon [Mr. Wyden], for himself, Ms.
Snowe, and Mrs. Lincoln, proposes an amendment numbered 468
to amendment No. 98.

The amendment is as follows:

At the end of title I of division B, insert the following:

SEC. 1903. TREATMENT OF EXCESSIVE BONUSES BY TARP RECIPIENTS.

(a) In General.--If, before the date of enactment of this
Act, the preferred stock of a financial institution was
purchased by the Government using funds provided under the
Troubled Asset Relief Program established pursuant to the
Emergency Economic Stabilization Act of 2008, then,
notwithstanding any otherwise applicable restriction on the
redeemability of such preferred stock, such financial
institution shall redeem an amount of such preferred stock
equal to the aggregate amount of all excessive bonuses paid
or payable to all covered individuals.
(b) Timing.--Each financial institution described in
subsection (a) shall comply with the requirements of
subsection (a)--
(1) not later than 120 days after the date of enactment of
this Act, with respect to excessive bonuses (or portions
thereof) paid before the date of enactment of this Act; and
(2) not later than the day before an excessive bonus (or
portion thereof) is paid, with respect to any excessive bonus
(or portion thereof) paid on or after the date of enactment
of this Act.
(c) Definitions.--As used in this section, the following
definitions shall apply:
(1) Excessive bonus.--
(A) In general.--The term ``excessive bonus'' means the
portion of the applicable bonus payments made to a covered
individual in excess of $100,000.
(B) Applicable bonus payments.--
(i) In general.--The term ``applicable bonus payment''
means any bonus payment to a covered individual--

(I) which is paid or payable by reason of services
performed by such individual in a taxable year of the
financial institution (or any member of a controlled group
described in subparagraph (D)) ending in 2008, and
(II) the amount of which was first communicated to such
individual during the period beginning on January 1, 2008,
and ending January 31, 2009, or was based on a resolution of
the board of directors of such institution that was adopted
before the end of such taxable year.

(ii) Certain payments and conditions disregarded.--In
determining whether a bonus payment is described in clause
(i)(I)--

(I) a bonus payment that relates to services performed in
any taxable year before the taxable year described in such
clause and that is wholly or partially contingent on the
performance of services in the taxable year so described
shall be disregarded, and
(II) any condition on a bonus payment for services
performed in the taxable year so described that the employee
perform services in taxable years after the taxable year so
described shall be disregarded.

(C) Bonus payment.--The term ``bonus payment'' means any
payment which--
(i) is a discretionary payment to a covered individual by a
financial institution (or any member of a controlled group
described in subparagraph (D)) for services rendered,
(ii) is in addition to any amount payable to such
individual for services performed by such individual at a
regular hourly, daily, weekly, monthly, or similar periodic
rate, and
(iii) is paid or payable in cash or other property other
than--

(I) stock in such institution or member, or
(II) an interest in a troubled asset (within the meaning of
the Emergency Economic Stabilization Act of 2008) held
directly or indirectly by such institution or member.

Such term does not include payments to an employee as
commissions, welfare and fringe benefits, or expense
reimbursements.
(D) Covered individual.--The term ``covered individual''
means, with respect to any financial institution, any
director or officer or other employee of such financial
institution or of any member of a controlled group of
corporations (within the meaning of section 52(a) of the
Internal Revenue Code of 1986) that includes such financial
institution.
(2) Financial institution.--The term ``financial
institution'' has the same meaning as in section 3 of the
Emergency Economic Stabilization Act of 2008 (12 U.S.C.
5252).
(d) Excise Tax on TARP Companies That Fail to Redeem
Certain Securities From United States.--
(1) In general.--Chapter 46 of the Internal Revenue Code of
1986 (relating to excise tax on golden parachute payments) is
amended by adding at the end the following new section:

``SEC. 4999A. FAILURE TO REDEEM CERTAIN SECURITIES FROM
UNITED STATES.

``(a) Imposition of Tax.--There is hereby imposed a tax on
any financial institution which--
``(1) is required to redeem an amount of its preferred
stock from the United States pursuant to section 1903(a) of
the American Recovery and Reinvestment Tax Act of 2009, and
``(2) fails to redeem all or any portion of such amount
within the period prescribed for such redemption.
``(b) Amount of Tax.--The amount of the tax imposed by
subsection (a) shall be equal to 35 percent of the amount
which the financial institution failed to redeem within the
time prescribed under 1903(b) of the American Recovery and
Reinvestment Tax Act of 2009.
``(c) Administrative Provisions.--
``(1) In general.--For purposes of subtitle F, any tax
imposed by this section shall be treated as a tax imposed by
subtitle A for the taxable year in which a deduction is
allowed for any excessive bonus with respect to which the
redemption described in subsection (a)(1) is required to be
made.
``(2) Extension of time.--The due date for payment of tax
imposed by this section shall in no event be earlier than the
150th day following the date of the enactment of this
section.''.
(2) Conforming amendments.--
(A) The heading for chapter 46 of such Code are amended to
read as follows:

``Chapter 46-Taxes on Certain Excessive Remuneration

``Sec. 4999. Golden parachute payments.
``Sec. 4999A. Failure to redeem certain securities from United
States.''.

(B) The item relating to chapter 46 in the table of
chapters for subtitle D of such Code is amended to read as
follows:

``Chapter 46. Taxes on excessive remuneration.''.

(3) Effective date.--The amendments made by this subsection
shall apply to failures described in section 4999A(a)(2) of
the Internal Revenue Code of 1986 occurring after the date of
the enactment of this Act.

Mr. WYDEN. Mr. President, Senators are working to limit the cost of
the stimulus legislation. This bipartisan amendment that I offer with
Senator Snowe and Senator Lincoln, holds down the cost of the stimulus
legislation by bringing back to the taxpayers billions and billions of
dollars.
This amendment provides a way to quickly return to taxpayers much of
the $18 billion that has been paid out in excessive bonuses to
companies under the Troubled Asset Relief Program.
Americans were horrified recently to learn that Citigroup and others
that had received extensive Federal support had paid out billions of
dollars in excessive bonuses. This bipartisan amendment makes it clear
it is not enough to say the excessive Wall Street bonuses were wrong,
it makes clear they have to be paid back.
Our amendment gives those companies that receive Federal bailout
money and pay the unjustified large bonuses a choice: Pay back the cash
portion of any bonus paid in excess of $100,000 within 120 days of the
amendment's enactment, or pay an excise tax of 35 percent on what is
not returned to the Treasury.
The money can be repaid by the financial firms buying back the
preferred stock the Federal Government owns in these companies or in
any other fashion the institution chooses.
Senator Snowe, Senator Lincoln, and I have received extensive legal
analysis with respect to this amendment. It is clear our approach
passes constitutional muster. Recently, I had printed in the Record a
letter to me from Edward Kleinbard, head of the Joint Committee on
Taxation, on this matter.
I also wish to thank Mr. Kleinbard and his very professional staff
for their analysis of this legislation. No other bipartisan bill
proposed in either this body or the other body would force the
repayment of these bonuses and actually protect the taxpayer. This
amendment has real teeth, and it is supported by colleagues on both
sides of the aisle.
Let me close by saying, first, I wish to thank the distinguished
chairman of the Finance Committee and our wonderful staff. They have
been so gracious, as always, to assist me on this. I would close by
saying I think the President summed it up. The President said these
bonuses ``were shameful.'' Now it is time for us to do our job and pass
legislation with teeth that requires that these bonuses are repaid and
the taxpayers are protected.
I urge my colleagues to join Senator Snowe, Senator Lincoln, and
myself in supporting a bipartisan approach in this area. It is
particularly relevant this afternoon.
I see my colleague and friend, a former chair, Senator McCain on the
floor. He has done yeoman's work in terms of blowing the whistle for
unjustifiable Federal spending. This is a bipartisan way, colleagues,
to hold down the cost of the stimulus legislation.
I ask unanimous consent that amendment No. 468 be made pending. I
know of no opposition at this point. No colleague has spoken in
opposition and urge my colleagues to approve it. My sense is, it can
probably be done on a voice vote.
I yield the floor.
The PRESIDING OFFICER. The amendment is pending.

[[Page S1836]]

The Senator from Montana is recognized.
Mr. BAUCUS. Mr. President, I think that concludes all the amendments
on the list. We are now awaiting an attempt to drop a unanimous consent
request so we can start voting on those amendments. That is in the
process right now. Pending the completion of that list, it is probably
advisable that we keep the Senate open for debate equally divided until
the hour of 5 o'clock.
If we get the consent agreed to before then, we can ask to vitiate
that agreement where debate be allocated equally so we can propound the
other consent.
I ask unanimous consent that the time until 5 o'clock be time
available for debate only, equally divided.
The PRESIDING OFFICER. Is there objection?
Mr. McCAIN. Mr. President, reserving the right to object, I probably
will not object, if I understand the Senator from Montana, we most
likely will have a vote about 5 o'clock.
Mr. BAUCUS. We will try to.
Mr. McCAIN. I have no objection.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Alabama is recognized.
Mr. SESSIONS. Mr. President, I wish to share a few thoughts about
where we are. The enormity of the legislation that is before us can
hardly be comprehended. The bill, with interest, scored by the
Congressional Budget Office, is $1.25 trillion. That is more than twice
as much as the 5-year Iraq war has cost. It is the largest expenditure
in the history of this country or any country in the history of the
world.
Remember, we have a big budget. We are spending a lot of money, too
much money, most people think, in our normal budget. Every penny of
this money is debt. We do not have the money to pay for it. We already
are in deficit. This increases the size of that deficit.
It increases the interest we will have to pay on it. I would note the
Congressional Budget Office, which is our nonpartisan group, hired a
new Director--the Democrats have a majority, but it is a bipartisan
selection, so, of course, he is approved by everybody, a good leader.
Their numbers show the interest on the debt today, this year, will be
$195 billion. We are very fortunate because low interest rates, in the
very short term, are out there today. But by 2014, when you add the
stimulus package into that, we will be looking at a deficit of $440
billion each year and thereafter. It could be higher if interest rates
go higher. That is the equivalent each year of the Iraq war, for
example--almost.
This is how big the numbers are. I think the American people
understand what is happening. They are very uneasy. I talked to my 90-
year-old shut-in aunt a little earlier today. She said: Who do they
think is going to pay that money back? That is a pretty good question,
is it not?
Let me give perspective to my colleagues on how big and how dangerous
a condition our economy is in. These are numbers that are important.
Back in 2004, that is when we had the largest deficit ever, after 9/11,
after the Iraq efforts and the slowdown in the economy, it hit $413
billion.
President Bush was roundly criticized by members of this body, many
on the other side who are supporting this trillion-dollar bill, for
allowing the deficit to go to $413 billion. That was 3.6 percent of the
total gross domestic product in America, to give some perspective. But
we whittled it down a little bit. In 2005, it dropped to $318 billion;
in 2006, $248; and in 2007, the year before last, the budget deficit
fell to $161 billion.
I am a member of the Budget Committee. I kept an eye on that. I felt
like we were going in the right direction. I thought we were. It was
1.2 percent of GDP. I felt the deficit was heading in the right
direction. We were not there, but I was pleased.
Then, last year about this time, President Bush decided we were
heading into economic troubled waters and that we should stimulate the
economy. They came up with an idea to send everybody a check. I am sure
most people enjoyed receiving their checks. They went out, though, and
it cost us over $150 billion right there.
It was all debt because, see, we were already in deficit. It just
about doubled the deficit to $455 billion last year. Now, this is what
the Congressional Budget Office says the deficit will be this year,
when we complete the fiscal year, September 30, how much it is going to
be for 2009.
Well, the numbers--you can see what a dramatic thing it is--total
$1.4 trillion, almost three times as much as the largest debt we have
ever had in the history of the Republic.
Now, this is scoring about $200 billion-plus, a little over $200
billion out of the financial bailout, that $700 billion. They are
saying that will be lost during this period of time.
We will lose that much on that. They are scoring money for Freddie
and Fannie, bailing out those institutions that helped get us in this
fix. Add this gray area down here, this is the stimulus. They are
projecting out of the trillion dollars we would have 232 sent this
year. The Freddie and Fannie and the Wall Street bailout, the $700
billion, they are scoring right now as a one-time cost. The next year,
with those one-time costs out, we are still over a trillion, $1.16,
almost $1.2 trillion. These are huge numbers, and they impact us so
severely. They will burden us forever, and we are not going to pay this
back. We are just going to borrow the money and pay the interest on it.
There is no way in our expectation that we will get the money to pay
this debt back.
Therefore, we should listen to what the Congressional Budget Office
wrote. They conclude that the effects of this legislation would
``diminish rapidly after 2010.'' They say that over the 10-year period,
the stimulus package ``would be a net negative to the economy.'' They
say that the gross domestic product over 10 years will be less if we
pass this bill than if we don't.
We all want to do the right thing. I had a feeling that this was not
good legislation in the long run. That is why I have been opposed to
it. People I respect questioned it. Now we have our own independent
Congressional Budget Office issuing a report yesterday, saying that
over 10 years, already, we would be hurt by the legislation more than
benefited. Then think about the next 10 years or the next 10 years or
the next 10 years. A lot of people living today will still be alive 30
years from now. I probably won't be one of them. But I will just say
that they are going to be feeling the negative pressure of the interest
burden every year for as long as we can foresee. It portends dangerous
times.
Where does the money come from that will pay this debt? That is what
an interesting article in the Wall Street Journal today, written by
George Melloan, asked:

Where does the money come from?
He goes on:

That might seem like a no-brainer, which perhaps explains
why no one has bothered to ask.

He makes the point that right now we have low interest rates. He then
says:

Congress is able to assure itself that it will finance the
stimulus with cheap credit. But how long will credit be
cheap? Will it still be when the Treasury is scrounging
around in the international credit markets six months or a
year from now? That seems highly unlikely.

Senator Conrad, chairman of the Budget Committee, a fine Member of
the Senate, really worried about the debt, a Democratic leader and a
fine leader in the Senate, passed out an article in the Budget
Committee the week before last from the New York Times.
The PRESIDING OFFICER. The time of the Senator has expired.
Mr. SESSIONS. I ask unanimous consent for 30 more seconds.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. SESSIONS. The article said that China's trade surplus with the
United States had dropped from $50 billion a month to $20 billion a
month. They are going to spend more on their own economy. The question
is, How could they buy more and more and more of our debt, even if they
wanted to, when they don't have the money to do so? It portends higher
interest rates, as Mr. Melloan wrote.
I yield the floor.

[[Page S1837]]

The PRESIDING OFFICER. The Senator from Louisiana.
Ms. LANDRIEU. While we had a lull in the offering of amendments, I
thought I would come to the floor and speak about two amendments I
would like to have considered later on this evening as we continue with
this debate on this important bill. First let me say that there are
some really exciting opportunities in this bill to move our country
forward, to give people hope and confidence that this Government
finally, after many years of inaction and negligence, is ready to act
and try to be as focused as possible on creating and sustaining jobs,
strengthening our financial sector, and thawing the capital markets,
not just for what it means to Americans but for the world.
A group of us have been trying through the week to reach out to
Members on the other side and to live up to the call of the new
President to try to build this bill from the center, to try to build
common ground, to open dialog, to try to reach some accommodation so we
can do this together. I have found in my time in the Senate that some
of the best things that have been accomplished have been accomplished
in that way.
I wanted to speak for a minute and publicly thank Senator Nelson for
his leadership, the Senator from Nebraska, who has worked so very hard
on this. I would like to also mention others who have been part of this
effort--Senator Bayh and Senator Tester, Senator Lincoln, Senator Webb,
some of the new Senators who have joined us, Senators who have now
several terms of experience, Senator Carper, Senator Begich from
Alaska, and others, Senator McCaskill. I have been part of this group
as well, working to try to forge some common ground.
When this bill came out of the Senate Appropriations Committee--and I
am a member of that committee--we were told that there could be some
work done on the floor to improve it. Our group took that to heart and
said: Could we trim out some of the fat, add in some muscle, add in
some focus, and reach out to the other side?
There were Republicans who voted for the bill in committee. The
ranking member, Thad Cochran, gave support to the chairman, Senator
Inouye, and said: I am moving this bill forward in an effort to see if
we can improve it.
We have made some significant improvements on the floor over the last
week. It has been tough--late nights, early mornings--but we are going
to continue that work. I am proud of the work of this centrist group,
which is getting larger, not smaller, Members who come from the east
coast and the west, the South and the Midwest, across geographic
bounds, working with Members on the other side. The Senators from Maine
have been particularly helpful, both on Appropriations and Finance.
There have been other Senators I have enjoyed working with on many
issues, whether it is coastal issues or Corps of Engineers issues.
Hopefully, this centrist group will come together.
Unfortunately, there are a few Members--and maybe a few too many on
this floor--who, no matter what showed up, no matter if it was the
perfect bill, would still say no because they don't want to move
forward. I hope that a majority of us would heed the President's call
and pull together and try our very best to move this debate forward.
In the last minute and a half I have, I want to mention two things
that could slightly improve. Again, there are some good things in this
underlying bill, but I still think we need to cut out a great deal.
Hopefully, we can come to some arrangement. It needs to be a
substantial adjustment so that we can take out some fat and add some
muscle. As we are adding some muscle, I suggest that we add some
infrastructure funding in a broader array.
We all think highways are a great way to get people back to work,
invest in brick and mortar and highways. But we also think that about
revolving-loan funds, particularly for smaller cities and parishes and
counties in other States, parishes in Louisiana--we have a huge
backlog--waterways. And this is what I want to stress for the last
minute or so.
I realize when you poll, highways always poll very high because we
are always on them, roads and highways. In some parts of the country,
mass transit and high-speed rail will poll well, particularly on the
northeast corridor, because a lot of people ride trains.
But I come from a place where there is a lot of water. Where I come
from, there are levees. Sometimes they hold and sometimes they don't.
But not many people get on the other side of those levees, so they
don't always see these waterways that make our commerce move, that
support the manufacturing base and the business base of this country.
Sometimes we forget that we need to invest in not just highways and not
just rail, which is very important, but also our waterways. That is why
I have an amendment pending that will add a billion dollars to the
Corps of Engineers for restoration and water projects. I hope we can
take that up.
I commend Byron Dorgan, the chairman of our committee, for adding
$4.6 billion because there was nothing in the bill when it started, and
not just for Louisiana but for Illinois, for Washington State, for
Florida. These ports, inland waterways, are very important. There is a
backlog of $61 billion. I know there is about $15 to $20 billion in the
pipeline, but there is $61 billion in backlog. I think adding a little
bit more for the Corps of Engineers and restoration projects for the
Great Lakes, for the Gulf of Mexico, and for other areas would be
important.
I also think it is not just hiring welders and carpenters and
construction managers that is important, but some of our Members have
said we should invest in the National Science Foundation because hiring
a scientist is a good thing to build a new experiment or to build a new
way. It is not just building brick and mortar. So the National Science
Foundation, in my view, is very much part of the new infrastructure of
America because it is not just about steel and concrete and
shipbuilding and fabrication. The new infrastructure is also about
intellectual property, and it is also about strengthening our
scientific investments.
Our group feels that a broader infrastructure piece that would not
only be about highways but about waterways, about high-speed rail,
about investing in the scientific base of our country would be an
important investment to make.
I know my 5 minutes has passed. I know we have a vote at about 5
o'clock. I look forward to working with my colleagues in a team spirit
to see if, as we progress, one or two of these amendments could be
offered.
I thank the Chair and suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. McCAIN. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Arizona.
Mr. McCAIN. Mr. President, there are some procedural situations on
the other side of the aisle, and I understand that, and I will
certainly be patient while those are resolved. I would just like to say
we have been following a procedure today that seems to be largely
satisfactory to most Members: that we consider a body of amendments
that are considered and then voted on en bloc or as a series. I hope we
would be able to continue that. There are, I believe, eight pending
amendments. We could vote on those and then move on to other
amendments. It is a procedure we have been following throughout the
day. I hope we continue it and continue to make progress on the bill.
So I note the Senator from Montana is not on the floor, nor is
leadership. But I hope the leadership would come out soon and give us
an idea as to what the plans are for the remainder of the evening and
tomorrow.
Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. BROWNBACK. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BROWNBACK. Mr. President, I wish to make a few comments based
upon the hearing we had this morning----

[[Page S1838]]

Mr. MENENDEZ. Mr. President, will my colleague from Kansas yield for
just a moment?
Mr. BROWNBACK. Sorry?
Mr. MENENDEZ. Will my colleague from Kansas yield for a moment?
Mr. BROWNBACK. Yield for what?
Mr. MENENDEZ. For a unanimous consent request.
Mr. BROWNBACK. Yes, I will be happy to.
Mr. MENENDEZ. Mr. President, I ask unanimous consent that the time
from now until 5:30 be for general debate purposes only and that it be
evenly divided.
The PRESIDING OFFICER. Is there objection?
The Senator from Montana.
Mr. BAUCUS. Mr. President, I suggest the absence of a quorum.
Mr. BROWNBACK. Mr. President, I believe I have the floor.
The PRESIDING OFFICER. The Senator from Kansas has the floor.
Mr. BROWNBACK. Mr. President, as I was stating----
Mr. BAUCUS. Mr. President, might I ask the Senator from Kansas, how
long do you wish to speak?
Mr. BROWNBACK. Probably less than 10 minutes.
Mr. BAUCUS. OK. Thank you. Fine.
Mr. BROWNBACK. Mr. President, as I was mentioning, we had a hearing
in the Joint Economic Committee this morning on Bureau of Labor
Statistics numbers for this past month of January. They are not good,
obviously. There are nearly 600,000 job losses taking place. What has
happened up until about 3 months ago--the crisis was centered in
housing, primarily, as everybody knows. Then it spread out to the rest
of the economy. Then we have seen that spread out, make more impact,
now getting to unemployment rates that have been rising substantially
during those past 3 months.
Obviously, the economy is ailing. Everybody knows that. American
families are suffering. But there are two things I want to bring out
from this study that I think are a little bit different, and I hope my
colleagues are watching these particular items.
There are two sectors in the economy that are still producing jobs.
It is in health care, and it is in education. Obviously, we wish they
were producing more jobs in those sectors, but the point of the matter
they were making and saying is that these two sectors are doing well
without stimulus. They are continuing to move on forward.
It would be my hope that as people move forward on this process in
the stimulus bill, we would say: Let's target in and focus on the areas
that are not creating jobs, that have lost a huge number of jobs, and
target much more of our effort there rather than in areas such as
health care and education that have continued to produce jobs.
The auto industry--Senator Mikulski and I had an amendment that was
adopted that, if this gets to conference, I would hope would be
maintained in conference, of taking interest on a new car purchase in
2009 and allowing that interest to be tax deductible. That would be
something that would stimulate a sector of the economy that is
obviously in great trouble. And while we have limited resources, we
need to target it to areas that have difficulty and not areas that are
doing relatively well compared to the rest of the economy and do not
need stimulus, areas that are performing and look as if they are going
to be able to continue to perform. So with the limited resources we
have, we have to target and get into those areas that actually need to
be stimulated and stimulate the economy in those zones.
I was just reading an article on the front page of the New York Times
today. They were talking about Japan's lost decade that a number of
people have cited with pretty extensive writing: infrastructure
projects that did not produce yield, and then they were left with 10
years of pretty radical Government spending and not much to show for
it; and only with global economic activity picking up did the Japanese
economy pick up out of that, and then they were left with this towering
debt.
Point No. 1 on this issue is that for those sectors performing
relatively well--although not great--let's take those stimulus dollars
and focus them into areas that are not performing, like in the auto
industry or in housing, which is where this started. I think that is a
great point we need to do.
The second point on this--we just put out a paper on this on the
Republican side of the Joint Economic Committee--is that we need a
stimulus, and we need it to be a stimulus, and we need to have some
criteria of stimulus. A number of people have studied this and looked
at past experiences in this country and other places, and I would
simply ask my colleagues, let's make sure to put all of those proposals
through a stimulus grid and ask, does it actually produce stimulus,
does it actually create jobs, and not have a multiple set of targets
taking place of, well, OK, we want to do this in the energy field, we
want to do this in the environment field, we want to do this in other
fields. All of these are fine objectives, but right now the economy is
in this crisis situation, and that is what we have to have as a laser
focus.
I have seen too many times around here where we get a multiple set of
targets and we do not hit any of them very well. We have one target: We
have to get the economy going again. We have one job, and we probably
have one bullet the size we are talking about with this one. We can
only hit one target with this, and we need to hit that target.
In looking at these tax multipliers, President Obama's Chair of the
Council of Economic Advisers has done studies on this and found that
the tax multiplier from tax cuts is nearly 3 to 1--every $1 of tax cuts
producing $3 of GDP activity. I have other papers--and I am going to
submit those for the Record--showing the efforts for stimulus packages
that are focused on Government spending have as low a yield as $0.33
per $1 of economic activity spent on them. We cannot at all afford to
have that low of a yield on a Government spending package. We have this
from studies from Robert Hall of Stanford and Susan Woodward, the chair
of Sand Hill Econometrics, and a Harvard study by Robert Barro, showing
a multiplier of 0.8 in some of the Government spending.
My point in saying all this is I think there is a stimulus package to
be had out there that has 75, 80 votes for it from the Senate. I think
we have to slow up and get that package that gets that number of votes
and have one criteria for it: Does it stimulate the economy? And if it
does not have a multiplier of at least 1.5--I think it should be 2, but
if it does not have a multiplier of at least 1.5, we should not be
doing it because what if we are 6 months down the road and this spreads
into another sector or we have more banking problems, and you need
resources again, and you have already piled up this level of debt, and
you are going to add more to it, and you do not have another bullet in
the chamber to be able to do it?
A simple taking of a couple more weeks to get this hit on the
target--it is far more important that we hit the target, that we have 2
or 3 more weeks to target in on it. We have good models, and there is
good will to do this. The pleas from these hearings we had this morning
on the unemployment rate say we have to hit the targets and the sectors
that need it, not the targets and the sectors that do not need it as
much as in some of these manufacturing pieces and some of the
construction pieces that are there.
Our economy is ailing, American families are suffering. They are
looking to us to help get the economy moving again without dooming
future generations to decades of economic stagnation and decreased
opportunity. Just like the patient who counts on his doctor to
prescribe the right medication when he is ill, the American people are
counting on us to deliver the right medicine--medicine that will help
the economy recover.
I am concerned that we are on the verge of prescribing the wrong
medicine for the economy. The medicine we are on the verge of
prescribing--a permanent and significant increase in the size of
government--may well leave our economy buried under a mountain of debt
with no appreciable impact on improving the long-term health of our
economy and little actual short-term ``stimulus.''
Time and again during this debate, Members of this body have taken to
this floor to proclaim that tax cuts don't stimulate the economy and
create jobs. We have been told that spending is more effective at
stimulating

[[Page S1839]]

economic growth than reducing tax burdens as though that were settled
economic fact.
However, the multipliers cited are more the result of how the macro
models are constructed than they are from any statistical analysis of
the data. These models are built upon the assumption that spending by
the Government is more effective in stimulating the economy than tax
relief to individuals and their families. When you construct an
economic model with assumptions that ensure large multiplier effects
from Government spending--guess what--you get large effects from
Government spending: multiplier in, by assumption, multiplier out.
But the consumer doesn't necessarily march to the tune of an
``omniscient government,'' and might save some of the money instead of
spending it all. Well, if we think that an American family might save
half of any relief we give them, why not double the amount we give them
and get the type of multiplier effects we want. Let the American
people, and not the Government, choose. I have a basic problem with the
basic notion that the Government is a better allocator of resources
than American families. Yet, we hear these multipliers bandied about as
though they represented settled economic fact.
That simply is not the case. In fact, there is a good deal of recent
economic research that analyzes data as opposed to building models on
Keynesian assumptions.
I want to briefly cite a couple of examples of that research--
research that looks at historical data and experience, not results
produced by theoretical models of the economy.
First, and some of my colleagues have alluded to this, Christina
Romer, President Obama's Chair of the Council of Economic Advisors and
her husband, David Romer of the University of California at Berkeley,
found a tax multiplier of about three--a dollar of tax cut raises the
gross domestic product, GDP, by about three dollars.
In a recent paper published by the National Bureau of Economic
Research, Andrew Mountford of the University of London and Harald Uhlig
of the University of Chicago, evaluated the effectiveness of three
policy options. Let me quote from their findings:

We find that deficit-financed tax cuts work best among
these three scenarios to improve GDP, with a maximal . . .
multiplier of five dollars of total additional GDP per each
dollar of the total cut in government revenue five years
after the shock.

They found a maximal multiplier of 5.33 after 14 quarters for a
deficit-financed tax cut. What did they find the maximum result of
deficit-financed Government spending was? Mr. President, 0.65-- after
one quarter.
Robert Hall of Stanford and Susan Woodward, the chair of Sand Hill
Econometrics, find a general Government spending multiplier of about
one. Robert Barro of Harvard recently noted in the Wall Street Journal
that his research showed a 0.8 multiplier for war-time spending. When
he attempted to estimate directly the multiplier associated with
peacetime Government spending, he got a number insignificantly
different from zero.
While the other side is fond of criticizing the 2001 and 2003 tax
cuts, they often forget that they produced revenues that were greater
than estimated by CBO before they were passed. There is no question
that private investment and the jobs market improved dramatically and
quickly after the passage of the 2003 tax cuts. Capital repatriated to
this country from abroad skyrocketed when we had a 1-year reduction in
the tax on earnings brought back to this country from abroad.
I want to impress upon my colleagues that these multipliers that are
cited to support broad increases in spending are not supported by much
solid academic research. They are supported by models whose assumptions
largely drive the result.
Now I want to turn briefly to one aspect of this spending bill that
needs some emphasis. The proponents talk about creating jobs. This bill
spends large amounts of money on worthwhile programs such as education
and healthcare. This morning, the BLS reported that payroll employment
in the education and health services sectors increased by 54,000 during
January 2009. Payroll employment in those sectors has registered
positive growth for 52 consecutive months. During that period, payroll
employment in those sectors has increased by 2,164,000. Over the past
year, payroll employment in the education and health services sectors
has increased by 530,000.
It is not the education and health services sectors that need
stimulus to create jobs; it is already creating them. We should be
targeting sectors that have suffered severe declines, like the motor
vehicle and parts subsector where employment has declined by more than
20% in just the past year and 40% since January 2001. We should be
looking at data to target incentives for enterprise to create jobs that
are permanent and part of private-sector activity, not Government.
We need to also be careful to avoid reinflating the bubble. The
construction sector lost 111,000 jobs in January and has seen 935,000
jobs lost over 19 consecutive months of decline. Yet even with that
decline, construction-sector jobs are within 1 percent of January 2001
prehousing-bubble levels. We need to make sure that we aren't simply
creating temporary Government funded jobs that will vanish and leave
American families in the same situation they find themselves in today.
Lastly, I want to again address this concern over the fact that
consumers might save tax reductions or equivalently pay down debt. This
bill takes the approach that consumers won't do the right thing and
rush out and spend the money. What is wrong with a family making the
decision to improve its balance sheet rather than recklessly spend what
they might not be able to afford? The household and nonprofit sectors
lost $7 trillion in net worth between the third quarter of 2007 and the
third quarter of 2008. We have poured hundreds of billions into helping
banks improve their balance sheets, but when a taxpayer chooses to do
what he believes is best for his family, somehow we manage to criticize
that.
Rushing to pass a bill because of the fear that support is slowly but
surely fading under the face of pressure from the American people is a
foolhardy exercise. We should act with due speed, but not haste. Let's
take this bill down, send it back to committee, and focus on creating a
bill that will stimulate the economy and does not use the current
crisis to shoehorn permanent expansions of Government programs into a
stimulus bill under the guise of stimulus.
Mr. President, I yield the floor.
The PRESIDING OFFICER (Mr. Sanders). The Senator from Montana.
Mr. BAUCUS. Mr. President, I yield 5 minutes to the Senator from
Rhode Island.
The PRESIDING OFFICER. The Senator from Rhode Island.
Mr. WHITEHOUSE. Mr. President, I thank the distinguished chairman.
Earlier today we adopted an amendment that prohibits appropriations
under this act to aquariums or zoos or beautification projects or other
such entities, and Rhode Island was specifically targeted by the
Senator who offered that amendment. He mocked a zoo that belongs to the
city of Providence that would be, I think, a potential area of support
from this bill. He mocked a tree-planting program within the city of
Providence.
I urge my colleagues, at their leisure, to reconsider the wisdom of
that vote, perhaps in conference.
The Roger Williams Park Zoo is a wonderful facility. Children come
through it to get educated through schools. People are employed there.
It opens minds to the wonders of nature. It has wonderful science
programs. And it's a municipal business that is run for the benefit of
the people of Providence. And it needs work. As long as it needs work,
as long as cities are broke in this economy, I don't understand why one
would single out a zoo as opposed to the Department of Motor Vehicles
or some other structure that might need repair. Why take that job away?
Is the Senator who offered this so infallible? Does he know so much
about other States he has never even visited that he can impose his
views? I would never dream of suggesting that I know more about towns
and cities in Oklahoma than the local political establishments of those
towns as to what is wise. I really think that that is a mistake.
If a city needs tree planting and that brings real jobs and it puts
people and their trucks and their trees and their

[[Page S1840]]

nurserymen to work, and if it provides shade, and it provides
greenness, and if it absorbs carbon, and if it engages in traffic
calming, there are all sorts of good reasons why people would want to
do that. Why is it necessary for one Senator to tell the city of
Providence that he knows better, having never visited?
And, finally, we don't have an aquarium, but there was a story in the
New York Times about ``Japan's Big-Works Stimulus.'' It talks about a
bridge they built with their stimulus money. As to the bridge, here is
what they say:

``The bridge? It's a dud,'' said Masahiro Shimada, 70, a
retired city official who was fishing near the port. ``Maybe
we could use it for bungee jumping,'' he joked.

Here is what he concluded:

Among Hamada's many public works projects, the biggest
benefits had come from the prison, the university, and the
Aquas aquarium. These had created hundreds of permanent jobs
and attracted students and families with children to live in
a city where nearly a third of residents were over 65.

Of the hundreds and hundreds of projects Japan did for stimulus in
Hamada, the three best included an aquarium--and we have ruled that out
because one Senator from a State far from Rhode Island who has never
been to my State purports to know more about what we should do in our
cities than we do ourselves.
I urge that we have a little bit of the spirit of Ben Franklin at the
closing of the discussion over the Constitution when he urged all of
the Members who were present to doubt a little bit of their own
infallibility so that we can get together and get something done. I
urge the Senator who proposed this amendment to doubt a little of his
own infallibility, and I urge that we have a little bit more confidence
in our own local judgments about what might actually provide the most
bang for the buck.
I thank the chairman for allowing me this moment and I yield the
floor.
Mr. BAUCUS. Mr. President, I yield 5 minutes to the Senator from
Ohio.
Mr. BROWN. Mr. President, later this evening or tomorrow, I will
offer an amendment that will put money back where it belongs: into the
pockets of retirees who earn those dollars and who will spend those
dollars. I wish to thank Senator Voinovich, my colleague from Ohio, as
well as Senator Durbin from Illinois, Senators Schumer and Gillibrand
from New York, and Senator Casey from Pennsylvania for joining me in
this effort.
Our amendment would drive economic activity and confront a policy
that has blindsided too many American retirees--retirees from all over
the country, from many sectors of our economy.
Mr. President, 44 million Americans rely on the Pension Benefit
Guaranty Corporation--PBGC--to protect their retirement income in
today's volatile economic climate. When pension plans are terminated,
the PBGC steps in. Six hundred forty thousand Americans are covered
under the Pension Benefit Guaranty Corporation. It is a crucial
institution to maintaining a decent standard of living for American
retirees. But in administering pension plans, the PBGC can pay out
benefits for years, based on preliminary estimates of the guaranteed
amount. Determination of the final benefit amount routinely takes
several years to calculate and sometimes results in ``overpayments.''
I wish to put this term in context. When the PBGC takes over a
pension--when a corporation, in essence, dumps its pension on the PBGC
which it has paid premiums into--it is a government agency but one that
relies on premiums paid by companies--when PBGC takes over a pension,
benefits are routinely cut--dramatically cut--for retirees. So if you
are receiving $2,000 a month from your company, it declares bankruptcy,
you are thrown into the PBGC, you don't get $2,000 a month, you get
appreciably less, sometimes $800 $900, $1,200, $1,400--way less a month
than you were getting before. So when PBGC makes a mistake with these
overpayments, they don't make retirees flush, they are dollars at the
margin that reflect the difference between initial and final pension
benefits. In other words, most retirees covered under PBGC are
receiving significantly lower pension payouts with or without these
temporary overpayments, so it is never good news for the retiree. They
are virtually never getting what they were promised by their company
when they worked for that company and after they retired from that
company.
Retirees have no control over the amount they are paid by PBGC. They
have no control over when PBGC will come up with final benefit
determinations or whether these determinations will be different from
the initial estimates. But they are still required to pay the price for
any difference between estimated and actual benefits, and that price
can be steep.
Let me share a story. For privacy's sake, I am going to use first
names only. Richard owes $53,415.60. He was told when he was working in
a steel mill that he would get a monthly pension benefit of around
$2,400. When PBGC assumed trusteeship, he was told he would get a
benefit of $1,088. Now he is being told that he will get $325 minus a
recoupment deduction of 10 percent, yielding $292 before taxes. Now,
Richard, as I said, was initially getting a pension when he retired--a
promised pension, a commitment, a pledge from this company of $2,400.
That was the promise. That was the covenant he had. Now, because of all
of this, he is getting $292 before taxes.
Louis. Louis put in nearly 34 years at Republic Technologies in
Lorain, OH, where I lived for many years. PBGC has informed him he will
be paying back pension money until he is 95 years old.
These are Ohio stories, but Ohioans are not the only ones who have
been hit with pension cut after pension cut after pension cut. Not only
Republic Technology retirees such as Richard and Louis, but retirees
from Oneida, Pillotex, Bethlehem Steel, Huffy, Penn Traffic, National
Steel, Reliable Insurance, U.S. Air, Eastern Airlines, Pan Am, Delta,
United Airlines--retirees from all of those companies have been
blindsided by overpayment recoupment.
Our amendment is simple. It gives a little relief to the 30,000
retirees whose pensions are being garnished by PBGC.
Under our amendment, these retirees receive a simple reprieve from
PBGC requirements for 24 months. Their pensions wouldn't be garnished
and they wouldn't be liable for those dollars--now or ever. If we want
to stimulate the economy, giving a few dollars back to retirees who
never thought they would lose them and who desperately need them is an
excellent way to do it.
Conservative estimates place the cost of this amendment at $20
million. Those dollars will go straight into the pockets of American
retirees to be spent immediately in our country, and it will help the
economy, and it will certainly help those thousands of retirees.
I yield the floor.
The PRESIDING OFFICER. The majority leader is recognized.
Mr. REID. Mr. President, there will be votes later on this evening.
We are going to have a Democratic caucus starting in 7 minutes, at
5:30. We hope to complete that in 45 minutes or thereabouts, but
caucuses sometimes don't work out as quickly as we wish. We will come
back after that and hopefully at that time work toward disposing of
these amendments that are now pending. We have a number of them that
need to have votes. I repeat, we are going to have some votes later on
tonight. I apologize for not having anything more definite than that,
but at this stage that is the best I can do.
I note the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. REID. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.

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