[Congressional Record (Bound Edition), Volume 149 (2003), Part 5]
[Senate]
[Pages 6761-6790]
[From the U.S. Government Publishing Office, www.gpo.gov]


  Mr. KENNEDY. What it shows is the appropriations for 2002, $49 
billion; the President's request is $50 billion. They added $400 
million. Then the appropriations went up $3 billion because of the 
activity on the floor of the Senate. The

[[Page 6762]]

next year the administration asked for $26 million--an increase of 5/
100th of one percent. Let us look at the point my good friend, Senator 
Gregg, left behind. The point he has not disputed is we have 6.2 
million children who are left behind. Let's forget what happened to the 
Republicans, let's forget what happened to the Democrats, and say let's 
accept the Murray amendment that will include 3 million more children. 
Let's not argue about the past. Let's argue about the future.
  This amendment will increase by 3 million the number of children who 
will be covered. We have a chance to do that tonight. We have a chance 
to do that at 5 o'clock. That is what we are asking the Senate to do, 
instead of having additional tax breaks for the wealthiest individuals 
in this country.
  Put the children first. That is what the Murray amendment would do.
  I hope my good friend from New Hampshire will join us hand in hand 
together and support the Murray amendment, and we will cut in half the 
number of children being left behind.
  Mr. GREGG. Will the Senator from Oklahoma yield a couple of minutes 
to respond?
  Mr. NICKLES. I yield 4 minutes to my colleague.
  Mr. GREGG. The Senator from Massachusetts argued it might have 
credibility and might have legs were it not for the fact there is 
presently--because of the huge amount of money the President of the 
United States, George Bush, has put into this account--there is 
presently unspent title I dollars representing billions.
  Mr. KENNEDY. Will the Senator yield?
  Mr. GREGG. Is this a question?
  Mr. KENNEDY. Yes. The Senator is not surprised on that because they 
always commit that money in July of the next year. You can use all the 
charts you want; it is committed and it is expended in July. Everyone 
understands that.
  Mr. GREGG. I appreciate the Senator's question, and I am sure it was 
a question, although I never really actually heard the question.
  But I make the point this is 2001 money, 2 years ago; August has 
already come and gone for 2001; and 2002 is fast approaching.
  The fact is, we are putting so much money in the pipeline so fast 
because we are prefunding this issue, as we should be, that we are not 
creating an unfunded mandate. We are actually creating a situation 
where many States are, for at least the moment, not making money but 
seeing a significant surplus in the amount of money coming in 
relationship to the amount of money they are having to spend to reach 
the goals of No Child Left Behind, which, as we all know, is to give 
low-income kids a better shot at the American dream by educating them 
properly.
  I reserve the remainder of my time.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. BINGAMAN. Mr. President, let me speak for the 4 minutes I was 
allocated by the Senator from Washington to support the amendment 
Senator Murray and Senator Kennedy have put forward. I compliment them 
on the leadership they provide on education issues and this amendment 
in particular.
  I heard my colleague from New Hampshire talk about how we cannot just 
increase funding ad infinitum, that what this amendment would do is 
throw out numbers that are irresponsible. That was one of his phrases.
  As I understand the amendment, and the reason I am cosponsoring the 
amendment, this amendment proposes to fully fund the No Child Left 
Behind Act. All it is saying is we made an agreement on a bipartisan 
basis. The President participated in that agreement. We told the people 
of our States and our school districts that we were going to provide a 
certain level of support to help them implement the No Child Left 
Behind Act. The budget before the Senate does not do that.
  The suggestion is made that the reason it has not done that is 
because there is surplus money that has come into the State and we 
prefunded things and they have not been able to spend the money in the 
pipeline. This is news to the school districts in my State and to the 
people involved with trying to educate the children in my State. In 
fact, when I go home, what I hear from people in my State is that we 
have these new requirements, we need assistance, we need resources. If 
you want us to train teachers' aides, which we want to do, if you want 
us to raise the level of qualifications of our teachers, which we want 
to do, please help. Please come through with the resources that were 
committed in the No Child Left Behind Act. That is exactly what this 
amendment tries to do.
  The other comment I heard was we cannot fully fund every bill that is 
authorized in this Congress. That is not what the Senator from 
Washington and the Senator from Massachusetts are proposing. They are 
saying, let's just fully fund this bill. Let's take education and 
recognize that it needs to be a priority.
  In this budget resolution, we have over $1.3 trillion in tax cuts. 
Now, is it too much to say that $8.9 billion of additional funds should 
go into education? I don't think that is an unreasonable request. I 
think, clearly, the priorities of the American people would be with us, 
and they would agree, let's fully fund the No Child Left Behind Act 
before we start cutting taxes.
  We all know we have enormous other expenses that are coming at us as 
a result of the war that is imminent in Iraq. I certainly intend to 
support those expenditures, but to suggest that we do not have enough 
money left to pursue our education funding, to keep the promise we made 
to the American people at the time the No Child Left Behind Act was 
signed into law, is very unfortunate.
  I participated with the Secretary of Education when he came to my 
State and had something of a rally in Albuquerque to talk about No 
Child Left Behind and what a wonderful thing it was for the State. I 
supported that legislation. I supported it all the way through. I 
worked with my colleagues to try to be sure it made good sense and fit 
the circumstances of our State. But I did so always on the assumption 
that we would then come along and provide the Federal support to the 
States for local school districts to implement those improvements.
  I think it is essential we do that. I think it is essential we adopt 
the Murray-Kennedy amendment. I hope our colleagues will support this 
amendment and keep faith with the young people of our country.
  Everyone in this body gives speeches talking about how the future 
lies with the children of the country. We need to do right by them and 
adopt this amendment and make education a priority in this budget.
  The pending budget simply sets the wrong priorities by providing over 
$1.3 trillion in tax benefits to the wealthiest while cutting education 
funding.
  This budget abandons the promise to leave no child behind by cutting 
funding for the No Child Left Behind Act--legislation repeatedly 
embraced by the Administration and passed by a strong bipartisan vote 
just last Congress--by $700 million.
  Under this budget, Title I--the program targeted on districts and 
schools with large numbers of disadvantaged students--would be 
approximately $5.8 billion short compared to the levels agreed to on a 
bipartisan basis in the No Child Left Behind Act. As a result, over 6 
million poor children will be left behind.
  In addition, over 500,000 children will lose access to after school 
services under these funding levels.
  The budget before us also contemplates eliminating funding for key 
education programs--again enacted on a bipartisan basis last Congress.
  For example, the budget contemplates eliminating funding for the 
dropout prevention program, at a time when the pressure is greater than 
ever to push at risk students out so they do not negatively impact 
school performance.
  The budget also contemplates cutting existing programs that provide 
research-based strategies for schools to improve academic achievement 
and reduce dropout rates. For example, the smaller communities program 
provides

[[Page 6763]]

funds to schools seeking to create personalized learning environments 
that research proves will increase student academic achievement, reduce 
dropout rates, and increase school safety. It is exactly the type of 
reform effort that we endorsed and indeed required in the No Child Left 
Behind Act. It is the type of program that we should expand, rather 
than eliminate.
  If we truly intend to leave no child behind, education funding--
particularly funding for the programs targeted toward the most 
disadvantaged children--must be our top priority, not our last.
  The funding provided in this amendment would achieve that goal by 
providing funding sufficient to serve another 2 million needy children 
under the Title I program. In addition, every one of the 10,000 schools 
currently identified as not meeting the standards provided in the No 
Child Left Behind Act will be able to implement research-based school 
reform models.
  We also will be able to maintain the current level of after-school 
services while expanding after school programs to another 1.3 million 
latchkey children.
  We would be able to make substantial contributions to the quality of 
instruction by providing enough funding to hire 50,000 fully qualified 
teachers and provide professional development to 200,000 teachers.
  Finally, we will be able to continue key programs such as the dropout 
prevention program and smaller learning communities programs.
  This amendment can make a real difference for our states and local 
districts.
  As my colleagues know, State cuts to education caused by ``the most 
ominous fiscal crisis since World War II'' make Federal support ever 
more crucial for local communities. States face a cumulative $80 
billion budget deficit, with a dozen States cutting k-12 spending last 
year and another 11 poised to do so this year.
  States and communities across the Nation are being forced to cut 
services due to increased demands and reduced resources. For example, 
in Oregon school districts are carving weeks of instruction off the 
school year. One thousand teacher positions have been lost in Oregon so 
far this year. The schools in Arkansas, Louisiana, South Dakota, and 
Colorado are cutting back to a four-day week to trim costs. In Alabama, 
the schools are being forced to raise the class sizes, cut back 
extracurricular activities, and lay off 2,000 teachers and support 
staff. In Kentucky, 1,000 teacher and support positions have been cut 
and their technology programs have been slashed. In Massachusetts, 
dozens of school nurses have been laid off.
  As a result, it is not a surprise that a bipartisan poll recently 
demonstrated that a majority of Americans support increased Federal 
support for education and more voters name education as their top 
budget priority for next year than any other issue. Education ranks 
more than 10 points higher than the next 2 highest budget priorities--
health care and terrorism/security.
  I urge my colleagues to support the amendment and thank my colleagues 
again for their leadership.
  Mr. SARBANES. Mr. President, I express my strong support for the 
amendment offered by Senators Murray and Kennedy to increase funds for 
the No Child Left Behind Act by $8.9 billion, fully funding this 
critical legislation. The amendment also includes $8.9 billion for 
deficit reduction. Both the education and deficit reduction funding are 
taken from the dividend tax cut. It is imperative that Congress sends a 
strong message in support of education that is accompanied by equally 
strong funding.
  The budget resolution we consider today fails to provide sufficient 
funding for education programs at all levels. Despite the 
Administration rhetoric that places great importance on improving 
educational opportunities for all Americans, President Bush's budget 
underfunds a variety of programs--early childhood education, elementary 
education, vocational education, and higher education--that are 
especially important to families given the weak economy.
  States are struggling with budget shortfalls, rising student 
enrollment, and an increasing number of students with limited English 
proficiency. At the same time, States are working to meet the new 
requirements of the No Child Left Behind Act. I supported the No Child 
Left Behind Act because I agreed with its principles--all public school 
children should be able to achieve and all schools should be held 
accountable when their students fail to do so. I believed the President 
when he said education would be a priority. But now we face a budget 
that does not make education a priority. Instead, we are asked to 
support a budget that somehow finds the money to provide a tax cut for 
the wealthiest individuals, but cannot do so for the education of our 
Nation's children.
  This budget provides only a 2 percent overall increase for education 
programs, and some increases such as those for both Title I and IDEA, 
are largely paid for with cuts to other valuable education programs. 
Funding for the No Child Left Behind Act is cut by $700 million below 
fiscal year 2003 levels. It shortchanges Title I funding by $5.8 
billion below the authorized level. Title I could reach only 40 percent 
of eligible low-income children at this level. This budget also cuts 
funding for teacher quality programs, after school programs, and 
eliminates 46 education initiatives.
  The No Child Left Behind Act places a variety of new requirements on 
States and local school districts, including annual standardized 
testing and increased teacher certification. While we can expect our 
educators to do all within their power to improve our schools, we 
cannot expect this landmark legislation to be effective if they are not 
given the resources to implement these programs. If this amendment 
passes, over 2 million additional needy children will be served by 
Title I, after school opportunities would be extended to an additional 
1.3 million latchkey kids, and 50,000 new teachers could become fully 
qualified.
  I find it unconscionable that we can consider a tax cut aimed at the 
wealthiest Americans while purporting to be unable to adequately fund 
education programs. Now is the time to move beyond the rhetoric and 
show teachers, parents and students that we are sincere in our efforts 
to help them. I urge my colleagues to vote in favor of the Murray-
Kennedy amendment.
  Mr. KERRY. Mr. President, I am pleased to be a cosponsor of Senator 
Murray's amendment to the budget resolution that will fully fund the No 
Child Left Behind Act. I regret that I will not be present for the 
vote, but if I were present I would vote for the Murray amendment to 
increase education funding by $8.9 billion.
  Unfortunately, both the budget resolution that we are debating and 
President Bush's proposed fiscal year 2004 budget do not fulfill the 
funding commitment that Congress made when we passed the No Child Left 
Behind Act into law. In fact, the budget resolution contains a $700 
million cut in funding for the No Child Left Behind Act compared to the 
fiscal year 2003 levels.
  The budget resolution's title I funding leaves more than 6 million 
disadvantaged children behind. There is no increase for teacher quality 
funds, even though nearly 40 percent of title I children are taught by 
teachers without a college degree in their primary instructional field 
and our schools will need to hire 2 million new teachers over the next 
decade. While 6 million latchkey children currently go without 
afterschool programs, this budget cuts afterschool funding for more 
than 500,000 children. And it eliminates all funding for rural 
education, dropout prevention, preparing tomorrow's teachers in 
technology, and smaller learning communities among other things.
  We have said it time and again during debate on No Child Left Behind 
and since it became law: new reforms and stronger accountability 
systems are not going to work if we don't provide resources to ensure 
that all children can learn to high standards. That means providing the 
full authorized amount of title I funding, it means helping schools 
meet the major new requirements for teacher quality that the

[[Page 6764]]

law imposed, and it means increasing not slashing funding for 
afterschool programs. I hope all of my colleagues can support this 
important amendment.
  Mrs. BOXER. Mr. President, I would first like to thank Senator Murray 
for this critical amendment to deliver on the promise we made to the 
Nation's children by fully funding the No Child Left Behind Act.
  It has been over 1 year since the approval of the No Child Left 
Behind Act. But we are not fulfilling the promise made in that law and 
are, in fact, leaving millions of kids behind. The Nation has made 
little progress toward improving the quality of our children's 
education. In fact, we have taken a huge step backward by actually 
cutting funding for the education reform law that was enacted.
  The Murray amendment will not only alleviate the fiscal crisis in our 
schools so that they can provide a high-quality education for our 
children, but it will provide funding to keep our children safe in 
afterschool programs.
  As the author with Senator Ensign of the bipartisan afterschool 
program that President Bush signed into law as part of the No Child 
Left Behind Act, I want to emphasize how important the Federal 
afterschool program is to children and families across America. Dozens 
of respected, independent studies tell us that afterschool programs 
keep children safe, reduce crime and drug use, and improve academic 
performance.
  However, despite strong evidence that keeping children safe after 
school can reduce juvenile crime and prevent children from engaging in 
risky behaviors, the administration's budget for fiscal year 2004 
slashes Federal funding for afterschool programs by 40 percent.
  This unprecedented cut would result in over 81,000 children in 
California and almost 600,000 children nationally being pushed out onto 
the streets after school. Furthermore, by not fully funding afterschool 
programs at the level that we promised in the No Child Left Behind Act, 
we will be leaving over a million more children not just behind, but 
home alone.
  We cannot afford to neglect our commitment to our Nation's children. 
The time for rhetoric has passed and now it is time to act. It is time 
to fully fund afterschool programs and the entire No Child Left Behind 
Act.
  The PRESIDING OFFICER. Who yields time?
  Mr. NICKLES. How much time remains?
  The PRESIDING OFFICER. The Senator from Oklahoma has 10 minutes and 
the Senator from Washington has 4 minutes.
  Mr. NICKLES. I yield 4 minutes to the Senator from Tennessee.
  Mr. ALEXANDER. Mr. President, I congratulate the Senator from New 
Hampshire and other Senators who have been working hard on the Leave No 
Child Behind legislation.
  I am a new Senator and was not here when it was done. I watched it 
from a distance as a former Education Secretary, to see how the Federal 
Government, which contributes about $650 or so out of the $7,000 or so 
we spend per student in this country on K-12 education, could make a 
difference.
  The principles of flexibility and accountability and the addition of 
more options for parents and significant additional funding have been a 
very good bipartisan start. The funding, which is the area at issue 
today, has been generous.
  When I look at my own State of Tennessee, for example, we can always 
use a little more of the Federal dollars to help do what needs to be 
done, but the amount that has come in has been very helpful. For 
example, in fiscal year 2000--and this follows to a great extent what 
the Senator from New Hampshire said--and then in fiscal year 2001, 
President Clinton asked for $8 billion and then $8.3 billion. In fiscal 
year 2000, the Congress appropriated roughly what the President 
requested, and in fiscal year 2001, it appropriated $8.7 billion. 
Tennessee got $137 million in fiscal year 2000 and $141 million in 
fiscal year 2001 for title I funding, the largest federal program that 
helps low-income children. This is the money that focuses on leaving no 
child behind.
  When President Bush came in, he asked for $9 billion and the Congress 
appropriated over $10 billion, and the share of title I funding for 
Tennessee went up to $152 million. In the budget we just finished in 
January, the President asked for $11 billion, and Congress provided 
$300 million more, and Tennessee's share went to $164 million. With the 
newest recommendation from the President, an increase of $1 billion, 
Tennessee is up to $174 million. These increases in title I funding are 
moving more rapidly than other parts of the federal budget.
  Could it be more? Maybe I will suggest over time we spend more. But 
we need to recognize these are significant increases in spending to 
fund the new programs from the Federal Government, while staying within 
a reasonable budget.
  In Nashville last week, I picked up an article about teachers, which 
you do not see that often, that talked about how much they appreciated 
the additional federal funding for ESL, English as a second language, 
and how it was helping and how the new money for this year, which we 
just finished appropriating a few weeks ago, is making its way into the 
school system. One of the teachers said this was the first year for 
major funding and it should really improve services.
  So I stand here today to say that I compliment President Bush, and 
this Senate, and this Congress, for what they have accomplished in the 
last 2 years--significant increases in funding for title I and the IDEA 
program over what was being spent when President Bush took office, even 
in a time when we have a budget under stress and are considering a war. 
Education funding is growing at a more rapid rate, as it should, I 
believe, than virtually any other part of the budget. I am glad to see 
that.
  I ask unanimous consent that the article from the Tennessean be 
printed in the Record, and I yield the floor.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                  [From the Tennessean, Mar. 17, 2003]

        Federal Funding Helps Defray Local Cost of ESL Programs

                          (By Claudette Riley)

       Students with limited English skills who enter Tennessee 
     schools will now find classrooms that are better equipped 
     than ever to meet their needs.
       This year, the state received more than $2.24 million in 
     federal funding to help public schools meet the needs of 
     students served in English as a Second Language, or ESL, 
     programs.
       In recent years, local districts have shouldered the cost 
     of providing the required services, with limited help from 
     state funding or grants.
       ``This is the first year for major funding. It should 
     really improve services,'' said Carol Irwin, ESL coordinator 
     for the state Department of Education. ``It should put more 
     professional development in place, pay for materials and 
     technology, and hire more tutors and translators.''
       Tennessee and other states with a steady influx of families 
     from other countries are benefiting from a shift in the way 
     federal ESL funds are allocated. National education officials 
     used census data to determine how much each state would 
     receive for this school year.
       ``It's made a tremendous difference. We went from a teacher 
     and a half to a teacher with two full-time educational 
     assistants,'' said Vivian McCord, director of federal 
     projects for Dickson County schools. ``We meet with the 
     children on a daily basis now, and they are given tutoring.''
       Of the $2.24 million in federal funds allocated to 
     Tennessee this year, nearly $1.8 million went directly to 
     school districts, $112,000 was pulled out for administrative 
     costs and another 15%--or $336,000--was awarded as grants to 
     the school systems with the highest need.
       ``It's just encouraging for districts to know they'll have 
     some financial help,'' Irwin said. ``The districts have been 
     struggling to get this done.''
       Based on existing numbers, the state will get $2.65 million 
     in federal funding for ESL during the 2003--04 school year 
     and nearly $3 million the next year, officials said.
       ``The numbers keep rising, and so we're getting more 
     money,'' Irwin said.
       The extra money is welcome news for the state's 138 school 
     districts, many of which have reached deep into their own 
     pockets to put the ESL programs in place.
       The federal funding is helping us,'' said Sayra Hughes, 
     coordinator of ESL for Metro schools, which received nearly 
     $600,000 from the new funding. ``It's just an added bonus. It

[[Page 6765]]

     has assisted--the local funding is still there.''
       The federal funding isn't expected to replace local 
     contributions, but school officials said it would help them 
     provide more staff and better services and materials.
       Tennessee has 15,007 students in ESL programs, and 28.5% of 
     them--4,283--are in Metro schools. The district received the 
     largest chunk of the new federal funds.
       ``We've been able to purchase a lot of additional 
     materials,'' Hughes said. ``We were able to increase the 
     services provided by the tutor translators.''
       Jan Lanier, chairwoman of the ESL department at Metro's 
     Glencliff High School, said she would like to eventually put 
     in a language laboratory and provide students struggling to 
     learn English with better research materials and bilingual 
     dictionaries.
       ``We have some, but we don't have enough for every class to 
     have a full set.''
       While district officials say the extra federal money is 
     welcome, some note that it won't cover the cost of operating 
     ESL programs.
       We did have more money this year, but it didn't come close 
     to covering what we spend on staff,'' said Andy Brummett, 
     director of Lebanon Special School District. ``The majority 
     of the money we spend to serve these children is local.''
  The PRESIDING OFFICER. Who yields time?
  The Senator from Washington.
  Mrs. MURRAY. Mr. President, I ask unanimous consent to add Senator 
Reed of Rhode Island as a cosponsor, and I yield him 2 minutes of my 
time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. REED. Mr. President, the choice before us is very clear: Are we 
going to devote $8.9 billion to tax cuts, most of them favoring the 
very rich, or are we going to devote $8.9 billion to the children and 
the schools of America? The choice is much more clear since the No 
Child Left Behind Act was passed because we made significant 
commitments to improve the quality of education in the United States 
while imposing significant responsibilities on the schools. The schools 
are expecting this money. The suggestion that there is a lot of money 
in the pipeline is interesting, but I would be shocked because that 
suggests the Department of Education is inept in getting money that is 
there to the schools that desperately need it.
  There are 10,000 identified failing schools in this country. There 
are scores of children being taught by teachers without a college 
degree in their primary field of instruction. All of that needs 
remediation, help, and resources, but instead the budget before us 
provides billions in tax cuts when our schools desperately need that 
money.
  It is not a question of what we did last year, it is a question of 
what we will do this year. It is a question of whether we will meet the 
needs of the American students and whether we will keep the promises of 
the No Child Left Behind Act. We are not keeping those promises in the 
budget that is presented to us by the Budget Committee. We should keep 
those promises, and by doing so, we will do something I believe every 
American wants more than tax cuts that favor very wealthy Americans. We 
want to see every child in this country have a decent education, 
succeed, contribute, and be part of this great country. That is what 
the Murray amendment does.
  The choice before us is clear, compelling, emphatic: Put the money 
with the schools and the children, and our economy will be better, and 
our schools and students will be better. We can afford it because if we 
do not commit the funding to the children, it will go to tax cuts 
primarily to upper income Americans.
  The PRESIDING OFFICER. The time of the Senator has expired.
  Mr. NICKLES. How much time remains on both sides?
  The PRESIDING OFFICER. Six minutes for the Senator from Oklahoma, 2 
minutes for the Senator from Washington.
  Mr. NICKLES. I yield myself 3 minutes.
  Mr. President, when we marked up our budget, we put in a couple of 
billion dollars actually over the President's request. I mentioned to 
my colleagues then: No matter what we put in, there are going to be 
amendments on the floor to increase education.
  I might show our colleagues--Senator Gregg did this far better than 
I--education funding under this President as compared to President 
Clinton has exploded. It has gone up dramatically. Title I, which 
addresses the issue we have before us on No Child Left Behind--if you 
look at the rate of growth we have in title I grants, it is a dramatic 
increase.
  The Senator from Washington has an amendment. This might even show it 
better. It shows that the spending level basically in the last few 
years, under this President compared to the previous President, has had 
a dramatic increase. As a percentage, I might mention, it went up in 
title I percentages of 10.3, 18.1, 12.9, 8.6--big increases.
  The Senator from Washington has an amendment that says let's do No 
Child Left Behind and let's go from $23 billion--let's add another $8.9 
billion, which would be a 38.7 percent increase for 1 year. It says 
$8.9 billion. It doesn't sound like much. Most of the figures we are 
dealing with are over 10 years. This is 1 year. We only increased 
nondefense discretionary spending by $10 billion. This is $9 billion 
for education, and not all education, just part of education. I 
understand there will be amendments later to deal with IDEA, and we put 
in an additional $1 billion for IDEA, we put in an additional $1 
billion for title I at the request of the chairman of the HELP 
Committee, who was a strong leader and made an excellent presentation.
  No matter what we do, no matter how high the percentage increases we 
have, even if they are double digits, there are amendments that will 
say let's do more. This amendment says let's do 38.7 percent more. I 
think it is irresponsible, and I will urge my colleagues at an 
appropriate time to support a motion to table the amendment.
  The PRESIDING OFFICER. Who yields time?
  The Senator from Washington.
  Mrs. MURRAY. Mr. President, we are about to vote on a very important 
amendment. Not very long ago, the Members of this body voted to pass a 
bill called No Child Left Behind. The budget that is put forward to us 
today will leave thousands of children behind if we do not fulfill the 
commitment we have made.
  I have listened to the arguments on the other side. I have seen the 
charts and graphs. If there is one thing I have learned here in the 
Senate, it is that you can have a chart or graph to show whatever you 
want it to show. But what I do know is Senator Kennedy showed on the 
chart behind us, 3 million more children in this country, 3 million 
more children need more funding if they want to meet the obligations of 
No Child Left Behind; 50,000 fully qualified teachers need to be hired; 
we need to provide training for 200,000 teachers. The numbers are 
really clear.
  If you look at the Republican budget itself, their document shows 46 
programs that have been eliminated in their budget: Adult education, 
community technology, dropout prevention, elementary and secondary 
school counseling, foreign language, physical education, rural 
education, vocational education. These are programs listed in their 
budget that they cut.
  We can put up charts and graphs, but I can tell you one thing: The 
children in our schools, the parents who take their children there, the 
teachers who teach there, the community members who work in our schools 
all know when we pass a bill and say we are going to test our kids at 
the Federal level and we do not provide the resources to make sure 
those children can learn, we pass on an unfunded mandate that is 
irresponsible to our States that are struggling today.
  The amendment we are about to vote on fully funds title I. It 
continues the effort to hire 100,000 qualified teachers. It helps to 
put high-quality teachers in the classrooms and continues to make sure 
we fulfill our obligations.
  Tougher accountability without adequate reform is not reform, it is 
politics. We know our children need books, they need teachers, they 
need the programs, and they need the Federal Government to live up to 
its responsibility. That is what this amendment does.
  The PRESIDING OFFICER. The time of the Senator has expired.

[[Page 6766]]

  The Senator from Oklahoma.
  Mr. NICKLES. I yield the remainder of our time to the Senator from 
New Hampshire.
  Mr. GREGG. There have been a lot of representations here, but we need 
to go back to the fact that on our side of the aisle we had to produce 
a budget--and we did, something that didn't happen last year from the 
other side of the aisle relative to bringing it to the floor.
  When the other side of the aisle was talking dollars, they were 
willing to give up on $4 billion relative to children in title I. That 
was their gap last year in their appropriating bill. For them to come 
forward this year and say suddenly that gap is an unacceptable event 
and inappropriate and inconsistent with everything that is right about 
taking care of our children in this country is truly a bit of an 
inconsistency, to be kind.
  The issue of balancing this against a tax cut I find difficult. Tax 
cut for the rich? Sixty percent of the people who get the dividends 
cut, should we actually put it in place, are going to be senior 
citizens. It is their money. It is their money.
  The issue is, how do you prioritize spending? The President of the 
United States has prioritized spending. He has put education right at 
the top of his priorities, at a much higher level than President 
Clinton put it--in fact, at a level so much higher than President 
Clinton put it that it represents a factor of two or three times what 
President Clinton did during his time in office.
  He has done it at the same time as he has limited overall spending of 
the Federal Government. The spending on education in this bill 
significantly exceeds the overall spending of the Federal Government in 
all accounts except possibly defense, because we are at war. That is a 
hard commitment, and it translates into real dollars, $1 billion of 
additional money every year since he has been President for title I, 
for IDEA, over $3 billion of new money--$3.9 billion--for title I. 
Those are hard dollars, real dollars, done in a responsible budgeting 
way.
  Mr. President, is my time up?
  The PRESIDING OFFICER. Yes. All time has expired.
  Mr. GREGG. Mr. President, I yield the floor.
  Mr. President, I move to table the amendment and 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 motion to table amendment No. 284.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. REID. I announce that the Senator from North Carolina (Mr. 
Edwards) and the Senator from Massachusetts (Mr. Kerry), are 
necessarily absent. I further announce that, if present and voting, the 
Senator from Massachusetts (Mr. Kerry) would vote no.
  The PRESIDING OFFICER (Ms. Collins). Are there any other Senators in 
the Chamber desiring to vote?
  The result was announced--yeas 50, nays 48, as follows:

                      [Rollcall Vote No. 60 Leg.]

                                YEAS--50

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Chafee
     Chambliss
     Cochran
     Coleman
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner

                                NAYS--48

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Campbell
     Cantwell
     Carper
     Clinton
     Collins
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                             NOT VOTING--2

     Edwards
     Kerry
       
  The motion was agreed to.
  Mr. NICKLES. Madam President, I move to reconsider the vote.
  Mr. GREGG. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. NICKLES. Madam 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. NICKLES. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. NICKLES. Madam President, for the information of our colleagues, 
this is Wednesday night. I ask the Parliamentarian, how many hours are 
left on both sides?
  The PRESIDING OFFICER. On the majority side, there are 10 hours 17 
minutes remaining. On the minority side, there are 11 hours 42 minutes 
remaining.
  Mr. NICKLES. For the information of our colleagues, this is 
Wednesday. We are working very aggressively to finish this bill. I have 
tried to see if we could not advance a lot of the major amendments, 
including the 350 amendment. I have been trying to get that up all day. 
I have not been successful, but I understand we will have that up 
tomorrow.
  Several people have been asking about this amendment. This is the 
amendment that would reduce the growth package from $725 billion to 
$350 billion. I suspect we will have votes on that tomorrow. It is my 
expectation tonight, for the information of my colleagues, as long as 
the majority leader is willing, we will stay in until midnight tonight. 
Several people said they did not want to have votes tonight, that they 
have other things to do.
  I have consulted with my friend and colleague from North Dakota who 
has been a pleasure to work with on this resolution, and we both know 
we have a lot of amendments with which we need to deal. I urge my 
colleagues to work with us and not surprise us with their amendments, 
show us their amendments, and we will see if we can agree to them or 
work out a time agreement on them and see if we can finish this 
resolution in a timely, orderly fashion, in a way we would be proud to 
function. Sometimes the Senate does not do that when we handle budgets.
  It would be my expectation that we would stay in at least until 
midnight tonight and consider several amendments. I believe we now have 
three amendments in order. Senator Kyl has an amendment dealing with 
the death tax; Senator Graham of Florida has an amendment dealing with 
prescription drugs; and Senators Collins and Rockefeller have an 
amendment dealing with assistance to States.
  We are willing to consider all those amendments and additional 
amendments tonight. I will yield the floor. It is our expectation there 
will not be any additional rollcall votes tonight, but that does not 
mean the Senate will not be considering amendments.
  I urge my colleagues, if they have amendments, please work with 
Senator Conrad and myself to have those amendments timely considered.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. CONRAD. Madam President, let me rivet a point that the chairman 
of the budget committee is making. We have three additional amendments 
lined up, but we should do more amendments tonight. If we are serious 
about avoiding a vote-arama at the end, where we do not have a chance 
to describe amendments, we just have to vote on amendment after 
amendment, the way to do that is not to do our work now.
  I say to some colleagues who have said they have to make a change in 
amendments, it is not convenient for them to come tonight, if we are 
going

[[Page 6767]]

to get this done, they have to put aside convenience and get over here 
and offer their amendments. There is a limited amount of time remaining 
to debate and discuss amendments, and people are going to lose their 
opportunity--let me make that very clear on our side--to have time to 
debate their amendment. They will get a vote because the rules allow 
that, but they are going to lose their chance to debate and discuss it. 
So this is the time, if they want to debate an amendment, to get over 
here and offer the amendment.
  Mr. DORGAN. If my colleague will yield for a question?
  Mr. CONRAD. Be happy to yield.
  Mr. DORGAN. I ask my colleague, and perhaps Senator Nickles and the 
majority leader as well, I fully agree with the notion we need to move 
along, address these amendments, try to get through this budget 
resolution, but I also understand, as do most of my colleagues, that 
the potential of military action is imminent--perhaps hours, perhaps a 
day, perhaps two days, I do not know, but my expectation would be when 
military action is commenced and our sons and daughters of America are 
ordered to military action and in the field, almost every Senator will 
want to address and discuss that issue. My hope and expectation would 
be at that moment, when we see what is the most serious decision faced 
by our country, that is, sending our young men and women to combat, 
that we would want to leave the budget and have an ample amount of time 
for every Member of the Senate to address that issue.
  I inquire of my colleague and others who are managing this bill 
whether that interval will be made available to Members of the Senate?
  Mr. CONRAD. I respond to my colleague by saying I hope that would be 
the case if we find ourselves at war, that there would be an ample 
opportunity for Senators to address that. My own belief is that would 
be appropriate for the Senate to do, to turn its attention to a state 
of war. My own belief is it would be inappropriate for us to continue 
on with business as usual when we have our sons and daughters in harm's 
way.
  I am very hopeful if it comes to that, during this period while we 
are debating the budget, that it would be set aside for a time so there 
would be a discussion in the Chamber and the Senators have a chance to 
express themselves.
  Several Senators addressed the Chair.
  The PRESIDING OFFICER. The majority leader.
  Mr. FRIST. Madam President, I have a couple of objectives. First and 
foremost will be an appropriate response to military action if our 
women and men are engaged in combat. There will be an appropriate 
response in terms of support for our Commander in Chief, as well as the 
military personnel, which will be discussed on the floor. There will be 
an opportunity to do that. At this juncture, we do not know when that 
will occur, if it will occur. In all likelihood, it will occur at some 
juncture. I think the fact we are hearing from both sides of the aisle 
that it is important to do--yet the time is uncertain--means I need to 
go back to the first point the chairman and ranking member made, and 
that is we have a lot of work to do; that the clock is ticking. The 
clock is ticking in terms of the budget process itself, in terms of the 
number of hours on both sides of the aisle. It is critically important 
that Members of this body come to the floor to offer amendments, to 
come up with specific language, to debate it and discuss it. That is 
the reason we are going to be here for the next 6 hours to give that 
opportunity to Members. We will start in the morning at an early hour 
in order to fulfill our responsibilities in terms of the budget. That 
is the plan.
  We will finish the budget this week. It may be tomorrow or tomorrow 
night. It may be Friday morning, it may be Friday afternoon, it may be 
Friday night, but we will finish this budget this week.
  Mr. DORGAN. Will the majority yield for one question?
  Mr. FRIST. Yes.
  Mr. DORGAN. Madam President, I, of course, think the response by the 
majority leader is perfectly appropriate. We do want to finish this 
bill. We ought to make progress and try and get it done. My only 
inquiry was if there is military action and if, in fact, our soldiers 
are in the field in hostile action, I agree with my colleague, Senator 
Conrad, that I would not want us to be going through a vote-arama for 
6, 8, 10, 12 hours with business as usual. I would very much want us, 
and I think most Members of the Senate would want us, to move off what 
we are doing and recognize that this Senate will want to express itself 
on these issues, not to be critical but I think to be supportive, 
supportive of our troops and supportive of this country's interests. We 
want this to go well and we want to express ourselves on it.
  I am satisfied with the majority leader's response. I wanted to say I 
feel strongly, as do many others in this Chamber, about the desire to 
address our support for those troops who are ordered to action, if that 
is the case.
  The PRESIDING OFFICER. The majority leader.
  Mr. FRIST. As we talked about this morning, a resolution of support 
for President Bush, and the men and women, our troops, who will be in 
the field, is being developed in concert with the minority leader, 
myself, and others. We are working on that language, as the Senator 
well knows, as we speak.
  If and when military action occurs, that will be brought to the floor 
in short order, with an opportunity to express that very important 
support.
  The PRESIDING OFFICER. The Senator from Oklahoma.
  Mr. HARKIN. Will the Senator yield?
  Mr. NICKLES. I will be happy to yield to my friend for a question.
  Mr. HARKIN. Let me ask a question on process. A lot of us would like 
to offer amendments. This thing gets plugged up and goes on hour after 
hour. If the Senator wants to be in until midnight, that is fine. I 
have an amendment I would like to offer, but should I offer it at 8, 9, 
10, 11, or 12? I would like some idea of where I am going to be in the 
queue, but just to say come and offer amendments is not very conducive 
to an orderly process. So if there is some kind of queue, will there be 
time limits put on these amendments so we have some idea of when we 
should come over to offer our amendments? Since we are not going to 
have any votes, it would be nice to have some idea of when we could 
come over and offer our amendments.
  Mr. NICKLES. I will be happy to respond. Most of the amendments have 
been offered on the minority side, and we are happy to consider 
amendments. I have been urging people to offer amendments dealing with 
the growth package. We need to find out if the growth package is going 
to be zero, if it is going to be 350, if it is going to be 725. So I 
would encourage those amendments. We had those amendments in committee. 
We ought to have them on the floor. If we are going to have them, let 
us have them.
  I have also encouraged other amendments. Members can work with our 
colleague, Senator Conrad, as far as trying to prioritize which 
amendments might be next on the minority side. I think that would be 
the likely outcome.
  Colleagues on this side have been consulting me as far as who would 
be next on our side, and so at that point I think we might be better 
served to begin considering amendments. Right now we have three 
amendments in the queue. I believe Senator Kyl's amendment will not be 
debated too long tonight, maybe 30 minutes.
  Mr. KYL. At most.
  Mr. NICKLES. Thirty minutes for his. I believe Senator Graham of 
Florida is going to discuss the prescription drug amendment. That is a 
pretty big amendment, a couple hundred billion dollars, I believe, and 
so that may take a little longer discussion. Then I believe there is 
also a resolution to be offered by Senator Rockefeller and Senator 
Collins. That may take maybe an hour, maybe less than an hour. We will 
be available for consideration of additional amendments. We may set 
aside a lot of amendments tonight and stack those amendments

[[Page 6768]]

that require a rollcall vote. Maybe most of these will not require a 
rollcall vote, but we are willing to stack some of these for votes for 
the convenience of all Members.
  Mr. SARBANES. Will the chairman yield on that very point?
  Mr. NICKLES. Be happy to.
  Mr. SARBANES. When does the chairman intend to vote on the amendments 
that are going to be offered and considered this evening?
  Mr. NICKLES. I would expect that will be tomorrow afternoon. I will 
make that decision after consulting both the majority leader and the 
ranking member of the Budget Committee.
  Mr. SARBANES. Presumably, then, if it is tomorrow afternoon, there 
would be added to the list other amendments that will be offered 
tomorrow morning, is that the procedure?
  Mr. NICKLES. That is correct. I say to my colleagues, for their 
information, I did consult with Senator Breaux and Senator Snowe, and I 
believe they are planning on offering the 350 amendment in the morning. 
That is a very significant amendment, just so people will know that 
will also be in the queue tomorrow morning.
  Mr. DURBIN. Will the Senator yield for a question?
  Mr. NICKLES. Be happy to yield.
  Mr. DURBIN. I ask the Senator from Oklahoma, has anyone suggested a 
time limit on the debate on each of these amendments of no more than 
half an hour so more amendments can be debated? We know where we are 
headed. We are going to run out of time and some of the amendments will 
not even have 1 minute of debate if we are not careful.
  Is it possible we could have a unanimous consent request to limit the 
debate to no more than half an hour on each amendment?
  Mr. NICKLES. Responding to my colleague, it depends on the amendment. 
I don't know if we can agree to a half an hour agreement on an 
amendment that would increase spending on prescription drugs by $200 
billion. That does not fit for a 30-minute discussion. Possibly other 
amendments might. So we will have to do an amendment-by-amendment 
basis.
  The resolution says each amendment would have up to 2 hours. I am 
happy to shorten that when appropriate.
  The PRESIDING OFFICER. Senator from North Dakota.
  Mr. CONRAD. I wonder if, on the next three amendments, we might 
arrive at a time agreement for the convenience of our colleagues. The 
Senator from Arizona has been very generous. He has said we can have 30 
minutes equally divided, something like that. Would that be 
appropriate?
  Mr. NICKLES. We are not prepared to enter into that on that amendment 
yet, nor on the Graham amendment. Possibly on the Rockefeller-Collins 
and possibly after Senator Collins' amendment we might agree to some of 
these. But I don't think we are ready just yet.
  Madam President, I yield to the Senator from Arizona for the purpose 
of introduction of an amendment.
  The PRESIDING OFFICER. The Senator from Arizona.


                           Amendment No. 288

  Mr. KYL. Madam President, I have an amendment at the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Arizona [Mr. Kyl] proposes an amendment 
     numbered 288.

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

   (Purpose: To provide financial security to family farm and small 
  business owners by ending the unfair practice of taxing someone at 
                                 death)

       On page 3, line 9, decrease the amount by $200,000,000.
       On page 3, line 10, decrease the amount by $5,200,000,000.
       On page 3, line 11, decrease the amount by $10,200,000,000.
       On page 3, line 12, decrease the amount by $34,600,000,000.
       On page 3, line 13, decrease the amount by $31,600,000,000.
       On page 3, line 14, decrease the amount by $34,100,000,000.
       On page 3, line 15, decrease the amount by $36,600,000,000.
       On page 3, line 16, decrease the amount by $31,100,000,000.
       On page 3, line 17, decrease the amount by $33,700,000,000.
       On page 3, line 18, decrease the amount by $58,100,000,000.
       On page 3, line 19, decrease the amount by $63,900,000,000.
       On page 3, line 23, decrease the amount by $200,000,000.
       On page 4, line 1, decrease the amount by $5,200,000,000.
       On page 4, line 2, decrease the amount by $10,200,000,000.
       On page 4, line 3, decrease the amount by $34,600,000,000.
       On page 4, line 4, decrease the amount by $31,600,000,000.
       On page 4, line 5, decrease the amount by $34,100,000,000.
       On page 4, line 6, decrease the amount by $36,600,000,000.
       On page 4, line 7, decrease the amount by $31,100,000,000.
       On page 4, line 8, decrease the amount by $33,700,000,000.
       On page 4, line 9, decrease the amount by $58,100,000,000.
       On page 4, line 10, decrease the amount by $63,900,000,000.
       On page 41, line 22, decrease the amount by $85,000,000.
       On page 41, line 23, decrease the amount by $85,000,000.
       On page 42, line 2, decrease the amount by $4,692,000,000.
       On page 42, line 3, decrease the amount by $4,692,000,000.
       On page 42, line 6, decrease the amount by $9,406,000,000.
       On page 42, line 7, decrease the amount by $9,406,000,000.
       On page 42, line 10, decrease the amount by 
     $33,617,000,000.
       On page 42, line 11, decrease the amount by 
     $33,617,000,000.
       On page 42, line 14, decrease the amount by 
     $30,324,000,000.
       On page 42, line 15, decrease the amount by 
     $30,324,000,000.
       On page 42, line 18, decrease the amount by 
     $32,408,000,000.
       On page 42, line 19, decrease the amount by 
     $32,408,000,000.
       On page 42, line 22, decrease the amount by 
     $35,018,000,000.
       On page 42, line 23, decrease the amount by 
     $35,018,000,000.
       On page 43, line 2, decreased the amount by 
     $28,750,000,000.
       On page 43, line 3, decreased the amount by 
     $28,750,000,000.
       On page 43, line 6, decreased the amount by $2,515,000,000.
       On page 43, line 7, decreased the amount by $2,515,000,000.
       On page 43, line 10, decreased the amount by $336,000,000.
       On page 43, line 11, decreased the amount by $336,000,000.
       On page 43, line 14, decreased the amount by $347,000,000.
       On page 43, line 15, decreased the amount by $347,000,000.

  Mr. KYL. In the spirit of the day, I was going to take 30 minutes. I 
will take exactly half that time, 15 minutes, and perhaps later we can 
agree to a time limitation. We certainly should not need a great deal 
of time on this amendment.
  This amendment is very simple. It simply moves forward 1 year the 
time for repeal of the estate tax or what is known as the death tax. As 
my colleagues know, we repealed the death tax permanently in the year 
effective January 1, 2010. This amendment moves that to January 1, 
2009.
  The reason for this is we can establish the proposition with this 
amendment that we do need to permanently repeal the estate tax. The 
budget that has been crafted by Senator Nickles and his committee has 
accounted for 3 years of permanent repeal. So that is already accounted 
for in this budget. This amendment would bring that forward 1 more 
year, so we would have a total of 4 years of repeal of the estate tax 
accounted for in our budget.
  We would still have to accomplish this, of course, by amendment or 
legislation. We cannot do it as part of the budget itself. This would 
create the opportunity for us to do that. That is the reason for my 
amendment.
  Now, there are a lot of reasons we decided to repeal the estate tax, 
and I don't think we need to repeat all of those tonight. The majority 
of this body supports repeal of the estate tax. We have passed repeal 
of the estate tax. There were good reasons for doing so, primarily 
because it is an unfair tax.
  In addition to that, it hurts small business. If you have a business 
of, say, 25 employees and you have to sell your

[[Page 6769]]

assets, your equipment, in order to pay your estate taxes, not only 
have you had to disband your business but you have also put 25 people 
out of work.
  At this time in our economy where we are concerned about joblessness, 
where we want to create more jobs, not see more jobs disappear, knowing 
the estate tax is going to be permanently repealed even sooner than we 
anticipated will help businesses stay alive to provide the jobs and the 
economic growth we need.
  We know by far and away the vast majority of the jobs in this country 
are created by small business.
  There were a number of sponsors of our original repeal. I anticipate 
we will have a number of sponsors of this amendment.
  I ask unanimous consent Senator Sessions be added as an original 
cosponsor of my amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. KYL. Rather than restating all the arguments for repeal, since we 
have already voted to do that, I will bring my colleagues up to date on 
some current research about what the American people believe about the 
estate tax.
  A poll was conducted early this year between January 16 and 21. It 
was a poll of about three times as many people as are ordinarily 
interviewed. Over 2,500 registered voters were interviewed for this 
survey by a research company. Its findings ought to be of significant 
interest to my colleagues.
  The bottom line is with respect to the estate tax. The conclusion of 
the poll is that the American people simply oppose, on principle, the 
concept of anyone being taxed on the death of their parents or their 
spouse.
  I thought I would share just four specific results from this survey. 
When it comes to stimulating the economy, the poll confirmed that 
Americans overwhelmingly believe tax relief is more effective than 
increases in Government spending. This goes to the general proposition 
that is being debated between those who believe we should spend more to 
help our economy and those who believe we should provide tax relief.
  The question was, Which is better for the Federal Government to 
stimulate the economy, increase economic growth, and create new jobs? 
And they were given two choices. One was the tax cut option, and the 
other was the spending option. Fully 68 percent chose the tax cut 
option, whereas only 20 percent said increased Government spending was 
the best for economic growth and the creation of new jobs.
  Two of the subgroups are particularly fascinating. Among Democrats 
surveyed, the ratio in favor of tax cuts over increased spending is a 
healthy 2 to 1, 57 percent to 28 percent. I do not have it broken down 
by State, but among Democrats, if it is 2 to 1, I daresay among 
Republicans it is even more than that.
  Among those with incomes below $30,000, 65 percent back the tax cut 
approach to improving the economy, while only 19 percent prefer 
increased Government spending. This is a significant finding in the 
survey.
  If there is going to be a tax cut, the question is, Should everyone 
get something back or should we wait until we have a budget surplus? In 
other words, what of this argument that will be contributing to the 
deficit?
  When given a choice of three options, even with the debate about the 
ballooning deficit, just one in four Americans, 24 percent, believe 
there should be no tax cuts for anyone until we have a budget surplus. 
Let me restate that. Only 24 percent of Americans believe it is 
improper to cut taxes while we have a deficit.
  For those who believe the majority of Americans do not want to cut 
taxes until we are in a surplus situation, this survey demonstrates 
that is incorrect. Only 24 percent of Americans believe that.
  To the third point, tax fairness. This is where we get into the death 
tax repeal specifically, but it relates to other taxes, too. As a 
general proposition, one expects people tend to favor taxes on someone 
else and to oppose taxes that affect them directly. And that is, as a 
general proposition, true. But what this survey of over 2,500 Americans 
just a couple of months ago confirms is that there is a very strong 
consensus that there are a couple of taxes that are absolutely unfair 
and it does not make any difference what demographic category you are 
in. Whether you are rich or poor, the overwhelming majority believes 
there are two taxes that are absolutely unfair, and there is an 
overwhelming consensus they should be repealed.
  What are those two taxes? These are the two at the top of the list to 
the question, What tax do you think is completely unfair or completely 
fair? The two taxes people would repeal with the biggest majority are 
the Social Security benefit tax and the death tax.
  Remember the tax that was imposed in the early Clinton years to 
actually tax Social Security benefits? That is very unpopular. Five 
percent of the people think it is completely fair; 62 percent think it 
is completely unfair.
  With the death tax, 7 percent think it is completely fair and 62 
percent also think that tax is completely unfair. Sixty-two percent of 
all Americans think it is completely unfair to have a death tax, and 
only 7 percent think it is completely fair.
  All other taxes--marriage penalty tax, long distance phone tax, 
savings account tax, all the way down to stock dividends, payroll 
income tax, property tax, gas tax, sales tax, right down the list, and 
they get increasingly popular. The marriage penalty, 60 percent of 
Americans think that is completely unfair. We are doing away with that 
in the tax package we will present as part of the budget. Long distance 
phone tax, 38 percent of the people think that is unfair. Capital gains 
tax, 23 percent think it is unfair. Stock dividend, more think it is 
completely unfair than completely fair, 23 to 21, the payroll tax, and 
so on. You finally get down to an alcohol and beer tax. That is pretty 
unpopular. Only 8 percent think that is a bad deal; 57 percent think it 
is fine. It is pretty much the same number for the cigarette tax.
  The bottom line is in this very recent extraordinarily large survey 
what we find is the two taxes the American people would repeal first 
and foremost are the tax on Social Security benefits and the estate 
tax. Fully 62 percent of the American people believe that tax to be 
completely unfair.
  With regard to the death tax in particular, you would think that this 
would be a tax that rich people would really like to get rid of and 
poor people would like to keep. After all, by its very nature, if you 
have a business or family farm or have some wealth to pass on to your 
heirs, repealing this tax would benefit you more than someone who has 
absolutely nothing. What does the survey show?
  Fully 65 percent of those with incomes below $30,000 believe the 
death tax is completely unfair. By comparison, a very interesting 
statistic, only 59 percent of individuals with incomes above $60,000 
label the death tax unfair.
  Ironically, more people at the lower end of the economic spectrum 
view this tax as completely unfair than when you get to be higher in 
the economic spectrum. The fact is, another poll, a Gallup poll, 
demonstrated the same phenomenon. Even though most people understood 
that repeal of the death tax would not benefit them personally, an 
overwhelming majority still favored repeal of the death tax. Why? 
Because they understand it is unfair.
  One of the great things about this country and the American people is 
they have an innate sense of fairness. Even if something doesn't 
benefit them directly, they understand if it is wrong they are willing 
to support its repeal.
  There are some other interesting survey results in terms of arguments 
against the death tax. I thought some of these were fun, and then I 
will close this out. If you ask certain questions about the death tax, 
for example, if you remind people that the highest rate of taxation for 
the death tax is 50 percent, then 79 percent of the people agree that 
is unfair and the tax should be repealed.
  When you remind people that the inheritance tax represents double and 
triple taxation, again 79 percent believe it should be repealed.
  With some of the arguments that are actual statements of fact with 
respect

[[Page 6770]]

to the inheritance or estate tax, when reminded of that, the American 
people are even more strongly in support of its repeal than if they are 
not reminded of that. Also, when you remind people that the tax is 
unfair because it singles out those who save and invest, for no reason 
other than the fact that they became successful and then died--of 
course, the exact thing we try to teach people, save your money, invest 
it, try to pass it along to your kids. It is the American dream to make 
the next generation better off than your generation; if you live the 
American dream, you get punished. If you are broke, you don't get 
punished. Of course the American people, when reminded of that, are 
even stronger in favor of repeal.
  The bottom line is every subgroup and fully 58 percent of the 
electorate as a whole, including, as I said, a majority of every 
subgroup, would vote for a candidate who advocates repeal of the death 
tax. Only 32 percent would vote for the candidate who supported 
maintaining the death tax.
  The bottom line of all this research is it seems to me we would not 
be keeping faith with the American people unless we are willing to move 
forward the date that the death tax is repealed.
  In the interim period of time, we are reducing the rate and we are 
also increasing the amount of income that is exempted from the 
inheritance tax. Both are good. But it seems to me, given this fact, 
that it is not too much to ask my colleagues to accelerate by 1 year 
the date that the tax is actually repealed. There will be some who say 
we cannot afford an immediate repeal today. To that I say, if that is 
your view, fine. That is not what we are doing here. I would prefer to 
do that.
  I think we can compromise and agree that moving the repeal date 
forward 1 year is both something that is affordable and something that 
should be done.
  This amendment is very straightforward. That is the long and short of 
it. I think I pointed out the American people would support this. I 
hope since the Senate has already gone on record by repealing the 
estate tax in the year 2010, that we would not be bashful about moving 
that forward by 1 year, to 2009.
  I guess my question to the body when we finally bring this to a vote 
is, Did you mean it when you said we should repeal the estate tax? If 
so, let's move that repeal date forward by 1 year.
  Mr. CONRAD. Mr. President, might I ask the author of this amendment 
what the cost is?
  Mr. KYL. Mr. President, I will try to get the exact number here in 
just a moment. I am informed that the estimated cost is $46 billion.
  Mr. CONRAD. It is $46 billion?
  Mr. KYL. Correct.
  Mr. CONRAD. Mr. President, I say to my colleague--
  Mr. KYL. Might I add one more thing, that, in our amendment, is 
accounted for within the budget because the money is taken from another 
account so it is not added on to the expense of the budget.
  Mr. CONRAD. That was going to be my next question, if I could, to the 
Senator. What is the way the Senator pays for this $46 billion?
  Mr. KYL. Mr. President, I tell my colleague the function in the 
budget is No. 920. That is the source of the funding for this 
amendment.
  Mr. CONRAD. Could the Senator tell us what constitutes 920?
  Mr. KYL. That is a general fund for Finance Committee action at some 
specified date in the future.
  Mr. CONRAD. I would say to my colleagues and the Senator from 
Arizona, it strikes me as ill-timed to come before the body and ask for 
another $46 billion when we are already deep in debt. We now know we 
are going to be facing deficits this year of $500 billion; the deficits 
as defined by law of over $300 billion every year for the next 10 
years. We are going to be taking virtually every penny of the Social 
Security surplus under the chairman's mark. Now the Senator offers $46 
billion, which he funds by reducing function 920. Function 920, of 
course, is a general governmental function, which is a popular place to 
reduce around here.
  I say to my colleagues, it seems to me that a wiser course than full 
repeal, which costs, combined with this amendment, $207 billion over 
the period of this budget, when we are already running deficits under 
the chairman's mark of $1.7 trillion, that a wiser course would be, 
instead of waiting until 2009 to have an elimination of the estate tax, 
to have people waiting all of that time between now and then and having 
an exemption of $1 million currently, instead of that, we could go to a 
$3 million exemption per person, $6 million per couple, have it take 
effect now, and only cost $33 billion for the whole thing, a fraction 
of the cost of complete repeal. We would continue to have a functioning 
estate tax but fundamentally reform it: Change it, don't end it. Change 
it to say an individual would have $3 million completely sheltered; a 
family would have $6 million completely sheltered. With planning, they 
could do substantially more than that and have that effective now, have 
that effective in the first part of the budget year that we are 
discussing. That would have a cost of $33 billion instead of the cost 
of permanent repeal of $207 billion, especially given the fact we are 
already in deep deficit.
  At some point I hope colleagues will begin to consider alternatives, 
to reform the estate tax, to change it, to make it more fair, and to 
fundamentally buttress the economic security of the country by not 
compounding these record deficits we already have.
  Mr. DORGAN. Will the Senator yield for a question?
  Mr. CONRAD. I am happy to yield to my colleague for a question.
  The PRESIDING OFFICER (Mr. Alexander). The Senator from North Dakota.
  Mr. DORGAN. I say to my colleague, Senator Conrad, I am unfamiliar 
with this notion of a tax on death. My colleague from Arizona spoke at 
length about the death tax.
  I am wondering, would it not be true that should a Member of the 
Senate, perhaps a married Member of the Senate, die, God forbid, in the 
coming week or so, that the spouse of that Member of the Senate would 
inherit, would have all of their property immediately with the spousal 
exemption, so that death would incur no tax, there would be no tax?
  So if there is a death in which there is no tax--which is the case 
with respect to the spouses, a 100-percent exemption--and all the 
property goes to the spouse, with no tax consequence, then exactly what 
is the death tax the Senator from Arizona is referring to? Is it, in 
fact, the tax on inherited wealth that exists in our law?
  And if it is on inherited wealth, of course, that is a different 
discussion which we should have. But if it is the death tax--which is a 
term that was created by pollsters to evoke a certain response--is it 
not the case that there is not a tax on death, that many deaths in this 
country means the estate is probated, and all of the assets of that 
estate go immediately to the spouse, with no tax under any 
circumstances? Is that not the case?
  Mr. CONRAD. That is the case. In fact, there is no death tax in 
America. That is a good rhetorical line, but there is no tax at death 
in America. Only 2 percent of estates currently are taxed, and they are 
taxed because they have amounts of value in the estate of over $1 
million.
  Now, under current law, in 2009, only three-tenths of 1 percent of 
estates will be subject to tax. That would mean 99.7 percent of estates 
would not be taxed.
  I might say, under the proposal I am suggesting tonight, we could go 
to that level next year. Why wait to have estate tax reform? Why not go 
to a $3 million exemption per person, $6 million per couple, and not 
wait until 2009?
  Mr. NICKLES. Will the Senator yield for a question?
  Mr. CONRAD. I want to complete my thought and complete my exchange 
with my colleague. Then I will be happy to yield.
  The thing that strikes me is we have gotten off on a debate here that 
really is detached from reality. It is detached from reality because 
the cost of full repeal in the next 10 years is $207 billion. How is 
that going to be financed? It is going to be financed by borrowing the 
money. It is going to be financed by

[[Page 6771]]

taking it out of the Social Security trust fund surpluses. That is how 
it is going to be financed.
  Now, does that make any sense? I would say no. I would say to borrow 
the money to give a big tax cut to the wealthiest Americans really does 
not make a whole lot of sense.
  Does that mean the current estate tax ought to be retained? No, it 
should not. It ought to be reformed, not repealed. It ought to be 
altered, as I suggest, so that a couple could exempt $6 million 
dollars. That costs a fraction of repeal and would give immediate 
relief.
  I am happy to yield to my colleague.
  Mr. DORGAN. If the Senator will yield further for a question, is it 
not the case that the majority last year passed a tax plan that had the 
following rather comical circumstance: It said we will sequentially 
increase the exemption on the estate tax to the point where in 2010 it 
is repealed, but in the year 2011 it actually comes back again?
  And if that is the case--I believe it is--I think historians will 
look back at this and say, well, who on Earth could have thought of 
that? Well, they thought of it, all right. That is what they put in the 
tax bill.
  Now, if that is the case, isn't it also the case that the amendment 
being offered today says let's make it even more farcical: Let's decide 
we will increase the exemption up until 2009, and we will have a 2-year 
repeal of the estate tax, to have it come back in 2011?
  We laughed a little last year about estate planning. There are going 
to be a lot of people on life support in 2009 because they have to wait 
until 2010 to die to get the total exemption, total repeal that was 
offered by the majority party.
  Now they are going to offer a 2-year window for death, apparently, 
and then the estate tax comes back in 2011. It is the most Byzantine, 
preposterous amount of nonsense. You would not put 10 people in a room 
with a six-pack of beer and come out with a worse result than they came 
out with last year on this estate tax issue.
  But to get back on the final point, it was passed as a repeal of the 
death tax when, in fact, there is no tax on death. There is a tax on 
inherited wealth.
  I ask my colleague, isn't the remaining question for this Senate, do 
we want to have some basic taxation on the largest estates--on the 
largest estates--of $1 billion, $10 billion, $20 billion, many of which 
have never been subjected to any kind of a tax because they were built 
with inside buildup and built with growth appreciation and have never 
been subjected to tax?
  Is the final argument, final debate, and final question, do we want 
to retain at least some basis of an estate tax for the very largest 
estates?
  Mr. CONRAD. It would seem to me really almost self-evident that the 
wiser course here would be immediate reform of the estate tax. Let's go 
to $3 million for an individual, $6 million for a couple. It would cost 
$33 billion over the next decade, but that is a fraction of the over 
$200 billion it would cost to fully repeal it.
  My colleague is quite correct, in estates of over $10 million, fully 
56 percent of the value of those estates has never been taxed. This is 
according to a study by Poterba and Weisbenner, that finds that is as a 
result of unrealized capital gains and as a result of buildup of 
property values never subjected to tax at all.
  So the question is, what is going to be the way we share the tax 
burden in this country? What is the most fair and equitable way to do 
that?
  I would suggest completely eliminating the estate tax for very 
wealthy individuals, which is of necessity going to force others--
middle-class people, lower-middle-class people--to pay more in order to 
foot the bill, is not fair. It is not equitable.
  It would really make more sense to fundamentally change the estate 
tax, to give a much larger exemption than we currently have. Currently, 
it is $1 million. Instead, we should raise that to $3 million for an 
individual, $6 million for a couple, and do it immediately. It costs a 
fraction of repealing it all. We would still have wealthy individuals 
in this country who would have an opportunity to contribute and not 
shift that tax burden onto middle-income taxpayers.
  Mr. NICKLES. Will the Senator yield?
  Mr. CONRAD. I am happy to yield to my colleague.
  Mr. NICKLES. I thank my friend and colleague.
  I heard your proposal that would increase the exemption. I did not 
hear you address rates. Would you leave the rates at the present 50-
percent rate for estates that would be taxed?
  Mr. CONRAD. What I just described, I say to the Senator, I don't know 
if you had a chance to hear.
  Mr. NICKLES. I will be happy to look at it.
  Mr. CONRAD. It is to have a reform of estate tax. Instead of the $1 
million exemption currently, to go to $3 million for an individual, $6 
million for a couple. In this calculation, it costs $33 billion. I 
don't----
  Mr. NICKLES. What is the tax rate?
  Mr. CONRAD. I was going to get to that.
  I think this is at the 50-percent rate. I would certainly be open to 
an adjustment of that rate as well in order to try to arrive at a 
conclusion that was equitable and that is not as costly as full repeal.
  Mr. NICKLES. I thank the Senator.
  Mr. REID. Will the Senator from North Dakota yield for a question?
  Mr. CONRAD. I am happy to yield.
  Mr. REID. I have been sitting here listening to this debate. Under 
the proposal offered by the distinguished Senator from Arizona, it is 
my understanding that Warren Buffet, who is worth $38 billion, I was 
told----
  Mr. CONRAD. How much?
  Mr. REID. Worth $38 billion.
  Mr. CONRAD. That is real money.
  Mr. REID. If he passed away, under this amendment offered by my 
friend from Arizona, he would pay no estate taxes.
  Mr. CONRAD. That is correct. He would pay no estate tax.
  Mr. REID. What would happen to his accumulated wealth?
  Mr. CONRAD. Well, it would go as directed under his will. I am not 
privy to what distributions he has determined to make.
  Mr. REID. Will the Senator from North Dakota yield for another 
question?
  Mr. CONRAD. I am happy to yield.
  Mr. REID. I wanted to confirm that the Senator from North Dakota has 
listened to Warren Buffett, Bill Gates, Sr., and George Soros. I have 
heard those three people state that they think it is ridiculous, 
senseless to have them pay no estate tax. Have you heard these three 
very wealthy men say this?
  Mr. CONRAD. I have. In fact, I have heard all three of those 
gentlemen and other wealthy individuals--George Soros, of course, who 
is a multibillionaire; Mr. Buffett, a multibillionaire; Mr. Gates, Sr., 
I don't think he himself is a multibillionaire, although he is 
obviously a very wealthy individual--say they believe it is un-American 
not to have an estate tax; that an estate tax was put in place first of 
all to raise revenue during a war, interestingly enough. That is how we 
initially got the estate tax, was to help pay for a war.
  Here we are on the brink of another war, and instead of figuring out 
how to pay for it, we are trying to figure out how to have trillions of 
dollars of additional tax cuts going primarily to the wealthiest among 
us. It really is kind of baffling. We are asking young men and women to 
be prepared to sacrifice everything, and we are prepared to sacrifice 
nothing, apparently.
  There are many wealthy individuals who believe the estate tax ought 
to be modified. I would strongly support that. I don't think a million-
dollar exemption anymore is realistic or very relevant in light of the 
economy today. I believe it ought to be dramatically increased. I think 
we ought to go to $3 million for an individual, $6 million for a 
couple, and we ought to do it now. I would also be open to a reduction 
in rates. I think 50 percent is too high. But repealing it all is 
unaffordable, it is unfair, and it is fundamentally a long-term 
mistake. Why? Because I think it will lead to the concentration

[[Page 6772]]

of wealth in the hands of fewer and fewer people.
  If you look back to the establishment of the estate tax, one of the 
foremost advocates was a Republican President, Theodore Roosevelt. 
Theodore Roosevelt said it is a profound social mistake to allow wealth 
to accumulate in the hands of a handful of people who, by inheritance, 
become enormously powerful; that our society is a society based on 
merit and a society based on what an individual achieves, not what they 
inherit; and that if we want to become like Europe and have inherited 
wealth assume a greater and greater role in society, then eliminate the 
estate tax, because in very short order you will have enormous wealth 
and power accumulate in the hands of a few.
  Mr. REID. Will the Senator yield for a question?
  Mr. CONRAD. I am happy to yield.
  Mr. REID. In my previous question to the Senator from North Dakota, I 
talked about three very successful men, all of whom are senior 
citizens. I want to relate to the Senator from North Dakota that about 
2 months ago I had dinner in Las Vegas with a man I had never met 
before. His name is Pierre Omidyar. Pierre is the founder of eBay. As a 
young man, he had this idea and on his computer developed eBay which is 
now a fantastically significant part of our economy. It is his. He, in 
spite of the stock market dropping, is worth $3 or $4 billion. He is 34 
years old.
  The whole purpose of his dinner with me, just the two of us, was to 
explain to me how he hoped I would work as hard as I could to make sure 
the estate tax is not repealed. Here is a man who is happily married, 
has two little children, and is one of the wealthiest men in America. 
He is not an old man; he is a very young man. And he believes, as does 
the Senator from North Dakota, that acquired wealth in large amounts is 
not good for America.
  I don't think I have given this story to the Senator from North 
Dakota, have I?
  Mr. CONRAD. No.
  Mr. REID. But if we have these very successful people talking about 
why they believe it is bad--I have been present when Mr. Gates, Mr. 
Buffett, and Mr. Soros all talked about their belief that by a roll of 
the dice, a roulette wheel, they were born in America. They said they 
could have their entrepreneur genius--those are words I am using, not 
theirs--and if they were born anyplace but in the United States, it 
wouldn't amount to much. They believe as a result of their having been 
born in America, they owe that to America.
  The Senator has heard those statements, has he not?
  Mr. CONRAD. I have.
  Mr. REID. Would the Senator agree that those three older men and the 
young man have a concept of what the Senator from North Dakota is 
saying: Change the estate tax, raise it if it is appropriate. I believe 
it is appropriate. Would the Senator agree that we have tried to do 
that? We have asked unanimous consent. We have offered amendments that 
have been defeated. I want the Senator from North Dakota to see if he 
agrees with me. I think people want the political issue more than they 
want to change the estate tax. Would the Senator agree with that?
  Mr. CONRAD. I hope that is not the case. We have an opportunity now 
to resolve the estate tax for a long time. If we would reform it 
without repealing it, we would do something that is important and 
valuable. At $1 million, the estate tax is biting at much too low a 
level. Most of us in this Chamber would certainly degree with that 
statement. The economy has changed. The world has changed. We have not 
made a significant enough adjustment in the estate tax. We have not 
modernized the estate tax in a way that makes any sense.
  One million, it has been raised to that, but that has not kept pace 
with what has happened in the real world. As a result, it is putting 
too much pressure on small farmers and small business people. We could 
do something right now. We could raise that exemption to $3 million for 
an individual and $6 million for a couple. With planning, it could be 
substantially more than that. That would shield the vast majority of 
small businesses, the vast majority of individuals. At the same time, 
we would not have the extraordinary cost associated with repeal.
  We have to have current events inform our decisions. The hard reality 
is, we are in record deficit. We have deficits as far as the eye can 
see. And the situation is going to get worse when the baby boomers 
retire. From where is the money going to come? If you repeal the estate 
tax, that burden is going to have to shift somewhere else. It is going 
to raise taxes on middle-income people. That is where most of the taxes 
are paid. I don't think that is the appropriate outcome.
  I do think we ought to reform it. We ought to raise this. I would 
even be open to what the chairman of the committee has referenced as 
the tax rate itself, which at 50 percent seems unreasonably high as 
well. Perhaps in the time remaining here we might get together and come 
up with something that would really be a contribution to the country 
and a valuable change.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. DORGAN. Mr. President, as I understand it, the Senator from 
Arizona had offered an amendment. We had discussed, prior to his 
offering the amendment, that Senator Graham, I, and Senator Stabenow 
would offer an amendment on prescription drugs. I would ask the manager 
about the circumstances. Do we need to set aside the amendment that is 
now pending in order to offer the amendment on prescription drugs for 
Senator Graham, myself, and Senator Stabenow?
  Mr. NICKLES. The Senator is correct. We need to set it aside. I think 
a couple of us want to speak on the amendment that is pending before we 
set it aside.
  I think the debate has been on the one side for the last 25 minutes.
  Mr. DORGAN. I understand. We were told that the presentation of that 
was going to be 5 minutes, and we were going to move to that amendment. 
That has not quite happened. I wonder when we might expect to move to 
this amendment.
  Mr. NICKLES. Mr. President, I encourage my colleagues to go through 
the Chair for parliamentary procedure. I didn't make that point, but I 
think it is important.
  The PRESIDING OFFICER. Who yields time?
  Mr. NICKLES. If the Senator is finished with his inquiry, I yield to 
the Senator from Alabama 10 minutes. Would that be sufficient?
  Mr. SESSIONS. That would be sufficient.
  The PRESIDING OFFICER. The Senator from Alabama is recognized.
  Mr. SESSIONS. Mr. President, I send a modification to the desk on 
behalf of Senator Kyl, which he failed to file earlier.
  The PRESIDING OFFICER. Is there objection to the modification?
  Mr. CONRAD. Mr. President, is the Senator proceeding on a modified 
amendment?
  Mr. SESSIONS. My understanding is that it has been agreed to 
previously.
  Mr. CONRAD. There has been no request to modify the amendment.
  Mr. SESSIONS. I withdraw that request at this time.
  The PRESIDING OFFICER. The Senator from Alabama has the floor.
  Mr. SESSIONS. Mr. President, there is a death tax. I had in my office 
2 days ago Professor Harold Apolinsky, from the University of Alabama. 
He is indeed a brilliant professor. He has dedicated his life to the 
elimination of the death tax. He says it is an immoral tax. He feels so 
strongly about it that he has given an incredible amount of his time 
and effort and resources into seeking its elimination.
  I recall just how much of an impact it can have. A lady I know told 
me the story of her grandfather. President Reagan had been in office in 
1981, and they passed an amendment that changed the death tax a little 
bit.
  Do you know what it was then when they changed it? The rate was 70 
percent on estates over $175,000. Four Members in this body voted to 
keep it at that rate. They reduced it to 55 percent. Big deal.

[[Page 6773]]

  They were home for Christmas and the family was gathered. He had 
cancer and he was dying, fading fast. She told the story that every 
morning he asked what day it was. He died at 10 a.m. on January 1, the 
day the law took effect--his last great act for his family to protect a 
little bit more of the farm that he had built up over all those years.
  I believe we are in agreement on the modification now; is that 
correct?
  Mr. CONRAD. Mr. President----
  The PRESIDING OFFICER. The Senator from Alabama has the floor.


                     Amendment No. 288, As Modified

  Mr. SESSIONS. Mr. President, I reoffer the modification on behalf of 
Senator Kyl. I think maybe we have an understanding now.
  The PRESIDING OFFICER. Is there objection to the modification?
  Mr. CONRAD. Reserving the right to object, and we will not object, we 
are happy to have the amendment modified so that Senator Kyl's actual 
intention is embodied in the amendment. We are happy to allow that 
modification to be made.
  The PRESIDING OFFICER. The amendment will be so modified.
  The amendment, as modified, is as follows:

       On page 3, line 9, increase the amount by $115,000,000.
       On page 3, line 10, increase the amount by $508,000,000.
       On page 3, line 11, increase the amount by $595,000,000.
       On page 3, line 12, increase the amount by $783,000,000.
       On page 3, line 13, increase the amount by $1,076,000,000.
       On page 3, line 14, decrease the amount by $3,909,000,000.
       On page 3, line 15, decrease the amount by $12,218,000,000.
       On page 3, line 16, decrease the amount by $28,750,000,000.
       On page 3, line 17, decrease the amount by $2,515,000,000.
       On page 3, line 18, decrease the amount by $336,000,000.
       On page 3, line 19, decrease the amount by $347,000,000.
       On page 3, line 23, increase the amount by $115,000,000.
       On page 4, line 1, increase the amount by $508,000,000.
       On page 4, line 2, increase the amount by $595,000,000.
       On page 4, line 3, increase the amount by $783,000,000.
       On page 4, line 4, increase the amount by $1,076,000,000.
       On page 4, line 5, decrease the amount by $3,909,000,000.
       On page 4, line 6, decrease the amount by $12,218,000,000.
       On page 4, line 7, decrease the amount by $28,750,000,000.
       On page 4, line 8, decrease the amount by $2,515,000,000.
       On page 4, line 9, decrease the amount by $336,000,000.
       On page 4, line 10, decrease the amount by $347,000,000.
       On page 4, line 14, increase the amount by $115,000,000.
       On page 4, line 15, increase the amount by $508,000,000.
       On page 4, line 16, increase the amount by $595,000,000.
       On page 4, line 17, increase the amount by $783,000,000.
       On page 4, line 18, increase the amount by $1,076,000,000.
       On page 4, line 19, decrease the amount by $3,909,000,000.
       On page 4, line 20, decrease the amount by $12,218,000,000.
       On page 4, line 21, decrease the amount by $28,750,000,000.
       On page 4, line 22, decrease the amount by $2,515,000,000.
       On page 4, line 23, decrease the amount by $336,000,000.
       On page 4, line 24, decrease the amount by $347,000,000.
       On page 5, line 4, increase the amount by $115,000,000.
       On page 5, line 5, increase the amount by $508,000,000.
       On page 5, line 6, increase the amount by $595,000,000.
       On page 5, line 7, increase the amount by $783,000,000.
       On page 5, line 8, increase the amount by $1,076,000,000.
       On page 5, line 9, decrease the amount by $3,909,000,000.
       On page 5, line 10, decrease the amount by $12,218,000,000.
       On page 5, line 11, decrease the amount by $28,750,000,000.
       On page 5, line 12, decrease the amount by $2,515,000,000.
       On page 5, line 13, decrease the amount by $336,000,000.
       On page 5, line 14, decrease the amount by $347,000,000.
       On page 41, line 22, increase the amount by $115,000,000.
       On page 41, line 23, increase the amount by $115,000,000.
       On page 42, line 2, increase the amount by $508,000,000.
       On page 42, line 3, increase the amount by $508,000,000.
       On page 42, line 6, increase the amount by $595,000,000.
       On page 42, line 7, increase the amount by $595,000,000.
       On page 42, line 10, increase the amount by $783,000,000.
       On page 42, line 11, increase the amount by $783,000,000.
       On page 42, line 14, increase the amount by $1,076,000,000.
       On page 42, line 15, increase the amount by $1,076,000,000.
       On page 42, line 18, decrease the amount by $3,909,000,000.
       On page 42, line 19, decrease the amount by $3,909,000,000.
       On page 42, line 22, decrease the amount by 
     $12,218,000,000.
       On page 42, line 23, decrease the amount by 
     $12,218,000,000.
       On page 43, line 2, decrease the amount by $28,750,000,000.
       On page 43, line 3, decrease the amount by $28,750,000,000.
       On page 43, line 6, decrease the amount by $2,515,000,000.
       On page 43, line 7, decrease the amount by $2,515,000,000.
       On page 43, line 10, decrease the amount by $336,000,000.
       On page 43, line 11, decrease the amount by $336,000,000.
       On page 43, line 14, decrease the amount by $347,000,000.
       On page 43, line 15, decrease the amount by $347,000,000.

  Mr. SESSIONS. Mr. President, this is a big deal in real life. We are 
talking about taking half of somebody's accumulated estate. That is a 
lot. It does happen when people die, and there are professionals out 
there who do this business, and they try to manipulate and avoid and 
delay, and sometimes they are successful, sometimes they are not. I 
want to talk about it in a little bit different vein tonight.
  I want to talk about what I think is a major problem in America. I 
know Senator Conrad is concerned about it. It is a collapse of smaller 
businesses and a trend toward larger and larger consolidation of 
business.
  I know an individual in Alabama--I met him at a town hall meeting. He 
and his father spoke to me. They told me they are paying $5,000 a month 
for life insurance on their father's life. They own three motels. They 
would like to expand motels. That $5,000 a month would probably help 
them buy a fourth motel. But they have to pay it for no other reason 
than if something happens to their father, they would have to pay an 
estate tax, and it would come out of their small business and they 
would lose it.
  Remember, this little chain of three motels is competing against 
Ramada, Holiday Inn, Marriott, and they are getting savaged every 
generation by a 50-percent tax on what the value of that family's 
estate is. That tax is not paid by the broadly held corporations, the 
international corporations. They never pay this tax. Think about it. It 
is a tax that falls on small businesses and individuals. It does not 
fall on big businesses.
  I know an individual who owns several thousand acres of land. He is 
very fortunate and very generous with ball teams and schools and 
charitable organizations and is a wonderful person. Some might say he 
is wealthy. But the big paper companies own millions of acres of land. 
They don't ever pay a death tax. He is competing, really, with them.
  I know International Paper owns 2 million acres of land. They are 
never impacted by the death tax.
  Ask yourself, why is it that banks in towns all over America are 
closing? In Mobile, AL, we had four local banks. They are all gone 
today. One or two came back, but all of them were sold out to the big 
ones. Why? Because the people who owned them got up in years and they 
were facing a confiscatory tax on what they had accumulated. They 
didn't have the cash to pay it. Everything they owned was in the bank, 
the business they built up. They had to get out and get liquid and 
create a situation in which they could avoid some taxes, perhaps, and 
have the cash to pay the tax because if they had to sell off the 
business all at once to pay the tax, it would collapse.
  I am saying, with absolute confidence, this death tax is a driving

[[Page 6774]]

force behind the collapse of small businesses. Think about funeral 
homes. I know the occupant of the chair, who is from Tennessee, knows 
that the people running those funeral homes are usually good business 
people. As the population grew and more people came to the end of their 
life, they have done well in their business, but they are then facing 
the death tax. Maybe they have stock or bought some property, and they 
may have a home that has appreciated in value. All of a sudden they are 
looking at a big hit.
  Now funeral homes are being brought up by chains--broadly held 
corporations now have these funeral homes. They will never pay the 
death tax. It will never impact them.
  How do you with a $3 million company compete with Holiday Inn? We 
want to encourage $50 million companies, $100 million companies, and 
$200 million companies to compete against billion-dollar companies. We 
are chopping them off.
  A vision I have is that you go out in the woods and there is a little 
pine tree trying to grow and compete with the taller trees. But just as 
it breaks in and gets sunlight, somebody comes in and chops the top off 
and takes half of it. It will never be able to compete.
  We are putting them at a disadvantage. It cannot be overcome. I 
believe it is unhealthy. If we care about small business, about 
encouraging innovation and competition and growth in America, we need 
to think about this. So I think there are a lot of reasons we ought to 
consider the elimination of this tax. It is certainly an unfair tax. 
People have paid their taxes, and then at the time of their death, they 
are taxed again in a way that savages the ability of a business to 
remain competitive.
  I note that the taxes are only a percent or two of the income to this 
Government. It is not critical to our revenue.
  The PRESIDING OFFICER. The Senator has used his 10 minutes.
  Mr. SESSIONS. We voted to eliminate the death tax once before. It is 
time to complete the job. I support the amendment.
  The PRESIDING OFFICER. The Senator from Oklahoma.
  Mr. NICKLES. Mr. President, I know there are colleagues who want to 
offer the prescription drug amendment. I will make a few comments on 
elimination of the death tax.
  A couple of people said there is no tax on death. I disagree. I can 
say that from experience. My father died, and there was a significant 
death tax. His death was a taxable event. If he had not died, there 
would not have been a taxable event. To say there is no death tax--
maybe it is something the pollsters came up with--is something about 
which I totally disagree.
  Under current law, if you die, if your estate is above a certain 
amount, your survivors will have to pay a tax. I call that a death tax. 
It can be called an inheritance tax, an estate tax, whatever one wants 
to call it.
  We did pass an exemption in 1981 that exempted surviving spouses from 
the death tax. I was one of the principal sponsors of that legislation 
in 1981. I worked to put that in the big bill. That was one of the big 
tax bills. I was a freshman Senator and I really wanted to put that in 
the bill because I learned the hard way.
  My father passed away. My mother had five kids, and she inherited a 
business. The Government came in and said: We want about half of the 
business. We negotiated, struggled, and agonized. I say we, I was a 
child. My mother struggled for years over what the size of this company 
was, how much of it the Government was entitled to--were they entitled 
to half of it, a third of it. Eventually, something was settled but she 
had to pay the Government. I guess I did, too. Survivors who wanted to 
keep the business had to pay a lot of tax. Why? Because my father died. 
So if somebody says there is not a death tax, I disagree.
  They say: We exempt spouses. That does not make any difference. If 
you want to pass your business on to your son, the Government says: We 
want half.
  Somebody said it only applies to 1 percent or 2 percent of the 
estates. What tax rate is right? Fifty percent? I appreciate the fact 
that my colleague from North Dakota said the rate is too high. It is 
too high. Why would we tax estates, a death tax, in excess of the 
personal tax rate? The maximum personal tax rate hopefully will soon be 
35 percent. The maximum corporate rate is 35 percent. Why should a 
taxable event caused by death be as much as 50 percent?
  Frankly, if we do not extend the law, it could go back to 55 and 60 
percent. In present law, the maximum is 50 percent. But if the 2001 law 
expires--if we go back before we made the changes in 2001, then the 
maximum tax rate returns to 55 percent, and on a taxable estate between 
$10 million and $17 million, there is an additional 5 percent 
surcharge. It will go back to 60 percent.
  I hear some colleagues say: We should exempt not just $1 million, but 
maybe $2 million or $3 million, maybe twice that amount for spouses. 
But above that, we still would have a rate of 50 percent. That is way 
too high. Why is that? Why in the world if somebody passes away should 
the Government take half? If somebody builds a business and let's say 
they build up the business, and maybe they are employing thousands of 
people, should the Government come in and take half? Whoever inherited 
the business has to sell it and pay taxes. The Government wins and the 
employees lose--they lose their jobs.
  What about George Soros? He is a billionaire. Or Mr. Buffett? My 
guess is--I do not know--my guess is they have foundations, they have 
great tax accountants, and they were able to set up foundations that do 
not pay tax, period.
  They do not pay tax on their earnings. They are tax exempt, and they 
do not pay death taxes. They built up these enormous foundations. 
Great, I am proud of them.
  There are a whole lot of people who own family farms and businesses 
that they are trying to grow and expand, and they are not big enough to 
hire attorneys and have foundations, and they are liable for a death 
tax. That hangs as a heavy cloud over a lot of businesses that decide 
not to grow because they know if they grow, the Government is going to 
get half.
  We did work in 2001 to bring that down. We gradually brought it down 
to, I think, 45 percent. It goes to zero in the year 2010, and then 
presumably if we do not pass a bill to change it, by 2011, it will pop 
back up to 55, maybe even as much as 60 percent.
  Senator Kyl says let's expand that zero bracket. The resolution 
before us presumes--presumes--that Congress will extend the provisions 
in the 2001 tax bill, so it would extend the repeal of the death tax 
for the year not only 2010, but also 2011 and 2012. Senator Kyl's 
amendment says it should be for the year 2009. That will be 4 years 
with a zero tax on the taxable event of death.
  If somebody says they pay no tax, they do not understand Senator 
Kyl's amendment. They do not understand the law we passed. Senator 
Kyl's amendment and the present law says a taxable event is moved from 
death to the sale of the property. What does the sale of the property 
mean? It means capital gains. What is the tax rate on capital gains? It 
is 20 percent.
  Also in that provision we passed in 2001, it says we eliminate or 
stop the step-up in basis over a certain amount. What does that mean? 
It means if George Soros has a net worth of $38 billion and he passed 
away, if he has not paid capital gains on that net worth and there is 
no step-up in basis and the initial investment was much less than that, 
then he would be taxed at 20 percent on that incremental value.
  Maybe if he had initial investment of, let's say, $18 billion--I 
doubt it would be that much; maybe a lot less--he would pay 20 percent 
on the incremental difference between the carry-over basis and what it 
was at the time of sale. If somebody in his company did not sell the 
business, there would not be a tax.
  I like to think of this more in the vernacular of a small business. 
If a small business wants to pass it on to their kids and the kids do 
not sell the business, they do not pay a tax. But

[[Page 6775]]

when and if they do sell, they pay a tax. There would be capital gains 
on a carried-over basis.
  It is interesting, the people who have scored some of these 
amendments, Joint Tax, sort of forgot to account the offsetting 
additional income that would be generated from the sale of operations, 
the capital gains that would be measured.
  The law we passed in 2001 says: Let's change the taxable event from 
death to when the property is sold. If someone receives property as a 
result of someone's death and they sell it, then they pay capital 
gains. If they do not sell it, then there is no capital gains. The 
taxable event would no longer be death; it would be when the property 
is sold. It makes eminent good sense.
  There are other ways of doing this, but the present law in taxing 
estates and taxing inherited property or taxing a business or a farm or 
a ranch just makes no sense whatsoever. The big boys are able to figure 
out ways to get around it through fancy accountants and foundations, 
and they do not pay the tax. A lot of middle-income people and smaller 
businesses pay a lot of tax. It really does inhibit their growth.
  I compliment my colleague from Arizona for his amendment. I am 
intrigued by the interest of my colleagues from North Dakota and Nevada 
in maybe trying to do something. I think we can do something, and we 
have the opportunity to do it. It will not be done in this bill. We did 
not put in a reconciliation instruction dealing with this provision, 
but it is something we can deal with and this Congress ought to deal 
with. There is some money on the table to make that available. We 
should have a tax rate on a taxable estate or inherited property in the 
neighborhood of 20 percent. You might generate some money.
  Right now this tax is counterproductive in so many ways. I will give 
one example. Our business did not grow because we were thinking at that 
time that the Government would take so much, so why would anybody 
expand if the Government is going to come in and take it? And how could 
you pass property on from one generation to another generation to 
another generation if the Government wanted to come in and take half 
every time? It just does not work. It is very difficult for a privately 
held business, if they want to pass it on from the second and third 
generation, to do so if the Government is going to take half. That 
business may be more than $3 million. That business may be $20 million. 
It may be $100 million. Think of some great companies that might be 
privately held. If the owners pass away, should the Government take 
half? I do not think so. I would hope not.
  I am intrigued by the ideas that different colleagues have.
  I encourage an open dialogue. I think my colleague from Arizona is to 
be complimented for his work in this field. I am intrigued and 
encouraged by some of the debate I am hearing. I would love to see us 
come up with a bipartisan, permanent resolution on how to address the 
estate tax. The present law is not satisfactory. It needs to be 
amended. It needs to be addressed, and I would love to see this 
Congress this year pass something we could all be proud of that would 
be a significant and positive reform for businesses and individuals all 
across the country.
  Mr. REID. Will the Senator yield for a question?
  Mr. NICKLES. I would be happy to yield.
  Mr. REID. Would the Senator, the manager of the bill for the 
majority, on the next amendment which will be offered, which will be 
prescription drugs, allow a time of 40 minutes on each side?
  The PRESIDING OFFICER. The Senator from Oklahoma.
  Mr. NICKLES. I cannot agree to a 40 minute time limit----
  Mr. REID. I withdraw the request.
  Mr. NICKLES. On an amendment that deals with $200 billion. That would 
be so many billion dollars per minute. That might be a little 
expensive. I will be happy to work with my colleagues.
  If no other Senators wish to speak on the underlying amendment, I ask 
unanimous consent to set aside the pending amendment so an amendment 
offered by the Senator from North Dakota and the Senator from Florida 
can be offered at this point.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  The Senator from North Dakota.


                           Amendment No. 294

  Mr. DORGAN. Mr. President, I send an amendment to the desk on behalf 
of myself, Senator Graham of Florida, and Senator Stabenow, and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from North Dakota [Mr. Dorgan], for himself, 
     Mr. Graham of Florida, and Ms. Stabenow, proposes an 
     amendment numbered 294.

  Mr. DORGAN. 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 a meaningful prescription drug benefit in Medicare 
                that is available to all beneficiaries)

       On page 3, line 9, increase the amount by $7,580,000.
       On page 3, line 10, increase the amount by $23,341,000,000.
       On page 3, line 11, increase the amount by $26,169,000,000.
       On page 3, line 12, increase the amount by $29,003,000,000.
       On page 3, line 13, increase the amount by $32,406,000,000.
       On page 3, line 14, increase the amount by $35,710,000,000.
       On page 3, line 15, increase the amount by $39,465,000,000.
       On page 3, line 16, increase the amount by $43,508,000,000.
       On page 3, line 17, increase the amount by $47,687,000,000.
       On page 3, line 18, increase the amount by $52.440,000,000.
       On page 3, line 19, increase the amount by $58,514,000,000.
       On page 3, line 23, increase the amount by $7,589,000,000.
       On page 4, line 1, increase the amount by $23,341,000,000.
       On page 4, line 2, increase the amount by $26,169,000,000.
       On page 4, line 3, increase the amount by $29,003,000,000.
       On page 4, line 4, increase the amount by $32,406,000,000.
       On page 4, line 5, increase the amount by $35,710,000,000.
       On page 4, line 6, increase the amount by $39,465,000,000.
       On page 4, line 7, increase the amount by $43,508,000,000.
       On page 4, line 8, increase the amount by $47,687,000,000.
       On page 4, line 9, increase the amount by $52,440,000,000.
       On page 4, line 10, increase the amount by $53,514,000,000.
       On page 4, line 14, decrease the amount by $56,000,000.
       On page 4, line 15, decrease the amount by $6,750,000,000.
       On page 4, line 16, decrease the amount by $12,607,000,000.
       On page 4, line 17, decrease the amount by $2,089,000,000.
       On page 4, line 18, increase the amount by $11,134,000,000.
       On page 4, line 19, increase the amount by $13,388,000,000.
       On page 4, line 20, increase the amount by $18,051,000,000.
       On page 4, line 21, increase the amount by $23,189,000,000.
       On page 4, line 22, increase the amount by $28,020,000,000.
       On page 4, line 23, increase the amount by $33,135,000,000.
       On page 4, line 24, increase the amount by $39,338,000,000.
       On page 5, line 4, decrease the amount by $56,000,000.
       On page 5, line 5, decrease the amount by $6,750,000,000.
       On page 5, line 6, decrease the amount by $12,607,000,000.
       On page 5, line 7, decrease the amount by $2,089,000,000.
       On page 5, line 8, increase the amount by $11,134,000,000.
       On page 5, line 9, increase the amount by $13,388,000,000.
       On page 5, line 10, increase the amount by $18,051,000,000.
       On page 5, line 11, increase the amount by $23,189,000,000.
       On page 5, line 12, increase the amount by $28,020,000,000.
       On page 5, line 13, increase the amount by $33,135,000,000.
       On page 5, line 14, increase the amount by $39,338,000,000.
       On page 5, line 17, increase the amount by $7,645,000,000.
       On page 5, line 18, increase the amount by $30,091,000,000.
       On page 5, line 19, increase the amount by $38,776,000,000.

[[Page 6776]]

       On page 5, line 20, increase the amount by $31,092,000,000.
       On page 5, line 21, increase the amount by $21,272,000,000.
       On page 5, line 22, increase the amount by $22,322,000,000.
       On page 5, line 23, increase the amount by $21,414,000,000.
       On page 5, line 24, increase the amount by $20,319,000,000.
       On page 5, line 25, increase the amount by $19,667,000,000.
       On page 6, line 1, increase the amount by $19,305,000,000.
       On page 6, line 2, increase the amount by $19,176,000,000.
       On page 6, line 5, decrease the amount by $7,645,000,000.
       On page 6, line 6, decrease the amount by $37,737,000,000.
       On page 6, line 7, decrease the amount by $76,513,000,000.
       On page 6, line 8, decrease the amount by $107,604,000,000.
       On page 6, line 9, decrease the amount by $128,877,000,000.
       On page 6, line 10, decrease the amount by 
     $151,199,000,000.
       On page 6, line 11, decrease the amount by 
     $172,612,000,000.
       On page 6, line 12, decrease the amount by 
     $192,931,000,000.
       On page 6, line 13, decrease the amount by 
     $212,599,000,000.
       On page 6, line 14, decrease the amount by 
     $231,903,000,000.
       On page 6, line 15, decrease the amount by 
     $251,080,000,000.
       On page 6, line 18, decrease the amount by $7,645,000,000.
       On page 6, line 19, decrease the amount by $37,737,000,000.
       On page 6, line 20, decrease the amount by $76,513,000,000.
       On page 6, line 21, decrease the amount by 
     $107,604,000,000.
       On page 6, line 22, decrease the amount by 
     $128,877,000,000.
       On page 6, line 23, decrease the amount by 
     $151,199,000,000.
       On page 6, line 24, decrease the amount by 
     $172,612,000,000.
       On page 6, line 25, decrease the amount by 
     $192,931,000,000.
       On page 7, line 1, decrease the amount by $212,599,000,000.
       On page 7, line 2, decrease the amount by $231,903,000,000.
       On page 7, line 3, decrease the amount by $251,080,000,000.
       On page 29, line 6, decrease the amount by $6,000,000,000.
       On page 29, line 7, decrease the amount by $6,000,000,000.
       On page 29, line 10, decrease the amount by 
     $10,000,000,000.
       On page 29, line 11, decrease the amount by 
     $10,000,000,000.
       On page 29, line 14, increase the amount by $2,498,000,000.
       On page 29, line 15, increase the amount by $2,498,000,000.
       On page 29, line 18, increase the amount by 
     $17,195,000,000.
       On page 29, line 19, increase the amount by 
     $17,195,000,000.
       On page 29, line 22, increase the amount by 
     $20,630,000,000.
       On page 29, line 23, increase the amount by 
     $20,630,000,000.
       On page 30, line 2, increase the amount by $26,482,000,000.
       On page 30, line 3, increase the amount by $26,482,000,000.
       On page 30, line 6, increase the amount by $32,751,000,000.
       On page 30, line 7, increase the amount by $32,751,000,000.
       On page 30, line 10, increase the amount by 
     $38,644,000,000.
       On page 30, line 11, increase the amount by 
     $38,644,000,000.
       On page 30, line 14, increase the amount by 
     $44,787,000,000.
       On page 30, line 15, increase the amount by 
     $44,787,000,000.
       On page 30, line 18, increase the amount by 
     $52,013,000,000.
       On page 30, line 19, increase the amount by 
     $52,013,000,000.
       On page 40, line 2, decrease the amount by $56,000,000.
       On page 40, line 3, decrease the amount by $56,000,000.
       On page 40, line 6, decrease the amount by $750,000,000.
       On page 40, line 7, decrease the amount by $750,000,000.
       On page 40, line 10, decrease the amount by $2,607,000,000.
       On page 40, line 11, decrease the amount by $2,607,000,000.
       On page 40, line 14, decrease the amount by $4,587,000,000.
       On page 40, line 15, decrease the amount by $4,587,000,000.
       On page 40, line 18, decrease the amount by $6,061,000,000.
       On page 40, line 19, decrease the amount by $6,061,000,000.
       On page 40, line 22, decrease the amount by $7,242,000,000.
       On page 40, line 23, decrease the amount by $7,242,000,000.
       On page 41, line 2, decrease the amount by $8,431,000,000.
       On page 41, line 3, decrease the amount by $8,431,000,000.
       On page 41, line 6, decrease the amount by $9,562,000,000.
       On page 41, line 7, decrease the amount by $9,562,000,000.
       On page 41, line 10, decrease the amount by 
     $10,624,000,000.
       On page 41, line 11, decrease the amount by 
     $10,624,000,000.
       On page 41, line 14, decrease the amount by 
     $11,652,000,000.
       On page 41, line 15, decrease the amount by 
     $11,652,000,000.
       On page 41, line 18, decrease the amount by 
     $12,675,000,000.
       On page 41, line 19, decrease the amount by 
     $12,675,000,000.
       On page 61, line 12, insert ``on an equal basis with 
     respect to benefit level regardless of whether such 
     beneficiaries remain in the traditional medicare fee-for-
     service program under parts A and B of such title or enroll 
     in a private plan under the medicare program'' after 
     ``prescription drugs''.
       On page 61, line 19, strike $400,000,000,000 and insert 
     $619,000,000,000.

  Mr. DORGAN. Mr. President, I will describe the general direction of 
this amendment. I will be followed by my colleague, Senator Graham of 
Florida, who will talk in greater specifics about the particular 
approach dealing with a prescription drug benefit in Medicare. 
Following that, my colleague from Michigan will also speak.
  This amendment would increase the amount of money available to put a 
prescription drug benefit in the Medicare Program. I think we are long 
past the point where the question is whether we should put a 
prescription drug benefit in the Medicare Program. The question is no 
longer whether. I think almost all Members of the Congress agree we 
ought to do that. The question is how. How do we do it? What kind of a 
prescription drug benefit do we put in the Medicare Program?
  Senior citizens are 12 percent of the population in our country, yet 
they consume one-third of all prescription drugs. That is important to 
understand. As people grow older, they have more health challenges. 
They are able to access these miracle drugs, the new miracle drugs that 
extend life in so many areas, but miracle drugs produce no miracles if 
one cannot afford them.
  At an age in life when people reach retirement and have diminished 
income, they discover that they cannot afford to buy the miracle drugs 
they need, the drugs their doctor prescribes, for someone who may have 
heart disease, diabetes, and several other maladies. We hear senior 
citizens say over and over again that they go to the grocery store with 
a pharmacy in the back, and they have to go to the pharmacy first to 
find out how much they are going to have left for food because they 
cannot afford all of their medicine and food.
  If we had created Medicare last year, there is no question that we 
would have included in that Medicare Program a prescription drug 
benefit. Instead, Congress created it in the 1960s. Most of us were not 
here then. So there was no prescription drug benefit put in the 
Medicare Program because most of the lifesaving drugs that are now 
available were not then in existence. They are now, and senior citizens 
are living longer and better lives. Part of it is because we have these 
prescription drugs that can extend life.
  So the question is, How do we now modify the Medicare Program to add 
a benefit for prescription drugs, to help so many senior citizens who 
simply cannot afford them?
  I had a hearing in Dickinson, ND, one evening on the issue of 
prescription drugs in Medicare. An oncologist told me about his cancer 
patient, a woman on Medicare who had a mastectomy because of breast 
cancer. He prescribed a prescription drug for her. He said: You need to 
take this prescription drug in order to reduce the chances of 
recurrence of this breast cancer. She said: What will it cost? He told 
her the cost of the drugs. She said: Doctor, I cannot possibly buy that 
prescription drug. I have no money. I will just take my chances.
  We do not have to do that. Our amendment is very simple. The 
underlying budget proposed $400 billion for a Medicare prescription 
drug plan. We propose that the portion of the tax cut in this budget 
amendment dealing with the tax cut for dividends be used instead of 
cutting taxes for dividends in

[[Page 6777]]

the following manner: That $219 billion be provided in this amendment 
in order to increase above the $400 billion, so we would have then $619 
billion for a prescription drug plan in the Medicare Program. The 
additional $251 billion in savings generated by this amendment would be 
used to reduce the Federal budget deficit.
  We are doing two things: Making more money available so a decent 
prescription drug plan can be offered, and my colleague from Florida 
will more adequately describe exactly what kind of a program can be 
offered for that, and then in addition, reducing the Federal budget 
deficit.
  I will make a couple of additional points. Our amendment also 
establishes a very important principle for a Medicare prescription drug 
benefit. Medicare beneficiaries who choose to remain in traditional 
fee-for-service Medicare should receive the same level of benefit for 
prescription drugs as do others. The President has proposed something 
that says we will provide a prescription drug benefit but we will do it 
only if someone leaves their fee-for-service type of care and goes to 
an HMO. That is not fair. That is not the right thing to do. Senior 
citizens ought to be able to go to the doctor of their choice and get 
the health care they need from the doctor they have always been seeing 
for their problems. Yet that will not be the case under the President's 
proposal.
  So we say let's increase the amount of money so we can have a 
reasonable and a good prescription drug benefit in the Medicare 
Program. Let's do that at the same time we reduce the Federal budget 
deficit with the other money that we save from this tax change, and 
let's also establish the principle, as we do in this amendment, that 
all Medicare beneficiaries ought to have the availability of this 
prescription drug benefit, even if they choose to stay in a fee-for-
service program. That is a very important issue.
  Let me make one final point. As is always the case when we debate the 
budget in the Senate, we are confronted with a series of choices, 
difficult choices sometimes but nonetheless choices. We can make a 
decision about that. We can decide that it is far more important, as 
some have done in the Senate, to exempt dividends from taxation than it 
is to have a good prescription drug benefit in the Medicare Program. I 
do not happen to share that choice. I think that is a terrible choice. 
That is a horrible choice to make in terms of priorities. So with this 
amendment we make a different choice. We believe that this is one of 
those circumstances that demands and certainly deserves the attention 
of the Senate. I think every Senator is on record as saying we ought to 
do something about this issue of prescription drugs in Medicare, but we 
have had difficulty trying to find the right approach.
  We have all kinds of different plans. What we propose with this 
amendment is to have sufficient money, $619 billion, to put together a 
plan of which we can be proud, to put together a plan that works, one 
that really helps senior citizens and one that does not force them all 
into managed care or HMO organizations as a price for them to be able 
to access prescription drugs that they need to continue to lead a good 
life. That is all this amendment is about. It is a simple choice. It is 
a lot of money, but it is a simple choice. Let's choose the right 
thing. Let's choose to do what all of us have said we want to do, and 
that is to put a good prescription drug plan in the Medicare Program.
  My colleague, Senator Graham from Florida, is going to describe in 
more detail exactly what that program could look like and how that 
program would work for senior citizens. I am very pleased to have 
worked with him, as well as the Senator from Michigan, on this 
amendment.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Coleman). Who yields time?
  Mr. GRAHAM of Florida. I yield myself such time as I may consume.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from Florida.
  Mr. GRAHAM of Florida. Mr. President, I offer this amendment with my 
colleagues from North Dakota and Michigan so that when we come to 
debate the specifics of a prescription drug benefit for Medicare, we 
will be able to provide a real benefit, a real benefit with no 
gimmicks, no gaps, no hidden ``gotchas.''
  Last year, 52 Senators voted for a plan that provides all Medicare 
beneficiaries with an affordable, comprehensive, and universal drug 
benefit delivered through Medicare. The proposal offered last year 
received 52 votes and was very direct. It provided that seniors would 
pay a $25 per month voluntary premium. This program is not mandatory; 
seniors will decide for themselves whether they want to participate. 
There would be no deductible. Seniors would pay no more than a $10 
copayment for generic medications and $40 for medically necessary 
brand-name medications. After $4,000 was paid by the senior out of 
pocket, Medicare would pay the remaining expenses under a catastrophic 
position. Special consideration was provided for the lowest income non-
Medicaid elderly by picking up all, or a portion of, their monthly 
premiums and copayments.
  The plan we offered last year that received 52 votes, with the 
inflation and with the change in the demographics of the elderly 
population, would cost, over the next 10 years, $619 billion. The 
budget resolution which is before the Senate today would limit the 
expenditure for a prescription drug benefit to no more than $400 
billion. Removed from the $400 billion would be the cost of any other 
changes to the Medicare system.
  Our colleagues on the Budget Committee have adopted the $400 billion 
from the President's framework for adding a prescription drug benefit 
to Medicare. It is unclear precisely what we would be buying with $400 
billion, but let's talk about what we know of some of the principles of 
the President's prescription drug plan.
  He would provide, for those Medicare beneficiaries in the traditional 
fee-for-service program, that there would be coverage of prescription 
drugs for the lowest income--the question mark as to what that 
demarcation would be. They would receive up to $600 a year for their 
prescription drug benefits. I point out to the Presiding Officer and my 
colleagues, the average Medicare beneficiary last year paid $2,100 for 
their prescription drugs.
  Other than the lowest income, there would be no ongoing benefit and 
there would be a catastrophic benefit at a yet to be specified level. 
That is what 89 percent of the Medicare beneficiaries--those who have 
elected to stay in the traditional fee-for-service Medicare--would have 
available.
  Mr. President, 11 percent of the 40 million Medicare beneficiaries 
are in some form of managed care. Under the President's plan, they 
would receive a prescription drug benefit, maybe one very similar to 
the one that 52 Senators voted for last year. We do not have the 
details to have a clear understanding of what that 11 percent would 
receive.
  The only way you can fit an affordable, comprehensive, universal 
prescription drug benefit is by not making it universal, not covering 
seniors who are in the traditional Medicare Program unless they either 
have very low incomes or very high drug costs. For instance, if the 
catastrophic level were to be set at $5,000, less than 3 percent of the 
Medicare beneficiaries would spend that much and therefore be eligible 
to participate in the catastrophic provisions of the President's plan.
  The President's proposal buys a drug benefit for $400 billion by 
providing a benefit--even that is undefined--only for those seniors who 
will enroll in some form of managed care. This has been referred to as 
a plan to herd seniors into managed care because their needs for a 
prescription drug benefit are so desperate. No one can argue a benefit 
like the one proposed by President Bush meets the goals of an 
affordable, universal, comprehensive drug benefit which is what 
America's seniors need.
  The most fundamental reform we can make in the Medicare Program is to 
offer to all Medicare beneficiaries, including the 89 percent who have 
elected

[[Page 6778]]

to enroll in the traditional fee-for-service Medicare, all 
beneficiaries--those as well as the 11 percent who have currently 
elected to participate in a managed care program--a universal, 
comprehensive, affordable prescription drug benefit. Why is this so 
important? In my opinion, it is so important because it is the 
fundamental reform which Medicare must make.
  Medicare is a program of the 1960s. It is appropriately described as 
a sickness program. If you are ill enough to require a physician's 
attention or, even more, require hospitalization, Medicare will pay a 
substantial proportion of your costs. What Medicare will not pay is the 
cost to keep you out of the doctor's office and out of the hospital. 
Why? Because almost every preventive care program has as one of its key 
elements the use of prescription drugs. These are the modern miracles 
of medicine. They are almost always required if we are to be able to 
manage a condition before it becomes critical.
  Thus, to have a Medicare Program which makes that fundamental reform 
from a sickness system to a system that promotes the highest level of 
health, it must have a prescription drug benefit. Certainly some 
seniors under the President's proposal will have no choice but to move 
from their current preference for traditional fee-for-service, where 
they have the maximum number of choices, into a managed care system, 
where their choices can be severely restricted.
  As my colleague from North Dakota has already said, this debate is 
about priorities. Is the statement the Senate wants to make that we 
give greater importance to an oversized tax cut than we do to a real, 
affordable, comprehensive, and universal drug benefit for all seniors? 
I think the answer is clear.
  In addition to providing adequate funding for a prescription drug 
benefit, this amendment will also provide $177 billion over the next 10 
years for deficit reduction, which would, in fact, become $251 billion 
for deficit reduction by including the interest cost which we will have 
to pay for $177 billion over the next 10 years. This is a needed remedy 
for the rapidly increasing deficits that we have experienced, almost as 
urgent as the needed benefit of prescription drugs for older Americans.
  We are suggesting these two elements, a $219 billion addition to the 
Medicare account in order to be able to fund an affordable, 
comprehensive, and universal prescription drug benefit, and $177 
billion for deficit reductions--we are suggesting it be paid by a 
reduction in the provision for tax reductions of $396 billion. That 
number was not just chosen by accident. That is the amount the 
President has proposed for his dividend tax cut, making dividends no 
longer taxable.
  I believe the dividend tax cut should be reduced, first because it 
will do very little to stimulate our sluggish economy, and specifically 
because it will do very little to benefit America's seniors. I heard 
earlier today the argument made in support of the elimination of 
taxation of dividends, that it was a critical matter for America's 
seniors. Most American seniors will not benefit at all, and the average 
tax reduction for America's seniors, by eliminating the taxation on 
dividends, is estimated to be $118 per year.
  Contrast that minimal savings for seniors with the savings that 
seniors will secure through a comprehensive, universal, and affordable 
prescription drug benefit.
  I urge my colleagues to support this amendment. This amendment will 
not only affect our seniors and our ability to provide them with a 
reasonable prescription drug benefit, it will also provide Congress the 
direction required to assure responsible spending of the taxpayers' 
money. This is a goal, not just for seniors, it is a goal which all 
Americans deserve.
  Mr. REID. Mr. President, on behalf of Senator Conrad, I yield one-
half hour to the Senator from Michigan, Ms. Stabenow.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Michigan.
  Ms. STABENOW. Mr. President, I first commend my friend and colleague 
from Florida for his ongoing leadership on the issue of Medicare 
prescription drug coverage. I am very hopeful we will be able to put 
into place the bill he has described so eloquently that would greatly 
benefit all older Americans and the disabled. It is my pleasure to join 
with him and with my distinguished colleague from North Dakota, Mr. 
Dorgan, as well, who has also been an outspoken leader both on Medicare 
prescription drugs and also on issues relating to containing costs, 
opening the borders to Canada, and other issues that would lower 
prices.
  It is my pleasure to join with both of them in what I believe to be 
one of the most important, if not the most important, amendment we will 
be addressing to the budget resolution.
  As my colleagues have said, the budget resolution is about American 
priorities and values. We lay out for the year and then project for 10 
years what our most important priorities are, just as a family does in 
their own budget. We on this side of the aisle have argued that, of 
course, safety and security is critical. Education and the opportunity 
for young people and adults to have skills and be able to be successful 
in our society is critically important. Also, health care, the ability 
to have health care for your family, and the ability for every senior 
and every disabled person to know that, in fact, Medicare will be 
strong and will be there for them when they retire when they are 
eligible, and that it will reflect the way health care is provided 
today is also important.
  We all know today prescription drug coverage is the primary way to 
provide health care, both for prevention, to be able to stop disease, 
and be able to monitor and keep us from having to have an operation or 
be in the hospital. Outpatient prescription drugs are a critical part 
of the way health care is provided today.
  Medicare, which is a great American success story, simply needs to be 
updated in order to cover prescription drugs. That is what this 
amendment does. It says that as a value for our families and a priority 
for Americans, we choose to set aside dollars for a comprehensive, 
affordable prescription drug benefit for all seniors. We want to do 
that through Medicare, through strengthening, protecting, and 
preserving Medicare. It also says when we have to make choices, if we 
have to choose--as we always have to do in our own budget, in the 
Federal budget--between another tax cut for those earning millions of 
dollars a year, or putting dollars in the pockets of our seniors to 
help pay for their prescription drugs, their medicine, we choose 
prescription drug coverage for our seniors. We also choose paying down 
the debt to protect Social Security and Medicare for the future.
  This amendment does two very important things: It guarantees that we 
will have enough resources to do a comprehensive Medicare prescription 
drug benefit. It also says the debt that is being accumulated by this 
country is absolutely unacceptable, and we need to be putting money 
aside to pay down that debt in order to make sure we can keep interest 
rates low to spur the economy so our families can buy homes and cars 
and send their children to college and not experience double-digit 
interest rates. We need to keep that debt down. That also allows us to 
protect Social Security and Medicare funds for the future for the trust 
funds. That priority, and a prescription drug coverage priority, is 
absolutely essential.
  We also say something else that is very important. We need to make 
sure that traditional Medicare that has been there is there regardless 
of where you live. My great State is a huge State geographically, 9 
million people plus. We need to make sure the seniors in Detroit or 
Marquette or Ironwood or Three Rivers or Benton Harbor or my home in 
Lansing all have the same ability and the same dependability in terms 
of Medicare prescription drugs. They will know the premiums are the 
same, their cost, their ability to choose their own doctor, their 
ability to choose their own medicines, to go to their own local 
pharmacy--that should be available regardless of where you live.
  One of my great concerns is we have seen, unfortunately, more and 
more

[[Page 6779]]

talk about reforming Medicare, which I believe is a code word for 
privatizing Medicare. All we are seeing leads us to believe that the 
administration wants to privatize Medicare and require seniors, if they 
are going to get real health care coverage that includes prescription 
drugs, to go into private insurance systems; to go into an HMO or 
another kind of system.
  The administration has indicated, if they stay in traditional 
Medicare where the overwhelming majority of seniors are, they are 
willing to offer a discount card that the GAO tells us would be about 
$3.31 savings on a prescription. That is not very much if you are 
someone who is paying $100 or $150 or $200 for a simple 30-day 
prescription.
  Then they have said: If you accumulate thousands of dollars--we don't 
know exactly what the number would be, but have catastrophic needs--you 
would be able to get some kind of help. We don't know at what point 
they would designate that, but if you want to get real help with 
prescription drugs, if you want to be covered for prescription drugs, 
then you would have to go to the private sector to be covered.
  That is absolutely unacceptable. Seniors of this country have already 
chosen between Medicare and going into the private sector. We have that 
now. We have traditional Medicare and we have something called 
Medicare+Choice that is a private sector HMO approach. It is your 
choice as a senior.
  In fact, my mother chose to go into an HMO herself in Michigan, and 
had a good experience, but the Medicare beneficiaries were dropped from 
that HMO because they decided not to cover them anymore. And that has 
happened to over 41,000 people just in Michigan.
  What we have seen is that when seniors are being given a choice 
between traditional Medicare and the HMO system, they have already 
chosen: They have chosen Medicare, traditional Medicare. But for the 
small percent who chose to go into the private sector, they found it 
was not dependable. For my own mother, who chose to do that, she found 
she could not count on it. It was not ultimately available to her. And 
now, in Michigan, only 2 percent of people who are on Medicare can even 
qualify, can even find a private insurer that will cover them, and they 
all are in the eastern part of our State. So if you live in Lansing or 
Flint or Saginaw or Grand Rapids or on up in Traverse City or on up in 
the upper peninsula, you don't even have that choice because there is 
nothing available.
  So what we have said in this amendment is that seniors need to know 
the prescription drug benefit that everybody is talking about should 
not just be available if you choose a private insurance policy, private 
insurance model through Medicare; you should have the right to have a 
choice of traditional Medicare and have the very same prescription drug 
coverage.
  That is what this amendment says. If we want to offer seniors choice, 
then we need to make sure we offer them a real choice: the choice of 
Medicare as they know it, Medicare as they have been able to depend 
upon, as well as the other private sector models that have been 
proposed by the President and our colleagues.
  This amendment, I believe, is exactly what the seniors of America are 
asking us to do: simply update Medicare, strengthen the system they 
count on, and make sure they have affordable prescription drug 
coverage. I strongly support this amendment. I am proud to be 
cosponsoring this amendment with my colleagues. The dual goal of having 
Medicare prescription drug coverage and a major payment on the debt is 
very important.
  When we look at who the beneficiaries of Medicare are--our seniors--
the majority of them are women. So I speak as one of the women of the 
Senate to say that the women of this country are counting on Medicare 
as well as Social Security. This is very real for the older women of 
our country. They are counting on us to fulfill the real promise of 
Medicare.
  Mr. President, our seniors, as well as everyone who is involved with 
prescription drugs, are counting on us to do one other thing. I wish to 
speak to that for a moment. It relates to another amendment I will be 
offering later on in this debate that needs to be coupled with this 
amendment, and that is the question of lowering the price of 
prescription drugs.
  We need to update Medicare to cover prescriptions. But at the same 
time, we need to lower the price through more competition, so that we 
can afford that coverage and be able to make it available to as many 
people as possible.
  Along with my colleagues, Senator Dorgan and Senator Schumer, I am 
going to be offering an amendment the purpose of which is to reduce 
prescription drug prices for everyone, with the passage of legislation 
similar to S. 812, which passed overwhelmingly by the Senate last 
summer, a bill that contained provisions relating to generic drug 
reform, reimportation of prescription drugs from Canada--in other 
words, opening the border to Canada for our citizens--and State 
authority with respect to Medicaid drug rebate agreements. What that 
means is supporting our States that are being creative in finding ways 
to use their authority to lower the prices of prescription drugs for 
their citizens.
  This amendment would take the approximately $7.4 billion minimal of 
savings through the generic drug reform we passed last summer coupled 
with any savings--and as yet they have not been able to calculate the 
savings--that we know would be there from opening the border to Canada, 
and dropping prices in half. But we would take those dollars and put it 
into a fund that is already in the budget resolution--a $50 billion 
fund for the uninsured--and we would add those budget savings to that 
fund for programs that help individuals and small businesses obtain 
health insurance.
  We know the majority of those without insurance--in fact, we are told 
that 75 percent of the people who do not have health insurance are 
working, and they are working for small businesses. So this issue of 
lowering prices is very important for all businesses, but I would say 
particularly small businesses, that have seen their premiums--at least 
in Michigan, we know, according to Michigan Blue Cross and Blue Shield, 
that premiums for small businesses have doubled, at least, in the last 
5 years. And we know, when we look behind those prices, as well as the 
prices for the Big Three automakers, and for other major employers, 
that the major reason the price of health care is going up is because 
of the explosion in the price of prescription drugs. The average retail 
prescription drug increase for brand names is three times the rate of 
inflation--three times the rate of inflation. So we have seen an 
explosion.
  By the way, this relates back to Medicare coverage because a majority 
of those who are uninsured who are paying those prices are our senior 
citizens. In fact, the people who pay the highest prices in the world 
today are Americans, predominantly our seniors, who do not have 
insurance and walk into the local pharmacy and need to buy their 
medicine. So there is an important partnership here of both Medicare 
prescription drug coverage and lowering prices for everyone.
  Last year, on a bipartisan vote, I was very proud of this body, my 
colleagues on both sides of the aisle, who joined together to, first of 
all, tighten up the rules and eliminate loopholes in relation to 
unadvertised brands, what we call generic drugs, that are supposed to 
be available when a patent runs out on a brand name. The formulas are 
supposed to be available so they can be manufactured at a much cheaper 
price, oftentimes 50 percent, sometimes as much as 70 percent less. We 
know by having more use of unadvertised brands, and they being more 
available on the market, we can drop insurance rates, we can drop 
prescription drug prices for our seniors and for everyone.
  We also know if we simply open the border to Canada--I find this 
whole issue so amazing because we trade with Canada on everything 
except prescription drugs. In fact, in my great State of Michigan, 
right now we are seeing truckloads of trash coming in from Canada that 
we are told we cannot stop from going into Michigan landfills because 
we have open trade laws. So we

[[Page 6780]]

can't stop the trash, but we can't bring in prescription drugs that 
would help our seniors and help our families be able to lower their 
costs, by bringing in American-made, American-subsidized prescriptions, 
that are sold in Canada at reduced prices.
  That was the second part of what we did last summer, to pass a bill 
that opened the border. And we know that by doing that, licensed 
pharmacists could develop business relationships. Whether it is a 
pharmacist at the hospital, a pharmacist at the local pharmacy, a 
pharmacist working with health clinics or at a university, they could 
bring these back and make prescription drugs available. We ought to be 
doing that. It is very perplexing and frustrating that that is not 
happening.
  In fact, to add insult to injury, the FDA has just informed us in the 
last week based on pressure from the pharmaceutical industry that not 
only are they not going to open the border, but they are going to begin 
enforcing the law against those who help our seniors. Whether it is an 
insurance company paying for reimbursement, whether it is others 
helping our seniors to go across the border to get their prescriptions 
at a lower price, working through a Canadian doctor and pharmacy, the 
FDA now says they will clamp down on that rather than working with us 
to open the borders in a safe way. This is the second part of how we 
lower prices.
  The third way we lower prices is by supporting States that have been 
working to use their group purchasing power to negotiate with the 
pharmaceutical companies that do business with them on Medicaid, to 
negotiate with them to provide rebates and discounts for the uninsured 
in their State. A number of States have done that, and they have all 
been challenged, unfortunately, by the pharmaceutical industry. We want 
to make it clear that States have the ability on behalf of their 
citizens to advocate and to negotiate lower prices. That is the second 
amendment we will be offering.
  Again, we will be offering an amendment that says we will reduce 
prescription drug prices. We will save dollars for the Federal 
Government, and then those dollars will be redirected into a fund and 
put aside to support small businesses to provide health care coverage 
for their employees.
  The budget resolution is about priorities. We all know that. It is 
about values. It is about who we are as Americans. When I talk with 
people in Michigan, there is not a higher priority now than health 
care: Families struggling with the cost of medicine; seniors not having 
access to prescription drug coverage; businesses trying to figure out 
how to pay the bill; employees being told their pay will be frozen so 
their employer can pay the health care costs; those who are losing 
their jobs finding themselves in a situation where they are losing 
their health care. We even know that our reservists and members of the 
National Guard currently serving us in the gulf may find themselves not 
having health insurance for themselves and their families.
  This is an issue that touches each and every one of us. Every year we 
talk about it. Every session we talk about it. It is complicated. It 
involves setting priorities on funding. Too much of the time, we set it 
aside to go on to something else. I hope we will not do that this time, 
that we will make it clear, through this budget, that Medicare 
prescription drug coverage, that health care for small businesses and 
their employees, that lowering the prices of prescription drugs will be 
a top American priority. We can say, we will wait until next year, we 
will wait until the next budget resolution, but we can't say, we will 
wait until next year to get sick, to get cancer, or that a family will 
wait until next year until grandma or grandpa need a nursing home or 
their children get sick.
  Health care for American families is an urgent matter. It is an 
urgent matter for everyone. It needs to be an urgent matter for all of 
us here in the Senate.
  I urge my colleagues to support the amendment on Medicare 
prescription drug coverage, and I urge my colleagues as well to join 
with us in the amendment to reduce the price of prescription drugs and 
support our small businesses that are struggling to provide health care 
for their employees.
  I yield back.
  The PRESIDING OFFICER. Who yields time?
  The Senator from Utah.
  Mr. BENNETT. Mr. President, acting as the leader, I yield myself 7 
minutes, with the understanding that following me, the Senator from 
Iowa will be recognized.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BENNETT. Mr. President, I have listened to the debate and wanted 
to make a few observations. I understand the Senator from Iowa is 
prepared to perhaps be a little more erudite than I. But I have heard 
personal references, and I must come share a few personal references, 
not specifically on this amendment but on the subject of Medicare.
  The statement has been made that Medicare is a great success story. 
Medicare is a disaster. Everybody who deals with it understands that 
except the Congress. We have to understand that Medicare, in order to 
work properly, is going to have to be overhauled from top to bottom as 
quickly as possible. Taking the assumption that the present Medicare 
system is working well and all we need to do is add a little here and 
add a little there will further compound the disaster.
  Let me give two examples that I hope will help illustrate this. The 
first is a town meeting where a woman came to me and said: Can you do 
something to fix Medicare?
  I said: Well, tell me what the problem is.
  She said: I am a professional woman. I am a college graduate. I think 
I am fairly intelligent. I handle my mother's affairs. My mother is in 
her eighties. She is on Medicare. I have finally figured out how to 
deal with Medicare. I throw away everything unopened, and at the end of 
the month I call the Salt Lake clinic and say: How much do I owe you 
for my mother? Trying to wade through the paperwork is so daunting, I 
can't even begin to understand anything they send to me. The assumption 
that my 85-year-old mother would be able to handle any of it is absurd. 
I tried. I struggled. I got the manuals. Finally, I discovered the way 
to deal with Medicare is to throw away everything unopened and once a 
month call the Salt Lake clinic and say: How much do I owe you for my 
mother?
  This is a family and a circumstance where money is not a problem. 
Simply coping with the paperwork is overwhelming.
  Second example: I have a daughter of whom I am enormously proud. She 
graduated with her master's degree from George Washington University 
after her bachelor's at Boston University. She got a job in a nursing 
home. She is a speech therapist. She is also a very enthusiastic young 
lady. She called me after about 4 days on the job.
  Dad, she said--exploding over the telephone--you are a Senator. You 
have to fix Medicare.
  I said: Now calm down. Tell me what your problem is.
  She said: Medicare is a disaster. Medicare is terrible. Let me tell 
you my experiences.
  And she began describing some of the problems she had in giving 
proper care to the people in this nursing home and always being told, 
no, you can't do that until you check to see whether or not Medicare 
will cover it.
  She said: I thought that would be a fairly simple thing to find out. 
So I go down the hall and say: Will Medicare cover this procedure? It 
takes days to get an answer to that question.
  Then she said: Dad, do you know who the highest paid person in this 
facility is--with a salary higher than the administrator, higher salary 
than the doctors, higher salary than the nurses, higher salary than any 
of the health professionals? It is the woman who understands Medicare. 
She gets paid more than anybody here because that skill is in greater 
demand and shorter supply than professional medical skills.
  She called me back sometime later and said:

       I have had patients die while we waited to get an answer as 
     to whether or not Medicare would cover it. Their family said, 
     ``Don't touch my grandmother; don't do anything

[[Page 6781]]

     until we find out whether Medicare would cover it.''

  It was so arcane and difficult to work through all of the paperwork 
and come up with the answer--well, maybe they would have died anyway; 
they were old and in a nursing home. People die in nursing homes. But 
this was a very traumatic experience for my daughter, who was convinced 
that the kind of therapy she was trained to provide, she was prepared 
to provide, which could have extended the life of that particular 
patient.
  So as we get carried away with the rhetoric around here about what we 
have to protect and not protect about Medicare, let us begin to 
understand the truth about Medicare. Medicare is the best Blue Cross/
Blue Shield fee-for-service indemnity plan of the 1960s--frozen in 
time. We don't practice medicine the way medicine was practiced in the 
1960s when Medicare was created. We don't even come close anymore.
  Yes, we need a prescription drug benefit because prescription drugs 
do things now that they had nothing to do with in the 1960s. But 
instead of pasting it on to the existing circumstance and creating a 
new set of forms and eligibilities and more demand for that highest 
paid person in the nursing home, let us as a Congress face the fact 
that we need to start from a clean sheet of paper, all over again, with 
all of the money we are putting into it--which is sizable--and say 
let's create a whole new system. This budget doesn't do that, but this 
amendment that is being offered will make things worse in that regard.
  I only hope that somewhere along the line we can begin to face the 
fact that Medicare is 40 years old, whereas the practice of medicine is 
changing so constantly that we could say it is only 40 months old. 
Let's start with a clean sheet of paper. Let's not try this Band-Aid 
approach. Let's not just put this here, and put that there, and tell 
our constituents we are giving them something when, in fact, we are 
perpetuating an existing problem and ultimately making it worse.
  The PRESIDING OFFICER. The Senator from Iowa is recognized.
  Mr. GRASSLEY. Mr. President, I yield myself such time as I might 
consume. For the benefit of the people who are waiting to speak, I 
don't think I will take long on this subject.
  I rise because I want to urge my colleagues to vote against the 
Dorgan amendment when the vote comes up tomorrow. I don't see anything 
wrong with the issue of Medicare being discussed because it is one of 
two or three of the most important issues this Congress will deal with. 
So it is very appropriate to have Medicare very much at the top of the 
agenda. It is very appropriate to have prescription drugs for seniors, 
as a part of strengthening and improving Medicare, be very high on the 
agenda. And it is very high on the agenda.
  It is just a question, as it relates to the Dorgan amendment, of 
whether or not crafting a Medicare prescription drug program ought to 
be an issue on the budget, or whether you ought to let the will of 
Congress work and do that through the Senate Finance Committee.
  We know Medicare is going to be a very important issue this year, not 
only because it has been very much an issue in the last election, but 
because the Senate majority leader has a long-time interest in Medicare 
and prescription drugs. He told me, as Chairman of the Senate Finance 
Committee, that he would like to have the Senate Finance Committee put 
it very high on its agenda and have legislation prepared early for this 
summer's debate.
  The Senate Finance Committee is going to meet that deadline. I hope 
Senator Frist will be able to keep his own calendar and bring it up at 
that particular time. What we are talking about on this issue is 
whether or not the $400 billion for prescription drugs in the budget 
resolution is enough and whether or not an extension beyond that $400 
billion is needed at this particular time.
  I am here to say it is not needed at this particular time for two 
reasons. One, I think I can show that $400 billion is an ample amount 
of money to present to the Senate a good prescription drug program; and 
two, taking money away from tax relief for working men and women, which 
this amendment does, to spend on Medicare is the wrong thing to do for 
the long-term benefit of Medicare. Because as the trustees of the 
Medicare and Social Security Program pointed out in their annual 
report, you see Medicare in a little worse situation this year than 
last year because there is less payroll tax coming in because the 
economy is not doing quite as well as it should be. If we want to 
preserve the long-term viability of the Medicare trust fund, obviously, 
the best thing we can do is create jobs. That is what the growth 
package, the jobs package, that we are going to be working on this 
spring--tax reduction for working men and women--is all about--the 
creation of jobs, to have the economy grow, so more payroll taxes will 
be coming into the Medicare fund.
  Let me explain to my colleagues why we should vote this amendment 
down. I start with the premise that it is long past time for Congress 
to strengthen and improve the Medicare Program, and the No. 1 way in 
which we can improve and strengthen Medicare is the enactment of a 
prescription drug benefit for our Nation's seniors.
  We all know that adding prescription drug coverage to the Medicare 
Program is an expensive endeavor. Given the rapidly rising costs of 
Medicare and the present challenge we have just to meet our current 
obligations in the program, adding prescription drug coverage must be 
done carefully and responsibly. You don't do it by just pulling a 
figure out of the air, reducing the tax relief package, and putting it 
over here in the Medicare trust fund.
  As I have said, the Medicare trustees reported last year that the 
program already faces substantial challenges in the not-too-distant 
future. The Medicare trust fund will begin to run cash deficits in 2013 
that grow larger and larger until the fund is bankrupt in the year 
2026.
  While we are working on adding a drug benefit to Medicare, 
prescription drug spending has grown an average of almost 15 percent 
annually from 1995 to the year 2000. And the Congressional Budget 
Office predicts that Medicare beneficiaries will spend about $1.8 
trillion on prescription drugs over the 10-year budget window.
  Now, is the $400 billion in the budget resolution before us enough to 
spend on improving Medicare and adding a prescription drug benefit? 
Well, first of all, we have to recognize that Congress has come a long 
way in how much it has allocated to a Medicare drug benefit. For 
example, in fiscal year 2001, the budget resolution had $40 billion 
over 5 years for a drug benefit. This budget, as I have said, proposes 
$400 billion over 10 years and is yet $100 billion more than we had in 
the last budget resolution, which was for fiscal year 2002, and had 
$300 billion for prescription drugs over the 10 years.
  I say to people on the other side of the aisle that we had a lot of 
support in arguing for a $300 billion budget figure for prescription 
drugs in that fiscal year 2002 budget. Many of my friends on the other 
side of the aisle spoke in favor of that proposal on the Senate floor. 
These Senators believed then that $300 billion would provide a good 
drug benefit for seniors and be affordable for taxpayers. Now we are 
proposing $400 billion for Medicare and for a drug benefit. This amount 
is certainly adequate for developing a good Medicare drug benefit for 
our Nation's seniors.
  I urge my colleagues to support the $400 billion in funding for 
Medicare and vote against amendments such as the Dorgan amendment to 
dramatically increase the cost of that drug benefit.
  I ask those very same Senators on the other side of the aisle who may 
want to support their colleague that if they thought 2 years ago $300 
billion was a good figure and they helped us get that passed, then they 
would think that $400 billion is adequate as we start down this road, a 
road that is going to lead us to the successful passage of a drug 
benefit program for seniors.
  As for a comparable prescription drug benefit, one of the directions 
that the Dorgan amendment would give the

[[Page 6782]]

Committee on Finance--a requirement that traditional Medicare and 
whatever enhancement of Medicare we develop for seniors which would 
give them the right to choose between more than one benefit plan would 
have comparable prescription drug benefits--I want my colleagues on the 
other side of the aisle to know I will work with other members of the 
Finance Committee to make sure Medicare beneficiaries in traditional 
Medicare have a good prescription drug benefit, as well as those who 
may choose to go to a new, enhanced plan.
  This amendment wants to tie the hands of the members of the Senate 
Finance Committee. The budget bill is not the place to craft a Medicare 
prescription drug benefit. That is the jurisdiction of the Senate 
Finance Committee. The committee will have its opportunity to function 
under my chairmanship, at the direction of Senator Frist, our majority 
leader, who said he did not want to make the mistake of last year when 
then-majority leader Senator Daschle brought the issue right to the 
floor, bypassing the committee.
  We can in this body develop bipartisanship not on the floor of the 
Senate but in the committees of the Senate. That is no more true than 
in the Senate Finance Committee which has such a reputation for 
bipartisanship.
  I urge my colleagues to defeat this amendment and let the Finance 
Committee do its work.
  I yield the floor.
  The PRESIDING OFFICER. Who yields time? Who yields to the Senator?
  Mr. CONRAD. Mr. President, how much how much time is the Senator 
seeking?
  Mr. ROCKEFELLER. There will be, I say to the Senator from North 
Dakota, three Senators speaking on behalf of the amendment. Forty-five 
minutes would be an outside number.
  Mr. CONRAD. How much time would the Senator from West Virginia like?
  Mr. ROCKEFELLER. Eight, nine minutes.
  Mr. CONRAD. I yield 10 minutes to the Senator from West Virginia.
  Mr. REID. Mr. President, I ask, through the Chair, the Senator from 
Maine, it is my understanding she has permission from the manager of 
the bill to have the pending amendment set aside to offer this 
amendment.
  Ms. COLLINS. The Senator is correct.
  Mr. REID. I should think that is what should be done now. Does the 
Democratic manager agree with that?
  Mr. CONRAD. That will be the appropriate action to take at this 
point, if the Senator from Maine will make that request.
  The PRESIDING OFFICER. The Senator from Maine.
  Ms. COLLINS. Mr. President, the Senator from West Virginia, on behalf 
of the Senator from Maine, the Senator from Oregon, the Senator from 
Nebraska, and several cosponsors, is sending an amendment to the desk 
to ask for its consideration. I ask that the pending amendment be set 
aside.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from West Virginia.


                           Amendment No. 275

  Mr. ROCKEFELLER. Mr. President, I call up amendment No. 275 which is 
already at the desk.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from West Virginia [Mr. Rockefeller], for 
     himself, Ms. Collins, Mr. Nelson of Nebraska, Mr. Smith, Mr. 
     Schumer, Mr. Edwards, Mrs. Clinton, Mrs. Hutchison, Mr. 
     Bingaman, Mr. Corzine, Ms. Mikulski, Mr. Kohl, Mr. Kerry, Mr. 
     Sarbanes, Mrs. Murray, Ms. Cantwell, Mr. DeWine, and Mr. 
     Coleman, proposes an amendment numbered 275.

  Mr. ROCKEFELLER. 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 express the sense of the Senate concerning 
     State fiscal relief)
         At the appropriate place, insert the following:

     SEC. __. SENSE OF THE SENATE CONCERNING STATE FISCAL RELIEF.

         (a) Findings.--The Senate makes the following findings:
         (1) States are experiencing the most severe fiscal crisis 
     since World War II.
         (2) States are instituting severe cuts to a variety of 
     vital programs such as health care, child care, education, 
     and other essential services.
         (3) According to the Kaiser Commission on Medicaid and 
     the Uninsured, 49 States already have taken actions or plan 
     to cut medicaid before or during the current fiscal year 
     2003. Medicaid budget proposals in many States would 
     eliminate or curtail health benefits for eligible families 
     and substantially reduce or freeze provider reimbursement 
     rates.
         (4) In 2002, at least 13 States reported decreased State 
     investments in their child care assistance programs.
         (5) According to a forthcoming analysis of 22 States, at 
     least 1,700,000 people are now at risk of losing their health 
     care coverage under cuts that have already been implemented 
     or proposed.
         (6) Fiscal relief would help avoid adding even more 
     Americans to the ranks of the uninsured while preserving the 
     safety net when it is most needed during an economic 
     downturn.
         (7) Curtailing the States' need to cut spending and 
     increase taxes is essential for true economic growth.
         (b) Sense of the Senate.--It is the Sense of the Senate 
     that the functional totals in this resolution assume that any 
     legislation enacted to provide economic growth for the United 
     States should include not less than $30,000,000,000 for State 
     fiscal relief over the next 18 months (of which at least half 
     should be provided through a temporary increase in the 
     Federal medical assistance percentage (FMAP)).

  Mr. ROCKEFELLER. Mr. President, I ask unanimous consent that the 
following Senators be added as cosponsors. Cosponsors already are 
myself, Ms. Collins, Mr. Nelson of Nebraska, Mr. Smith, Mr. Schumer, 
Mr. Edwards, and Mrs. Clinton. I ask unanimous consent to add Mrs. 
Hutchison, Mr. Bingaman, Mr. Corzine, Ms. Mikulski, Mr. Kohl, Mr. 
Kerry, Mr. Sarbanes, Mrs. Murray, Ms. Cantwell, Mr. DeWine, and the 
distinguished Presiding Officer, Mr. Coleman, as cosponsors.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. ROCKEFELLER. Mr. President, I will not talk long, although this 
is an extraordinarily important subject particularly affecting the 
stimulus package and affecting a lot of people in all of our States.
  The sense-of-the-Senate amendment which we put before the Senate 
now--and it is that, a sense of the Senate--we did the same thing this 
past July in the form of an amendment, and it received some 75 votes. 
It was very bipartisan. But this is a sense of the Senate. It is not an 
amendment per se.
  What we are wanting to do is to add no less than $30 billion over the 
next 12 months for the State stimulus relief package that should be 
included in any stimulus package. In fact, I would argue it makes no 
sense to do this without including the amendment which will then find 
its way to the Finance Committee where we will work with it.
  It is interesting, in fact, that there are many who say the primary 
problem for our economy at this particular point is not the impending 
war with Iraq, but is, in fact, the plight of our State governments and 
our Federal Government--the deficits and debt, in the case of the 
Federal Government, and the deficits, in the case of the States. We 
have to address the State budget shortfalls in order for any growth 
package to be at all meaningful. It is not as colorful and does not 
have as much pizzazz, but it affects incredible numbers of people.
  States obviously have to balance their budgets. Senator Nelson from 
Nebraska will be speaking shortly. He was a Governor, as was I. Nearly 
every State, if not every State, faces deficits. They are likely to 
grow in the upcoming year. The deficits are now $70 billion to $85 
billion projected for 2004. This is on top of the $50 billion in 
deficits that the States already have for 2003.
  This constitutes a real crisis for them. They cannot print money, and 
they cannot do what we can do in the Senate: simply go into deficit and 
go on. They have to take action to close the deficit. Herein is the 
problem that affects the stimulus package, States, and people.

[[Page 6783]]

  They have to cut programs or they have to increase revenues--neither 
important--but one of the difficulties and responsibilities of being a 
Governor is that you have to make those decisions--either raise 
revenues, cut programs, or you do both, which is why Governors often 
are not terribly popular at the end of 8 years.
  It is about $1 out of every $8 of expenditures in the budget that 
these deficits represent. So it is a very large amount of money. Some 
38 States, three out of four States, either cut spending in 2002, are 
projecting to cut spending in 2003, or do both. That is, raise revenues 
and cut spending.
  One cannot talk about stimulating the States' economies without 
talking about Medicaid. Medicaid and Medicare--Medicare which we have 
just been discussing--between those two programs, which are both 
located in the same Government agency, it is a substantially greater 
amount of money than resides in the Department of Defense. People have 
to understand this, it is an enormous amount of money in Medicaid and 
Medicare.
  Families USA, which is well respected, recently did a study on the 
economic impact of Medicaid. I am not talking yet about people. This is 
the economic impact of Medicaid. One of their key findings was that in 
the year 2001, which was the last year their research could cover, 
States spent almost $98 billion on Medicaid. But that was not the whole 
point. The point was that the Medicaid amount that they spent generated 
a threefold increase in the economic impact on the 50 States to the 
tune of $279 billion.
  I submit that is called fiscal stimulus of a large magnitude, because 
it gets into goods and services, increased business activities, and I 
do not think I have to go on. I am very happy to say that West Virginia 
was among the 10 States with the highest rate of return for every 
dollar spent on Medicaid. So for the State that this Senator 
represents, it was very meaningful.
  This amendment specifies that no less than one-half of the amount; 
that is, $30 billion, allotted for State fiscal relief must be devoted 
to a temporary increase in the Federal medical assistance percentage, 
or FMAP. That is what we voted on in July of last year. That is what 
passed 75 to 24--tremendously bipartisan.
  This is a similar structure to the legislation that Senator Collins, 
Senator Nelson of Nebraska, and I introduced recently involving $20 
billion. It was a temporary increase in the Federal Medicaid matching 
rate, as well as increasing funding for the Social Security block 
grant.
  As I indicated, the legislation is very bipartisan. It puts money 
into Medicaid, but it also puts money into the Social Security block 
grant, which, quite frankly, is very good because in the Finance 
Committee we have been discussing welfare reform. We all know there is 
a shortage of childcare. Governors have the discretion to take that 
money and spend it on local projects or on childcare or however they 
might wish. Obviously, there are restrictions.
  This is strongly supported by providers and by--well, I will not go 
into that, but it is strongly supported. It did get 75 votes, and the 
National Governors Association wants this more than anything else the 
Congress can provide, with the exception of homeland security. This 
will then go on to the Finance Committee.
  The stimulus that Medicaid provides to the States--aside from the 
stimulus, there are now 1,700,000 people who will lose their Medicaid 
if we do nothing about this problem, if we do not increase FMAP, the 
Medicaid match matter. There is nothing they can do about it. They will 
simply have to cut more people. I say to my colleagues, they should 
know that States have already cut a million people off of Medicaid.
  Up until this point, if we do nothing they will then cut an 
additional 1.7 million people off Medicaid. When one does that, one 
understands that there are about 47 million people on Medicaid in this 
country and they are people who are vulnerable. It is the second 
largest item in most States' budgets. It is always, therefore, a target 
for cuts. It cannot be otherwise, and Governors have to do that.
  What I need to say more than anything, and more poignantly hopefully, 
is that Medicaid is an extraordinary safety net which was set up years 
ago for our most vulnerable Americans, which includes not only our low-
income children and working families but also our disabled and our 
elderly.
  This strikes me as an extraordinarily reasonable amendment. Some may 
argue that the Federal Government is already spending too much on 
Medicaid and the States need to do a better job, and I would come back 
vociferously and say that the States are doing a superb job. In fact, 
they have done as well or better than the private sector on this matter 
indeed, as Medicare only spends 2 to 3 percent for overhead costs in 
the administration of the program, in spite of all the fraud and abuse 
charges that are thrown at it.
  Costs are rising in Medicaid because of prescription drugs and long-
term care costs. Those are the two fastest growing items in health 
care. They both reside in Medicaid at this point. Medicaid has 
prescription drugs. Medicare does not. And so people seek it out.
  In conclusion, this is a sense-of-the-Senate amendment. No less than 
$30 billion of State fiscal relief should be included in anything which 
we call a fiscal stimulus or an economic growth package. This is the 
most important action we could take, and I urge my colleagues to 
support the amendment.
  I yield whatever time she may consume to the distinguished Senator 
from Maine, Ms. Collins.
  The PRESIDING OFFICER. The Senator from Maine.
  Ms. COLLINS. Mr. President, I thank my colleague from West Virginia 
for his comments. It has been such a pleasure to work with him. He is 
an eloquent and compassionate advocate for health care for low-income 
families. I am delighted to be his partner in this regard.
  I also acknowledge the hard work of Mr. Nelson, the Senator from 
Nebraska, and Senator Gordon Smith of Oregon. The four of us have 
worked very hard on this initiative for over a year. We are also 
delighted to have the Presiding Officer's critical support in this 
initiative.
  States from Maine to Nebraska, from West Virginia to Oregon, are 
facing the most serious budget shortfalls in 50 years. The bipartisan 
amendment that we are offering tonight takes the first step toward 
providing States with a measure of much needed fiscal relief.
  Regardless of the size of the tax cut, we believe it is imperative 
that the economic growth package include a significant amount for State 
fiscal relief. Therefore, our amendment expresses the sense of the 
Senate that at least $30 billion of the economic growth package be 
targeted to State fiscal relief over the next 18 months to help our 
States cope with an aggregate budget shortfall that is nearly four 
times that size.
  This bipartisan amendment has been drafted in a way that is both 
budget and deficit neutral, and I stress that for the information of my 
colleagues. It neither increases nor decreases the amount provided for 
reconciliation in the budget resolution. Therefore, our amendment does 
not add to the deficit. It does not change the spending caps that are 
included in this resolution.
  The attacks of September 11 on our Nation, coupled with the 
subsequent recession and resulting unemployment, have placed tremendous 
and unanticipated strains on Government services and resources. At the 
same time, the States, which are after all our partners in providing 
health care, education, and other essential services, are facing a 
dramatic and unexpected decline in Government revenues at precisely the 
time when the demand for Government services is the greatest because of 
the lagging economy.
  State budgets are under siege. The combination of increasing demands 
for services and resources, coupled with the dramatic drop in revenues, 
is causing a fiscal crisis for States from coast to coast.
  The State of Maine, for example, faces a budget shortfall over the 
next 2 years of approximately $1.2 billion. Let

[[Page 6784]]

me put that in perspective. The entire budget for Maine is only $5.3 
billion, which means it faces a shortfall of more than 20 percent. To 
put the plight of Maine into perspective, I point out if the Federal 
Government were facing a 20-percent shortfall, it would have to close a 
$440 billion budget gap, and it would have to do so under its 
Constitution without borrowing a single dime. That is the dilemma 
facing our States.
  The States have to balance their budgets. They cannot print more 
money. They cannot borrow more money. They have to balance their 
budgets. States have been using rainy day funds, delaying capital 
projects, cutting spending, increasing taxes. They are doing whatever 
they can to balance their budgets.
  According to a February report by the National Conference on State 
Legislatures, States have been forced to cut a number of critical 
programs, ranging from education to corrections. Mr. President, 29 
States have imposed across-the-board budget cuts, and at least 24 
States are considering tax increases to help close those budget gaps.
  Moreover, at a time when the number of people without health 
insurance is climbing, 49 States have either already taken action to 
cut their Medicaid Program, or are planning to do so. Medicaid provides 
medical care for 44 million low-income people nationwide, including 
218,000 individuals in my home State. States are cutting benefits, 
increasing copays, restricting eligibility, or removing poor families 
from the rolls because of soaring costs and plunging revenues. As a 
consequence, the National Governors Association estimates as many as 2 
million low-income individuals across this country will lose their 
health care coverage as a result of the loss of Medicaid coverage.
  Let me be clear, I am not saying Congress should bail out the States. 
I am not saying States should not have to make hard choices. I am not 
saying States should not cut their budgets, that they should not 
balance their budgets. The States do need to tighten their belts during 
these austere fiscal times, but the nature and the severity of the 
fiscal crisis facing our States has convinced me we simply must help. 
The consequences are too dire, otherwise, and too many very low-income 
individuals will suffer if we do not step in and help.
  That is why I joined in this effort to provide for a temporary 
increase in the February Medicaid matching rate as well as some 
flexible funds that go to every State. Specifically, our amendment, 
which has strong bipartisan support, provides $30 billion to the 
States, at least half of which would have to be provided through a 
temporary increase in the Medicaid matching rate.
  Our amendment is strongly supported by a host of health care patient 
and consumer advocacy groups, including the American Hospital 
Association, the American Health Care Association, the Visiting Nurses 
Associations of America, the American Dental Association, Families USA, 
the Child Welfare League of America, the Alzheimer's Association, the 
National Alliance for the Mentally Ill, the Children's Defense Fund, 
the Consortium for Citizens with Disabilities, and many other 
critically important organizations.
  The support our proposal has received underscores how important it is 
we act now to provide assistance to the States at a time when many are 
looking toward further cuts in their health care programs to help 
balance their budgets.
  We have focused particularly on Medicaid because of our concern about 
the impact on low-income families in America. But there is another 
reason it makes sense to target this assistance to the Medicaid 
Program; that is, Medicaid is the fastest growing component of State 
budgets.
  While State revenues are stagnant or declining in most States, 
Medicaid costs are increasing at a rate of more than 13 percent a year. 
My home State of Maine is one of many States that has been forced to 
consider cuts in its Medicaid Program to compensate for its budget 
shortfalls.
  Legislation enacted as a consequence of our amendment, I stress 
again, will not free States from making very painful and difficult 
choices in crafting their budgets for the year. But it will help 
prevent the most harmful cuts, those that would affect the families who 
can least afford them, those who are already under strain as we see the 
number of uninsured continue to climb to 41 million Americans without 
insurance.
  To Maine, our amendment could mean as much as $190 million over the 
next 18 months for health care and social services that would help our 
most needy citizens. In other words, this is about helping those who 
are most vulnerable in our society. In addition, our proposal makes 
sound economic sense. Putting money into the hands of the States is a 
good way to stimulate economic growth.
  After all, if we cut taxes in Washington only to have taxes increased 
in State capitals across this country, we will wipe out the good that 
we do by cutting taxes. We know if we get money into the hands of the 
States, they will put it directly into the economy, and that is just 
the kind of stimulus our economy needs.
  Congress is most effective when it stands arm in arm, not toe to toe, 
with our partners, the States. Our States face a crisis of vast and 
still-expanding dimensions. We need to help. This amendment is a 
critical step forward in doing just that. I hope we will have another 
very strong bipartisan vote for our proposal so that we can ensure any 
fiscal relief is included in any economic growth package that we 
consider later this year.
  I am happy to yield to my colleague from West Virginia.
  Mr. ROCKEFELLER. I ask the Senator from Maine, in the summary before 
the vote tomorrow, opponents will no doubt ask what is our source of 
funding. That is a fair question to ask, and it has a very easy answer, 
in this case in a sense-of-the-Senate amendment.
  Would the Senator from Maine be willing to clear up for our 
colleagues how we will pay for this?
  Ms. COLLINS. The Senator from West Virginia raises an excellent 
question. Again, I stress that what our direction to the Finance 
Committee would say, when you report an economic growth package, fiscal 
relief up to at least $30 billion should be part of that package.
  So our sense-of-the-Senate amendment does not increase the deficit. 
It does not increase the overall spending in this resolution. It does 
not increase the budget caps that are in this resolution. All it says 
is, when an economic growth package is reported by the Finance 
Committee, it should include the $30 billion in State fiscal relief.
  So this proposal is budget neutral and it is deficit neutral. It does 
not have the impact that might cause some people otherwise to oppose 
it.
  Mr. ROCKEFELLER. I thank the Senator and ask if she would further 
yield?
  Ms. COLLINS. I am happy to yield to my friend.
  Mr. ROCKEFELLER. It would be natural, in the nature of this body, for 
people to come and say--the Senator referred to this in her remarks--
you are talking about making available $30 billion to the States; we 
have enough problems of our own at the Federal Government level. I 
pointed out in my remarks the recession we are in right now is more a 
matter, not of war that we are in, but the State situation and the 
Federal Government situation.
  So people would say just let the States go ahead and pay for this. If 
they have to make cuts, they have to make cuts. It is their fault they 
are in this kind of situation.
  I was wondering how the Senator would reply to that.
  Ms. COLLINS. Mr. President, I would respond to that concern in two 
ways. First of all, the dramatic decline in revenues is not the fault 
of State governments. It is a product of the lagging economy we are in, 
and the lingering effects of the attacks on our Nation of September 11. 
The States have been prudent, have taken appropriate steps, but when 
you have 49 States, every single State but Wyoming, struggling to close 
budget gaps, it is clear it is not the result of profligate spending by 
one

[[Page 6785]]

or two particular States but, rather, reflects our declining economy or 
our lagging economy.
  What we have here is a confluence of the impact of September 11 and a 
recession with declining revenues that have caused these budget gaps in 
49 States.
  A second point is, despite our best efforts, the States are still 
going to have to make some very painful and difficult choices. In the 
State of Maine, we are facing a budget gap of over $1 billion. Under 
our proposal, Maine would get a much welcomed $190 million. There is 
still a long ways to go.
  Our proposal will certainly help the States avoid some of the most 
harmful cuts, particularly in health care, which is our greatest 
concern, but it certainly does not mean States are let off the hook in 
any way.
  Mr. ROCKEFELLER. If the Senator will further yield, she leads 
directly to the question I wanted to ask her. That is, that there are 
many who have not worked in the bowels of State government, so to 
speak, who think Medicaid is sort of a gift from the Federal Government 
to the States. They do not understand that there is a very complex 
formula wherein all the States have to contribute, the formula is based 
upon their prosperity, and things of that sort.
  So the concept that this is somehow the Federal Government turning 
over money to the States and there is no cost to them doesn't make any 
sense, does it?
  Ms. COLLINS. The Senator is absolutely correct. Medicaid is a 
partnership between the Federal Government and our partners, the 
States, to provide health care to low-income families, the very poor 
individuals, to those who need it most. Medicaid is the fastest growing 
component in State budgets. So States certainly are contributing to 
this program. It has been a successful partnership. We are suggesting a 
temporary increase over the next 18 months. I hope we will grant that.
  I have several letters which I am going to have printed in the 
Record, which talk about protecting the States' ability to provide and 
deliver this health care, and points out, again, that these are health 
care services to the most vulnerable Americans we serve.
  I ask unanimous consent that a letter from the National Association 
for Home Care and Hospice be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:


                                           Homecare & Hospice,

                                                 January 22, 2003.
     Hon. Bob Graham,
     U.S. Senate, Hart Senate Office Building, Washington, DC.
       Dear Senator Graham: On behalf of the National Association 
     for Home Care & Hospice (NAHC), the nation's largest 
     association representing home care and hospice providers, 
     caregivers and the patients they serve, I am writing to 
     commend you on the introduction of S. 138, the ``State Budget 
     Relief Act of 2003.''
       As you are well aware, the current economic downturn has 
     resulted in drastically lower state tax revenues. Moreover, 
     the number of uninsured continues to grow as more and more 
     people are forced from the labor market. This has resulted in 
     states being forced to cut their Medicaid budgets at the 
     exact time that there is a growing need for services.
       Your legislation, by temporarily increasing the Federal 
     Medical Assistance Percentage (FMAP) as a way to direct 
     additional federal funding to state Medicaid programs, will 
     protect states' health care delivery systems and ensure the 
     continuation of health services for the most vulnerable of 
     our population. Without this assistance, many communities 
     will find themselves with providers that are understaffed, 
     have crumbling infrastructures, lack current medical 
     technology, or have reduced or eliminated certain services.
       NAHC believes that home health and hospice services remain 
     one of the remedies to the widespread concern over growing 
     health care costs. In recent years, state Medicaid programs 
     have increased their utilization of home and community-based 
     long-term care services in lieu of institutional care through 
     the use of waivers. In fact, the Centers for Medicare and 
     Medicaid Services (CMS) recently reported that Medicaid 
     spending growth levels for home care services more than 
     doubled between 2000 and 2001--from 8.6 percent to 17.3 
     percent. Some of this trend reflects the growing desire to 
     implement the Supreme Court's Olmstead decision to provide 
     disabled individuals care in the least restrictive setting 
     possible and the Administration's goals as set forth in its 
     ``New Freedom Initiative.'' This desirable trend is at risk 
     of falling victim to the widespread cuts to the Medicaid 
     program that states are being forced to implement due to 
     budget shortfalls.
       Once again, thank you for your leadership on this issue. 
     Let me know if there is anything my staff or I can do to 
     ensure the passage of this important legislation.
           Sincerely,
                                              Val J. Halamandaris,
                                                        President.
  Mr. ROCKEFELLER. I thank the Senator from Maine.
  Mr. SMITH. Mr. President, I rise today in support of this sense of 
the Senate amendment to provide funding for State fiscal relief.
  States are suffering their worst fiscal crisis in over half a 
century.
  Forty one million Americans live, work, and go to school without 
health insurance, and that number grows every single day.
  I have been a strong supporter of State fiscal relief since the 
economy began to slow several years ago. Since then, the situation has 
only gotten worse. This is the third consecutive year of nationwide 
budget problems for the States.
  According to the Kaiser Family Foundation, 49 States and the District 
of Columbia have taken Medicaid cost-containment action this fiscal 
year; additional cuts are expected next year as States struggle to fill 
budget shortfalls of billions of dollars.
  States are reducing or freezing provider payments, establishing or 
strengthening prescription drug cost controls, reducing benefits, 
increasing co-payments for Medicaid beneficiaries, and most 
significantly, States are increasing restrictions on eligibility for 
Medicaid.
  What does this mean? Let me be clear: it means that the number of 
uninsured Americans will continue to grow.
  According to the CDC, Medicaid and SCHIP provided coverage for 2 
million children and 1 million adults who lost their health coverage 
last year. In addition to those who did qualify for these programs, 
many more did not; they joined the ranks of the uninsured. In 2001, 1.4 
million people became uninsured, and this number is likely to be even 
higher for 2002 and 2003.
  While we need to strengthen our economy in the long run, it is 
imperative that we address the immediate economic problems, 
particularly the state fiscal crisis. State fiscal relief is one of the 
most effective policies the Congress could and should enact as part of 
the economic stimulus/growth package.
  There is no question that States will spend any additional Federal 
funds they receive quickly, putting money directly into the economy 
rather than curtailing economic activity. As many economists have 
noted, we need to increase demand in the economy--but State budget 
actions to balance their budgets right now are reducing demand 
significantly.
  This is precisely the wrong medicine at the wrong time for our 
economy.
  Last year, 75 Senators voted to provide State fiscal relief by 
boosting FMAP payments to States, but in the end, the legislation was 
not signed into law and State fiscal relief--needed now more than last 
year--has still not been delivered.
  The magnitude of the State fiscal crisis is growing steadily worse. 
Oregon alone is facing a budget deficit of at least $1 billion in the 
upcoming fiscal year. Already, one in four Medicaid recipients in 
Oregon is experiencing service cuts, and more reductions are on the 
way. Districts in my State have the shortest school year of any schools 
in the country. Some teachers in my State have even agreed to work for 
free in order to keep the schools open! And things are so bad for 
Oregon schools that recently the Doonesbury comic strip dedicated a 
whole week of comics to the sad state of Oregon school funding.
  This proposal would bring almost $331 million to Oregon over the next 
18 months, which would go a long way to maintain the fragile health 
care safety net for vulnerable Oregonians. Bipartisan support for our 
FMAP proposal has grown steadily. It is supported by

[[Page 6786]]

groups representing the States, the elderly, the disabled, children, 
and Oregon's governor Kulongoski, among many, many others. It has 
support because it is a sound proposal. It provides temporary 
assistance to States in a very timely and efficient manner.
  Several weeks ago, I was in Oregon for a series of town hall meetings 
with my colleague Ron Wyden. At every stop, we spoke to people who were 
being affected by the first round of budget cuts. I can tell you, as we 
listened to these good people tell their stories, there wasn't a dry 
eye in the house.
  The pain is real. We have to do something and we have to do it now, 
and I urge my colleagues to support this fiscal relief amendment to the 
budget.
  The PRESIDING OFFICER. Who yields time? Does the Senator from West 
Virginia yield time?
  Mr. ROCKEFELLER. How much time, might I ask the Senator, does he 
require?
  Mr. NELSON of Nebraska. I estimate 5 minutes.
  Mr. ROCKEFELLER. The Senator is welcome to that.
  Mr. NELSON of Nebraska. Mr. President, it is a pleasure to join with 
my colleague from the State of Maine. We have been working for a long 
time to bring about help for the States in the area of Medicaid and in 
the area of welfare reform and social services.
  Our amendment makes it clear that the Senate recognizes the 
partnership between the Federal Government and the States, and is 
committed to helping the States see their way out of their dire budget 
situation.
  How bad is this budget shortfall? The States are currently 
experiencing the worst fiscal crisis since World War II. States have 
accumulated $26 billion in deficits this year on top of $50 billion in 
deficits from last year. Even greater gaps, reaching upwards of $70 to 
$85 billion in deficits, are projected for the next fiscal year. It is, 
in fact, a crisis.
  But the budget crisis is more than just numbers and dollars. This is 
about real people. And the people of our States have been hit hard by 
the tough economic times. Nearly every State is required to have a 
balanced budget, even during a recession. The rainy day funds have run 
dry and funding for programs as critical as Medicaid have been cut to 
the bone. The only option left for many States is to cut critical 
programs even further or raise taxes.
  Just last year, Nebraska reduced the number of low-income working 
families that were eligible for assistance with childcare. More than 
2,000 Nebraska families have lost childcare assistance as a result of 
this change. Those hardest hit are families that have managed to stay 
off welfare for more than 2 years. These families who have slowly but 
steadily made progress to self-sufficiency may soon find themselves 
struggling to pay their childcare bills and returning to the welfare 
rolls. Childcare assistance is integral to any effort to move families 
from welfare to work and to keeping low-income parents employed. State 
fiscal relief will protect the progress we have made in welfare reform 
over the past decade from being undone.
  Many of the other cuts are being considered in the areas of 
education, health care, social services, and corrections.
  My office recently received a call from Sharon Walters of Omaha, NE. 
The message she relayed is a good illustration of how these proposed 
cuts are affecting real people. She wanted to make sure I know the 
importance of my efforts to provide State fiscal relief. She represents 
Bethphage, an organization that provides community-based services for 
people with disabilities. She was worried because much of their funding 
comes from Medicaid. Because of so many proposed cuts to the Medicaid 
program, Bethphage and other programs like theirs, may soon be forced 
to limit the good work they do if State budgets do not see some relief 
soon.
  State fiscal relief is not only needed to protect education, health 
care, Medicaid and other social service programs, it is needed to 
stimulate our economy.
  In discussing various jobs and growth proposals with my colleagues 
this year, I have repeatedly asked them to ``Show me the Stimulus'' and 
demonstrate how proposed tax cuts or spending will get our economy back 
on track.
  Although economists differ on the stimulative effect of the varying 
tax cut proposals, I think there is little question that providing 
States with fiscal relief would be a boost to the economy. In fact, 
State fiscal relief may provide more ``bang for the buck'' than many of 
the other stimulus proposals being discussed. According to a recent 
study done by Mark Zandi at economy.com every dollar spent in State 
fiscal relief will create $1.24 in demand the following year.
  At a time when we are trying to get the economy back on track, it 
would be irresponsible for the Senate to turn its back on this 
nationwide crisis and do nothing.
  It doesn't make much sense to cut taxes in Washington while States 
are forced to raise them in Lincoln, Des Moines, Topeka, Pierre, Saint 
Paul, or wherever and other State capitals throughout the United 
States. State fiscal relief is a commonsense approach to getting our 
economy back on track. As well, it is the right thing to do. Not only 
will State fiscal relief shield the people of our States from some of 
the tough economic times, to some extent, it will also stimulate our 
economy and return individuals and States alike to financial security.
  Again, I thank my colleagues--Senators Collins and Rockefeller--for 
their work on this important effort and urge my colleagues to join us 
in supporting this amendment.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. NELSON of Nebraska. I thank my colleagues and thank the Presiding 
Officer for this time.
  The PRESIDING OFFICER. The Democratic whip.
  Mr. REID. Mr. President, on behalf of Senator Conrad, I yield to the 
distinguished Senator from Maryland 20 minutes.
  Mr. SARBANES. At most.
  The PRESIDING OFFICER. The Senator from Maryland.
  Mr. SARBANES. Mr. President, I intend to speak to an amendment which 
will be offered tomorrow. I take this approach because I am joined in 
sponsoring this amendment by Senator Jeffords, Senator Mikulski, and 
Senator Bob Graham of Florida. And they will, presumably, be able to 
address the amendment as well on that occasion.
  The amendment that we will offer will boost Federal funding for the 
Clean Water and Safe Drinking Water State Revolving Funds from the 
level that is recommended in the budget resolution, which is $2.2 
billion, to $5.2 billion; $3.2 billion of this for the Clean Water 
State Revolving Fund and $2 billion for the Safe Drinking Water State 
Revolving Fund.
  Regrettably, the President's budget for fiscal 2004 and the budget 
resolution severely shortchange the funds needed by State and local 
governments to upgrade their aging wastewater and drinking water 
infrastructure.
  The President's budget provides only $1.7 billion for both State 
Revolving Funds, equally split. The budget resolution recommends a 
somewhat higher figure, a little over $2 billion for both funds, but 
that is still far short of what is needed.
  Despite progress over the last three decades, EPA reports that more 
than 40 percent of our Nation's lakes, rivers, and streams are still 
too impaired for fishing or swimming. Discharges from aging and failing 
sewage systems, urban storm water, and other sources continue to pose 
serious threats to our Nation's waters, endangering public health and 
both the fishing and recreational industries.
  Of course, as we all realize, population growth and development are 
placing additional stress on the Nation's water infrastructure and our 
ability to make sustainable gains in water quality.
  Across the Nation, our wastewater and drinking water systems are 
aging. And, in some cases, systems currently in use were built more 
than a century ago and have outlived their useful life.
  For many communities, current treatment is not sufficient to meet

[[Page 6787]]

water quality goals. Recent EPA modeling indicates that municipal 
wastewater treatment facilities in my own State will have to reduce 
nitrogen discharges by nearly 75 percent to restore the Chesapeake Bay 
and its tributaries to health.
  In April of 2000, the Water Infrastructure Network, a broad coalition 
of locally elected officials, drinking water and wastewater service 
providers, State environmental and health administrators, engineers, 
and environmentalists released a report, ``Clean and Safe Water for the 
21st Century.'' This report documented a $23 billion a year shortfall 
in funding needed to meet national environmental and public health 
priorities in the Clean Water Act and in the Safe Drinking Water Act. 
And all of the studies have substantiated this gap. For example, in May 
of 2002--less than a year ago--the Congressional Budget Office released 
a report showing very large gaps for clean water needs and drinking 
water needs over the next 20 years.
  The need for additional investment in wastewater and drinking water 
infrastructure is clearly documented. But States, localities, and 
private sources cannot meet the funding gap alone. Local communities 
already pay almost 90 percent of the total cost, or about $60 billion a 
year, to build, operate, and maintain their drinking water and 
wastewater systems.
  But as Administrator Whitman recently pointed out:

       The magnitude of the challenge America faces is clearly 
     beyond the ability of any one entity to address.

  States are currently facing the worst fiscal crisis in 50 years and 
cannot afford to make new investments in clean water and drinking water 
infrastructure.
  Clearly, water pollution is an interstate problem that requires, in 
part, a Federal response. In our own case, in Maryland, water flows 
into the Chesapeake Bay from six States. Other States need to make 
investments as well in order to clean up the watershed. It is vital 
that the Federal Government maintain a strong partnership with States 
and local governments in order to address this major environmental 
challenge.
  The increases provided for in this amendment are the first step 
necessary to deal with this pressing problem. It represents an 
investment in the health of Americans and a clean environment, and is, 
I believe, an investment that will pay substantial dividends.
  Wastewater treatment plants not only prevent billions of tons of 
pollutants from reaching our rivers, lakes, streams, and coasts, they 
also help prevent waterborne diseases and make waters safe for swimming 
and fishing. In fact, the Water Infrastructure Network says that clean 
water supports $50 billion a year in the water-based recreation 
industry, at least $300 billion a year in coastal tourism, $45 billion 
annually in commercial fishing and shellfishing, and hundreds of 
billions of dollars a year in basic manufacturing that relies on clean 
water.
  According to the Water Infrastructure Network, clean rivers, lakes, 
and coastlines attract investment in local communities and increase 
land values on or near the water, and that, in turn, creates jobs, adds 
to the tax base, and improves revenues for local, State, and Federal 
governments. Some 54,000 community drinking-water systems provide 
drinking water to more than 250 million Americans. By keeping water 
supplies free of contaminants that cause disease, these water systems 
reduce sickness and related health care costs. They reduce absenteeism 
in the workforce. And they, obviously, add to our quality of life.
  Investment in the infrastructure we are talking about here--sewer and 
water improvements--would also create substantial numbers of jobs 
through construction. It would provide an impetus to our economy at a 
time when it needs an impetus.
  There is strong support for increased investment in infrastructure. 
Colleagues on both sides of the aisle have taken a lead on this issue 
over the years.
  The case for the amendment is compelling. Maintaining clean, safe 
water remains one of our leading national challenges. This budget 
resolution should not and need not come at the expense of human health 
or a clean environment. I strongly urge my colleagues, when the 
amendment is presented, to support it and to begin to address this 
large funding gap that looms into the future with respect to this very 
important aspect of our domestic agenda. This is both good 
environmental policy and good economic policy. Support for this 
amendment will offer an opportunity to continue to make progress on 
clean water and safe drinking water. I commend the amendment to my 
colleagues when it is brought before them at the appropriate time.
  Mr. President, I have a number of letters from organizations in 
support of the amendment. I ask unanimous consent to print them in the 
Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                             National Association of Counties,

                                   Washington, DC, March 19, 2003.
     Subject: Support for the Jeffords/Sarbanes/Mikulski/Graham 
         SFR amendment.

       Dear Senator: The National Association of Counties (NACO) 
     supports the Jeffords/Sarbanes/Mikulski/Graham amendment to 
     boost funding for the Clean Water and Safe Drinking Water 
     State Revolving Funds (SRF) from the Fiscal 2003 enacted 
     level of $2.19 billion to $5.2 billion.
       Despite progress over the past 30 years, the Environmental 
     Protection Agency reports that more than 40 percent of our 
     nation's lakes, rivers, and streams are still too impaired to 
     be utilized for their intended use. And, discharges from 
     aging and failing sewage systems, urban storm water and other 
     sources continue to pose serious threats to our nation's 
     waters. Population growth and development only place more 
     stress on the nation's water infrastructure and its ability 
     to maintain current standards.
       On September 30, 2002, the EPA released a Clean Water and 
     Drinking Water Infrastructure Gap Analysis. This report 
     discovered a $535 billion gap between current spending and 
     projected water and wastewater infrastructure needs over the 
     next 20 years if additional investments are not made.
       It is vital that the Federal government work with the state 
     and local governments to prevent this massive projected 
     funding gap and share the burden of maintaining and improving 
     the nation's water infrastructure. An increase in funding for 
     the Clean Water SRF to $2 billion in fiscal year 2004 is the 
     first step necessary to meet these funding requirements.
       Additionally, each billion dollars invested in water 
     infrastructure creates an estimated 40,000 jobs. So this 
     amendment is both pro-environmental policy and pro-economic 
     policy. Thank you for offering this timely and important 
     amendment.
           Sincerely,
                                                      Larry Naake,
                                               Executive Director.


     
                                  ____
                                    National League of Cities,

                                   Washington, DC, March 19, 2003.
     Hon. Paul Sarbanes,
     U.S. Senate,
     Washington, DC.
       Dear Senator Sarbanes: On behalf of the National League of 
     Cities and the 18,000 cities and towns across the nation we 
     represent, we would like to express our support for your 
     efforts, along with those of Senators Mikulski, Graham and 
     Jeffords, to increase funding for the Clean Water and 
     Drinking Water State Revolving Funds.
       As you know, our cities and towns are facing a $23 billion 
     funding gap annually to repair and replace aging 
     infrastructure for these critical, but unseen, services, 
     despite annual local expenditures of more than $60 billion 
     for wastewater and drinking water. We also agree that 
     investments in our water and wastewater infrastructure can 
     serve as a job creation component of an economic stimulus 
     initiative.
       We applaud and appreciate your efforts and offer any 
     assistance we can to help you attain your objective.
           Sincerely,
                                                        Don Borut,
                                               Executive Director.


     
                                  ____
                                                    Association of


                                  Metropolitan Water Agencies,

                                   Washington, DC, March 19, 2003.
     Hon. Paul S. Sarbanes,
     U.S. Senate,
     Washington, DC.
       Dear Senator Sarbanes: On behalf of the nation's largest 
     public water suppliers, thank you for your efforts to 
     increase funding for the drinking water and clean water state 
     revolving funds (SRFs) to $5.2 billion in fiscal year 2004. 
     If this increase is appropriated, the benefits will be safer 
     water supplies, cleaner rivers and streams, and a stronger 
     economy.

[[Page 6788]]

       The Association of Metropolitan Water Agencies represents 
     the nation's largest publicly owned drinking water providers. 
     ANWA's members serve safe drinking water to more than 110 
     million Americans.
       Sources including the Water Infrastructure Network, EPA, 
     GAO and the CBO confirm that water systems face multi-
     billion-dollar gaps in funding, as water facilities, 
     particularly underground distribution systems, reach the end 
     of their useful lives. According to WIN, the gap between what 
     utilities currently invest and what they will need to invest 
     over the next 20 years is $23 billion per year. Water systems 
     themselves pay the majority of infrastructure costs, but 
     federal help is needed, especially for metropolitan systems.
       Twenty-one States provided no assistance to systems serving 
     100,000 or more people between 1996-2002. Thirteen more 
     States provided assistance to only one or two of these 
     systems. Only a substantial boost in funding will provide the 
     opportunity to better help our nation's largest public water 
     systems.
       Thank you for supporting drinking water and wastewater 
     infrastructure funding.
           Sincerely,
                                                  Diane VanDe Hei,
                                               Executive Director.


     
                                  ____
                                 Water Environment Federation,

                                                   March 19, 2003.
     Hon. Paul Sarbanes (D-MD),
     Washington, DC.
       Dear Senator Sarbanes: It is our understanding that you and 
     other Senators plan to offer an amendment during 
     consideration of the FY 2004 Budget Resolution that would 
     substantially increase funds available for the Clean Water 
     and Safe Drinking Water state revolving funds (SRFs). The 
     Water Environment Federation, an organization whose members 
     are directly involved in the implementation of clean water 
     programs, strongly supports this amendment.
       The need for increased investment in water infrastructure 
     is well documented. In September 2002, the Environmental 
     Protection Agency released a Clean Water and Safe Drinking 
     Water Infrastructure Gap Analysis which found that there will 
     be a $535 billion gap between current spending and projected 
     needs for water and wastewater infrastructure over the next 
     20 years if additional investments are not made. In May 2002, 
     the Congressional Budget Office released a report that 
     estimated a spending gap for drinking water between $132 
     billion and $388 billion over 20 years and the spending gap 
     for drinking water needs at between $70 billion and $362 
     billion over 20 years.
       WEF, founded in 1928, is a not-for-profit technical and 
     educational organization with members from varied disciplines 
     who work toward the WEF vision of preservation and 
     enhancement of the global water environment. The WEF network 
     includes more than 100,000 water quality professionals from 
     79 Member Associations in 32 countries.
           Sincerely,

                                                 Tim Williams,

                                                Managing Director,
     Government and Public Affairs.
                                  ____

                                                    Association of


                               Metropolitan Sewerage Agencies,

                                   Washington, DC, March 19, 2003.
     Hon. Paul Sarbanes,
     U.S. Senate, Hart Senate Office Building, Washington, DC.

     Hon. Jim Jeffords,
     U.S. Senate, Dirksen Senate Office Building, Washington, DC.

     Hon. Barbara Mikulski,
     U.S. Senate, Hart Senate Office Building, Washington, DC.

     Hon. Bob Graham,
     U.S. Senate, Hart Senate Office Building, Washington, DC.
       Dear Senators: On behalf of the nearly 300 publicly owned 
     wastewater treatment agency members who provide treatment to 
     a majority of Americans, the Association of Metropolitan 
     Sewerage Agencies (AMSA) offers its support for your 
     amendment to the Fiscal 2004 Budget Resolution. Your 
     amendment would boost funding for the Clean Water State 
     Revolving Fund (CWSRF) from its current funding level of 
     $1.35 billion to $3.5 billion in fiscal year 2004, an 
     increase which AMSA believes would mark an important first 
     step toward developing a long-term, sustainable solution for 
     the wastewater infrastructure funding gap.
       As your March 14 Dear Colleague letter aptly states, ``It 
     is vital that the Federal government maintain a strong 
     partnership with states and local governments in averting 
     this massive projected funding gap and share in the burden of 
     maintaining and improving the nation's water 
     infrastructure,'' Your amendment demonstrates that water 
     quality remains a high priority for the 108th Congress and 
     helps bring the significant goal of overcoming the clean 
     water funding gap within reach.
       AMSA's overarching goal is to ensure America's clean water 
     progress. Once again, we thank you for your support of the 
     nation's publicly owned treatment works and for your help in 
     meeting this critical national objective. AMSA looks forward 
     to working with you on a long-term, sustainable funding 
     solution for the nation's core wastewater infrastructure. If 
     you have any questions, please contact me at 202/833-2672.
            Sincerely,
                                                         Ken Kirk,
     Executive Director.
                                  ____

                                                    Association of


                                     California Water Agencies

                                   Washington, DC, March 19, 2003.
     Hon. Paul Sarbanes,
     U.S. Senate, Hart Senate Office Building, Washington, DC.

     Hon. Jim Jeffords,
     U.S. Senate, Dirksen Senate Office Building, Washington, DC.

     Hon. Barbara Mikulski,
     U.S. Senate, Hart Senate Office Building, Washington, DC.

     Hon. Bob Graham,
     U.S. Senate Hart Senate Office Building,
         Washington, DC.
       Dear Senators: The Association of California Water Agencies 
     (ACWA) strongly supports your proposed amendment to the 
     fiscal year 2004 Budget Resolution to increase funding for 
     the Clean Water and Safe Drinking Water State Revolving Funds 
     (SRFs).
       Throughout the United States, these programs provide 
     indispensable resources to rural areas and municipalities 
     alike for projects that enable compliance with drinking water 
     standards, protection of waterways, sanitation, environmental 
     preservation and more. The SRFs are the backbone of our water 
     infrastruce, and with increasingly severe demands on water 
     supplies, the Funds will become more important in the years 
     ahead.
       Last year the U.S. Environmental Protection Agency 
     acknowledged a multi-billion dollar need for reinvestment in 
     our water infrastructure, and this ``funding gap'' is the 
     ongoing subject of bipartisan legislation.
       ACWA represents 440 public water agencies in California 
     collectively responsible for more than 90 percent of the 
     water delivered for residential and agricultural use.
       Thank you for your efforts to increase funding for water 
     infrastructure in the 2004 budget, and we look forward to 
     working with you to advance this worthwhile goal.
           Sincerely,
                                                David L. Reynolds,
     Director of Federal Relations.
                                  ____

                                               American Society of


                                              Civil Engineers,

                                   Washington, DC, March 19, 2003.
     Hon. Paul Sarbanes,
     Hart Building, Washington, DC.
       Dear Senator Sarbanes: I am writing on behalf of the 
     130,000 members of the American Society of Civil Engineers 
     (ASCE) to support passage of your amendment to increase 
     funding for the Clean Water Act and Safe Drinking Water Act 
     State Revolving Loan Fund (SRF) programs for fiscal year 
     2004.
       Two years ago ASCE released its 2001 Report Card for 
     America's Infrastructure. At that time, we found that the 
     nation's aging wastewater and drinking-water systems received 
     an overall grade of D. These systems are quintessential 
     examples of aged systems that need to be updated. For 
     example, some sewer systems are 100 years old. Many older 
     drinking-water systems are structurally obsolete.
       The annual funding shortfall of $11 billion for drinking-
     water and $12 billion for wastewater only accounts for 
     improvements to the current system and do not even take into 
     consideration the demands of a growing population.
       The amendment that you propose would help make an important 
     down payment on the necessary investment in our long-
     neglected water systems.
       If ASCE can be of any assistance in this important 
     endeavor, please do not hesitate to contact Brian Pallasch at 
     202-326-5140 or Michael Charles at 202-326-5126.
           Sincerely yours,
                                          Thomas L. Jackson, P.E.,
     President.
                                  ____

                                           Construction Management


                                       Association of America,

                                       McLean, VA, March 19, 2003.
     Hon. James M. Jeffords,
     U.S. Senate, Washington, DC.

     Hon. Barbara A. Mikulski,
     U.S. Senate, Washington, DC.

     Hon. Paul S. Sarbanes,
     U.S. Senate, Washington, DC.

     Hon. Bob Graham,
     U.S. Senate, Washington, DC.
       Dear Senators Jeffords, Mikulski, Sarbanes, and Graham: I 
     am writing on behalf of the more than 2,000 members of the 
     Construction Management Association of America (CMAA) to 
     express our strong support for the proposed amendment you 
     plan to offer today during consideration of the FY 2004 
     Budget Resolution, which would increase funding for the Clean 
     Water and Safe Drinking Water State Revolving Funds (SRF) 
     from

[[Page 6789]]

     the Fiscal 2003 enacted level of $2.2 billion to $5.2 
     billion.
       CMAA is an industry association of firms and professionals 
     who provide program and construction management services to 
     owners in the planning, design and construction of capital 
     projects of all types. CMAA's mission is to ``promote 
     professionalism and excellence in the management of the 
     construction process.''
       As you are well aware, America's water infrastructure 
     systems are aging, deteriorating and demanding attention. 
     Reports show that municipal sewer systems overflow some 
     40,000 times annually. In addition, approximately 42 million 
     Americans are served by old sewer systems that don't even 
     separate storm water from waste. The need for improvement is 
     clear, and growing.
       According to a 2001 report published by The Water 
     Infrastructure Network (WIN), of which CMAA is a member, 
     wastewater systems faced a daunting capital investment 
     shortfall of approximately $12 billion each year over the 
     next two decades. A similar report by the Congressional 
     Budget Office (CBO) concluded in 2002 that ``costs to 
     construct, operate, and maintain the nation's water 
     infrastructure can be expected to rise significantly in the 
     future.'' The CBO conservatively estimated that the needs 
     would be $13 billion annually for wasterwater systems over 
     the next 20 years.
       An increase in funding for the Clean Water SRF to $3.2 
     billion and for the Safe Drinking Water SRF to $2 billion in 
     fiscal year 2004, as proposed in your amendment, would help 
     address this massive water infrastructure funding gap.
       Once again, CMAA offers its strongest support for this 
     important amendment and commends you for your leadership in 
     helping to address our nation's water infrastructure funding 
     gap. Should you have any questions or comments, please do not 
     hesitate to contact Elizabeth Aronson, our Director of 
     Government Affairs, at 703/216-3248.
       Thank you for the opportunity to comment on this important 
     matter.
           Sincerely,
                                                 Bruce D'Agostino,
     Executive Director.
                                  ____

                                            The Associated General


                                       Contractors of America,

                                   Alexandria, VA, March 18, 2003.
     Hon. Paul Sarbanes,
     U.S. Senate, Washington, DC.
       Dear Senator Sarbanes: As you consider the Fiscal Year 2004 
     Budget Resolution, the Associated General Contractors of 
     America (AGC) urges you to support the Jeffords-Sarbanes-
     Mikulski-Graham amendment to boost funding for the Clean and 
     Safe Drinking Water State Revolving Funds. The amendment 
     would increase funding from the Fiscal Year 2003 enacted 
     level of $2.19 billion to $5.2 billion.
       AGC is proud of the role the construction industry has 
     played in improving water quality. However, the needs facing 
     our nation's wastewater and drinking water systems are 
     tremendous. The EPA reports that more than 40 percent of our 
     nation's lakes, rivers, and streams are still too impaired 
     for fishing or swimming. Discharges from aging and failing 
     sewage systems, urban storm water and other sources continue 
     to pose serious threats to our nation's waters, endangering 
     not only public health, but also fishing and recreation 
     industries. Population growth and development have placed 
     additional stress on the nation's water infrastructure and 
     its ability to sustain the water quality gains realized since 
     the inception of the Clean Water Act. Today, maintaining 
     clean, safe water remains one of our greatest national and 
     global challenges.
       In May 2002, the Congressional Budget Office released a 
     report that estimated the spending gap for clean water needs 
     between $132 billion and $388 billion over 20 years and the 
     spending gap for drinking water needs at between $70 billion 
     and $362 billion over 20 years. In September 2002, the EPA 
     released the Clean Water and Drinking Water Infrastructure 
     Gap Analysis which found that there will be a $535 billion 
     gap between current spending and projected needs for water 
     and wastewater infrastructure (combined) over the next 20 
     years if additional investments are not made. When the 
     analysis was released Administrator Whitman pointed out, ``. 
     . .the magnitude of the challenge America faces is clearly 
     beyond the ability of any one entity to address.''
       The funding included in this amendment will improve our 
     water systems, the environment, and also create tens of 
     thousands of jobs. Please support the Jeffords-Sarbanes-
     Mikulski-Graham amendment.
           Sincerely,
                                              Stephen E. Sandherr,
                                          Chief Executive Officer.

  Mr. NICKLES. Will the Senator yield for a brief question?
  Mr. SARBANES. I am happy to yield.
  Mr. NICKLES. I missed the opening part of his comments. Can the 
Senator tell me how much money is involved and over what period of 
time?
  Mr. SARBANES. The amendment has another $3 billion for these 
purposes, both for the Clean Water and the Safe Drinking Water State 
Revolving Funds. These are the moneys that go into the State Revolving 
Funds. Then, of course, they have to be matched by the States and often 
the localities. So the amount of money is leveraged significantly 
beyond what the Federal contribution would be.
  Mr. NICKLES. So there would be a total of $3 billion over the 10-year 
period of time.
  Mr. SARBANES. Another $3 billion, that is right.
  Mr. NICKLES. I thank my friend. Am I correct it would be offset, 
reducing the tax reductions that are in the proposal?
  Mr. SARBANES. The bill has room in it for $726 billion worth of tax 
cuts. Obviously, this raises the question of priorities. Is it more 
important to give these particular tax cuts, which, of course, I 
believe strongly are heavily weighted towards the wealthy, as opposed 
to making some investment in programs of this sort? We have to connect 
the two. I am willing to look at doing reasonable tax cuts, but I think 
what is in the resolution, as the chairman knows from my statements in 
committee, is far too excessive. If it were up to me, I would reduce 
that amount. I would use a limited portion of it to fund some of these 
priority programs. I would use the remainder of it to hold down the 
deficit so we are not projecting such large deficits out into the 
future.
  The PRESIDING OFFICER. The Senator from Oklahoma.
  Mr. NICKLES. Mr. President, I thank my colleague for offering his 
amendment. We will consider the amendment tomorrow. We have already had 
three or four amendments that are in the queue tomorrow. I understand 
there will be others. We have asked other Senators to come forward 
tonight to offer their amendments. The Senator from Maryland is doing 
that and explained it. I appreciate his explanation of the amendment. I 
am sure we will try to get that in the queue. I know Senator Crapo has 
an interest on this issue as well.
  It is 8:45, and we have requested colleagues if they had amendments 
to bring those to the floor. I am concerned about having a vote-arama 
or having so many people saying: Wait a minute, I didn't have a chance 
to offer my amendment.
  We have been saying all along that we would be in session very late 
tonight to receive amendments. We will be in session very late tomorrow 
tonight to dispose of amendments. I would like to see if we can't work 
out some amendments, accept some amendments, voice vote some 
amendments, and work toward completing this bill and avoid the crash at 
the end, the vote-arama where we have votes on amendments without 
having the slightest idea what is in them. We have done that in the 
past. That is not a good way to legislate. I would like to avoid that 
if possible.
  I thank my colleague from Maryland for coming late tonight and 
offering the amendment. I wish more Senators would have. I look forward 
to working with him tomorrow.
  The PRESIDING OFFICER. Who yields time?
  Mr. REID. Mr. President, I suggest the absence of a quorum and ask 
unanimous consent that the time be charged equally.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. NICKLES. 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. NICKLES. Mr. President, I ask unanimous consent that at 4 p.m. on 
Thursday, the Senate proceed to a series of votes in relation to the 
following amendments: Kyl amendment No. 288; Dorgan amendment No. 294; 
Rockefeller-Collins amendment No. 275. I further ask unanimous consent 
that no second-degree amendments be in order to any of the preceding 
amendments prior to the vote, and that there be 2 minutes for debate 
equally divided prior to each vote.
  Mr. REID. Mr. President, I ask if the Senator will modify his 
unanimous

[[Page 6790]]

consent request that there be 10 minutes between the second and third 
votes.
  Mr. NICKLES. Mr. President, I ask unanimous consent to limit the time 
on the last two amendments to 10 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________