[Congressional Record (Bound Edition), Volume 152 (2006), Part 1]
[Senate]
[Pages 709-746]
[From the U.S. Government Publishing Office, www.gpo.gov]




            TAX RELIEF EXTENSION RECONCILIATION ACT OF 2005

  The ACTING PRESIDENT pro tempore. Under the previous order, the 
Senate will resume consideration of H.R. 4297, which the clerk will 
report.
  The legislative clerk read as follows:

       A bill (H.R. 4297) to provide for reconciliation pursuant 
     to section 201(b) of the concurrent resolution on the budget 
     for fiscal year 2006.

  The ACTING PRESIDENT pro tempore. The Senator from Montana.
  Mr. BAUCUS. Madam President, we have a few hours left on this side. I 
believe the Senator from California, Mrs. Boxer, is on her way to the 
Chamber and will be here momentarily. Until that moment arrives, I 
suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BYRD. Madam President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. BYRD. Madam President, I ask unanimous consent that I may yield 
to the distinguished Senator from Michigan such time as she may require 
and that I may be recognized at the close of her remarks.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  The Senator from Michigan.
  Ms. STABENOW. Madam President, I thank the distinguished Senator from 
West Virginia for his kindness this morning.
  I rise in support of Senator Baucus's amendment. At a time when 
middle-class families are struggling to pay their bills, the House tax 
bill would actually increase taxes by more than $30 billion on those 
families--$30 billion.
  This is a very difficult time for Michigan families. Every day we 
hear news about another plant closing or a company entering into 
bankruptcy. Michigan has lost 111,000 manufacturing jobs, and that 
doesn't include the recent announcement by Ford to cut another 30,000 
jobs.
  Michigan families are worried about their jobs. They are also worried 
about losing the pension that they have worked hard for and paid into 
for the 30 years that they have worked. They see their health care 
premiums continue to skyrocket, and they are struggling to fill gas 
tanks and pay home heating bills. The average price of gasoline in 
Michigan last month was $2.35 a gallon. Now middle-class families are 
facing home heating bills that are as much as 35 percent more expensive 
than last year. And their salaries and their pay stubs don't show a 35-
percent increase. If anything, they are going down in terms of income.
  What does the House bill propose to do to help middle-class families? 
Raise their taxes. This was quite stunning to me when I reviewed the 
bill that came over from the House of Representatives. We are talking 
about a bill that actually raises taxes on middle-income families. That 
is not acceptable. We can do better than that. Our middle-class way of 
life is in danger. I believe very strongly that in Michigan and places 
all across this country we are fighting for a way of life. Will we have 
the standard of living that we have had? Will we have the ability to 
send our kids to college and be able to buy a home and be able to dream 
the American dream and be successful? At every turn, we are seeing 
action taken here that takes our way of life and our opportunities 
away. Before Christmas, it was a bill that is part of this whole 
package, cutting over $12 billion in opportunities for people to go to 
college, by cutting student loans.
  So this is another one of those cases where people are working hard, 
expecting us to do the right thing and, in fact, the House bill would 
raise taxes on middle-income people, while lowering taxes for those who 
are already very blessed, earning millions of dollars a year. We need 
to be passing legislation that lowers health care costs, which is 
hurting American manufacturers. We need legislation that will protect 
people's pensions. This ought to be a basic premise and principle that 
we abide by in this country. When you work hard all your life and you 
pay into a pension, you should know that that will be there for you and 
your family.
  We must also enforce our trade laws and insist that countries such as 
China and Japan play by the rules and stop manipulating their currency 
and that we don't see counterfeit products coming into this country 
illegally, or other countries stealing our ideas and patents.
  That is the debate we should be having. These are actions we should 
be taking. I was deeply concerned the other night to hear the President 
talk about those of us who want to enforce trade laws, essentially 
saying we are protectionists if we don't stand back and say that in a 
global economy, whatever happens happens, that those of us who care 
about the rules and want trade to be fair are somehow protectionists. I 
profoundly disagree with that.
  It is our job to fight for American businesses and American workers. 
That is what I do every day, and I know that many colleagues feel the 
same way. The debate we need to be having on the floor of the Senate is 
how to save our middle class, save our way of life. But at a minimum, 
we should not be passing a tax increase on middle-class families.
  Michigan is the heart and soul of the middle class. There are 52,000 
families in jeopardy of facing a tax increase if we do not address the 
alternative minimum tax. The alternative minimum tax ceiling needs to 
be raised, as we know. Fundamentally, while there has been agreement in 
this Chamber to do that, if that does not come out of conference 
committee between the House and the Senate, we will see 19 million 
families getting a tax increase as a result of actions of the Congress.
  For instance, a family with five children would be hit with this 
ceiling if their income exceeds $54,000. They would, under the current 
system, pay more taxes. But without children, their income could exceed 
$76,000 before they pay more taxes. Think about that. Why is that fair? 
If you have five children, five mouths to feed, five children to buy 
clothes for, five children whom you are worried about going to college, 
you are going to pay higher taxes than somebody without children. That 
makes no sense. That is a $20,000 difference, a $20,000 penalty for 
having children. That makes absolutely no sense. What is American about 
that?
  Sadly, under the current system on taxes with the AMT, the larger 
your family, the larger taxes you pay. To add insult to injury, the 
House bill extends the capital gains and dividend tax rates to provide 
$50 billion in tax breaks to our wealthiest Americans--$50 billion in 
tax breaks to our wealthy Americans--while a family with five children, 
earning $54,000 a year, will pay more taxes.
  The majority of Americans are looking at this and asking, what is 
going on here? Where are our priorities, our values? This is backward. 
Even more egregious is the fact that these tax breaks that are given 
under the House bill are not set to expire until 2008. So the current 
tax cuts being given to the wealthiest Americans don't even expire 
until 2008, but the current problem for middle-income families happens 
right away; the current tax increase happens right away.

[[Page 710]]

  This bill is money to ensure that the wealthiest 3 percent of 
Americans are given tax breaks way out until 2010. Meanwhile, right 
now, middle- and low-income families are facing lower wages, mounting 
health care costs, trying to pay the gas bill, trying to pay the home 
heating bill, trying to send the kids to college, while we cut student 
loans. I did not support that. And now we are going to say, 
potentially, if the House bill were to become reality, by the way, you 
are going to pay more in taxes. This makes absolutely no sense.
  I commend my colleague, Senator Baucus, and I commend the chairman of 
the Finance Committee, as well, for working together to fix this, 
getting the Senate to work together to fix this. We need to fix this--
and not only in the Senate because we have agreed that is not right--
this needs to be fixed when the bill ends up going to the President's 
desk. That is when we will know whether 19 million American families 
will have a tax increase. My vote is ``no'' on that one, and it is 
``yes'' on making sure we fight for that which will keep our way of 
life in this country.
  Madam President, I yield the floor, and I thank the Senator from West 
Virginia again for allowing me to use this time.
  The ACTING PRESIDENT pro tempore. The Senator from Montana is 
recognized.
  Mr. BAUCUS. Madam President, several on our side wish to make 
statements before we get to offer amendments and vote. It is my 
understanding that it will begin at about 2:15. There will be a series 
of amendments then offered which, obviously, we will vote on. There are 
a good number on this side and a few on the other side of the aisle. I 
encourage Senators to quickly firm up those amendments so we can line 
things up as expeditiously as we possibly can.
  In the meantime, I remind the Senate where we are. We are on the 
House deficit reduction bill. Later today, I expect that the majority 
leader will offer a substitute amendment. That will be the Senate 
amendment; that is a Senate-passed bill to the House bill. The Senate-
passed bill will include a perfecting amendment. The perfecting 
amendment will modify the Senate-passed bill that previously passed in 
the Senate by extending the so-called tax extenders, R&D tax credit, 
the WOTC tax credit, tuition reduction, and savers' credit, for an 
additional year. Those provisions expired at the end of 2005. The 
Senate bill extended all those provisions, so-called extenders, for 1 
more year, until the end of 2006.
  The perfecting amendment that will be offered will then add another 
year to all those, so that those provisions, if that amendment passes, 
will not expire; they will have 2 more years of life. That is the major 
change that will be in the perfecting amendment to the Senate 
substitute, which the majority leader, I assume fairly quickly, will 
offer.
  To remind Senators, the main difference between the House and Senate 
bill is this: The House bill includes the extension of the lower 
taxes--the dividend tax and capital gains taxes--for 2 more years. 
Currently, taxation on dividends and income taxation on capital gains 
enjoys a lower rate that was put into effect several years ago. That 
provision or lower rate is in current law and will extend under current 
law for 2 more years, until the end of 2008, December 31. The House-
passed bill extends that provision 2 more years, so it would be in 
effect for not only 2006, 2007, and 2008, but the House bill would be 
2009 and 2010, the full calendar years.
  The House-passed bill doesn't, however, include any relief for 
alternative minimum taxes, which about 17 million Americans will have 
to pay this year, 2006. Actually, it is about 20 million because 3 
million taxpayers had to pay for 2005, and 17 million more taxpayers 
will have to pay an additional tax under the so-called stealth tax, the 
alternative minimum tax in 2006. So the House bill extends provisions 
that need not be extended because the law doesn't change, but it does 
not reduce taxes for people who are going to pay more for taxes in 
2006. Contrast that with the Senate-passed bill, which would be the 
substitute for the House bill. If it passes, it will send that back 
over to the House. They, presumably, will disagree with the Senate and 
ask for a conference. We will appoint conferees and begin a conference 
on the two separate bills. That will happen next week probably.
  Again, the Senate bill doesn't extend dividend reduction, capital 
gains taxation reduction, for 2 more years. It maintains current law, 
which provides the current low rate in existence for not only this year 
but also next year and also the following year, through December 31, 
2008. We did, however, in the Senate bill, say, OK, those 17 million 
people--Americans who are going to have to pay AMT--that is additional 
tax for 2006--should not have to pay that additional tax. We, in the 
Senate bill, said we are going to extend the provisions, the so-called 
AMT patch, so those Americans will not have to pay additional tax under 
the alternative minimum tax.
  That is a major difference between the House and Senate bill. I hope 
that we in Senate can do what I think most Americans want. Most 
Americans would say, OK, 17 million Americans--let's not raise their 
taxes; let's make sure those taxes are not raised. And then we will 
worry about 2009 and 2010, when we may or may not want to extend more 
favorable tax treatment on capital gains income and on dividend income. 
We can cross that bridge when we get there. Because the budget 
resolution says we cannot lower taxes by more than $7 billion over 5 
years, we just can't do it all. We have to make choices. If you add up 
all the provisions that people want--the tax extenders and other 
extensions of tax breaks--it is forcing us in the Congress to begin to 
make a choice as to what is more important: prevent the additional 
taxes people have to pay next year under the AMT, or is it more 
important that they should pay those taxes but, more for the sake of 
principle than anything else, extend that dividend and capital gains 
preferential treatment for years 2009 and 2010.
  Again, the House bill only addresses 2009 and 2010. Why? Because 
under current law, capital gains income and dividend income enjoy 
favorable tax treatment.
  That is the basic posture we are in here. It should not take too 
long. After various amendments are brought up and Senators vote on 
them, we will send the bill over to the House. The House will probably 
disagree and request a conference. We will have a conference when we 
come back next week and finally work out passage of this bill.
  I see the Senator from West Virginia is on the floor. I turn to the 
Senator from West Virginia and yield to him whatever time he desires.
  Mr. BYRD. Madam President, I thank my distinguished friend. He can go 
ahead with whatever remarks he has. I would love to wait 2 or 3 more 
minutes.
  Mr. BAUCUS. Madam President, if I may ask the Senator from 
California, how much time does she desire?
  Mrs. BOXER. If I can have 20 minutes following Senator Byrd, which we 
think will be used by other Senators on the same topic.
  Mr. BAUCUS. I will do this. Why don't I yield to the Senator from 
Michigan 5 minutes and then the Senator from West Virginia. Is that all 
right with the Senator from California?
  Mrs. BOXER. If I can be in that line.
  Mr. BAUCUS. Yes. I think the Senator from West Virginia would like to 
defer to the Senator from Michigan at this point.
  Mr. BYRD. I thank the Senator.
  Mr. BAUCUS. I appreciate the Senator speaking on short notice. Madam 
President, I yield 5 minutes to the Senator from Michigan.
  The ACTING PRESIDENT pro tempore. The Senator from Michigan.


                       Detroit and Super Bowl XL

  Ms. STABENOW. Madam President, after speaking in support of the Boxer 
amendment, which I think is extremely important, I wanted to take a 
moment in the middle of this very important debate, a very important 
bill, and rise

[[Page 711]]

to speak to another important event that is occurring this weekend.
  I rise today to cheer not for the Pittsburgh Steelers or the Seattle 
Seahawks but for the city of Detroit and the State of Michigan, which 
is the host of the Super Bowl XL this weekend. We are very excited 
about this important event. It is a spotlight shining on Detroit, MI, 
and I am confident the city and my home State are ready for their 
closeup this weekend.
  The State of Michigan and the city of Detroit are honored to play 
host to the most watched sporting event in our country. I am sure 
Detroit will shine, as it has before when it has hosted the Stanley Cup 
finals, the World Series, and the Major League Baseball All-Star Game, 
which was just held this last summer.
  Ford Field is a beautiful stadium which will be an ideal setting for 
the Seahawks and Steelers, and Cobo Hall will play host to the NFL 
Experience, a football ``theme park'' where children and their parents 
can enjoy over 50 interactive football theme games and displays.
  We are expecting over 100,000 visitors to downtown Detroit. I was 
there last week and saw that a lot of people have gotten there early to 
enjoy what our city offers. We are so pleased to welcome them. Not only 
will visitors have a chance to experience Detroit's restaurants and 
nightlife, but they can go to the Henry Ford Museum and see the bus on 
which Rosa Parks made her historic stand and visit the African-American 
Museum. This weekend's visitors will see all the wonderful things 
Detroit and the State of Michigan have to offer.
  I must say that we have over 10,000 volunteers who are ready and are 
working to make sure everyone enjoys every minute of their stay, and I 
thank those volunteers for their hard work in being a part of helping 
Detroit shine.
  Detroit is the home of Motown, and I am thrilled that Stevie Wonder 
will perform before the game and that Aretha Franklin will sing the 
National Anthem. On Saturday, Motown's music heritage will be on 
display when the Four Tops, the Miracles, the Contours, the Dramatics, 
the former ladies of the Supremes, Freda Payne, Brenda Holloway, Martha 
Reeves and the Vandellas, the Velvelettes, and Paul Hill play at the 
Masonic Temple. That will be an amazing event to participate in and 
listen to.
  On Friday and Saturday night, Kid Rock plays at the Joe Lewis Arena 
before a sold-out house, proving that Detroit is the Rock City.
  This weekend, Detroit will welcome home two of its native sons--
Jerome Bettis and Larry Foote, both members of the Pittsburgh Steelers. 
Larry Foote, a graduate of Pershing High, is at the beginning of a 
promising NFL career, while Jerome Bettis is near the end of a Hall of 
Fame career where he has displayed the character and toughness of a 
Detroit native. Bettis graduated from MacKenzie High in the late 
eighties, entered the NFL in 1993, and has since been mowing down 
defenses on his way to ranking fifth on the NFL's alltime rushing list.
  The Super Bowl will give Detroit and the State of Michigan and the 
region an economic boost, but it will also provide a more important 
opportunity for the people I represent to shine, as I know they will. I 
am proud of Michigan's history and excited about our future. I am sure 
that on Sunday night, those who have visited Detroit, those who have 
watched the game will be excited as well. We say welcome to all of 
them.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from West Virginia.
  Mr. BYRD. I thank the very distinguished occupant of the chair, who 
presides over this august Chamber with a dignity that is so rare as a 
day in June and a loveliness that permeates the Chamber. I thank the 
Chair.


                              Mine Safety

  Madam President, yesterday, two more coal miners died in West 
Virginia--two more, two more coal miners died yesterday in West 
Virginia--one at Long Branch Energy's No. 18 tunnel mine in Boone 
County and the other at the Black Castle Surface Mine, which is also in 
Boone County, WV. That is a total of 16 coal miner deaths this year, 
and the year is only 33 days old. This situation is deplorable--ghastly 
deplorable.
  The Governor of West Virginia, the Honorable Joseph Manchin, 
announced last night that he has asked the coal operators of West 
Virginia to cease production immediately and to go into a mine safety 
standdown. He has asked that miners be removed from mines in order to 
review safety procedures and asked that each new shift also review 
safety procedures before entering the mine.
  The Governor has called for expedited inspections of the State's 
mines, and he has asked that the U.S. Labor Department send additional 
Federal inspectors and personnel to the State.
  The Mine Safety and Health Administration of the U.S. Department of 
Labor announced last night that it would expand the mine safety 
standdown to mines across the Nation on Monday, February 6.
  This is a very noble action on the part of our Governor, Joe Manchin. 
I have talked with Governor Manchin, and I compliment him.
  I have to say that shutting down the mines for 1 hour is not a 
serious solution. It may be a timeout for safety, but it is not time 
enough for meaningful safety. Mine safety officials are displaying 
increasing concern about this rash of mining fatalities.
  Those who consider the tragedies at the Sago and Alma mines to be 
random occurrences are now taking a second look. They are asking this 
morning: When will these mine tragedies stop? When? The answer to that 
question is unsettling, isn't it? It is possible that these accidents 
are not going to stop. God only knows. Life and death are in God's 
hands.
  It is possible that mine safety protections have eroded so much in 
recent years that these actions are going to continue. Who would have 
thought that these mine deaths would occur as they have and in one 
State? It is possible that these accidents are going to continue to 
happen again and again unless new action--dramatic action--is taken by 
the Federal Government to curb these mining hazards.
  The danger to our coal miners is real--very real. Yes, very, very 
real. The dangers to our miners is very real. There are too many needs, 
from emergency communications and breathing equipment to a rapid 
notification and response system to penalizing the reckless disregard 
of Federal safety standards. Real. Too many needs, I say, are not being 
addressed by the Labor Department and the Mine Safety and Health 
Administration and require swift action by the Congress.
  The longer we wait to act in Congress, the more likely another 
fatality and then another fatality and then another may occur. The 
longer we wait to act, the greater the threat to our energy 
infrastructure. If these tragedies continue, mines could be closed and 
coal and energy production could falter. The consequences could ripple 
throughout the national economy. We cannot delay. We cannot delay in 
responding.
  I spoke with the distinguished majority leader yesterday. Of course, 
I have already spoken with our distinguished minority leader, who has 
joined in supporting the need for action on the bill that I have 
introduced, along with Senator Rockefeller and along with the 
delegation in the House, a bipartisan delegation. I spoke with the 
majority leader yesterday, and I have asked mine safety legislation be 
considered quickly, and I publicly renew that request.
  I have come to the Senate floor hoping to see the majority leader 
again this morning, but he is needed elsewhere, and for good reason, at 
the moment. But I publicly renew that request, and upon his arrival I 
shall discuss this matter with him. I have discussed it already with 
the assistant leader, Mr. McConnell. I urge that this legislation be 
scheduled as soon as possible, that there be scheduled time as soon as 
possible on mine safety legislation.
  The bill the West Virginia delegation introduced yesterday will help 
to protect the lives of our miners. It will help

[[Page 712]]

to keep West Virginia mines open. It will help to keep the coal coming. 
It will help to keep the coal fueling the energy demands of our 
national economy. But we must act quickly. We must ensure the safety of 
our coal miners.
  Hear me. Listen. We must ensure the safety of our coal miners in 
order to ensure the security of the Nation. The security of the Nation 
depends on the safety of our coal miners. We have delayed too long 
already, and every additional day we wait puts another miner's life at 
risk.

       O Death, where is thy sting?
       O grave, where is thy victory?

  Senators, listen: For whom does the bell toll? Who knows who will be 
next?
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Montana.
  Mr. BAUCUS. Madam President, I yield 20 minutes to the Senator from 
California.
  Mrs. BOXER. I ask my colleague to make sure Senator Lautenberg knows 
my colleagues are willing to yield him 10 minutes upon my completion; 
is that correct?
  Mr. BAUCUS. I will then subsequently yield to the Senator from New 
Jersey.
  Mr. BYRD. Madam President, will the distinguished Senator from 
California yield?
  Mrs. BOXER. Yes.
  Mr. BYRD. I ask so that I might thank her again for delaying her 
speech until I could make these few remarks. I thank her from the 
bottom of my heart. She is so considerate always, so courteous: ``And 
what is so rare as a day in June?'' The beauty of the Senator from 
California.
  Mrs. BOXER. Oh, that is so nice.
  The ACTING PRESIDENT pro tempore. The Senator from California.
  Mrs. BOXER. I thank my friend and colleague, and really, in so many 
ways, our leader in the Senate, and say to him before he leaves the 
floor how much we stand with him on these mine safety questions.
  We Americans are just facing so many tragedies. My colleague reports 
on yet more deaths in the mines, deaths that are preventable if we do 
the right thing by our workers. We are mourning together today five 
more American soldiers killed in Iraq. We had an incident, a workplace 
killing in Santa Barbara where five or six people lay dead. It is tough 
times. But I want my good friend to know that we will stand with him on 
this mine safety question.
  Mr. BYRD. Madam President, if I might just take 1 minute, I deeply 
thank--as they say in the other body--the gentlelady from California, 
for her noble comments and for her support. The West Virginia 
delegation in the House and the Senate is pleased at her expressions of 
support. We are glad to have that support. West Virginia is proud of 
the California delegation, the delegation that stands with us in this 
hour of sorrow.
  I thank the Senator from California for yielding and for her support.
  Mrs. BOXER. Madam President, I rise now to discuss an amendment on 
behalf of myself and Senators Kerry and Lautenberg, which expresses the 
sense of the Senate that the White House should provide the public with 
a thorough account of the meetings that the President, his staff, and 
senior executive branch officials held with Jack Abramoff. The public's 
confidence in the Government has been rocked, rocked by the widespread 
reports of public corruption involving Jack Abramoff.
  On January 3, Mr. Abramoff pleaded guilty to conspiracy, fraud, tax 
evasion charges, charges that carry up to a 30-year sentence. He agreed 
to cooperate with prosecutors in their investigation of a number of 
public officials, and we don't know where all this will lead. I urge 
the Justice Department to continue its investigation into any bribery 
and corruption.
  The damage to the public trust from the Abramoff scandal, combined 
with the recent prosecution of Congressman Randy Cunningham, and the 
indictment of Congressman Tom Delay is massive. The investigation by 
the Department of Justice has really just begun. But right now, sadly, 
there is a very low opinion of politicians, and trust must be restored 
with the American people. We cannot govern effectively without the 
support and confidence of the people. We are supposed to be their 
representatives. We owe them everything, and we must start with 
honesty, with ethics, so we can regain their trust.
  If the people have lost confidence, we have to win it back. Every 
Senator I know has searched his or her records for contributions from 
Jack Abramoff, from his associates and the tribes he represented. Each 
of us has responded in our own way. But to my knowledge, we have all 
made our actions public. We have told our constituents what the 
situation is and whether we plan to do something about it.
  In the State of the Union Address the President said:

       Each of us has made a pledge to be worthy of public 
     responsibility--and that is a pledge we must never forget, 
     never dismiss, and never betray.

  Those are noble sentiments, very noble sentiments, and I challenge 
the President to live up to them. Where there is an appearance of 
impropriety, it is the responsibility of public officials to be open 
with the public and to clear up any questions that might exist. I know 
in my long career in elected life, and it is now more than 30 years of 
elected life, I have had to return contributions from time to time. I 
have tried to avoid the appearance of a conflict of interest. I have 
even recused myself on three occasions because I believed that was the 
right thing to do. But no matter what each of us does there will still 
be those who doubt us. It is the system. It is a system that is based 
on private financing, so it is very difficult, with that system, to 
gain the trust of the people.
  But it starts with openness. It starts with transparency. We should 
each try to be as open as we can and make sure that, whatever we decide 
to do, the public is informed. It doesn't help to be secretive. It 
doesn't help to say: I don't have to do this; it is my right not to 
tell the public anything. It may be your right, but it does not make it 
right.
  According to the press secretary of the President, Scott McClellan, 
the President does not know and doesn't remember ever meeting Jack 
Abramoff, and despite repeated requests the White House has failed to 
provide details of meetings between Jack Abramoff and the President and 
his staff. The problem is, more and more details keep coming out about 
the relationship between Mr. Abramoff and the President.
  Starting in 1997, Mr. Abramoff claimed credit for procuring a letter 
from then-Governor Bush that praised the then-Northern Marianas Island 
Education Plan. In 2000, Jack Abramoff joined the Bush-Cheney 
transition team. Several colleagues of Mr. Abramoff ended up being 
appointed to key positions in the Department of Interior, the agency 
that regulates Indian gaming issues, central to Mr. Abramoff's lobbying 
business.
  According to the Associated Press, Jack Abramoff and his lobbying 
team had nearly 200 contacts with the Bush administration in the first 
10 months they were in office--200 contacts in less than a year, and 
nobody remembers anything? I mean it doesn't pass the smell test, to be 
crude about it.
  By 2001, Mr. Abramoff appears to have been selling his clients access 
to the President. On May 9, 2001, the White House arranged an event on 
behalf of the group Americans for Tax Reform. That group is a very 
strong ally of President Bush. The event was attended by the President 
and a number of legislators. There is a trail of documents that shows 
that Mr. Abramoff asked some of his clients for $25,000 to go to that 
event, with the funds going to this Americans for Tax Reform.
  I want to show you some e-mails because I think that tells the story 
better than anything. So here is what Mr. Abramoff asked in an e-mail 
to a representative of one of his tribal clients. These are Mr. 
Abramoff's words from an e-mail.

       Americans for Tax Reform is bringing together the speakers 
     of all Republican-led legislatures for a meeting with Bush 
     and the

[[Page 713]]

     congressional leadership. They have requested sponsorship 
     ($25 K) from only four groups. Two of them will be major 
     corporations and one will be Choctaw. Chief Martin will be 
     coming to the event I expect. I told them that I would ask 
     you guys to participate. The exposure would be incredible and 
     would be very helpful. One of the things we need to do is get 
     the leaders of the tribe (ideally the chief) in front of the 
     President as much as possible. Please let me know as soon as 
     you can. Thanks.

  That is Mr. Abramoff to the representative of one of the tribes.
  Let us see what that particular individual wrote to her tribe after 
she received Mr. Abramoff's e-mail. She wrote:

       Attached is an e-mail from Jack Abramoff with the firm of 
     Greenberg & Traurig. The chairman has agreed for the tribe to 
     be one of the four sponsors of and participate in a White 
     House event on behalf of the Americans for Tax Reform which 
     is being held on May, 9, 2001 in D.C. Please immediately 
     prepare a check made payable to Americans for Tax Reform in 
     the amount of $25,000 and forward it to my office by Federal 
     Express. Then Fed/Ex the check to Mr. Abramoff.

  Just to finish this story, here we have a copy of the check Mr. 
Abramoff received from the Coushatta Tribe of Louisiana in the amount 
of $25,000--selling the President of the United States and using 
Federal property.
  The meeting was held in the Old Executive Office Building. In all, it 
appears that four or more of Abramoff's clients attended the event, and 
at least two claimed they paid the $25,000 requested. They paid that to 
get close to the President on Federal property. Jack Abramoff, as I 
said, delivered the President of the United States in exchange for his 
clients' contribution to the President's supporters. How many more 
Abramoff clients attended is not clear, and who paid money to attend 
the White House event is not clear. The White House claims it has no 
record of Mr. Abramoff attending, but Time magazine claims there is a 
photo of the President standing with Abramoff and one of Abramoff's 
clients.
  This event alone warrants the President providing full disclosure of 
meetings with White House officials and Jack Abramoff.
  But this was not a one-time event. The following year, Mr. Abramoff 
solicited money from his clients for another White House event in 
behalf of Americans for Tax Reform.
  The public has more and more questions about the relationship between 
Jack Abramoff, the President, and his staff, but no answers are 
forthcoming. The President's refusal to provide additional information 
about these meetings has increased the public's distrust in the 
administration and our Government at large.
  The President said some very noble words at the State of the Union 
Address. He said it was important for us to bring trust back. Yet we 
see no movement for transparency and openness.
  The public has a right to know whom Mr. Abramoff met with, what they 
discussed, and whether improprieties existed. According to a Washington 
Post/ABC News poll, 76 percent said Bush should disclose his contacts 
with his aides and Mr. Abramoff. Two of three Republicans favored 
disclosure. Let me say that again. In the poll, two of three 
Republicans favored disclosure.
  In fact, members of the President's own party in the Senate and in 
the House have urged the President to provide information to the public 
about this administration's dealings with Mr. Abramoff. I agree with 
them. All Government officials who serve the public must take all steps 
necessary to maintain their trust and confidence.
  I hope my colleagues will support this important amendment which I 
plan to offer on behalf of Senator Kerry and Senator Lautenberg. It 
simply calls on the White House to immediately and publicly disclose 
each visit and meeting between Jack Abramoff and the President, White 
House staff, or senior executive branch officials.
  Much is made about how Senators get an opportunity to fight for funds 
for their State. Senator McCain has derided this action. Senator McCain 
said earmarks right on their face are wrong. If you look at the number 
of earmarks Members of the Senate are involved in for our States--I 
know my colleague and I sit on the Public Works Committee. I don't need 
any lobbyist to tell me that I need a road in my urban area when one is 
broken down. I don't need a lobbyist to tell me that I need an HOV lane 
or a new water system or a new sewer system or a new school or a new 
senior center. It is my job to know that. Senator McCain thinks that is 
all terrible. But the bottom line is the number of earmarks pales in 
comparison with the amount of funds that are distributed by this 
administration and any subsequent or prior administration. They 
distribute most of the funds.
  It is very important, as we all look at our campaign contributions, 
to sort out in any of them which are in any way tainted by Mr. Abramoff 
and that the White House comes to the table and is as open as we have 
been. I believe it is very important. This isn't a partisan issue. 
Republicans have been calling for the White House to come clean on 
this, and Democrats are doing the same.
  If we are going to restore confidence in our Government, it starts 
with simple openness, not saying: Oh, this is privileged, this is 
secret. I will tell you right now, we all learned it from our moms and 
dads. When somebody says, this is secret, watch out. Our Government is 
supposed to be open, not secret.
  I hope there will be strong support for this particular amendment. I 
believe its timing is crucial. We can't let any more time elapse.
  There are calls for--and I am joining them--a special prosecutor in 
this particular case. But even before that debate begins, let us have 
everyone come clean on these meetings, contributions, and the like.
  I thank my colleague from Montana, the ranking member of the Finance 
Committee, for his generosity of spirit in allowing me to discuss this 
issue. Technically, of course, it isn't a matter of the Finance 
Committee jurisdiction, but I believe the timing is so important that 
we should have a vote on this.
  Thank you very much. I yield back whatever time remains.
  Mr. BAUCUS. Madam President, I very much thank the Senator from 
California for her terrific service to her State and to the Nation.
  I yield 10 minutes to the Senator from New Jersey.
  The ACTING PRESIDENT pro tempore. The Senator from New Jersey is 
recognized.
  Mr. LAUTENBERG. Madam President, I thank my colleague from Montana. I 
also congratulate our colleague, the Senator from California, for her 
diligence in pursuing this issue. Senator Boxer has an interest in 
fairness and equity at all times, and open government. I am so pleased 
that we can rely on her and her staff to research this matter and to 
bring it to the public's attention.
  Everyone knows there is a cloud over Washington these days. It is a 
cloud of corruption that challenges the fundamental concept of 
democracy in our great country, one that says the President, under the 
guise of an act of patriotism, can spy on people, innocent people, 
invade their privacy totally, and yet withhold records that are vital 
to the public's confidence in government, withhold data that is 
required in this scandal we are now witnessing which hangs over 
Washington.
  This deep-seated corruption was exposed as part of an investigation 
into the activities of the lobbyist Jack Abramoff. We now know that he 
committed despicable acts against his own clients and that he conspired 
at the same time with certain Members of Congress. His contacts with 
the White House and his friends are still very much a mystery. Imagine 
that--contacts with the President of the United States hidden from the 
public. It is incomprehensible. President Bush refuses to disclose his 
contacts with Mr. Abramoff for reasons that are unclear. If there is no 
wrongdoing, there should be nothing to hide.
  I wish to quote President Bush from a statement he made when running 
for President in 2000. He said, and I quote him:

       Americans are tired of investigations, scandals, and the 
     best way to get rid of them is to elect a new President--

  We are talking about 2000.

     --who will bring a new administration, who will restore honor 
     and dignity to the White House.


[[Page 714]]


  What an empty statement that has proven to be. President Bush pledged 
to run an ethical White House. Now, as we see, those words seem almost 
hypocritical. At the very least, in order to keep this pledge, 
President Bush must release information on contacts between him, his 
staff, and Mr. Abramoff. What is he ashamed of? Whether he is ashamed 
of it or not, he ought to release it to clear the air. The public wants 
these contacts disclosed. The President needs to help the truth come 
out, the whole truth, and nothing but the truth. And he should be 
assisting us in this investigation.
  White House Press Secretary Scott McClellan says President Bush does 
not know Mr. Abramoff. But there is stark evidence to the contrary. 
According to Washingtonian magazine, Abramoff said that not only did he 
know the President but that the President knew the names of Abramoff's 
children and asked about them during their meeting.
  There appears to be a long trail of contacts between Mr. Abramoff and 
the Bush White House. For starters, President Bush put Mr. Abramoff on 
his 2000 Presidential transition team--a pretty important job. Mr. 
Abramoff was then able to get his allies appointed to key positions at 
the Department of the Interior. Why the Department of the Interior? 
Because it regulates Indian gaming issues that were central to Mr. 
Abramoff's lobbying business.
  He was also one of President Bush's top campaign fundraisers, a so-
called Pioneer. He raised over $100,000 for President Bush's 2004 
reelection campaign. That was the definition of ``Pioneer''--big-time 
money.
  According to Time and Newsweek magazines, Mr. Abramoff also sold 
access to the White House through payments sent to Grover Norquist's 
front organization, Americans for Tax Reform. Senator Boxer displayed a 
check which was made out to Indian tribes which paid upwards of $25,000 
to Norquist for access to President Bush and his top adviser, Karl 
Rove. Mr. Abramoff bragged to one his clients, Tyco, that he talked to 
Karl Rove about their issues. And David Safavian, a White House 
official now under indictment, funneled confidential information to 
Abramoff to help Tyco.
  Mr. Abramoff's own billing records show that his office had almost 
200 contacts with the Bush administration in only its first 10 months. 
The officials listed as contacts included the then-Attorney General 
John Ashcroft and Vice President Cheney's top advisers.
  As far back as 1997, there is evidence of contacts between then-
Governor Bush and Mr. Abramoff. Abramoff charged his client at the 
time, the Northern Mariana Islands, to get Governor George W. Bush to 
write a letter praising the island's education plan. Governor Bush did 
write such a letter to the island government on July 18, 1997, with a 
``cc'' to one of Mr. Abramoff's deputies.
  The bottom line is that this amendment--once again, I salute my 
colleague from California for bringing this up, and I intend to support 
it vigorously--the bottom line is that this amendment urges the 
President to clear the air. The American people want to know whether 
the Bush White House was complicit with Mr. Abramoff's schemes. Maybe 
Mr. Abramoff was exaggerating his contacts with the White House. That 
is possible. But there is only one way to find out--release the 
records. We are seeing withholding of information by the White House. I 
sit on the Committee on Government Accountability. The Republican 
chairman, Susan Collins, has asked the White House for information 
related to the Federal Government's response to Hurricane Katrina. We 
cannot get that. There has been a public display of the requests for 
that information.
  Does this suggest this White House is committed to keeping the 
information--information that belongs to the public--private, within 
their confines so they can do anything they want and not be challenged 
with their conduct related to this issue? It looks like a constant 
pattern.
  I urge my colleagues to support honest and open government and to 
vote for the Boxer amendment.
  I yield the floor and suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BAUCUS. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. DeMint). Without objection, it is so 
ordered. 
  Mr. BAUCUS. Mr. President, I am pleased that later today we will be 
offering a modification to the Senate amendment to provide a 2-year 
extension and enhancement to the research and development tax credit. 
Of course, I have filed legislation with my friend, Senator Hatch, to 
make a permanent commitment to research-intensive businesses in the 
United States.
  This legislation is bipartisan and bicameral. But 2-years is 
certainly much better than the usual yearly extender. I am already 
starting to hear from business taxpayers how important a commitment to 
longer term research projects are, and I agree with them.
  I am hopeful that we can prevail upon our House conferees to retain 
this 2-year incentive.
  You know, just the other night, the President spoke of the importance 
of the R&D credit to maintaining America's competitive edge. He is 
right, and that is why I have been a strong supporter of legislation to 
make the credit permanent for the last few Congresses.
  Every morning we hear news of some new product or discovery that 
promises to make our jobs easier or our lives better. Many of these 
innovations started with a business decision to hire needed researchers 
and finance the expensive and long process of research and 
experimentation.
  Since 1981, when the R&D tax credit was first enacted, the Federal 
Government was a partner in that business endeavor because of the 
potential spillover benefits to society overall from additional 
research spending.
  But the credit has been hobbled over the years because of its 
temporary nature. As stated in an analysis last year by the Joint 
Committee on Taxation, ``Perhaps the greatest criticism of the R&D 
credit among taxpayers regards its temporary nature.''
  Joint Tax went on to say, ``A credit of longer duration may more 
successfully induce additional research than would a temporary credit, 
even if the temporary credit is periodically renewed.''
  I think we should heed the advice of the experts at Joint Tax and 
renew this credit for as long as we can. That is why I will support a 
modified Senate proposal later today for a 2-year extension.
  Research has shown that a tax credit is a cost-effective way to 
promote R&D. The General Accounting Office, the Bureau of Labor 
Statistics, the National Bureau of Economic Research, and others have 
all found significant evidence that a tax credit stimulates additional 
domestic R&D spending by U.S. companies.
  A report by the Congressional Research Service, CRS, indicates that 
economists generally agree that, without Government support, firm 
investment in R&D would fall short of the socially optimal amount, and 
thus  CRS advocates Government policies to boost private sector R&D.
  R&D is linked to broader economic and labor benefits. R&D lays the 
foundation for technological innovation, which, in turn, is an 
important driving force in long-term economic growth--mainly through 
its impact on the productivity of capital and labor. We have many times 
heard testimony from economists, including Federal Reserve Board 
Chairman Alan Greenspan, that the reason our economy grew at such 
breakneck speed during the 1990s stemmed from the productivity growth 
we realized thanks to technological innovations.
  There has been a belief that companies would continue to increase 
their research spending and that the benefits of these investments on 
the economy and labor markets would continue without end. 
Unfortunately, that is not the case.
  According to Battelle's 2005 funding forecast, industrial R&D 
spending will

[[Page 715]]

increase only 1.9 percent above last year, to an estimated $191 
billion, which is less than the expected rate of inflation of 2.5 
percent. For the fifth year in a row, industrial R&D spending growth 
has been essentially flat.
  It is also important to recognize that many of our foreign 
competitors are offering permanent and generous incentives to firms 
that attract research dollars to those countries.
  A 2001 study by the Organization of Economic Cooperation and 
Development, OECD, ranked the United States ninth behind other nations 
in terms of its incentives for business R&D spending. Countries that 
provide more generous R&D incentives include Spain, Canada, Portugal, 
Austria, Australia, Netherlands, France, and Korea.
  The United Kingdom was added to this list in 2002 when it further 
expanded its existing R&D incentives program. The continued absence of 
a long-term U.S. Government R&D policy that encourages U.S.-based R&D 
will undermine the ability of American companies to remain competitive 
in U.S. and foreign markets. This disparity could limit U.S. 
competitiveness relative to its trading partners in the long run.
  Also, U.S. workers who are engaged in R&D activities currently 
benefit from some of the most intellectually stimulating, high-paying, 
high-skilled jobs in the economy.
  My own State of Montana is an excellent example of this economic 
activity. During the 1990s, about 400 establishments provided high-
technology services, at an average wage of about $35,000 per year. 
These jobs paid nearly 80 percent more than the average private sector 
wage of less than $20,000 per year during the same year.
  Many of these jobs would never have been created without the 
assistance of the R&D credit.
  While there may not be an immediate rush to move all projects and 
jobs offshore, there has been movement at the margins on those projects 
that are most cost-sensitive. Once those proj-
ects and jobs are gone, it will be many years before companies will 
have any incentive to bring them back to the United States.
  We continue to grapple with the need to stimulate economic growth and 
advance policies that represent solid long-term investments that will 
reap benefits for many years to come. I repeatedly have pointed to the 
R&D tax credit as a measure that gives us a good ``bang for our buck.'' 
I hope my colleagues will join me in supporting a 2-year extension. It 
is good for American businesses and workers, and we need it to maintain 
our global competitive edge.
  Mr. President, I take a few moments to talk about the schedule for 
the rest of the day. The majority leader will be coming to the floor 
momentarily. Obviously, he will give a better idea of the schedule.
  I expect sometime before 11 o'clock this morning the majority leader 
will come to the floor to offer the Senate substitute in a Grassley-
Baucus perfecting amendment. I understand the majority then will fill 
the amendment tree--that is, offer amendments to fill up the tree--
preventing the offering of amendments this morning. However, Senators 
on this side of the aisle will be able to offer their amendments. It is 
just a question of when they can offer amendments.
  Later in the day Members can offer amendments. It is the managers' 
expectation Senators will have used or yielded all time back on the 
bill at 2:15 and we will begin a series of votes that regularly follow 
debate time on the reconciliation bill; that is, the so-called vote-
arama. Roughly at 2:15 we begin the vote-arama. As Senators offer the 
amendments, at that point we will vote on the amendments. I am hopeful 
we will have a couple minutes' time for an explanation as to what the 
amendments actually are. That is the procedure.
  I discussed the order of amendments to be offered with the Democrat 
leader, and I have discussed the order with the chairman of the 
Committee on Finance. Shortly, I will announce the plans for the first 
10 amendments the Democrat Senators will offer.
  Those first 10 amendments in this order are as follows: an amendment 
by Senator Bingaman on prescription drug implementation; next is an 
amendment by Senator Menendez, AMT dividends and capital gains, which 
is germane; third, a Rockefeller amendment on mine safety; fourth, an 
amendment by Senator Conrad, he will offer the substitute amendment 
which is fully offset; fifth, an amendment by Senator Kennedy which 
essentially is the R&D extension for 3 years, and that will be germane; 
sixth, an amendment by Senator Obama with respect to Katrina child tax 
credit; next, seventh, an amendment by Senator Cantwell dealing with 
energy taxes; and No. 8, an amendment by Senator Schumer which is a 
sense of the Senate on AMT; ninth, an amendment by Senator Harkin with 
respect to so-called PEP and Pease provisions and dependent care 
credit; and tenth is an amendment by Senator Landrieu for expansion of 
the low-income housing tax credit. She wants to expand the tax credit.
  There will be other amendments later. I am hopeful the additional 
Democrat amendments can be 10, 12, 14, but I am not sure. I don't want 
to prejudge that. These are the first 10. We will indicate what the 
others will be.
  This is our intention of how to proceed. My expectation is the other 
side of the aisle will offer amendments. We will work with the chairman 
of the committee and go back and forth at the appropriate time.
  That is the general procedure we have in mind. It is not locked in, 
but that is the general procedure in consultation with the chairman of 
the committee that we would like to work out. Senators from the other 
side of the aisle will want to offer their amendments. It will be the 
managers' intention to alternate between both sides of the aisle. We 
will seek to obtain copies of amendments and announce information on 
them as soon as possible.
  Obviously, if Senators get information on the amendments to us 
quickly, the more likely we get the amendments up earlier rather than 
later.
  With those caveats, those are the first 10 amendments we expect to be 
offered. Pending that, the majority leader is in the Senate. I am sure 
he wants to make a statement.
  I yield the floor.
  The PRESIDING OFFICER. The Senate majority leader is recognized.
  Mr. FRIST. Mr. President, I have been talking to the ranking member 
before coming to the floor. I think he explained generally what will 
take place. I will comment on it after completion of procedural 
requests.


                           Amendment No. 2707

              (Purpose: To provide a substitute amendment)

  Mr. President, I send a substitute amendment to the desk, and I ask 
for its consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Tennessee [Mr. Frist], for Mr. Grassley 
     and Mr. Baucus, proposes an amendment numbered 2707.

  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mr. FRIST. I ask for the yeas and nays on the amendment.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  Mr. FRIST. I now ask that notwithstanding the Budget Act, it be in 
order for me to send additional amendments and motions to the desk with 
all the statutory debate time on each amendment or motion still 
reserved.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                Amendment No. 2708 to Amendment No. 2707

              (Purpose: To provide a substitute amendment)

  Mr. FRIST. I send a first-degree amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Tennessee [Mr. Frist], for Mr. Grassley 
     and Mr. Baucus, proposes an amendment numbered 2708 to 
     amendment No. 2707.

  (The amendment is printed in Today's Record under ``Text of 
Amendments.'')

[[Page 716]]


  Mr. FRIST. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.


                Amendment No. 2709 to Amendment No. 2708

  Mr. FRIST. I now send a second-degree amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Tennessee [Mr. Frist] proposes an 
     amendment numbered 2709 to amendment No. 2708.

  The amendment is as follows:

       At the end of the amendment add the following:
       ``This section shall become effective 1 day after 
     enactment.''


                            Motion to Commit

  Mr. FRIST. I move to commit the pending bill, and I send the motion 
to the desk.
  The PRESIDING OFFICER. The clerk will report the motion.
  The assistant legislative clerk read as follows:

       The Senator from Tennessee [Mr. Frist] moves to commit the 
     pending bill to the Committee on Finance, with instructions 
     to report back forthwith, with an amendment.

  Mr. FRIST. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.


                           Amendment No. 2710

              (Purpose: To provide a substitute amendment)

  Mr. FRIST. I send an amendment to the instructions to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Tennessee [Mr. Frist], for Mr. Grassley 
     and Mr. Baucus, proposes an amendment numbered 2710 to the 
     instructions on the motion to commit.

  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mr. FRIST. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.


                Amendment No. 2711 to Amendment No. 2710

  Mr. FRIST. Mr. President, I send a second-degree amendment to the 
desk for its consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Tennessee [Mr. Frist], for Mr. Talent, 
     proposes an amendment numbered 2711 to amendment No. 2710.

  The amendment is as follows:

(Purpose: To repeal the sunset of the provisions in EGTRRA relating to 
                         the child tax credit)

       At the end of the amendment add the following:

     SEC. ___. PERMANENT EXTENSION OF EGTRRA PROVISIONS RELATING 
                   TO CHILD TAX CREDIT.

       Section 901 of the Economic Growth and Tax Relief 
     Reconciliation Act of 2001 (relating to sunset provisions) 
     shall not apply to the amendments made by section 201 of such 
     Act.

  Mr. FRIST. Mr. President, as a continuation of the explanation, it 
has not been my preference to file these amendments, but we have tried 
over the last couple of days to bring a semblance of order so we can 
complete the activity that is in the Senate. It was November when we 
first passed this bill. The House passed a bill. Under the usual 
circumstances, with unanimous consent, we marry the two bills and it 
goes to conference.
  We are spending these 20 hours, and we have had good debate over the 
course of yesterday and this morning. But we have been unable to get 
unanimous consent to have a list of these amendments with language 
which would allow our chairman and ranking member to begin voting on 
those amendments. Thus, what will happen today is, as the ranking 
member explained, time will expire sometime around 2:15 today. I don't 
know the exact time. After that, there will be a series of rollcall 
votes. The rollcall votes begin with the Talent amendment, which is the 
pending amendment. After that, others will have the opportunity to 
offer amendments, and they would be voted on accordingly.
  I do encourage all of our colleagues to work with the chairman and 
ranking member, the managers of the bill, so we can have an orderly 
process and we can stick with amendments that are pertinent and 
relative to the underlying bill. It means if we work aggressively but 
work collaboratively over the course of the day we will start voting 
early this afternoon. We will be voting until we finish this particular 
bill.
  The PRESIDING OFFICER. The minority leader is recognized.
  Mr. REID. Mr. President, I am sorry to have been late. Are we going 
to finish these votes today, tonight?
  Mr. FRIST. Mr. President, through the Chair, in response, I certainly 
hope so. I believe we are in a position to do so, but it depends on how 
many amendments we have. Once we start voting, we will keep the 
amendments very tight. Both the Democrat leader and I said we hoped it 
would not come to this point to have a vote-arama, but that is what it 
will be. I believe we can finish it tonight. The only hesitation is how 
much cooperation we get from our side of the aisle and your side of the 
aisle. If we do not finish tonight, we will continue tomorrow until we 
complete the legislation.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, if it is helpful to all Senators, 
especially the Senator from Tennessee and the Senator from Nevada, we 
have a total of about 20 amendments on this side. I don't know how many 
are on the other side, but I guess maybe we could finish by around 7 
o'clock or 8 o'clock tonight. That is a rough estimate. Maybe earlier.
  The PRESIDING OFFICER. The minority leader.
  Mr. REID. Mr. President, I appreciate the positive tone of voice of 
my distinguished friend from Montana, but if we have 20 votes--and that 
is on our side--and there are second-degree amendments to those, and 
amendments offered on the other side, we are talking about a long 
night. The best we can do, no matter how hard we try, is three, three 
and a half amendments an hour. So we are talking about, if we start at 
2 o'clock, a lot of hours.
  I appreciate everyone being confident we will do this. And we will 
certainly cooperate any way we can. And, as happens, there may be 
Members who decide not to offer their amendments. That is always a 
possibility. We will do the best we can. It may be necessary to alert 
Senators that there may be work tomorrow. The distinguished majority 
leader is in the Senate, but it is very likely we may not be able to 
finish all these votes--well, maybe not ``very likely''--but it is 
certainly possible we may not be able to finish the votes tonight.
  Mr. FRIST. Mr. President, I have made it clear from the outset we 
need to finish this legislation this week. Friday is a working day, as 
we all know. If we have to be here, we will do that. On the other hand, 
once people understand where we are and that we do not actually have to 
be doing this, people will step back and be reasonable in terms of the 
number of amendments, making sure they are amendments relative to the 
underlying bill.
  The managers will do this later, but Members need to be clear these 
are 10-minute votes, as well.
  I yield the floor.
  Mr. BAUCUS. Mr. President, I don't see any Member wishing to speak at 
this moment.
  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. GRASSLEY. 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. GRASSLEY. Mr. President, I rise to make an opposite point of view 
and critical comments on a statement that was made yesterday by the 
Senator from North Dakota, Mr. Dorgan. Once again, he made a very 
impassioned case, and everybody who hears him knows he presents his 
case very well. He made an impassioned case for American workers whose 
jobs have been lost when plants move overseas.

[[Page 717]]

  We have all witnessed this heart-wrenching event. I know even in my 
home State of Iowa we have had plant closings for that reason. Some of 
those operations have been moved out of the United States. But as far 
as Iowans are concerned, let me remind you this has been a phenomenon 
of plants moving from Iowa to other places for a long time, before we 
ever heard the word ``outsourcing.''
  I remind my colleagues I was a member of the International 
Association of Machinists at a sheet metal factory, the Waterloo 
Register in the town of Cedar Falls, IA. We made furnace registers. I 
started working there in 1961, when I was a young member of the Iowa 
Legislature, to supplement the income of a citizen legislator, and also 
to supplement the income of a young farmer getting started at that time 
because I was only farming 80 acres at that time. Even in 1961, you 
could not make a living farming 80 areas. You could not make a living 
getting $3,000 every other year being an Iowa legislator. So I became a 
factory worker.
  At about 1971, the people who owned our company decided people in 
Texas would work for less money than people in Waterloo, IA, so they 
moved the plant to Texas. Our job was shut down. Our job was lost. The 
outsourcing was not to China, it was to Texas. I presume that 25 years 
later there were jobs that moved from Iowa to Texas that eventually 
moved to Mexico, and then it was not long Mexico was losing jobs from 
Mexico to China. Now we hear about jobs moving from China to someplace 
else, where somebody is going to work someplace else for a lower wage. 
I guess when you have a planet of 6.5 billion people, and people want 
to eat, they want jobs, somebody is going to seek that work and do it. 
So I believe I have been a victim of outsourcing not to China but to 
Texas. But it is still a problem today, and it is one for which we have 
to have sympathy.
  Senator Dorgan, obviously, presents a great case for those people. 
But I want people to know I have lived through that and know what it is 
like when I am commenting because I do not want people to think I am 
unsympathetic to outsourcing. But I think we have to recognize the 
economic facts of life, whether it is my job at the Waterloo Register 
in Cedar Falls, IA, or whether it was 250 years ago when manufacturing 
jobs left Great Britain to come to the Colonies in the United States of 
America.
  Now, I want to say, unfortunately, Senator Dorgan's amendment--if it 
is the same one we saw in 2004. And you can tell from the debate that 
we just had that we do not have the language on these amendments, and 
we are begging for them. Anybody who believes in transparency of 
Government ought to get these amendments out here. There is no reason 
to be secretive about the people's business because everybody is 
watching us right here on television. We are not trying to hide 
anything. So we need to see those amendments.
  But the point is, if it is like the amendment in 2004, that amendment 
will not do one thing to bring jobs back to America. In fact, it could 
very well cost even more U.S. jobs. I would like to explain, then, why 
I come to this conclusion.
  This amendment, if it is similar, repeals deferral for property 
imported into the United States by a foreign subsidiary of a U.S. 
company, without regard to whether that property was ever previously 
produced, manufactured, or grown in the United States.
  This means the amendment by Senator Dorgan fails to focus on their 
primary complaint that U.S. companies are shutting their plants, moving 
production offshore, and selling back into the United States. The bill 
does not focus on this scenario. Instead, it overshoots the mark by 
hitting all goods sold into America by U.S. companies, even if it is 
impossible for those goods to be produced in America.
  For example, if a produce company sets up a banana farm in Costa Rica 
to import bananas into the United States and around the world, the 
income from sales to the United States is not eligible for deferral. I 
may be mistaken on this point, but I am not aware of too many banana 
farms in Texas or Florida, so I do not see how allowing a banana farm 
in Costa Rica is going to cost U.S. jobs.
  Similarly, if a U.S. company wanted to start a mining operation in 
some faraway land to extract a new and exotic mineral that is not found 
at home, they could see that anywhere in the world, but they cannot 
import that back into the United States without triggering the impact 
of this amendment.
  Or let's look at coffee. We have a lot of coffee shops on our streets 
these days. If they set up their own coffee plantation in Brazil, they 
would be hit by the Dorgan amendment. I think we only raise coffee in 
one State in the United States, and maybe they do not do that in Hawaii 
anymore. But there is not much coffee raised in the United States. We 
sure do not raise it in my State of Iowa.
  Our friends from New York and New Jersey ought to consider the 
effects of this amendment on Puerto Rican residents who work in plants 
owned by subsidiaries of U.S. companies. Many of the U.S. 
multinationals have manufacturing subsidiaries in Puerto Rico that 
import products into the U.S. market. Since our Tax Code treats Puerto 
Rican corporations like foreign corporations, this amendment would hit 
those companies very hard. But it would not hit their foreign-owned 
competitors who sell into the United States.
  It seems Senator Dorgan's amendment would allow a U.S. company to 
sell a foreign-produced good to anyone in the world except Americans, 
but it would allow a foreign-based company to sell those same goods to 
Americans. When you stop to think about looking out for the benefit of 
Americans, this does not make any sense.
  I have described how the bill would operate, but I do not think this 
is the intent of the legislation. What I believe is intended is that 
deferral should be denied if a company closes a U.S. plant, produces 
the goods offshore, and then imports the goods back into the United 
States.
  This does not actually happen very often. We have had this debate 
before. The last time I spoke on this issue was when we were debating 
the JOBS bill back in 2004. I do not think much has changed since then.
  At that time, the latest Department of Commerce data on U.S. 
multinationals showed that only 7 percent of foreign subsidiary sales 
were into the United States--only 7 percent.
  Nevertheless, this amendment insists that the rule of ``deferral'' in 
our tax law is somehow a ``tax benefit'' that moves jobs offshore and 
allows you to not pay taxes on foreign income. This is not true, of 
course. Deferral has nothing to do with moving jobs, and it never 
forgives taxes that are owed on foreign profits of U.S. companies.
  Many U.S. companies, however, choose to reinvest their foreign 
earnings in foreign markets, and so the U.S. tax on those earnings is, 
then, indefinitely deferred.
  As Senator Dorgan noted, the JOBS bill, that we call the American 
Jobs Creation Act of 2004, did contain a provision that provided U.S. 
multinationals a temporary ability to receive dividends from their 
foreign subsidiaries at a reduced tax rate. Now, it is important to 
note that companies could only avail themselves of this reduced rate on 
an amount of earnings they identified in SEC filings as ``permanently 
reinvested.'' That is a legal term, which means they had no intention 
of bringing that money back to the United States.
  Senator Dorgan's characterization of that provision is misleading, 
and I would say in two ways. First, Senator Dorgan calls the 
repatriation provision a tax cut of over $100 billion. To arrive at 
that huge number, the Senator's calculation must assume these companies 
would have brought close to $340 billion of their foreign earnings home 
in the absence of the repatriation provision of the JOBS bill.
  Now, the fact is--and I get this from scoring by the nonpartisan 
Joint Committee on Taxation--this provision has a cost to the Treasury 
of not $100 billion but $1.9 billion over 5 years and $3.3 billion over 
10 years; and it actually scored as a revenue raiser in the first year 
of $2.8 billion.

[[Page 718]]

  Now, I plan on looking at the actual results of this repatriation 
provision when all the facts are in, after the fact. You are kind of 
guessing before you pass a bill. But after it has operated for a couple 
years, then you get a chance to get a real look at it. So we are going 
to look at this repatriation provision. But the Joint Committee on 
Taxation must have scored this provision as a raiser in year 1, and a 
relatively small cost over 5 and 10 years, because 5.25 percent of a 
large amount that was repatriated is a lot more than 35 percent of a 
much smaller amount that would have been repatriated otherwise.
  In other words, it is not as much money coming back into this 
country, and if it does not come back here, it is not taxed.
  I am not here to defend the repatriation provision or those companies 
that laid off workers or took advantage of the repatriation provision. 
I am just as troubled by those announcements as Senator Dorgan. I am 
simply pointing out that Senator Dorgan's characterization of that 
provision as a $100 billion tax cut is extremely misleading.
  Second, Senator Dorgan talks as if the repatriation provision was the 
cornerstone of the American Jobs Creation Act, and it was kind of an 
appendage. In fact, the repatriation provision was a very small part of 
the bill. One of the key pieces of the JOBS bill was the manufacturing 
deduction which does actually give a tax break for companies that 
manufacture, leaving jobs here or creating jobs here. The Joint 
Committee on Taxation scored this provision as a cost to the Treasury 
of $76 billion over a 10-year period. That is, in fact, a tax cut, and 
it is a tax cut that will maintain jobs in America and will create jobs 
because one of the problems for American corporations compared to 
international competition is the high tax rate that we have on 
corporations compared to a lot of other countries. Those other 
countries are waking up. Just look at Ireland, look at Europe, what we 
are talking about doing now--sometimes through the European Union, 
sometimes through individual countries. They are seeing great advantage 
by reducing the corporate tax rate in their respective countries.
  Two years ago, we thought we had moved ahead of them. Now they are 
following suit. We may have to go back and look at our corporate tax to 
find out if we are going to continue to be noncompetitive.
  I would like to go back to the deferral issue. The rule of deferral 
exists to keep U.S. companies competitive in the global marketplace. 
Deferral is not something new. It has been in our tax laws since 1918. 
We have debated the rule of deferral on several occasions, and we will 
no doubt continue to do so when we debate tax reform proposals.
  Opponents of deferral too often make wild accusations about how this 
rule, which has been in place since 1918, spells doom for the American 
worker. Of course, none of this is true. In fact, just the opposite is 
true because we must always be vigilant about enhancing international 
competitiveness for our U.S. companies. Hence, deferral ensures an 
ever-growing base of opportunity for U.S. companies and, more 
importantly, their employees at home and abroad.
  U.S. multinationals are a critical component of our economy. These 
companies operate in virtually every industry and, the last time I 
checked, have investments of more than $13 trillion in facilities 
located within the United States. As employers, they provided 23.5 
million jobs for Americans in the year 2001. That was nearly 18 percent 
of the payroll jobs in the United States. They had a payroll of $1.1 
trillion. When you go back to this debate we had in the year 2004, I 
noted at that time that the U.S. multinationals created more than 53 
percent of the manufacturing jobs in America and employed more than two 
U.S. employees for every foreign worker. Those were the latest years 
for which I had figures, but I have no reason to believe it is 
different today.
  During the 10 years from 1991 to 2001, U.S. multinationals increased 
domestic employment at a faster rate than the overall economy. A recent 
study confirms that U.S. multinationals are significant job creators, 
and those jobs are not created through ``exporting'' jobs to foreign 
nations with low-labor and low-tax costs, as Senator Dorgan contends. 
The Department of Commerce data shows that the bulk of the U.S. 
investment abroad occurs in high-income, high-wage countries.
  Again, referring to the year 2001, 79 percent of foreign assets and 
67 percent of foreign employment of U.S. multinationals were located in 
high-income, developed nations such as Australia, Canada, Hong Kong, 
Japan, New Zealand, Singapore, South Africa, and the countries of the 
European Union. We have to remember a very simple maxim for why 
companies go into foreign markets: 4 percent of the people in the world 
live in the United States. If you want to create jobs in America and 
you just want to sell to that 4 percent, you are going to have a very 
limited market. Whether you are in agriculture, like I and my son and 
grandson are, selling corn and soybeans overseas, or whether you are 
manufacturing John Deere tractors, whatever you are manufacturing, if 
you want prosperity, you go where the market is. That is the 96 percent 
of the people who don't live in the United States.
  Again, referring to that debate on the JOBS bill in 2004, fully 95 
percent of the world's population and 80 percent of its purchasing 
power--so the only new thing I am giving is not that 96 percent of the 
people live outside of the United States, but 80 percent of its 
purchasing power--is located outside the United States. Foreign sales 
growth has outstripped domestic sales growth. So our companies are 
taking advantage of selling to the rest of the world. This increased 
growth requires increased employment wherever you can find it. The good 
news is that foreign growth also results in U.S. job growth.
  A recent study confirmed that during the 10 years from 1991 through 
2001, for every one job that U.S. multinationals created abroad, they 
created nearly two U.S. jobs in their parent corporations. That is why 
it is critical to our economy that U.S. companies remain competitive in 
the international marketplace.
  I would like to review a more rational explanation of deferral and 
how it works to keep our U.S. companies competitive. The United States 
taxes all of the worldwide income of its citizens and corporations. The 
U.S. income tax applies to all domestic and foreign earnings of U.S. 
companies. The United States fully taxes income earned overseas by 
foreign subsidiaries of U.S. companies. However, many foreign countries 
tax their companies on a territorial basis, meaning that they only tax 
income earned within their country's borders and don't impose tax on 
the earnings of foreign subsidiaries. Major countries using this 
territorial system of corporate taxation are Australia, Belgium, 
Canada, Denmark, Finland, France, Germany, Italy, Luxembourg, 
Netherlands, Sweden, and Switzerland. A company from one of these 
countries that uses the territorial tax system has great advantage over 
U.S. companies.
  For example, a U.S. company with a Singapore subsidiary will pay U.S. 
tax and Singapore tax on the subsidiary's income. A French company with 
a Singapore subsidiary will pay Singapore tax but no French tax. This 
means that a U.S. company in Singapore has a higher tax burden than a 
French company in Singapore. Two basic tax rules answer this problem 
and seek to put U.S. companies on a level playing field with foreign 
competitors from territorial countries. The first rule says that when 
foreign income is brought home, the U.S. allows a reduction against 
U.S. tax for any foreign taxes paid on that income. The foreign tax 
credit prevents the U.S. from double-taxing foreign earnings which 
would make our companies noncompetitive in the international 
marketplace. And like deferral, this has been in the tax law since 
1918.
  The foreign tax credit, however, is limited. It may only offset the 
U.S. tax on that income which is currently imposed at a 35-percent 
rate. If the foreign tax rate is higher, the credit stops at 35 
percent. If the credit is lower, say 10 percent, then additional U.S. 
taxes

[[Page 719]]

 will be owed up to the full 35 percent. In this example, an additional 
25 percent of the taxes would be owed to the United States, which is 
the difference between the 10 percent and 35 percent of the U.S. rate.
  The second basic tax rule is that U.S. companies are allowed to defer 
U.S. tax on income from the active business operation of a foreign 
subsidiary until that income is brought back into this country, usually 
in the form of dividends paid to the U.S. parent. This is referred to 
as the rule of deferral, meaning that the U.S. tax is deferred until 
the earnings are brought back. This is the rule the Dorgan amendment 
attacks.
  It is important to note that deferral is not the forgiveness of tax. 
It simply means that we impose the full U.S. tax when foreign earnings 
are repatriated to the United States instead of doing it the very day 
of earning. The reason that we defer tax on active business operations 
is so that U.S. companies can remain competitive with foreign companies 
that have a different system of taxation than what we have. I am 
referring to what I called the territorial tax. We don't defer tax on 
passive activities like setting up an offshore bank account or other 
passive investments. We tax passive activities yearly. But active 
operations are subject to competitive disadvantage.
  For example, if we impose U.S. tax today on the profits of a 
Singapore subsidiary, then the U.S. company will pay a 35-percent tax 
in the United States, net of any Singapore taxes, but that French 
competitor located right next door in Singapore will pay only the 
Singapore tax. If the Singapore tax rate is less than 35 percent, which 
is the U.S. tax rate, then the French competitor will have a tax 
advantage. Who wants to give any advantage to a French competitor? This 
is because the United States allows a foreign tax credit to offset the 
U.S. income tax imposed on those foreign earnings but only up to the 35 
percent U.S. corporate rate.
  If the foreign rate is less than the U.S. 35 percent rate, then 
residual U.S. taxes are owed on the difference between the U.S. tax 
rate and the foreign rate. For example, if a Singapore tax is 15 
percent and the U.S. tax is 35 percent, then the United States will 
impose an additional 20 percent on those Singapore earnings. The French 
company, however, would only pay the 15 percent Singapore tax. If we 
did not allow deferral on that additional 20 percent of tax, then the 
U.S. company today would have a 20-percent tax disadvantage compared to 
the French company.
  The question on repealing deferral is whether we want to hand over 
the world market to companies from France and Germany and other 
countries that have a different system of taxation than we have, called 
the territorial system. Repealing deferral means that we export our 
high U.S. tax rates to U.S. corporations around the globe. The United 
States has one of the highest corporate tax rates in the world. There 
are few countries with rates higher than the United States. This means 
that without deferral, U.S. companies will be at a continual worldwide 
disadvantage compared to their foreign competitors.
  That is why we defer U.S. tax on active business operations, so that 
U.S. companies can be competitive in the global marketplace.
  Some Senators have proposed repealing deferral or cutting back on it, 
as Senator Dorgan's amendment would do. These proposals would export 
the high U.S. tax rate to U.S. operations around the world. That would 
be fine if all companies around the world were paying the high U.S. tax 
rate, but, as I have said so many times, they are not. We have one of 
the highest corporate tax rates in the world. Companies of foreign 
countries are not subject to our tax laws and are usually taxed at 
lower rates. This all brings us back to the implications of Senator 
Dorgan's proposal. It would enhance the competitive advantage of 
foreign-owned multinationals over U.S. multinationals.
  Our focus in considering this amendment must be on the ability of 
American companies to compete within the United States as well as in 
foreign markets if we want to maintain and create jobs in America. The 
issue is not whether we tax foreign earnings currently but whether we 
cede the U.S. market to foreign competition.
  The Dorgan amendment will increase taxes on U.S. companies, but their 
foreign competitors in the U.S. will not face a similar tax increase. 
This can lead to a loss of domestic market share, or even if market 
share is maintained, losses may be incurred on domestic sales because 
of pricing pressures and uncompetitive margins created by the 
additional tax burden.
  No one is happy when companies move abroad to a tax haven to avoid 
U.S. tax. But let me tell you another side effect of the proposal to 
eliminate and cut back on deferrals. In the American Jobs Creation Act 
of 2004--that bill I always referred to as the JOBS bill--we enacted a 
provision that prevents corporate inversion, where a company would 
pretend to move its corporate headquarters to Bermuda, to a simple post 
office box there, and do it not because they are going to do anything 
productive there but for the sole purpose of avoiding U.S. taxes. Many 
U.S. multinationals complained that inversions were necessitated by an 
inability to compete with foreign-owned multinationals that aren't 
subject to the higher U.S. tax rate.
  We should be proud, then, that we shut down those inversions, those 
shell corporations, those postal box corporations which do nothing over 
there except go there to avoid tax and then make the situation even 
worse for honest corporate taxpayers in America that are paying the tax 
into the Federal Treasury. But in the process of doing that, we didn't 
do it at the expense of repealing deferral. Now that we have shut down 
inversions, if we repeal deferrals, or significantly cut back on them, 
the only other alternative that would be available to U.S. 
multinationals would be to sell themselves to foreign companies or to 
be taken over by a foreign company in a possible hostile takeover. If 
we prevent U.S. companies from deferring their foreign profits, we will 
see more and more U.S. multinationals being bought out by foreign-owned 
multinationals. Tax changes have consequences.
  Increasing taxes on U.S. multinationals will not bring jobs back to 
America. You only pay taxes if the company is profitable, and you only 
stay profitable as long as you remain competitive. But in the United 
States, taxes are 35 percent cost-to-profit, and that is where a 
competitiveness disadvantage can occur when a U.S. company is competing 
against foreign companies that will not incur this tax increase.
  Senator Baucus and I held hearings a couple years ago regarding the 
effects of the international competition within the United States, so 
we as leaders of the Finance Committee are very familiar with the 
effects of these kinds of rate differentials.
  I think a quote by Joseph Guttentag, international tax counsel of the 
Clinton administration, during testimony before the Finance Committee 
in July of 1995 is a very good place to end this debate. So I end with 
this quote:

       Current U.S. tax policy generally strikes a reasonable 
     balance between deferral and current taxation in order to 
     ensure that our tax laws do not interfere with the ability of 
     our companies to be competitive with their foreign-based 
     counterparts.

  Now, if that position just expressed by Joseph Guttentag, 
international tax counsel in the Clinton administration, the last 
Democratic administration, testifying before a Republican Congress, 
isn't good enough evidence that the route Senator Dorgan wants to go is 
the wrong route and a route contrary to previous leaders of his own 
party, then I don't know what will be evidence that this position is 
going to make American companies uncompetitive, not go to the 
marketplace of the other 96 percent of the consumers around the world 
outside the United States, and consequently creating jobs in the United 
States, and I don't know what it takes to convince him that position is 
a wrong position for the United States and is so different than what we 
have traditionally had for the Tax Code since 1918. When I say 1918,

[[Page 720]]

that goes back almost to the beginning of the income tax in the United 
States.
  I yield the floor.
  The PRESIDING OFFICER. Who yields time?
  The Senator from Pennsylvania is recognized.
  Mr. SANTORUM. Mr. President, it is sort of with mixed emotions that I 
am here on the floor to talk about this tax bill. In one sense, I am 
very happy we are moving forward with the Tax Increase Protection Act. 
At the same time, I am at somewhat of a loss as to why we are spending 
2, 3, and maybe more days of the Senate's time for something that is 
traditionally done when there is comity and cooperativeness in the 
Senate by unanimous consent, putting in a substitute Senate-passed bill 
for the House bill and go to conference. That is something we do 
routinely here, almost daily. We have disagreements with the House, and 
we simply go through the procedure of moving to conference and having 
those differences worked out.
  Unfortunately, we are at a time here where even routine things become 
weeklong labors to accomplish them. That does not reflect well on the 
Senate. I don't believe it accomplishes anything other than to delay 
other matters that are to come before the Senate.
  We have a very important bill dealing with an issue that is of vital 
importance to my State--many manufacturing jobs in my State--and that 
is the asbestos debacle going on throughout the courts in this country 
where over half of the money paid out by corporations in asbestos 
claims has gone to lawyers. There are many people in the Commonwealth 
of Pennsylvania who are literally getting pennies--people who are sick 
and some are dying and some have died, and they have received literally 
pennies for their exposure to asbestos and their subsequent disease 
because of the horrific environment of litigation on asbestos, where 
lawyers are profiting and patients--those who are sick or are survivors 
of those who have gotten ill and died--get virtually nothing. This is 
something we have to address.
  Instead of addressing that, which is what we should be doing right 
now, we are holding up the Senate on a procedural matter. It is truly 
sad that we can no longer just cooperate on the normal business. 
Everything is obstruction and slowdown and political potshots and 
making points. I think that is unfortunate for this body. It sets a 
very dangerous precedent that we are going to conduct business like 
this in the future. Whether it is in the next election or elections in 
the future, at some point in time, the tables will turn. I believe what 
we are establishing today is not something that will be beneficial for 
the long term in our ability to get things done in the Senate.
  While the chairman is still on the Senate floor, I thank him again. I 
am repeating this because we are doing the same bill. I thank him for 
all the hard work he has put into this bill. The fact that he was able 
to get a bipartisan bill through the Senate is a testament to him, and 
I know it is very difficult and trying, negotiating within our own 
conference as well as negotiating with Members on the other side of the 
aisle. He was able to, as he has done on many occasions, cut through 
all of the difficulty and partisanship and the angst some Members have 
about various provisions and find a good middle ground, and well over 
60 Members of the Senate supported the Senate bill that passed in 
November. I thank him for his good work and for the work he has done 
with me, in particular, on the issue of helping the nonprofit sector in 
our society meet the needs of those.
  We were at the prayer breakfast this morning, and Senator Grassley 
was there. We heard Bono and the President talk about taking care of 
the least of our brothers and sisters. The President says it so well. I 
have been advocating so long that nobody really does it better than our 
faith-based communities and our community nonprofits. They are the ones 
on the front line. We talked about it at the prayer breakfast--whether 
it is responding to a natural disaster or, more often and less 
prominently, responding to a person in need in our communities across 
America, rich as well as poor, people in need who are suffering.
  It is important that we recognize that portion of this bill has to be 
a net plus for our charitable community. There are provisions in there 
that I have expressed concerns about which would do damage to those 
nonprofits' ability to be able to provide the needed services and to do 
the good works in our communities that make America stronger.
  We have some good charitable-giving incentives, which are a big plus, 
but we also have charitable reforms on which I worked with the 
chairman. I think that maybe we are 90 percent of the way there, making 
sure we weed out some bad practices and making sure there isn't abuse 
within the charitable field, but at the same time not saddling our 
charities with a Sarbanes-Oxley type of oversight and regulations that 
would drive a lot of our small volunteer-oriented nonprofits out of 
existence and leave a big hole in our communities across America.
  I am hopeful that when we get to the House and into conference, 
Chairman Thomas will work with us and we will be able to get a bill 
that will be not only a net plus but a big plus for the armies of 
compassion, the foot soldiers across America who are helping men and 
women in need and children in need in our society.
  A big part of this bill, obviously, is the tax relief. It is not 
exactly what I had hoped for. It is one of those compromises we had to 
make along the way. I thought the House bill actually had some better 
provisions when it comes to some of the tax provisions. It continues on 
a policy that has resulted in a lot of positive economic news over the 
past several years since 2003. We have seen that by these changes in 
the Tax Code and reducing marginal rates and capital gains taxes and 
dividends, it has incentivized the entrepreneurial spirit and 
incentivized business investment; it has created an explosion of growth 
in this country, which has also resulted in millions of people getting 
jobs--net new jobs across America.
  I have a chart that shows, since the Jobs and Growth Act of May of 
2003, and looking at the real GDP growth in America, there is a 
dramatic tilting upward since these provisions were passed. That has 
resulted in a dramatic increase, as we have seen on some other charts, 
in Federal revenues.
  There is a constant complaint, a drumbeat on the other side of the 
aisle, and from a few on this side of the aisle, that somehow we cannot 
afford these tax reductions.
  It is interesting; if you think of tax reductions, that leaves the 
question, What is a tax reduction? What is a tax reduction? Is a tax 
reduction a reduction in the taxes paid; or is it a reduction in the 
rate of the tax paid? What is a tax reduction?
  Depending on how you view a tax reduction--and the answer is 
different based on what we did--if you look at, Did we reduce taxes, 
the answer is, with respect to rates, yes, we reduced taxes; we reduced 
the capital gains dividend rates, the marginal tax rates. We reduced 
the rates on the taxation of married couples and in several other 
areas. So, yes, we reduced the rate of tax.
  The question is, Did we reduce the collection of taxes? What should 
Congress be more concerned about? Should we be more concerned about the 
rates of taxes or should we be more concerned about the collection of 
tax revenues?
  I would think most people, when we have cut taxes, would say we 
reduced the collection of taxes in America. That is not what happened. 
When we reduced the rate of taxes, when we cut taxes, we actually 
didn't cut taxes. We actually increased the flow of revenue to the 
Federal Government.
  So if we are looking at it from the standpoint of the budgeteers, the 
folks who are responsible for managing the receipts and distributions 
of Government, then the actions taken by the Congress in 2001 and 2003 
resulted in increased taxes paid to the Federal Government through a 
policy that believes in the innovation and the energy of the people, 
that if you unshackle them from higher tax rates, they will produce 
more, they will create more

[[Page 721]]

jobs--and job growth has been terrific, over 2 million jobs, and the 
unemployment rate has been under 5 percent--and we end up with a better 
quality of life, more revenue to the Federal Government, and higher 
growth rates overall in our economy.
  That is a pretty good picture. So why the complaints? Why are people 
so upset that we actually put a program in place that has resulted in 
more revenues coming to the Federal Government? Why the complaints? Why 
the gnashing of teeth that somehow this is a policy that is harmful to 
the budget deficit? Revenues were up 14 percent last year. How is that 
harmful to the budget deficit?
  They say: That would have happened; in fact, we would have gotten 
more money had we not reduced taxes. Is that true? Let's look at the 
capital gains issue.
  The Congressional Budget Office estimated in 2003 that we would 
collect roughly $125 billion in the year 2004 and 2005 in capital gains 
taxes. We went ahead and reduced the capital gains tax rate. Many of us 
stood on the floor and said, by reducing that rate, we will actually 
get more revenues. The Congressional Budget Office said ``no,'' 
everybody on the other side said ``no,'' and, in fact, everybody on the 
other side still said ``no'' and still says we shouldn't keep those 
rates low, we have to increase those rates because we need the money.
  How did it work out? What happened when we reduced those rates? Did 
we get, as the Congressional Budget Office suggested, $26 billion less 
money? And that is what they projected. They projected in 2004 and 2005 
that the amount of money coming into the Treasury in capital gains 
taxes paid would go down by $26 billion. What happened? Now we know. 
The amount of revenue collected in capital gains taxes went up $27 
billion.
  I was talking to a reporter the other day. I said: Lo and behold, I 
voted for a tax increase and didn't even know it. I voted for a 
provision that actually increased taxes to the Federal Government, and 
the folks who paid those taxes were very happy to pay them, by the way, 
because they were investing in America and America's values were 
increasing. Stock in America, real estate in America, the things that 
made wealth in America were increasing because of a growing economy 
because of what we did on the floor of the Senate, and they were very 
happy to have paid those taxes. And we got more Federal revenues.
  What does the other side want to do? They want to have that rate go 
back up. One might suggest that if the rate goes back up, revenues 
could do down. What could be their motivation? What is the motivation 
of trying to increase a tax to get less revenue? Think about it. What 
could be the possible motivation of coming to the floor of the Senate 
and saying we need to increase taxes, even though by doing so we are 
going to get less money. Why would you do that? From a public policy 
perspective, why would you want to do that?
  I can tell you that the argument is given that we need it to balance 
the budget. Wait a minute. We are going to get less money, so why would 
you do it? Could it be something of the whole politics of envy, the 
politics of pointing the finger at those who are successful, get a 
paycheck, and invest in America and say we need to tax them more; that 
is the fairness issue? We hear that a lot on the floor of the Senate: 
It is about fairness. That is what it is about? Stick it to those who 
succeeded, invested, purchased real estate, purchased stocks and bonds; 
we are going to take a bigger chunk of their money because that is 
fair. We may get less revenue, we may get slower economic growth, fewer 
jobs will be created, but we will feel better.
  That is not sound public policy. That is not in the best interest of 
the American people. We did not get in the Senate bill a reduction of 
capital gains tax rate extension for 2 more years, but I will tell you 
that we will work very hard in the conference to make sure that 
happens. It is important for the economic growth of our country, for 
the job creation in our country, and for Federal revenues that we get 
that extension in law.
  There are a lot of games being played on the floor of the Senate when 
it comes to tax policy and the politics of envy. What we should be 
focused on is how does this Senate, how does this Government create the 
best environment for growth opportunity and job creation and how do we 
do it in a way that is fiscally responsible. Those are the two things 
on which we should be focusing.
  I would make the argument that the bill before us, which prevents an 
increase in taxes--these are tax policies that are in place right now; 
there is no new policy or, I should say, very minor, little new policy 
changes, such as the charitable giving incentives, but very small 
policy changes, a very small percentage of the money. The overall bill 
deals with provisions such as the alternative minimum tax, which is 
vitally important and the small saver's credit, which is important. 
About a quarter of a million people in my State strongly support that 
provision, in fact, would strongly support increased incentives for 
low-income individuals to save and, in fact, put forth a bill with 
former Senator Corzine to do that. So I am looking for another new 
cosponsor if anybody wants to join. It is called a kid's account to 
give every child in America a nest egg to begin to save at their birth.
  I am big on giving people the opportunity to save, invest, build 
wealth, and feel connected to the economy of this country. We need to 
do more of that. But we have a little piece of that here, which is 
important to the people in my State. Mr. President, 150,000 families 
and students in my State will lose their deduction for college tuition 
if we don't extend that provision. With regard to the teacher tax 
credit provision Senator Collins championed, 142,000 teachers in 
Pennsylvania will not be able to deduct that. We can go on and on.
  These are preventions of tax increases, a tax reduction that caused 
the kind of economic growth we have seen. It is important for us to 
have these provisions stay in law.
  Finally, I want to talk about an issue that has been brought up--and 
it is an important issue--and that is the issue of mine safety. I know 
Senator Rockefeller has put forth an idea that I think deserves some 
consideration because it has merit. It provides mining companies with 
incentives to make available newer technology that will enhance safety.
  We have seen over the last month in West Virginia and we saw, I 
guess, 3 years ago in Pennsylvania, mine disasters occur where human 
life was lost, in the cases of West Virginia, and certainly a major 
disaster was diverted in Quecreek in Pennsylvania.
  This is a serious issue, one I care deeply about. My grandfather was 
a coal miner in a deep mine for 30 years, so this is very close to home 
for me. This is one issue we need to do something about, to improve the 
safety for those who literally risk their lives every day to provide 
for their families, to build strong communities, and to provide energy 
for all of us so these lights will work in the Chamber. We need to do 
all we can to improve enforcement as well as to create incentives for 
the mining community to improve safety at the workplace.
  There is another provision in the Rockefeller bill that has to do 
with training for rescue teams. Because of the way it is written, I 
have some concerns about it. I heard from a lot of our small mining 
operations, family-run operations, that this provision would not 
benefit them at all.
  As we know, a large percentage--at least in my State--a large 
percentage of the mine operations in my State are not big corporate 
mining operations. They are small, in some cases small corporations, 
family-run operations. So while I certainly strongly support the first 
provision and support the concept behind the second provision, I have 
serious concerns about the way that provision will tilt to the benefit 
of the larger mining operations.
  While I support it and will support this amendment, I hope it is 
included and that we can work on something in conference to include 
improvement of mine safety, I am putting my marker

[[Page 722]]

down here that we will do so not to discriminate against small mines 
versus larger mining operations. If anything--if anything--we should be 
concerned about, as we do on a lot of issues in the Senate, helping the 
little guy, as opposed to helping the big guy because the big guys 
already have the resources to spend to provide for a safer workplace.
  What we should be doing is focusing on how we can make smaller mining 
operations safer. That is not what this amendment that Senator 
Rockefeller puts forward does. As a result of that, while I support it 
and will support the provision to be included in the conference, I put 
the marker down that we are going to work diligently to make sure it 
uniformly impacts across the industry and, if anything, it benefits the 
smaller mine operator as opposed to the bigger one. That is not the way 
it is currently drafted.
  I completely understand. I don't think Senator Rockefeller--at least 
I hope he didn't go in there with the idea that we are going to favor 
one segment of the mining industry over the other. I hope that is not 
his intention. Whether it is his intention, I will certainly work with 
him to make sure it is a much more balanced provision when it comes out 
of conference.
  With that, Mr. President, I thank the chairman for yielding the time 
to speak on this important bill. I yield the floor, and I suggest the 
absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. DORGAN. Mr. President, I ask unanimous consent the order for the 
quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. My friend from Iowa came to the floor to speak a bit this 
morning on a couple of subjects I spoke about yesterday. Let me again 
say I have very high regard for Senator Grassley. We worked together on 
a good number of issues. I enjoy working with him. But there are times 
when you have disagreements on policy, and we certainly have that on an 
issue I am going to talk about. It is an issue he talked about this 
morning as well. Actually, there are a couple of tax issues.
  Before I do, however, I want to just make a slight correction to the 
remarks that were made by the Senator from Pennsylvania a few minutes 
ago. I heard him say the Democrats were holding up this bill on, I 
guess--I think he said a technicality. I think he said it was a 
technicality. I think that was the impression he intended to leave, 
obstruct or holding this up on a technicality.
  I guess the technicality is our interest in offering amendments. I 
know to some that is not a pleasant thing around here, to have people 
offer amendments and actually debate them and vote on them, but that is 
the way the system works. The reason there are not amendments offered--
and I would try to offer one right now, but I would be unable to offer 
one--is because the majority party has done something that is called 
filling the tree. It is a parliamentary procedure to make sure every 
branch of this legislative tree is filled so that no one is allowed to 
offer an amendment.
  For example, while this bill is on the floor, under the rules of the 
Senate, I should be able to offer an amendment. The majority party 
decided to fill the tree, as it is called, so no one on this side may 
offer an amendment. So when my colleague from Pennsylvania said the 
Democratic side of the aisle is using a technicality--whatever, I 
forget his term exactly--to hold this up, I am sorry that is not what 
is happening at all.
  He made a point that I share. I think it would be great to work 
together. I think there ought to be less rancid partisanship and we 
ought to find ways to work together to do the Nation's business. We, 
after all, represent the same interests. We represent the interests of 
this country. I hope we represent the interests of the American people. 
I would like to find areas where we can work together.
  In this case, however, let me just say there is no obstruction going 
on here. The only obstruction is we are obstructed from being able to 
offer an amendment which in ordinary circumstances the rules of the 
Senate would permit. I regret that. I wish the majority party would 
have allowed me. I would have offered the amendment yesterday, in fact, 
and I would offer it right now. I have an amendment to offer. I guess 
we will vote on it later because you will have to have a circumstance 
where we can offer the amendment. I suppose the purpose is to allow 
amendments to be offered when all time is expired so there is no debate 
that is allowed. I guess that is probably the purpose. But I did want 
to disabuse anyone of the notion left by my colleague from Pennsylvania 
that somehow it is this side that is hanging all of this up.
  It may be inconvenient to have people offer amendments in the Senate, 
but there are a couple of hundred years of tradition of this 
inconvenience. The inconvenience is to be able to offer ideas, debate 
the ideas in the form of an amendment, and then have a vote, and the 
vote determines whether the idea that is offered represents public 
policy that the full Senate will accept.
  Let me just respond to a couple of things my distinguished colleague 
from Iowa has said. Yesterday, I gave a presentation talking about 
something called deferral. I know most of these things sound like 
foreign language around here. Deferral of income tax obligations is 
what it is. If a company does business overseas, an American company 
does business overseas and earns income overseas, at some point when it 
brings those profits, that income back to our country, they will be 
required to pay an income tax to our country for the income they have 
earned. They will get a credit, actually, against taxes they paid to a 
foreign country so they will not be double-taxed. But when they 
repatriate that income, as it is called, they have to pay a tax.
  My colleagues in the Congress, a sufficient number of colleagues who 
represent the majority, decided that they wanted to have a kind of 
little sweetheart deal for companies that would repatriate their 
earnings because many companies park their earnings for a long while 
overseas and don't bring them back. When they bring them back they have 
to pay the full tax rate. My colleagues said: Let's create new jobs in 
America by allowing these companies to bring their income back, and we 
will give them a special superdeal.
  You have heard of blue light specials; this is the blue light special 
of all specials. It says you bring that money back from overseas, you 
get to pay not 35 percent, not 30 percent, not 25 percent, not 15 
percent or 10 percent--which is the lowest income tax rate that is paid 
by the lowest income earner who has to pay income taxes--you get to pay 
a 5.25-income-tax rate. Who is the ``you''? The biggest companies in 
our country: Ford Motor, for one thing. I mention that because when 
they announced they are going to lay off 30,000, they also said: By the 
way, we picked up a quarter of a billion dollars of tax refunds under 
the Jobs Creation Act. Isn't that interesting? Ford Motor said in the 
same press release: We are going to lay off 30,000 workers in this 
country and, by the way, we were able to get a quarter of a billion 
dollars, a $250 million benefit from the jobs creation tax rate special 
benefit of 5.25 percent.
  The whole purpose was to create jobs in our country and, at least in 
the most recent job announcement of 30,000 jobs lost, the very company 
that announces 30,000 jobs gone points out they got a quarter of 
billion dollars under this provision.
  My colleagues seem to suggest the provision really does work, it is 
helpful. No, it doesn't work. It didn't work. By my calculation, the 
income that was parked overseas and at some point would have had to 
have been repatriated to this country, that income would have borne a 
tax that is about $104 billion more than what was paid under the 5.25 
percent.
  Is anybody going to have to answer to that? I don't know. Maybe not. 
Maybe nobody cares--$104 billion. You could reduce the Federal debt, 
reduce

[[Page 723]]

the annual budget deficit. You could probably provide some health care 
to people who do not have it, perhaps help some kids who are hungry, 
perhaps provide health care for kids who are sick, improve some 
classrooms in schools that need improvement--maybe there is a lot of 
things you could do. But $104 billion, that is a tax break given to the 
biggest corporations in this country who brought income back to our 
country and would have had to pay normal income tax rates but were told 
by this Congress that we are going to give you a superspecial deal that 
no other American taxpayer has: 5.25 income tax rate.
  Wouldn't every American love to pay a 5.25 income tax rate? But they 
can't. That deal is just reserved by the Congress for some bigger 
interests.
  I didn't vote for that. I didn't support it. I strongly opposed it. 
My colleague who sat in this chair right here, Senator Fritz Hollings, 
who is now retired, offered the amendment to strip that out, but we 
were not successful. So this blue light special, 5.25 percent special 
income tax rate for big interests who were bringing money back from 
overseas--it got done and $104 billion, as I calculate it, was saved by 
those who otherwise would have had to pay regular income tax rates.
  I wanted to respond to that because I still think that was one of the 
goofiest ideas in the world for this Congress to embrace, saying let's 
provide a 5.25 tax rate because we think it will create jobs. The 
evidence is all around us. It didn't create jobs. In fact, I have 
charts saying the largest companies that got some of the biggest 
benefits--one company got a $14.5 million benefit and laid off 14,500 
people--almost complete and perfect symmetry, wasn't it? Except they 
were supposed to have hired people if they got this kind of special tax 
rate. They just forgot and laid them off, I guess.
  Let me go to the other point which is what persuaded my colleague to 
come to the floor and engage on this issue, and that was the point I 
made yesterday. We have a provision in our Tax Code that says to 
someone in Iowa or North Dakota or Colorado or Pennsylvania, if you 
have a manufacturing plant and you are across the street from your 
competitor and your competitor has a manufacturing plant and you 
produce exactly the same products but you do something different, you 
move your jobs to China and manufacture your widgets in China, your 
competitor across the street stays home and manufactures them here in 
this country--one thing has happened as a result of that move. We have 
embedded in this Tax Code a perverse incentive that says: By the way, 
we will give you a break. You move those jobs to China, close your 
plant door, get rid of your workers, produce in China, and we will give 
you a tax break. You are not going to pay as much in income taxes as 
your competitor across the street who stayed in this country.
  I think that is wrong. Going all the way back to 1961 with John F. 
Kennedy, proposals have existed to change it. Going back to 1987, the 
House actually passed legislation to change it. But we can't change it 
any longer because now, of course, the big economic interests that 
benefit a lot from that--and we have a lot of companies getting rid of 
American workers, padlocking their doors and shipping the jobs to 
China. I have spoken about many of them on the floor of the Senate. We 
have a lot of companies that like this tax break. Why? They like to 
hire people for 33 cents an hour, produce the product in China, sell it 
in Cincinnati or Toledo or Pittsburgh, and then run their income 
through the Grand Cayman Islands, through the Ugland House on Church 
Street on the island of Grand Cayman, that houses 12,748. It is just an 
address, of course, but the purpose is to reduce the tax burden.
  My point is on four occasions when I offered amendments on the floor 
of the Senate so we ought to at least decide as a country that we will 
not provide financial incentives in the Tax Code for those who decide 
to move their jobs overseas--that ought to be the least we ought to do. 
That ought to be the baby step in the right direction--but four times 
we have voted and on four occasions those big interests that really 
like this and have benefits from it have been able to persuade a 
majority of the Senate to oppose closing that loophole.
  I indicated yesterday I would once again offer that legislation. I 
would offer it right this moment except I am prevented because the 
majority has done what is called filled the tree and prevented anybody 
from offering any amendments. My colleague from Iowa came down this 
morning and offered what I believe is called the Banana defense. That 
is what he called it the last time he offered it. It had to do 
something with bananas.
  I don't know, maybe we could debate apricots or tailpipes or bananas. 
It doesn't matter to me what the product is. We could have a long 
debate about it. I will just call this the banana debate then. But 
whatever the product or circumstances, the question remains: Do you 
believe that our Tax Code ought to provide financial benefits and 
rewards to companies that have decided to move their jobs overseas? 
Should Huffy bicycle have gotten a reward for firing all their workers 
and producing Huffy bicycles in China? Should Radio Flyer little red 
wagon have gotten a benefit from moving all their jobs overseas? Fruit 
of the Loom, should they have gotten the benefit?
  I could go on at some length. Fig Newton cookies, when they went to 
Monterrey, Mexico, should they get a benefit? If you think yes, then 
good for you, and I suppose the benefit will continue to exist in our 
Tax Code, but we are going to continue to vote on it. I am not 
deterred. As far as I am concerned we can vote 10 times on it. At some 
point there will be enough people filling the seats in this Chamber to 
understand that at a time that we have a crisis, and it is a crisis 
with substantial numbers of jobs moving outside of this country in 
search of lower labor costs to produce products to ship back into this 
country, at a time when we have that kind of crisis and the American 
people are facing downward pressure on wages, they are facing the 
stripping away of their pensions, the loss of their health care--at a 
time when we have that kind of crisis, the question is: Will there be 
enough people filling the seats in this Chamber to stand up and say 
let's take the first baby step in addressing it?
  The first baby step is to say: Let's not provide incentives in the 
Tax Code for companies to move those jobs overseas. If we can't do 
that, we can't solve this problem. But we will have plenty of chances. 
We will have one more chance now. We had four chances previously.
  I respect everybody's ability and interest to vote however they 
choose in this Chamber. I don't demean their reputation nor diminish 
their capability. I only say that I feel very strongly that if they 
support this provision, they are wrong. They are wrong for this 
country. The right public policy position is at least to have some 
basic neutrality on the question of whether we want to export jobs and 
whether we want to have the financial incentives for exporting jobs in 
our Tax Code.
  I regret that we don't have a back and forth. I would love to have a 
real debate about this because I know there are those who benefit 
handsomely from this who want to continue it and want it to remain in 
the Tax Code. But I feel strongly that this provision that is known as 
deferral--and, incidentally, my repeal of deferral does not go to the 
John F. Kennedy proposal on repealing deferral. My repeal on deferral 
is rather narrow. It is those companies that leave this country and 
ship back into this country.
  I think it is a perfectly appropriate thing, especially now given the 
crisis we face with jobs and opportunities in this country, for us to 
do that.
  I have a right, under the procedures of the Senate, to offer this 
amendment. I should have the right to offer it at the moment but I am 
not because there is--I guess the word ``obstruction'' is to be used--
obstruction at the moment is the tree is filled so that no one can 
offer an amendment. So we are going into some process that is a vote-
arama, and I will offer the amendment, and we will have a vote.
  Let me finally say it again.
  There is not one Member of the Senate that puts on a dark suit every

[[Page 724]]

morning and comes to work here that has ever been threatened to have 
their job outsourced--not one. There is not a person here that is ever 
going to have their job outsourced. Maybe they do not think much about 
it. I don't know. We have all of these people in blue suits who come 
here every day and we talk and we talk, and mostly we talk. We are good 
at talking.
  But the question for most Americans who worry about their jobs and 
who see their neighbors' jobs moved overseas is, Will their jobs be 
moved? The question for them is, Will Congress do something about it?
  I mentioned a few moments ago the Ugland House in the Grand Cayman 
Islands, which is a slightly different approach than the Tax Code I 
have been describing.
  I wanted to mention that there is a man from Bloomberg News named 
David Evans who has done some reporting on this Ugland House. The 
Ugland House is a house on Church Street in the Cayman Islands. It was, 
according to news reports, dug out by David Evans, who has done the 
research. This is a five-story white building that houses 12,748 
companies. It doesn't really house 12,748 companies--it is an address. 
This is a five-story white house address on Church Street in the Cayman 
Islands. Why would 12,000 companies congregate to have an address in 
this five-story building? There is only one reason. And, by the way, 
every one of them are represented by the same law firm. Why? So they 
don't have to pay taxes, that is why.
  They want to access cheap labor in Asia, sell in America, and run it 
through the Cayman Islands so they don't pay taxes.
  That is what this is all about.
  Because we have a tax bill on the floor of the Senate, I have another 
amendment that I will not be offering now for those companies that want 
to congregate at an address in a tax-haven country, the Cayman Islands. 
But if you are creating an address to have a tax haven and avoid taxes, 
you shall be treated for tax purposes as if you have never left our 
country. You don't get to claim that you now have an address in the 
Ugland House, and, therefore, you are running your income through that 
house. My legislation would say you are going to be treated as if you 
never left for business purposes.
  We can shut that down like that, if Members of Congress have the 
interest and the will.
  Does anybody believe this is anything other than a huge scam, by 
having a little five-story house with 12,000 businesses congregate 
there under the umbrella of a law firm that runs their mail through 
that place in order to avoid paying U.S. taxes?
  Thanks to David Evans for the work he has done. But in many ways, I 
think this is the tip of the iceberg. There is substantial tax 
avoidance going on. Some of it is legal. The first description I made 
today was the description of the avoidance of what I think is about 
$104 billion in taxes under the 5.25-percent special tax deal.
  The other one I mentioned, deferral for those who move their jobs 
overseas, that is in law. I am not criticizing companies for following 
the law. I am criticizing the Congress for not changing the law and 
doing what we should do--stand up for American jobs.
  I was thinking I had actually done plenty yesterday to either aid or 
injure my cause, however one views these issues. But when I heard my 
colleague from Iowa come to the floor today, I at least wanted to 
respond to that. As I was coming over, I heard my colleague from 
Pennsylvania say someone else was obstructing, I guess, the work of the 
Congress over what I think is a technicality, and the technicality was 
we wanted to offer amendments.
  I say to my colleague, there is never a technicality when someone 
wants to offer an amendment. If the rules allow us to offer amendments, 
just have the amendments, have a little debate, vote regular order, and 
let it go. When it is done and the dust is settled, we decide what we 
decide, and everybody is responsible for the vote they cast.
  My colleague from Pennsylvania said he wished we would be a little 
less partisan. So do I. I think we need to find ways to make this a 
little less partisan. A good step in that direction would be, for 
example, for somebody to right now come out and say: We have a bill on 
the floor, let us have regular order. If amendments are, by the way, 
allowed, let us go ahead and offer them. Will you give us a time 
agreement? Sure. Vote, act the way legislators should act, and at the 
end of the day, we will all feel better about that.
  That is what the Senate ought to be about when we call this the 
greatest deliberative body in the world. It has slipped a bit. We can 
regain that status if we only decide amendments are good and not bad 
things. Debate is good--not bad. The noise of democracy coming from the 
Senate is welcome noise for the American people, if we are engaged in 
constructive debate about issues that matter.
  I yield the floor. I suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Graham). The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. SCHUMER. 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. SCHUMER. Mr. President, I rise today, in recognition of the 
beginning of Black History Month, in support of a bill to posthumously 
award a congressional gold medal to Constance Baker Motley, an American 
hero who, sadly, passed away on September 28, 2005, after having lived 
an extraordinary and exemplary life. I am pleased to introduce this 
bill along with my colleague from New York, Senator Clinton.
  Constance Baker Motley was the first African-American woman, and only 
the fifth woman, to serve on the Federal judiciary. Before becoming a 
judge, she was a renowned civil rights lawyer, public servant, and 
trailblazer. Her remarkable career reads like a civil rights history 
book.
  After earning her bachelor of arts degree in Economics from New York 
University and her law degree from Columbia University, Judge Motley 
joined Thurgood Marshall at the NAACP Legal Defense and Educational 
Fund. For two decades, Judge Motley worked closely with Marshall and 
other leading civil rights lawyers to dismantle desegregation 
throughout the country.
  As a Black woman practicing law in the South, Judge Motley endured 
gawking and physical threats. But she was not deterred.
  She won cases that ended segregation in Memphis restaurants and at 
Whites-only lunch counters in Birmingham, AL. She fought for Dr. Martin 
Luther King, Jr.'s right to march in Albany, GA, and visited him in 
jail whenever he was arrested.
  Judge Motley was the only woman on the legal team that won the 
landmark desegregation case, Brown v. Board of Education. She went on 
to argue 10 major civil rights cases before the Supreme Court, winning 
all but one of them, including James Meredith's fight to gain admission 
to the University of Mississippi.
  Before she died, Judge Motley would grin when she told people that 
she actually won 20 years later the only Supreme Court case that she 
lost, when the Court eventually agreed with her position and adopted 
her reasoning in holding that it was a violation of equal protection 
for prosecutors to use their peremptory challenges to strike Blacks 
from a jury because of their race.
  In 1964, Judge Motley became the first African-American woman elected 
to the New York State Senate, and in 1965, she became the first 
African-American woman, and first woman, to serve as a city borough 
president. During this time, Judge Motley worked tirelessly to 
revitalize the inner city and improve urban housing and public schools.
  In 1966, President Lyndon B. Johnson appointed Judge Motley to the 
Southern District of New York. She was confirmed 9 months later, over 
the strong opposition of Southern Senators. As a judge, Motley 
continued her commitment to social justice.
  She rose to the position of Chief Judge in 1982, and assumed senior 
status 4 years later. Judge Motley served

[[Page 725]]

with distinction for nearly four decades, until she passed away last 
fall, at the age of 84. At that time, I was pleased to introduce a 
Senate resolution, which passed by unanimous consent with 27 Democrat 
and Republican cosponsors, to honor her life and achievements.
  Since then, our country has lost two other great civil rights heroes, 
Rosa Parks and Coretta Scott King. Both of these remarkable women were 
awarded congressional gold medals for their leadership and 
contributions to American society while they were alive. I deeply 
regret that Judge Motley was not. But it is not too late for us to show 
our national appreciation to her friends and family. Congressional gold 
medals are reserved expressly for that purpose, and Judge Motley's 
lifelong commitment to the advancement of civil rights and social 
justice, and her lengthy career in public service, is worthy of just 
that.
  The Senate Banking Committee requires 67 cosponsors before it will 
consider legislation to award a congressional gold medal. I am pleased 
to introduce this bill with 16 other original cosponsors from both 
sides of the aisle. I now call on all of my Senate colleagues to join 
us this Black History Month to give thanks on behalf of the country to 
one of our greatest civil rights leaders and public servants, Judge 
Constance Baker Motley.
  I yield the floor and 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. GRASSLEY. 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. GRASSLEY. Mr. President, I yield myself such time as I might 
consume.
  I will make some additional points on the Dorgan tax haven included 
in the Conrad substitute. I share Senator Conrad's concerns about the 
ability of large corporations to manipulate the Tax Code, to shift 
large amounts of profit offshore, but this provision is not the right 
way to address those concerns. It is very overbroad and inadequate. It 
is overbroad because it harms the competitiveness of United States 
multinationals, repealing deferral for holding company structures that 
allow them to efficiently allocate active foreign generated resources 
among their foreign operations without incurring U.S. tax on entirely 
foreign transactions.
  It is inadequate because it applies only to the subsidiaries in 
black-listed countries. Companies that use tax savings for abusive 
purposes could easily avoid this rule by locating in a low-tax country 
that is not on the list.
  Ireland would be a perfect example of that, where we read press 
reports that companies such as Microsoft are shifting huge profits. 
Treasury would have authority to add countries to the list, but does 
anyone think Ireland, with whom we already have a tax treaty, would be 
added to that black list? The way to deal with those cases is through 
effective transfer pricing policy and enforcement, not by curtailing 
deferrals.
  Another issue that is going to be soon before us is the Democratic 
substitute of revenue raisers that are in our bill. I am flattered by 
the tax relief side of Senator Conrad's substitute amendment since it 
includes extension of the same widely applicable tax relief provisions 
in the underlying bill.
  I should also be flattered, and I am, by some of the pay-fors in that 
amendment--in particular, the provisions regarding the so-called SILO 
transactions. It is a fact that we shut down the abusive tax shelters 
that involve U.S. corporations claiming tax benefits on foreign subways 
and sewer systems in 2004. So these deals can no longer be done. The 
underlying bill would repeal a generous grandfather provision for 
certain domestic deals and would deny benefits for foreign deals 
entered into before the effective date of the JOBS Creation Act of 
2004.
  We have introduced a fully offset tax relief bill in the past. Most 
recently, that act of 2004 produced $82 billion of tax relief that was 
completely offset. The underlying bill, in fact, contains almost $20 
billion of offsets while providing $90 billion in broad-based tax 
relief. We do not need any more offsets to pay for the lost AMT revenue 
that we never intended to collect and for other provisions, such as the 
R&D credit, for example, that are broadly supported as good for the 
economy.
  We all know tax receipts are on the rise. In 2005, we had $274 
billion more coming in over the taxes that came in in 2004 under the 
same tax policy, and we exceeded the CBO baseline by--can you believe 
it--$97 billion. It is a very vibrant economy which produces that kind 
of revenue. That amount, whether it is the $274 billion in 2005 over 
2004 or the $97 billion above the CBO baseline, that amount exceeds the 
$70 billion of reconciled tax relief over 5 years provided in the 
budget resolution.
  So I hope we will be able to take these points I have just made about 
the inadequacies of the amendments we are going to be dealing with when 
we vote on these amendments.
  I would now, Mr. President, speak on the issue of an amendment I am 
going to place before the Senate this afternoon. In fact, I will submit 
this amendment at this point.
  I wish to take just a few minutes, in offering this amendment, to 
speak about amendments that are also offered by Senator Bingaman and 
Senator Nelson regarding the Medicare prescription drug program. I 
thank the Senators for their amendments. I know their intentions are 
good and their hearts are in the right place. But having said that, I 
am forced to oppose the amendments, and my reasons follow.
  Opponents of the benefit are trying to make it look as if Republicans 
are indifferent to the problems of the implementing part of the 
Medicare program. Such is not the case because everyone has to be 
concerned about the issues faced by some beneficiaries in getting their 
prescription drugs, even if that might be a very small percentage of 
the people who are involved. Whoever needs these prescriptions, we have 
to do everything we can to get them to them.
  Like everybody else, I am concerned about the drug benefit 
implementation issues. It is not acceptable that some of the most 
vulnerable and frail seniors are experiencing problems. But my 
opposition to the amendments is rooted in the goal of not just taking 
some action, but that we need to take the right action when we act. 
There is no question that Congress meddling could just make things 
worse.
  With that in mind, I want to share with you the following quote as to 
another new program that was getting underway:

       As the program gets under way the danger is that the 
     strains on it will generate pressures for unsound change. 
     They will come from those who will be disappointed because 
     they have been led to expect too much as well as from those 
     who see failure in every shortcoming. Changes will come in 
     time, but they should be made on the basis of the program's 
     own experience. This program must be given ample time to get 
     over its growing pains.

  Now, that is not about the prescription drug bill that is just now 
going into effect. That is a quote from the July 1, 1966, edition of 
the New York Times, and it is about the implementation of the original 
underlying Medicare Program passed by Congress a year before this July 
1 edition of the New York Times.
  Now, when I read that quote of 1966 just now, it said ``the program'' 
instead of ``Medicare'' because I did not want to give it away. The 
point of this editorial is that those words are extremely relevant 
today.
  I am not trying to make excuses or minimize the difficulties some are 
having. Those problems need to be fixed, and fixed fast. By all 
accounts, everyone is working hard to get them resolved. But in my 
opinion--echoed by the New York Times nearly 40 years ago--rushing to 
``fix'' things through legislation could do more harm than good.
  Just last week, the Finance Committee, in a bipartisan setting--with 
almost every member of the Finance Committee there--had a meeting with 
Secretary Leavitt and CMS Administrator Mark McClellan. We had a candid 
discussion about the unfortunate

[[Page 726]]

glitches, and we heard about steps taken by the agency to address them. 
We had a very constructive dialog. That dialog covered a range of 
issues the Agency had identified and the administration's actions 
already taken to address them.
  It is clear to me legislation is not needed at this time. Secretary 
Leavitt has the authority. Current law allows him to have a smooth 
transition. And administrative actions will work faster than if we pass 
this legislation. That is because changes in law have to be followed by 
more administrative actions. This is very much going to slow things 
down. That is not what we want. We want, need, and will get quick 
action.
  The issues that have surfaced do not lend themselves to legislative 
fixes. For example, we talked about problems in the data files. The 
data files have not always identified the plan where a dual eligible is 
enrolled. Obviously, that is a problem. But can Congress write a law to 
dictate exactly how to fix computer system data files? That is not 
something I would want to do. There is an opportunity for getting 
something wrong, if I ever saw an opportunity for Congress to do 
something wrong.
  But more importantly, these amendments are unnecessary. Senator 
Bingaman's amendment gets at issues that have already been addressed 
administratively. CMS has the authority to address these that way. And 
it will get fixed faster than if we pass additional legislation.
  So I am going to offer a sense-of-the-Senate resolution. That 
resolution expresses our concerns about these problems, and it 
expresses the Senate's support for the Agency's efforts to fix them.
  For example, prescription drug plans must have a first-fill policy. 
The first-fill policy already requires at least 30 days of coverage for 
the first prescriptions filled, even if the drugs are not on the plan's 
formulary. And just yesterday, Secretary Leavitt announced that the 
first-fill policy is being extended further. It is now going to be in 
place for 60 or 90 days as a first-fill policy. The Bingaman amendment 
requires only a 30-day policy. So it is already out of date. The 
administrative actions are much faster. Changes in law are not needed 
to address the issue.
  Now, here is another one. The Bingaman amendment says that dual-
eligible beneficiaries, whom we call dual eligibles, should be 
presumptively eligible. But the dual eligibles are already 
automatically eligible under the law, and they are automatically 
assigned to a plan. So again, no change in law is required.
  Another example. The Bingaman amendment says it would require plans 
to reimburse enrollees for cost-sharing problems. Here again, plans are 
already responsible for the costs to cover drugs. They are responsible 
for reimbursing beneficiaries for any cost-sharing charged in error. No 
change in law is required.
  Let me give you another one. Some States have stepped up to fill 
claims during the transition. The Bingaman amendment requires States to 
be reimbursed for their costs. This is already happening. Last week, 
Secretary Leavitt announced that the Federal Government will reimburse 
States for costs they have incurred during the transition period. We 
were told that that day we met with Secretary Leavitt. I do not know 
exactly when Senator Bingaman was there, but he was there for that 
meeting. Not every Senator stayed for every minute of the meeting, but 
Secretary Leavitt made this very clear. So again, legislation is not 
needed because administrative action is being taken, with the legal 
authority of the Secretary to do it. So no additional legislation is 
needed.
  Senator Nelson's amendment would extend the enrollment period through 
the end of the year and permit beneficiaries to change once before the 
end of the year. We have discussed this amendment before. The Senate 
has already voted twice, and we voted it down twice. And changing the 
enrollment period does nothing to address any of the issues experienced 
by beneficiaries just this last month.
  We are well into the enrollment period. Enrollment is exceeding 
expectations. Twenty-four million beneficiaries out of 44 million, 
potentially, have prescription drug coverage. Every day, nearly 90,000 
beneficiaries are enrolling in the program, and about 1 million 
prescriptions are being filled daily. So again, legislation is not 
needed.
  There are a number of resources for beneficiaries to help them choose 
a plan. There is the Medicare call center. It is available 24 hours a 
day, and the Medicare Web site. Every State has counselors available to 
assist beneficiaries through the State Health Insurance Information 
Program. That is the whole point of that program--the SHIIP program, it 
is called for short--to help beneficiaries understand their Medicare 
benefits. The prescription drug plans based their proposals to serve 
Medicare beneficiaries on the enrollment period specified in the law.
  In addition, there are already rules in place under which a 
beneficiary can change their enrollment outside of the open enrollment 
period. A beneficiary can seek what is called a special election period 
if that is needed for that individual--for example, if a plan fails to 
provide a beneficiary with information about the plan's benefits on a 
timely basis, or if it fails to provide benefits in line with quality 
standards, or if the plan, its agent, or plan provider materially 
misrepresents the plan in marketing that plan. So in all of these 
instances, there can be a special enrollment period or an opportunity 
to change.
  So again, we do not need legislation. These are issues already 
covered in the law today.
  I want to make another point about what is going on with these 
amendments. There was a time when opponents of this benefit were 
concerned that there wouldn't be enough choice. Now their concern is 
that there is too much choice. When we were in conference with the 
House on this 2 years ago, we were fearful there might not be a choice 
for people. So we provided if there wasn't a choice, the Secretary set 
up a subsidized choice so that every individual could at least choose 
from two. We wanted people to have choice. We followed the Federal 
Employees Health Benefit Plan where people have the choice of many 
plans to choose from, and they get to change once a year. We wanted to 
make sure we didn't cram anything down any senior citizen's throat. If 
they didn't want to participate, if they were satisfied with Medicare 
the way it was, they didn't have to. But if they wanted to participate, 
they elected.
  You don't write one plan for 44 million seniors because everybody has 
different benefits. And one-third of the people already had some 
prescription drug coverage. We didn't want to screw up their plans. So 
we subsidized those plans so that those people who had something they 
wanted would be able to keep it. I don't know when you satisfy people. 
I didn't think there would be enough choice. Now we are hearing 
complaints about too many choices. There are 44 million Americans; 
there are 44 million different personal needs of those people. We, 
sitting on the floor of the Senate, are not going to figure out what 
those 44 million needs are and pass a one-size-fits-all plan that is 
going to satisfy the needs of everybody.
  The point is, the opponents of this new benefit will complain and 
fight it no matter what happens. I hope everyone remembers that. I also 
find it ironic that folks think that legislation is the answer. These 
are the same people who are concerned about confusion. Now they are 
proposing legislative changes in a bill that has only been in operation 
for 1 month, on top of administrative actions that the agency has 
already taken. They want to screw that up with legislation on the floor 
of the Senate with changes that will have no impact on any of the 
problems encountered this last month, legislation that would have to be 
followed by yet more administrative action, a snowball rolling down the 
hill, just getting more complicated as it rolls on.
  I ask whether this is going to help these perceived problems. Well, 
not just perceived problems; I admitted there are problems out there. I 
admitted when you put something like this

[[Page 727]]

into place, there are growing pains, just like I quoted that New York 
Times article from 1966 about the growing pains that we were going to 
have with Medicare when it was first put in place. Do you think these 
things are going to smooth the transition? I don't think so. Talk about 
opportunity for confusion among beneficiaries, pharmacists, and plans. 
This is not going to reduce the confusion.
  Passing legislation now runs the very real risk of undermining and 
complicating things. It can undermine the progress already made. It 
will interrupt actions taken by the administration. It will create more 
problems, not fewer problems. I, for one, have a steadfast commitment 
to gaining a full understanding of the problems and pursuing the most 
appropriate and timely course of action.
  When the Secretary came before my committee and everybody turned out 
to make their complaints known, and the Secretary announced at that 
time seven problems and he announced at that time seven solutions to 
those problems and took full responsibility for them, I had a feeling 
people left that meeting fairly satisfied that nobody was going to 
blame somebody else and they had a grasp of the problems and solving 
problems, with some accountability that some changes had already taken 
place for the better.
  So then when you come out of an environment of a committee meeting 
like that, you wonder what planet they have been on when these 
amendments are being offered--amendments that, if they were passed, 
would not get to the President for another 30 days--to solve problems 
that were evident 30 days ago that the Secretary has already identified 
and taken action to overcome.
  Senator Baucus and I are working together to get to the bottom of 
this issue. That is how we do it in our committee. We do it in a 
bipartisan way so that we are going to also be able to work together if 
it turns out that legislation is needed. But I asked the Secretary at 
that very committee meeting: Do you need any legislative changes to 
take care of these problems that we have all identified, particularly 
the seven that he identified? He said: No, he had ample legislative 
authority to do it.
  An important part of Senator Baucus's and my work in this regard is 
going to be brought up at next week's Finance Committee hearing, an 
open hearing. We will hear from Dr. McClellan. We will hear from 
representatives of the plans. We will hear from pharmacies. We are, 
most importantly, going to hear from the people involved in educating 
and enrolling beneficiaries into the plan. More than once I have heard 
Members take issue with attempts to bypass the committee process. The 
amendments before us are just that.
  Senator Bingaman's amendment has not gone through the Finance 
Committee. It is clear that this amendment falls within the 
jurisdiction of the Finance Committee, and the Senator from New Mexico 
is a member of that committee. I ask him to work within the committee. 
If the Senate proceeds on legislation that the full committee has not 
considered, then nothing would prevent the Senate from legislating on 
other Finance Committee issues without the benefit of hearings or 
committee action.
  Next week's hearing is very important. We need to gather more 
information about what is happening. This is needed to inform all of us 
of any necessary response. In the absence of such information 
gathering, it is dangerously premature to consider any amendments 
related to the prescription drug program. We all know that this whole 
issue of Medicare prescription drug coverage has long been a political 
issue. With the amendments offered today, I can't help but think that 
is very unfortunate. It is also unfortunate that is probably not going 
to change during the 109th Congress.
  On the other hand, I hope that is not the case. But here we are, just 
1 month into the prescription drug program, already we see a lineup of 
amendments to perhaps the most inappropriate vehicle there could ever 
possibly be to deal with Medicare. In other words, these amendments are 
on a tax bill. But more importantly than just the process, these 
amendments are unnecessary because of administrative actions taken to 
date or to be taken tomorrow, if a new problem comes up.
  When these amendments that I have discussed--the Bingaman and Nelson 
amendments--come up for a vote, I hope my colleagues will trust what we 
learned in the committee: that the Secretary of HHS doesn't need any 
new legislative authority, consequently bringing any more uncertainty 
into this process by voting for these amendments. Vote them down.
  I said that I had an amendment I wanted to have considered when we 
vote this afternoon. I send the amendment to the desk and ask for it to 
be printed.
  I yield the floor. And since nobody else is desiring to speak, I 
suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Martinez). The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mrs. MURRAY. Mr. President, I ask unanimous consent the order for the 
quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. MURRAY. Mr. President, I came to the floor this afternoon to 
spend a few minutes speaking in support of the Bingaman-Rockefeller-
Murray Medicare drug REPAIR amendment that we will be seeing this 
afternoon. I came to the floor to urge my colleagues to support this 
amendment so we can address the immediate crisis facing our most 
vulnerable citizens.
  I wish we were here debating a real fix to the Medicare Modernization 
Act, but unfortunately the Senate leadership has placed a lot higher 
priority on tax cuts than on providing reliable access to prescription 
drugs for low-income seniors and the disabled, so we are here today 
debating that. I know the chairman of the Finance Committee was on the 
floor earlier talking about the relevance of this amendment, the 
Bingaman-Rockefeller-Murray Medicare drug REPAIR amendment, but this is 
the first piece of legislation that we have had on the floor since the 
rollout of the Medicare prescription drug bill. Offering this amendment 
on this tax bill is our only option.
  What this amendment does is ensure that our low-income seniors and 
our disabled--who are often technically referred to as duals--are at 
least ensured of a 30-day supply of lifesaving drugs, regardless of any 
communication or data exchange problem. It simply ensures that States 
and pharmacies and beneficiaries who have had to provide coverage to 
those who have fallen through the cracks in this rolling out of the 
Medicare prescription drug bill receive just and fair reimbursement.
  Finally, it will end the confusion facing any of our duals. And for 
any of my colleagues who have not been out in their States since 
January 1, I will tell you there is tremendous confusion and conflict 
and people are falling through the cracks and we need to end that 
confusion so they know whether, in fact, they qualify for assistance.
  Because of the tremendous data and outreach problems, many of these 
so-called duals have been told they have to meet a $250 deductible 
before their plan is going to cover their prescription drugs. If they 
are eligible today for Medicare and Medicaid, they are assumed eligible 
at the drugstore.
  I have listened to Secretary Leavitt and CMS Administrator McClellan 
reassure all of us that they are acting to fix these problems. I am 
here today to applaud their attention and their commitment and their 
recognition of the tremendous challenges out there, particularly for 
our duals, as this prescription drug rollout bill is occurring. I only 
wish they had listened last November when I offered an amendment to 
provide a 6-month transition and predicted the dire straits that we are 
now in before this was rolled out.
  I will say they have been responsive since January 1. But all of the 
steps that have been implemented are worthless if there is no education 
of our pharmacists and our seniors, or if there is no aggressive 
oversight and enforcement. Saying that they are just going

[[Page 728]]

to work to ensure the plans honor their commitment is not the same as 
saying plans will be required by law to honor that commitment. It 
doesn't do a senior any good to be told we are going to hold plans 
accountable, and they still do not have any access.
  There are a number of problems with this flawed structure, but I 
think it is critical that we address the immediate crisis for those 
people who have very few options. If anyone on this floor today thinks 
this is fixed, or these problems are going to go away, I want them to 
know they are sadly mistaken. I have traveled around my home State of 
Washington since August. I am not hearing that things are getting any 
better. I have people come to forums that I am holding where I try to 
give them information, and every forum I have had, time after time, 
there are new problems, new challenges: pharmacists are falling through 
the cracks, doctors who don't know how to deal with their patients, 
long-term care facilities that are at their wits' end, and certainly 
the mental health advocates who are telling us we have people who could 
be in serious crisis very soon if we don't address these problems.
  There is a lot of frustration. There is a tremendous amount of panic 
for these dual eligibles that they are being denied access to 
lifesaving drugs, and to low-income seniors, especially those in group 
homes, who can't afford the added burden of copayments. It is wrong for 
us to sit here and say this is going to get worked out. I think it is 
our responsibility to stand up today, at our very first opportunity, 
and make sure we fix this Medicare prescription drug plan.
  This week, my Governor, as many Governors who have been facing this 
at home on the ground, joined with me in urging the Federal Government 
to fix this mess. I want to quote her. She said:

       All we are asking is don't make these people worse off than 
     they were.

  Our Governor's office, as many Governors' offices, has been flooded 
with calls about this prescription drug plan. She says some of these 
people are telling her they would rather take their own life than deal 
with the situation.
  I have sat in forums in my State where people have said that to me, 
to my face, as well. These are people with mental health problems, they 
are elderly, they are having trouble working through the system. It is 
too much for them. They cannot deal with the copayments for the first 
time--and that is not what our country should be about. It does not 
sound to me like things are getting better and the kinks are getting 
worked out.
  Congress promised in 2005, they promised to people in this country 
access to affordable prescription drug coverage. It is clear they are 
not getting that today. We know these problems cannot be fixed through 
some kind of administrative action alone. We here in Congress have an 
obligation to act and not follow CMS.
  I urge my colleagues to support this amendment and send a message to 
those who are living, literally, in fear today that Congress is not 
going to wait and we are going to do the right thing.
  I do not agree that this is not the bill to deal with this issue. I 
wish we had another bill in front of us. I wish we had an actual fix in 
front of us. But we cannot wait to work through the next several weeks 
and then the budget process and everything else coming down the pike to 
deal with this issue. We are talking about real individuals in real 
communities who are not getting access to their prescription drugs 
because of the challenges that CMS is facing as this plan is rolled 
out, and we have an obligation to act.
  I urge my colleagues to support the Bingaman-Rockefeller-Murray drug 
REPAIR amendment and get a fix in place so people's lives are not in 
crisis. We have an obligation to do this, and I urge my colleagues to 
vote for this amendment.
  Mr. President, I yield the floor.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Alexander). The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. TALENT. 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. TALENT. Mr. President, I rise for a moment to speak in favor of 
amendment No. 2711, which is at the desk. It is my amendment regarding 
the child tax credit offered by the majority leader. I will discuss 
briefly that amendment.
  I originally hoped I could offer an amendment making the child tax 
credit permanent, which would help millions of workers and families 
around the country. I wanted to offer a straight-out extension. The 
Senate rules preclude that from being offered today. Instead, I will 
put the Senate on record that this Senator supports a permanent 
extension of the child tax credit.
  In 2001, the Congress set in motion legislation which extended that 
credit to $1,000 per child, but in 2011, unless Congress acts 
beforehand, the clock will turn back and taxes will go up effectively 
50 percent on the workers and families who qualified for the child tax 
credit. This additional money has made a big difference to families 
around the country and in Missouri. People like Beth Davis, who is a 
hairdresser in Kansas City, a single mother of three children, use this 
money to help pay for necessities for their children.
  The most recent Treasury Department data shows that 543,000 married 
couples and single parents in Missouri benefit from the child tax 
credit enacted in 2001. I believe this child tax credit is supported 
very strongly in the Senate. I expect the sense-of-the-Senate will be 
approved. I certainly hope it will so that, at the minimum, we can go 
on record to support making this projob, progrowth, prochild tax credit 
permanent.
  I yield the floor.
  The PRESIDING OFFICER. The Democratic leader.
  Mr. REID. Mr. President, we had a meeting and thought the votes would 
start immediately, and Members were advised that.
  It is my understanding, Senator Baucus, the voting will not start for 
at least a half hour. Everyone should understand the votes will not 
start now but within the next half hour, 45 minutes probably.
  Mr. BAUCUS. It is my understanding we could start early if Senators 
have amendments. We do not have to wait a full half hour.
  I yield the floor and 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. REID. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. REID. Mr. President, we have half an hour remaining. If there are 
Senators who wish to speak on their amendments, they should get over 
here immediately. If they do not come within a reasonable period of 
time, I am confident Senator Baucus will yield back the time on this 
side, as he should. If there is no one here who desires to speak, we 
can move to the votes more quickly. That is left up to Senator Baucus. 
If Members want to talk, now is the time.
  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. BIDEN. 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. BIDEN. Mr. President, I will speak up to 5 minutes on an 
amendment that is not in the first package of amendments we will vote 
on, but since we will have no opportunity in the second and third 
package of amendments, I will speak to it now.
  I have an amendment that is fashioned to deal with the 9/11 
Commission Report that came out less than 2 months ago, on December 5, 
2005. It was the so-called report card where this prestigious 
bipartisan Commission, led by former Republican Governor Tom

[[Page 729]]

Kean and former Democratic Congressman Lee Hamilton, took a look at 
what we have done based on what they recommended in the 9/11 Report. It 
tells how little we have learned and how little we have done to 
actually make the homeland safer.
  Most Americans, at least in my State, believe at least the most 
obvious steps have been taken to close the gaps in our homeland 
defense. They believe, at the very least, we have a plan, that we have 
set priorities, and we know what the next step will be.
  Let me quote from the Commission's report, which is only 6 or 7 weeks 
old, on what we have done to assess the risks and vulnerabilities of 
our critical infrastructure--transportation, communications, industrial 
assets. Here is what they say:

       No risk and vulnerability assessments actually made; no 
     national priorities established; no recommendations have been 
     made on allocation of scarce resources. All key decisions [on 
     homeland security] are at least a year away.

  We all remember September 11 when we discovered that local police, 
fire, and rescue units could not communicate with each other, could not 
communicate with Federal agencies. There was no way to coordinate the 
action, no way to share information. Things are no better today.
  It gets worse. Airline passenger screening, the one place most 
Americans think we have done pretty well, the 9/11 Commission gives 
that effort a grade of ``F.''
  Regarding airline baggage screening, to check for explosives, from 
the report on December 5, 2005:

       Improvements have not been made a priority by Congress or 
     the Administration.

  This is unacceptable. This administration tries to fill in the most 
obvious gaps in our homeland defense, but they have not done it. We 
have not done it. We simply have not done it.
  This amendment is designed to fill in the most obvious gaps. It 
begins with those areas where the Commission graded us and the 
President as ``F'' and ``D'' in the Commission Report. It addresses 
other issues such as the utter lack of a systematic program for rail 
security, passenger freight, stations, tunnels, rail yards, bridges.
  Every dime in this amendment is fully paid for by closing corporate 
tax loopholes. Frankly, this is a modest list. There is much more to be 
done. We will need more resources to make us safer. Wiretapping, even 
if it is legal, is not the sole homeland defense. This amendment 
focuses on the most glaring and dangerous shortcomings in our homeland 
defense. By closing these loopholes, this amendment actually returns 
$23 billion to the Treasury to improve our fiscal security and reduce 
our dependence on borrowing from other countries.
  I have been joined in this amendment--and I did not have time to 
notify her because I did not know until 2 minutes ago--by Senator 
Stabenow of the State of Michigan, who has worked tirelessly on dealing 
with this issue.
  It is pretty basic. We have done nothing much to deal with the 
problems most Americans know relate to homeland security. We are safer 
but not nearly safe enough.
  The bipartisan commission that got great grades from everybody in the 
Nation felt compelled on their own dime, with their own money, their 
own resources, not funded by the Government, to continue to issue 
reports and to hold hearings. And they issued a report on December 5 
that is, quite frankly, embarrassing and dangerous.
  So our amendment is designed to fill some of the loopholes, not all 
of them, that, in fact, have been left by the President's failure to 
secure our national interest, our homeland defense, as well as by our 
failure as a Congress to step to the ball.
  We can and we have to marshal all our country's resources in this 
struggle. I will bet you $100, if you asked anybody in the public, from 
corporate CEOs to the average American out there, Would you rather us 
spend this money on securing our ports, our nuclear plants, our 
railroads, our cities, or would you rather us give it back in a tax 
break, I think it is just like the COPS bill years ago, given the 
choice, the American people said let's make our streets safer. I am 
confident they think we should make the country safer.
  This amendment will be voted on not in this first tranche of 
amendments but the second, but I am not going to get a chance to speak 
to it at the later date. There was a little opening in time, and I 
thank the staff for letting me know this time was available.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Michigan.
  Ms. STABENOW. Mr. President, I rise, as we are waiting for the votes 
as well, to join with Senator Biden and to thank him for his continued 
leadership. We have come to this floor on numerous occasions to speak 
about this issue over and over again, ever since 9/11, and we still do 
not have this fixed.
  So I am pleased to be joining with Senator Biden to offer this 
amendment. It is time we act. It is past time. As Senator Biden said, 
it should be an embarrassment to all of us, the failing grades we 
received from the 9/11 Commission, a bipartisan commission, whose sole 
focus is on giving us information about whether we are safe today and 
what it will take to keep us safe, what it will take in the future to 
make sure Americans are safe.
  We received, collectively--the administration, the Congress--failing 
grades in area after area. One of my main focuses has been on whether 
the radios work; it is stunning to me we are still talking about this. 
It is very unfortunate that after 9/11--because we did not connect all 
of the radios to be able to work to communicate with each other--that 
we saw the same kinds of failings that had firefighters and police 
officers running into buildings in New York instead of running out, as 
they should have been, because they did not know what was happening--
that the same kinds of things, then, happened in the gulf, in New 
Orleans.
  I will never forget, going down right after the hurricanes with the 
bipartisan leadership, sitting outside of the New Orleans Convention 
Center with someone from Michigan who was with the Army National Guard, 
someone from the Michigan Coast Guard, talking with these folks who had 
not slept for several days, who were down doing their part, trying to 
save lives, getting people off of rooftops, doing what was necessary.
  I asked the gentleman from the Army National Guard: ``Do you have 
radios?'' ``Yeah.'' I asked the individual from the Coast Guard: ``Do 
you have radios?'' ``Yeah, of course.'' Then I asked: ``Can you talk to 
each other?'' ``No.'' I asked: ``Well, how are you talking to each 
other?'' ``Well, when we're out in the boats, we use hand signals.'' 
This was, at the time, 2005 in the United States of America, and they 
are using hand signals to tell whether they have found somebody, 
whether they are OK, and so on, because the radios did not work.
  When are we going to get this right? People expect us to get this 
right. They do not understand why this has not already happened. This 
amendment basically puts our priorities in place by saying it does not 
matter what your income level is, if there is another attack, you are 
going to want the radios to work. It does not matter where you live in 
America. It does not matter if you are a CEO or if you are a person 
going in and punching a timeclock every day or if your kids are playing 
in a school yard. You expect that your Government is doing everything 
humanly possible to keep you safe.
  We have heard from the 9/11 Commission. They have overwhelmingly told 
us that is currently not true. So I hope and pray we take action, that 
we would create the priorities that Americans are asking us to create, 
which is by starting with security, starting with security, making sure 
we are putting that at the top of the list, that we are providing 
police officers and firefighters with what they need in dealing with 
ports and nuclear plants and chemical plants and all of the other 
issues, such as with Amtrak, making sure people are safe as they 
travel, as well as airlines.
  We can do that by setting the right priorities. And that is what this 
amendment does. I urge my colleagues to join us in adopting this 
amendment.

[[Page 730]]

  Thank you, Mr. President.
  Mr. BAUCUS. Mr. President, I support the pending substitute 
amendment. I encourage my colleagues to support it as well.
  I almost need a flow chart to explain how we got here. But because of 
several events, there is now more room for tax cuts. Yes, you heard 
right: more tax cuts.
  We should tread carefully, though, rather than dive in. We have an 
opportunity to show responsibility. And I think that this substitute 
does just that.
  Let me first explain how we got here. As my colleagues will recall, 
the tax reconciliation bill that we passed last November included much-
needed relief for the Gulf States affected by Hurricane Katrina. 
Congress passed and enacted those incentives separately in December.
  Further, our tax bill allocation was limited by the fact that the 
spending reconciliation bill had not been enacted. The House is 
expected to pass that bill today, clearing it for the President.
  The bottom line is that this bill can accommodate $18 billion more in 
tax cuts.
  We have an opportunity here to show some responsibility. And the 
responsible thing to do is to pass another year of extenders. 
Otherwise, we will be right back here in a few months to pass those 
extenders. Or since it is an election year, we will be back during a 
lame duck session considering the same set of expiring provisions.
  These are very popular, bipartisan tax cuts we extend year after 
year. But we never have the resources in any given year to make them 
permanent.
  This list of annual extenders includes several proven tax incentives. 
Businesses are encouraged to do more U.S.-based research and create 
high-paying jobs. Long-term welfare recipients and others who are hard 
to employ are given job opportunities through an employer credit. And 
teachers who reach into their pockets to pay for classroom supplies can 
get a small deduction for their expenses.
  These tax incentives were all part of the original Senate 
reconciliation bill. But in that bill, they were limited to one year. 
Now, Chairman Grassley and I are pleased to offer this amended version 
today to extend these provisions through the end of next year. We will 
thus provide certainty to businesses, workers, and teachers.
  We know we will all vote to extend these provisions, if pressed at 
the end of the year to do so. We should take this opportunity now to 
provide these tax incentives through the end of 2007. It is the 
responsible thing to do. Individual and business taxpayers will be 
thankful.
  Mr. President, before us now are a series of amendments. I have a 
list of 21 Democratic amendments. I have a list of eight Republican 
amendments, with promises of more amendments on that side of the aisle, 
depending upon the course we take today.
  Pending a few moments ago, first was an amendment by the majority 
leader to permanently extend the child tax credit. That is a very 
popular amendment. I support--I think most of my colleagues do--
extending the child tax credit. I daresay that most Senators on both 
sides of the aisle would probably strongly support extension of the 
child tax credit. Senator Talent, the author, however, has expressed 
his will to convert his amendment to a sense of the Senate. The 
majority promises to offer the full version later.
  Because of the Nation's record on budget deficits, I would prefer 
that we paid for the pending amendment. But because of the procedural 
posture in which we find ourselves, we will not have that choice. So we 
will be faced with an unattractive choice of voting for an appealing 
tax cut without paying for it or voting against an appealing tax cut.
  After this amendment from the other side, we have been promised 
similar votes on measures to extend marriage penalty relief, estate tax 
relief, Social Security tax relief, 10 percent tax bracket relief, and 
so on. At the end of the day, this could become a fiscally very 
irresponsible exercise.
  I wish to propose a different path. I propose that we address a 
limited number of amendments--just six--and then go to third reading. I 
propose that these six amendments be Senator Talent's sense of the 
Senate on the child tax credit, Senator Bingaman's prescription drug 
benefit, a Republican alternative to the prescription drug amendment, a 
modified Schumer-Menendez-Grassley sense of the Senate on AMT relief, a 
modified Rockefeller-Santorum mine safety amendment, and a paid-for 
substitute by Senator Conrad, and then go to third reading.
  The Republican manager has conveyed to me that he would find this 
procedure acceptable. This procedure would require, obviously, many 
Senators to forgo their opportunity to offer amendments. That is clear. 
It would have that consequence. But this procedure would also do the 
most to maintain fiscal responsibility. This procedure would also allow 
Senators to get back to their States and their constituents in much 
shorter order.
  I implore my colleagues, let us choose the path of reason. Let us 
choose the path of moderation. Let us end this bill this afternoon.
  I have given deep thought to this issue. I know there are many on 
both sides of the aisle who have conflicting emotions and views on this 
basic prospect we find ourselves facing. It is my considered judgment 
that the path I am outlining is probably the best course for the Senate 
and, more importantly, the best course for the Nation. After all, we 
are here representing our constituents. We should go the extra mile to 
do whatever we possibly can to represent the people back in our home 
States as well as we possibly can.
  The PRESIDING OFFICER (Mr. Isakson). The Senator from North Dakota.
  Mr. CONRAD. Mr. President, we are here at a moment that people have 
to think very soberly about what the possible consequences of our 
actions might be. The Senator from Montana has outlined one possible 
scenario. Far be it for me to judge which amendments would be in order 
and which would not. Let me just say what consequences could flow from 
a failure to reach agreement.
  I have just had a consultation with the Parliamentarian. He informs 
me that if we were to waive on any one of the amendments that have been 
talked about on the other side, if we were to waive all budget points 
of order through conference committee, that would open up to the 
conference committee the opportunity to come back with legislation that 
would cost far in excess of the $70 billion limit we currently face as 
a result of the budget resolution.
  I know this is complicated, but I urge my colleagues to think very 
carefully about the potential consequences. Let me give four.
  If all points of order were waived through conference committee on 
the child credit, that could open up the conference committee to $185 
billion of additional tax cuts, not offset. If the estate and gift tax 
changes that have been proposed by some were adopted and all points of 
order waived through the conference committee, that could add $358 
billion that the conference committee could come back with with no 
points of order prevailing or possible.
  On the expanded 10 percent bracket, that would open up an additional 
$262 billion for the conference committee to come back to this Chamber 
with no points of order pending. An income tax raise of 25, 28, 33, and 
35 percent, if all points of order were waived through the conference 
committee, we could come back here and open up this Chamber to an 
additional $385 billion of tax reduction with no point of order 
pending.
  I do not pretend to know what the package is that could be agreed on 
to resolve this. I do know that the Senator from Montana has made an 
impassioned plea to our colleagues to think twice before we get into 
this destruction derby. Believe me, the potential is, at the end of the 
day, we would find ourselves in the circumstance very easily in which 
you could have a trillion dollars of additional tax cuts pending on the 
floor of the Senate, with no point of order available.

[[Page 731]]

  I notice the leader is in the Chamber. I yield the floor.
  Mr. REID. Mr. President, I think what we have here is a case being 
made for how bad this reconciliation plan is that we have. We have a 
number of amendments that Senators in good faith have tried to offer. 
There will be votes on these amendments. Ours doesn't break the bank, 
as indicated by the Senator from North Dakota. All the amendments he is 
talking about that are going to cost all this money come from the other 
side. With rare exception, our amendments are offset. We don't expect 
to ask to waive points of order through conference on our amendments. 
That is why Members should not vote to waive through conference.
  Also, I hope the country is watching what is going on here today. 
First of all, as I said earlier today, we are working on something that 
has been named by the majority the ``Deficit Reduction Act of 2005.'' 
Using the numbers given us by the majority, it increases the deficit by 
$50 billion. Today, as I was walking to lunch, a reporter says: Are you 
aware that we are going to get a supplemental next week for $90 
billion? The budget gimmicks of this administration are unbelievable. 
Everyone knows the cost of the war is ongoing. We are in our fourth 
year of war. The President doesn't include it in his budget because it 
would show the American people how deeply in the red we are. Rather 
than do that, he comes back later with all these supplemen-
tals. But I understand, having managed a few bills in my day, how the 
distinguished Senator from Montana and I will feel about it.
  We want to get the bill out of here and move on to other things with 
as little damage as possible. But, Mr. President, damage has been done 
by having this reconciliation bill in the manner that we got it in the 
first place. Having been given this bill, we are $50 billion in the 
hole to begin with, using the numbers of the majority.
  Now, people in good faith on our side offered amendments, or soon 
will offer them. Some have been debated. Our amendments take, for 
example, the amendment of the Senator from New York. She wants to have 
this Senate on record as to whether the Senate will stand for an 
independent bipartisan commission to study what went wrong with 
Katrina. We have been stymied every step of the way to do that. Rather 
than have a 9/11-type commission to find out what went wrong in the 
most significant natural disaster in the history of this country, we 
are being stonewalled. That is an amendment the majority doesn't want 
to vote on.
  I wish there were an easy way out of this, but there is not. I say to 
my friends who are offering this amendment on the child tax credit, if 
it is offered, a lot of Senators over here on this side are going to 
vote for it. Someday maybe this administration will recognize what they 
have done to this country economically. We are going to be asked in a 
few days to increase the debt ceiling from $8.2 trillion to whatever 
the majority wants--$8.2 trillion is not enough. So my suggestion is, 
let's just start voting.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. FRIST. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Cornyn). Without objection, it is so 
ordered.
  Mr. FRIST. I ask unanimous consent that the motion to commit be 
withdrawn. I further ask consent that amendment No. 2709 be withdrawn 
and further that the yeas and nays be vitiated on amendment No. 2708; 
further, that the amendment be agreed to; provided further that the 
only remaining amendments in order be the following, and further, when 
a motion to waive occurs, it be in order for each leader to offer up to 
two amendments to each motion to waive.
  The amendments are:
  Talent, child tax credit; Nelson, prescription drugs; Republican 
alternative to Nelson, relevant; Byrd-Rockefeller-Santorum, mine 
safety; Conrad, substitute; Dodd, veterans health; Republican 
alternative to Dodd, relevant; Reed, America's military; Republican 
alternative to Reed, relevant; Clinton, Katrina commission; Republican 
alternative to Clinton, relevant; Menendez, AMT; Grassley, AMT; Reid, 
relevant to any amendment on the list; Frist, relevant to any amendment 
on the list.
  I further ask consent that at the conclusion of this unanimous 
consent, all time be yielded back and the Senate proceed to votes in 
relation to the following amendments; that all votes in the sequence be 
limited to 10 minutes each; that following the reporting of each 
amendment, the amendment be considered as read and there be 2 minutes 
equally divided prior to the vote in relation to the amendment; 
finally, that following disposition of amendments, the substitute be 
agreed to, the bill be read the third time, and the Senate proceed to a 
vote on passage of the bill, with no intervening action or debate. The 
amendments will be considered in the order sent to the desk.
  The PRESIDING OFFICER (Mr. Chafee). Is there objection? Without 
objection, it is so ordered.


                           Amendment No. 2727

  Mr. FRIST. Mr. President, on behalf of Senator Talent, I would like 
to call up his amendment.
  The PRESIDING OFFICER. The clerk will report.
  The assistant journal clerk read as follows:

       The Senator from Tennessee [Mr. Frist], for Mr. Talent, 
     proposes an amendment numbered 2727.

  The amendment is as follows:

 (Purpose: To express the sense of the Senate regarding the permanent 
    extension of the amendments to the child tax credit made by the 
Economic Growth and Tax Relief Reconciliation Act of 2001 and the Jobs 
           and Growth Tax Relief Reconciliation Act of 2003)

       At the appropriate place insert the following:

     SEC. ___. SENSE OF THE SENATE REGARDING THE PERMANENT 
                   EXTENSION OF EGTRRA AND JGTRRA PROVISIONS 
                   RELATING TO CHILD TAX CREDIT.

       It is the sense of the Senate that the conferees for the 
     Tax Relief Act of 2006 should strive to permanently extend 
     the amendments to the child tax credit under section 24 of 
     the Internal Revenue Code of 1986 made by the Economic Growth 
     and Tax Relief Reconciliation Act of 2001 and the Jobs and 
     Growth Tax Relief Reconciliation Act of 2003.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  The amendment (No. 2727) was agreed to.
  The PRESIDING OFFICER. The Senator from Montana is recognized.


                Amendment No. 2728 to Amendment No. 2707

  Mr. BAUCUS. On behalf of Senators Byrd, Rockefeller, and Santorum, I 
send an amendment to the desk and ask for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant journal clerk read as follows:

       The Senator from Montana [Mr. Baucus], for Mr. Byrd, for 
     himself, Mr. Rockefeller, and Mr. Santorum, proposes an 
     amendment numbered 2728 to amendment No. 2707.

  The amendment is as follows:

 (Purpose: To provide tax incentives for the purchase of advanced mine 
 safety equipment and the training of mine rescue teams, and for other 
                               purposes)

       At the appropriate place insert the following:

     SEC. __. PARTIAL EXPENSING FOR ADVANCED MINE SAFETY 
                   EQUIPMENT.

       (a) In General.--Part VI of subchapter B of chapter 1 is 
     amended by inserting after section 179D the following new 
     section:

     ``SEC. 179E. ELECTION TO EXPENSE ADVANCED MINE SAFETY 
                   EQUIPMENT.

       ``(a) Treatment as Expenses.--A taxpayer may elect to treat 
     50 percent of the cost of any qualified advanced mine safety 
     equipment property as an expense which is not chargeable to 
     capital account. Any cost so treated shall be allowed as a 
     deduction for the taxable year in which the qualified 
     advanced mine safety equipment property is placed in service.
       ``(b) Election.--
       ``(1) In general.--An election under this section for any 
     taxable year shall be made on the taxpayer's return of the 
     tax imposed by this chapter for the taxable year. Such 
     election shall specify the advanced mine safety equipment 
     property to which the election applies and shall be made in 
     such manner as the Secretary may by regulations prescribe.

[[Page 732]]

       ``(2) Election irrevocable.--Any election made under this 
     section may not be revoked except with the consent of the 
     Secretary.
       ``(c) Qualified Advanced Mine Safety Equipment Property.--
     For purposes of this section, the term `qualified advanced 
     mine safety equipment property' means any advanced mine 
     safety equipment property for use in any underground mine 
     located in the United States--
       ``(1) the original use of which commences with the 
     taxpayer, and
       ``(2) which is placed in service by the taxpayer after the 
     date of the enactment of this section.
       ``(d) Advanced Mine Safety Equipment Property.--For 
     purposes of this section, the term `advanced mine safety 
     equipment property' means any of the following:
       ``(1) Emergency communication technology or device which is 
     used to allow a miner to maintain constant communication with 
     an individual who is not in the mine.
       ``(2) Electronic identification and location device which 
     allows an individual who is not in the mine to track at all 
     times the movements and location of miners working in or at 
     the mine.
       ``(3) Emergency oxygen-generating, self-rescue device which 
     provides oxygen for at least 90 minutes.
       ``(4) Pre-positioned supplies of oxygen which (in 
     combination with self-rescue devices) can be used to provide 
     each miner on a shift, in the event of an accident or other 
     event which traps the miner in the mine or otherwise 
     necessitates the use of such a self-rescue device, the 
     ability to survive for at least 48 hours.
       ``(5) Comprehensive atmospheric monitoring system which 
     monitors the levels of carbon monoxide, methane, and oxygen 
     that are present in all areas of the mine and which can 
     detect smoke in the case of a fire in a mine.
       ``(e) Special Rules.--
       ``(1) Coordination with section 179.--No expenditures shall 
     be taken into account under subsection (a) with respect to 
     the portion of the cost of any property specified in an 
     election under section 179.
       ``(2) Basis reduction.--For purposes of this title, the 
     basis of any property shall be reduced by the portion of the 
     cost of such property taken into account under subsection 
     (a).
       ``(f) Reporting.--No deduction shall be allowed under 
     subsection (a) to any taxpayer for any taxable year unless 
     such taxpayer files with the Secretary a report containing 
     such information with respect to the operation of the mines 
     of the taxpayer as the Secretary shall require.
       ``(g) Termination.--This section shall not apply to 
     property placed in service after the date which is 3 years 
     after the date of the enactment of this section.''.
       (b) Conforming Amendments.--
       (1) Section 263(a)(1) is amended by striking ``or'' at the 
     end of subparagraph (J), by striking the period at the end of 
     subparagraph (K) and inserting ``, or'', and by inserting 
     after subparagraph (K) the following new subparagraph:
       ``(L) expenditures for which a deduction is allowed under 
     section 179E.''.
       (2) Section 312(k)(3)(B) is amended by striking ``or 179D'' 
     each place it appears in the heading and text thereof and 
     inserting ``179D, or 179E''.
       (3) Section 1016(a) is amended by striking ``and'' at the 
     end of paragraph (36), by striking the period at the end of 
     paragraph (37) and inserting ``, and'', and by adding at the 
     end the following new paragraph:
       ``(38) to the extent provided in section 179E(e)(2).''.
       (4) Section 1245(a)(2)(C) is amended by inserting ``179E,'' 
     after ``179D,''.
       (5) The table of sections for part VI of subchapter B of 
     chapter 1 is amended by inserting after the item relating to 
     section 179D the following new item:

``Sec. 179E. Election to expense advanced mine safety equipment.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to costs paid or incurred after the date of the 
     enactment of this Act.

     SEC. __. MINE RESCUE TEAM TRAINING TAX CREDIT.

       (a) In General.--Subpart D of part IV of subchapter A of 
     chapter 1 (relating to business related credits) is amended 
     by adding at the end the following new section:

     ``SEC. 45N. MINE RESCUE TEAM TRAINING CREDIT.

       ``(a) Amount of Credit.--For purposes of section 38, the 
     mine rescue team training credit determined under this 
     section with respect to any eligible employer for any taxable 
     year is an amount equal to the lesser of--
       ``(1) 20 percent of the amount paid or incurred by the 
     taxpayer during the taxable year with respect to the training 
     program costs of each qualified mine rescue team employee 
     (including wages of such employee while attending such 
     program), or
       ``(2) $10,000.
       ``(b) Qualified Mine Rescue Team Employee.--For purposes of 
     this section, the term `qualified mine rescue team employee' 
     means with respect to any taxable year any full-time employee 
     of the taxpayer who is--
       ``(1) a miner eligible for more than 6 months of such 
     taxable year to serve as a mine rescue team member as a 
     result of completing, at a minimum, an initial 20-hour course 
     of instruction as prescribed by the Mine Safety and Health 
     Administration's Office of Educational Policy and 
     Development, or
       ``(2) a miner eligible for more than 6 months of such 
     taxable year to serve as a mine rescue team member by virtue 
     of receiving at least 40 hours of refresher training in such 
     instruction.
       ``(c) Eligible Employer.--For purposes of this section, the 
     term `eligible employer' means any taxpayer which employs 
     individuals as miners in underground mines in the United 
     States.
       ``(d) Wages.--For purposes of this section, the term 
     `wages' has the meaning given to such term by subsection (b) 
     of section 3306 (determined without regard to any dollar 
     limitation contained in such section).
       ``(e) Termination.--This section shall not apply to taxable 
     years beginning after December 31, 2008.''.
       (b) Credit Made Part of General Business Credit.--Section 
     38(b) is amended by striking ``and'' at the end of paragraph 
     (25), by striking the period at the end of paragraph (26) and 
     inserting ``, and'', and by adding at the end the following 
     new paragraph:
       ``(27) the mine rescue team training credit determined 
     under section 45N(a).''.
       (c) No Double Benefit.--Section 280C is amended by adding 
     at the end the following new subsection:
       ``(e) Mine Rescue Team Training Credit.--No deduction shall 
     be allowed for that portion of the expenses otherwise 
     allowable as a deduction for the taxable year which is equal 
     to the amount of the credit determined for the taxable year 
     under section 45N(a).''.
       (d) Clerical Amendment.--The table of sections for subpart 
     D of part IV of subchapter A of chapter 1 is amended by 
     adding at the end the following new item:

``Sec. 45N. Mine rescue team training credit.''.

       (e) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2005.

  Mr. BAUCUS. Mr. President, I believe we have 1 minute each. I yield 1 
minute to the Senator from West Virginia.
  Mr. ROCKEFELLER. Mr. President, I simply want to thank the chairman 
of the Finance Committee, and I thank the ranking member for working 
this out and having everybody in it together. I welcome working with 
Senator Santorum. It is a good thing to do. It is dark days in 
Appalachia now, and this will help a lot. Thank you.
  Mr. FRIST. Mr. Presient, on behalf of Senator Santorum, we yield back 
the remainder of our time.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  The amendment (No. 2728) was agreed to.
  Mr. BAUCUS. Mr. President, the next amendment on the list is to be 
offered by the Senator from North Dakota, Mr. Conrad. He should be here 
at any moment now. Until he is here, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant journal clerk proceeded to call the roll.
  Mr. CONRAD. 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. CONRAD. Mr. President, is this an appropriate time to offer my 
amendment?
  The PRESIDING OFFICER. Yes.
  Mr. BAUCUS. It is.


                Amendment No. 2729 to Amendment No. 2707

  Mr. CONRAD. Mr. President, I send my amendment to the desk, and I ask 
for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant journal clerk read as follows:

       The Senator from North Dakota [Mr. Conrad], for himself and 
     Mr. Bingaman, proposes an amendment numbered 2729 to 
     amendment 2707.

  Mr. CONRAD. Mr. President, I ask unanimous consent that further 
reading of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mr. CONRAD. Mr. President, the chairman and ranking member have done 
an excellent job in putting together this package that is in the 
interest of the American people. I have all of the same tax relief 
provisions that are in their package. The only difference is that I 
have paid for it over

[[Page 733]]

the 10 years. I have done it by adopting the same offsets as in the 
managers' package: closing the tax gap by shutting down abusive tax 
shelters and other reforms, raising some $34 billion, including 
revoking tax benefits for leasing foreign subway and sewer systems; 
second, ending a loophole for big oil that lets them avoid taxes on 
foreign operations, raising $9 billion; requiring tax withholding on 
Government payments to contractors such as Halliburton, raising $7 
billion; renewing the Superfund tax so that polluting companies pay for 
cleaning up toxic waste sites, raising $17 billion; and closing 
additional loopholes, raising $22 billion.
  This is the package that has all of the tax relief in the managers' 
package. It just has additional pay-fors, so we cover the costs. We 
have exploding deficits, exploding debt. Let's pay for these tax cuts 
we are offering.
  I thank the Chair.
  The PRESIDING OFFICER. The Senator from Iowa is recognized.
  Mr. GRASSLEY. Mr. President, I disagree with the proposal in two 
important parts.
  First, the proposal does not extend to 2009 several provisions that 
are very important to both sides, bipartisan--specifically, the section 
179 expensing, which encourages the growth of small business in our 
country, and the college tuition deduction, which will give parents 
more certainty in the planning of their children's education, and the 
low-income savers' credit, which assists families who make less than 
$50,000 in saving for their retirement.
  The second point I have----
  Mr. CONRAD. Mr. President, would the Senator yield on this point?
  Mr. GRASSLEY. I only have 1 minute.
  Mr. CONRAD. Can I grant you some additional time?
  Mr. GRASSLEY. We don't have that time.
  Mr. CONRAD. Mr. President, I ask unanimous consent for 30 seconds on 
this point, if I could.
  Mr. GRASSLEY. Then I will take 30 seconds, too.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. CONRAD. That is more than fair.
  I say to my colleague that the statement he made is just not true. I 
have precisely the same tax relief in my package as in yours. Every one 
of the items the chairman just mentioned is in my package for exactly 
the same period of time as is in yours.
  Mr. GRASSLEY. All I can say in my 30 seconds on my point is that the 
Senator may be entirely correct, but that is one of the things that 
happens when we have 2 days of debate and these amendments are not put 
before the Senate to study until the last minute.
  The second concern I have about the proposal is the inclusion of 
offsets which we have not had an opportunity to fully consider or with 
respect to which we have some policy concerns. An example of that is 
the revival of the environmental excise tax offered, referred to as the 
``Superfund tax.'' As you might expect, I believe the bill passed by a 
bipartisan majority with 64 votes in the Senate in November, which we 
are not going through again, represents a more balanced bill, one that 
provides longer-term benefits, including increased certainty and 
reduced complexity for planning.
  In addition, I raise a point of order that the budget does not meet 
reconciliation instructions to the Senate. It is an issue of 
germaneness, Mr. President.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. CONRAD. Mr. President, pursuant to section 904 of the 
Congressional Budget Act, I move to waive the applicable sections of 
the act for the purposes of the pending amendment, and I ask for the 
yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion. The clerk will call the 
roll.
  The assistant journal clerk called the roll.
  Mr. McCONNELL. The following Senators were necessarily absent: the 
Senator from New Mexico (Mr. Domenici), the Senator from Oklahoma (Mr. 
Inhofe), and the Senator from Wyoming (Mr. Thomas).
  Mr. DURBIN. I announce that the Senator from New Mexico (Mr. 
Bingaman) is necessarily absent.
  The PRESIDING OFFICER (Mr. Allen). Are there any other Senators in 
the Chamber desiring to vote?
  The yeas and nays resulted--yeas 44, nays 52, as follows:

                       [Rollcall Vote No. 3 Leg.]

                                YEAS--44

     Akaka
     Baucus
     Bayh
     Biden
     Boxer
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Conrad
     Dayton
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Harkin
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Menendez
     Mikulski
     Murray
     Nelson (FL)
     Obama
     Pryor
     Reed
     Reid
     Rockefeller
     Salazar
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--52

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Burr
     Chambliss
     Coburn
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeMint
     DeWine
     Dole
     Ensign
     Enzi
     Frist
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Isakson
     Kyl
     Lott
     Lugar
     Martinez
     McCain
     McConnell
     Murkowski
     Nelson (NE)
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thune
     Vitter
     Voinovich
     Warner

                             NOT VOTING--4

     Bingaman
     Domenici
     Inhofe
     Thomas
  The PRESIDING OFFICER. On this vote, the yeas are 44, the nays are 
52. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained and the amendment falls.
  Mr. GRASSLEY. Mr. President, I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, we are making a lot of progress. I think 
if we just keep operating in the sense of comity we can do quite well. 
In that spirit, I ask unanimous consent the Grassley AMT amendment and 
the Mendendez AMT amendment be moved down the amendment list in the 
time of offering.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BAUCUS. That means the next amendment is the amendment of Senator 
Grassley on the Medicare prescription drug program.
  The PRESIDING OFFICER. The majority leader.
  Mr. FRIST. Mr. President, tonight it has taken a long time to get 
where we are. We are going to have 10-minute rollcall votes, so 
everybody needs to stay in the Chamber. We are going to cut everybody 
off. We have agreed to 10 minutes. It has been a long day already. We 
know what we are going to be doing the rest of the night. We have the 
amendments laid out, but it means everybody has to stay here. It will 
be 10-minute votes. Everybody stay here.
  Second, we have a request from the other side of the aisle that after 
this series of amendments there be a rollcall vote on the extension of 
the PATRIOT Act. We will run through the series of amendments as 
outlined and then, in discussion with the other side of the aisle, they 
are requesting a rollcall vote on the extension of the PATRIOT Act 
following these stacked votes on the amendments.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, what is the regular order?
  The PRESIDING OFFICER. The next amendment is the Grassley amendment.
  The Senator from Iowa is recognized.


                Amendment No. 2731 to Amendment No. 2707

  Mr. GRASSLEY. Mr. President, the amendment expresses the sense of the

[[Page 734]]

Senate about the concerns regarding the problems encountered in 
implementing the new drug benefit. It expresses the Senate's support 
for the administration's efforts to fix them. These efforts have proven 
to be much speedier in getting the problems fixed, and fixed fast, than 
any legislation can do. To that point, one amendment offered yesterday 
has provisions that are completely unnecessary because administrative 
actions have already taken care of it. I see no point in legislating 
for the sake of legislating.
  Moreover, legislative action on top of administration action will 
undermine and complicate progress to date.
  I urge my colleagues to support this sense-of-the-Senate amendment.
  The PRESIDING OFFICER. The Senator from Iowa will please send the 
amendment to the desk.


                Amendment No. 2731 to Amendment No. 2707

  Mr. GRASSLEY. I call up amendment No. 2731.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Iowa [Mr. Grassley] proposes an amendment 
     numbered 2731 to amendment No. 2707.

  Mr. GRASSLEY. Mr. President, I ask unanimous consent that 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 regarding the Medicare 
                   part D prescription drug program)

       At the appropriate place, insert the following:

     SEC. __. SENSE OF THE SENATE REGARDING THE MEDICARE PART D 
                   PRESCRIPTION DRUG PROGRAM.

       (a) Findings.--The Senate finds the following:
       (1) It is not acceptable that startup issues under the new 
     Medicare prescription drug program have resulted in some of 
     our Nation's most vulnerable citizens having difficulties 
     getting their prescription drugs covered under the program, 
     and these issues must be addressed and resolved.
       (2) The Department of Health and Human Services and the 
     Centers for Medicare & Medicaid Services are working 
     tirelessly to address these startup issues and have taken 
     numerous steps to smooth the transition process.
       (3) All prescription drug plans under part D of title XVIII 
     of the Social Security Act and MA-PD plans under part C of 
     such title (in this section referred to as ``Medicare 
     prescription drug plans'') already have a ``first fill'' 
     policy in place that provides a new enrollee with coverage 
     for prescription drugs during at least the first 30 days of 
     enrollment regardless of whether the particular prescription 
     drug is on the plan's formulary, and the Centers for Medicare 
     & Medicaid Services is enforcing this requirement.
       (4) Under current law, full-benefit dual eligible 
     individuals (as defined in section 1935(c)(6) of the Social 
     Security Act (42 U.S.C. 1395u-5(c)(6)) are already 
     automatically enrolled into Medicare prescription drug 
     coverage so no change in law is necessary.
       (5) Medicare prescription drug plans are already 
     responsible for covering the cost of covered prescriptions 
     filled for enrollees, including short term transition 
     prescriptions.
       (6) Medicare prescription drug plans are already 
     responsible for reimbursing any enrollee, including full-
     benefit dual eligible individuals, for any out-of-pocket 
     costs incurred by the enrollee that should have been covered 
     by the plan.
       (7) The Centers for Medicare & Medicaid Services is already 
     reimbursing States for the reasonable administrative costs 
     incurred by States that have temporarily covered some claims 
     for prescription drug coverage during the transition period.
       (8) Enrollment is exceeding projections, with at least 
     24,000,000 Medicare beneficiaries who now have drug coverage 
     and another 90,000 are enrolling each day in the Medicare 
     prescription drug program;
       (9) In addition, the Secretary of Health and Human Services 
     has taken many other actions to smooth the implementation of 
     the Medicare prescription drug program, including the 
     following:
       (A) Establishing processes to ensure that full-benefit dual 
     eligible individuals are not overcharged for their 
     prescriptions and to require Medicare prescription drug plans 
     to refund overcharges to such individuals.
       (B) Establishing a reconciliation process to ensure that 
     Medicare prescription drug plans reimburse pharmacies for 
     costs incurred by pharmacies that are payable by such plans.
       (C) Conducting extensive and continuing outreach to 
     pharmacies and pharmacy associations on the implementation of 
     the Medicare prescription drug benefit, particularly with 
     respect to full-benefit dual eligible individuals, as well as 
     establishing a special pharmacy telephone help line.
       (D) Requiring Medicare prescription drug plans to have 
     comprehensive formularies and procedures for enrollees to 
     rapidly secure an exception to the limitation of coverage of 
     a prescription drug when medical necessity is demonstrated.
       (E) Permitting full-benefit dual eligible individuals to 
     switch Medicare prescription drug plan under the Medicare 
     prescription drug benefit at any time, for any reason, and 
     improving data flows and communication with plans to ensure 
     that plan switches by such individuals become fully effective 
     as quickly as possible.
       (F) Partnering with national, State, and local groups that 
     work with full-benefit dual eligible individuals to educate 
     such individuals about the Medicare prescription drug 
     program, and assisting in their transition to, and enrollment 
     under, such program.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that--
       (1) the Secretary of Health and Human Services is making 
     significant progress in smoothing the implementation of the 
     new Medicare prescription drug program, legislation changing 
     the program is not needed at this time, and legislation at 
     this time would also likely complicate implementation of the 
     program and confuse beneficiaries;
       (2) each of the implementation problems identified under 
     the Medicare prescription drug program will be resolved more 
     quickly through administrative actions, which the Secretary 
     of Health and Human Services already has the authority to 
     take under current law, rather than through Congressional 
     action followed by administrative action;
       (3) the Senate fully supports the efforts of the Secretary 
     of Health and Human Services, Medicare prescription drug 
     plans, pharmacists, and others to implement the Medicare 
     prescription drug program and to resolve problems that have 
     occurred during the implementation of the program; and
       (4) the pace of enrollment in the Medicare prescription 
     drug benefit indicates that extending the six-month 
     enrollment period is not warranted at this time, and, by 
     contrast, such an action could exacerbate implementation 
     issues under the program.

  Mr. BAUCUS. Mr. President, I yield 1 minute allocated to my side to 
the Senator from Florida.
  Mr. NELSON of Florida. Mr. President, Senators had better look at 
this sense-of-the-Senate amendment because it indicates that 
``extending the 6-month enrollment period is not warranted.''
  That is a direct quote. You know what you have been hearing from your 
senior citizens and how confused they are. This sense of the Senate 
says it shouldn't be extended.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  Mr. NELSON of Florida. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second, and the clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. McCONNELL. The following Senators were necessarily absent: the 
Senator from North Carolina (Mr. Burr), the Senator from New Mexico 
(Mr. Domenici), and the Senator from Wyoming (Mr. Thomas).
  Mr. DURBIN. I announce that the Senator from New Mexico (Mr. 
Bingaman) is necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 42, nays 54, as follows:

                       [Rollcall Vote No. 4 Leg.]

                                YEAS--42

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Coburn
     Cochran
     Collins
     Cornyn
     Craig
     Crapo
     DeMint
     Dole
     Enzi
     Frist
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Inhofe
     Isakson
     Kyl
     Lott
     Lugar
     Martinez
     McCain
     McConnell
     Murkowski
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Stevens
     Sununu
     Talent
     Thune
     Vitter

                                NAYS--54

     Akaka
     Baucus
     Bayh
     Biden
     Boxer
     Byrd
     Cantwell
     Carper
     Chafee
     Chambliss
     Clinton
     Coleman
     Conrad
     Dayton
     DeWine
     Dodd
     Dorgan
     Durbin
     Ensign
     Feingold
     Feinstein
     Harkin
     Hutchison
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Menendez
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Obama
     Pryor
     Reed
     Reid
     Rockefeller

[[Page 735]]


     Salazar
     Sarbanes
     Schumer
     Snowe
     Specter
     Stabenow
     Voinovich
     Warner
     Wyden

                             NOT VOTING--4

     Bingaman
     Burr
     Domenici
     Thomas
  The amendment (No. 2731) was rejected.


                Amendment No. 2730 to Amendment No. 2707

(Purpose: To provide for necessary beneficiary protections in order to 
 ensure access to coverage under the Medicare Part D prescription drug 
                                program)

  Mr. NELSON of Florida. Mr. President, I call up amendment No. 2730.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Florida [Mr. Nelson], for himself and Mr. 
     Bingaman, proposes an amendment numbered 2730.

  Mr. NELSON of Florida. I ask unanimous consent the reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mr. NELSON of Florida. On the vote Members just rejected, the thought 
was that extending the 6-month enrollment period was not warranted 
because, in fact, you have been hearing from your senior citizens. So 
we will give you an opportunity now.
  This amendment expands the 6-month enrollment period for the entire 
year of 2006 and allows beneficiaries, one time, to change plans in 
that year when they make a mistake. We are also going to make all those 
folks, those seniors who are out of pocket, the pharmacies that are out 
of pocket, the States that are out of pocket because of the Federal 
bungling, we will reimburse them in the implementation where individual 
senior citizens have had to eat the cost when they find their drugs 
that are essential to their health, that they cannot get them because 
they are not eligible under the new plan under Medicare.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I object to this amendment. Remember, 
all but two of our members of the Committee on Finance, Republican and 
Democrat, joined with Secretary Leavitt to go over the problems 2 weeks 
ago that this program is having. Secretary Leavitt took responsibility 
for those problems. He laid out seven problems. He laid out seven 
solutions to those problems that he has already inputted.
  I asked him if he needed additional legislative authority to solve 
these problems. He did not need any additional legislative authority. 
He had plenty. We are going to pass legislation now that not only will 
take a while to get passed, but we will also have a period of time 
afterwards of having regulations to administer that legislation.
  The problem goes on and on. The problem is being solved by the 
Secretary right now. Let's not screw up what the Secretary is trying to 
do, something that is working very well. There are problems, yes, but 
those problems are identified, and they can work.
  I raise a point of germaneness on this amendment. I raise a point of 
order under section 310 of the Budget Act, and I ask for the yeas and 
nays.
  Mr. NELSON of Florida. Pursuant to 904 of the Congressional Budget 
Act, I move to waive the applicable sections of that act for 
consideration of this amendment. I ask for the yeas and nays on my 
motion.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is opn agreeing to the motion.
  The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. McCONNELL. The following Senators were necessarily absent: the 
Senator from New Mexico (Mr. Domenici) and the Senator from Wyoming 
(Mr. Thomas).
  Mr. DURBIN. I announce that the Senator from New Mexico (Mr. 
Bingaman) is necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 52, nays 45, as follows:

                       [Rollcall Vote No. 5 Leg.]

                                YEAS--52

     Akaka
     Baucus
     Bayh
     Biden
     Boxer
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Coleman
     Collins
     Conrad
     Dayton
     DeWine
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Harkin
     Hutchison
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Menendez
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Obama
     Pryor
     Reed
     Reid
     Rockefeller
     Salazar
     Sarbanes
     Schumer
     Snowe
     Specter
     Stabenow
     Warner
     Wyden

                                NAYS--45

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Burr
     Chambliss
     Coburn
     Cochran
     Cornyn
     Craig
     Crapo
     DeMint
     Dole
     Ensign
     Enzi
     Frist
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Inhofe
     Isakson
     Kyl
     Lott
     Lugar
     Martinez
     McCain
     McConnell
     Murkowski
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Stevens
     Sununu
     Talent
     Thune
     Vitter
     Voinovich

                             NOT VOTING--3

     Bingaman
     Domenici
     Thomas
  The PRESIDING OFFICER. On this vote, the yeas are 52, the nays are 
45. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained and the amendment falls.
  Mr. GRASSLEY. I move to reconsider the vote.
  Mr. BENNETT. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from New York.


                Amendment No. 2716 to Amendment No. 2707

   (Purpose: To establish a congressional commission to examine the 
   Federal, State, and local response to the devastation wrought by 
Hurricane Katrina in the Gulf Region of the United States especially in 
the States of Louisiana, Mississippi, Alabama, and other areas impacted 
in the aftermath and make immediate corrective measures to improve such 
                        responses in the future)

  Mrs. CLINTON. Mr. President, I call up amendment No. 2716 and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will please report.
  The legislative clerk read as follows:

       The Senator from New York [Mrs. Clinton], for herself, Ms. 
     Mikulski, Mr. Harkin, Mr. Lautenberg, Mr. Reed, Mr. Salazar, 
     Mr. Obama, Mrs. Boxer, Ms. Stabenow, Mr. Schumer, Mr. Durbin, 
     Mrs. Feinstein, Mr. Feingold, Mr. Carper, Mr. Johnson, Mr. 
     Leahy, and Mr. Jeffords, proposes an amendment numbered 2716.

  Mrs. CLINTON. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mrs. CLINTON. Mr. President, this amendment would establish a Katrina 
commission modeled after the 9/11 Commission, made up of experts on a 
bipartisan basis.
  We are seeing the administration withholding documents, testimony, 
and information from the ongoing investigations by the House and 
Senate.
  I commend our colleagues, Senator Collins and Senator Lieberman, for 
their efforts to obtain the information that is needed. But we must 
establish this commission to get at what the truth is about what 
actually happened in order to take steps that will fix the problems so 
they do not happen anywhere else in our country.
  A vote against this commission is a vote for continued stonewalling, 
sweeping problems under the rug, and ignoring the problems that we know 
exist today. That is a dangerous precedent for the people of this 
Nation.
  I urge my colleagues to vote for the Katrina commission.
  The PRESIDING OFFICER. Who yields time in opposition? The Senator 
from Maine.
  Ms. COLLINS. Mr. President, the Homeland Security Committee of the 
Senate has been conducting a thoroughly comprehensive, bipartisan, and 
thorough investigation into the preparation for and response to 
Hurricane

[[Page 736]]

Katrina. We have held 15 hearings, the latest of which was today. We 
have interviewed 270 witnesses. We have reviewed 800,000--800,000--
pages of documents. We have a completely bipartisan staff of 
investigators, attorneys, and other experts.
  We are working together. We are making great progress. We will finish 
in March. We will produce a report and legislation. And, most 
important, we will finish our work before the next hurricane season is 
here.
  I urge opposition to the amendment, and I raise a point of order that 
the pending amendment is not germane to the measure now before the 
Senate. I raise a point of order under section 305(b) of the Budget 
Act.
  The PRESIDING OFFICER. The Senator from New York.
  Mrs. CLINTON. Mr. President, I move to waive the applicable sections 
of the Budget Act for purposes of the pending amendment, and I ask for 
the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion to waive.
  The clerk will please call the roll.
  The bill clerk called the roll.
  Mr. McCONNELL. The following Senators were necessarily absent: the 
Senator from New Mexico (Mr. Domenici) and the Senator from Wyoming 
(Mr. Thomas).
  Mr. DURBIN. I announce that the Senator from New Mexico (Mr. 
Bingaman) is necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 44, nays 53, as follows:

                       [Rollcall Vote No. 6 Leg.]

                                YEAS--44

     Akaka
     Baucus
     Bayh
     Biden
     Boxer
     Byrd
     Cantwell
     Carper
     Clinton
     Conrad
     Dayton
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Harkin
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Menendez
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Obama
     Pryor
     Reed
     Reid
     Rockefeller
     Salazar
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--53

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Burr
     Chafee
     Chambliss
     Coburn
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeMint
     DeWine
     Dole
     Ensign
     Enzi
     Frist
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Isakson
     Kyl
     Lott
     Lugar
     Martinez
     McCain
     McConnell
     Murkowski
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thune
     Vitter
     Voinovich
     Warner

                             NOT VOTING--3

     Bingaman
     Domenici
     Thomas
  The PRESIDING OFFICER. On this vote, the yeas are 44, the nays are 
53. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained and the amendment falls.
  Mr. GRASSLEY. I move to reconsider the vote.
  Mr. CRAIG. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from Iowa.


                           Amendment No. 2732

  Mr. GRASSLEY. Mr. President, I call up amendment No. 2732.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Iowa [Mr. Grassley] proposes an amendment 
     numbered 2732.

  The amendment is as follows:

  (Purpose: To support the health needs of our veterans and military 
                               personnel)

       At the appropriate place, insert the following:

     SEC. __. FUNDING FOR VETERANS HEALTH CARE AND DISABILITY 
                   COMPENSATION AND HOSPITAL INFRASTRUCTURE FOR 
                   VETERANS.

       (a) Funding for Medical Services.--
       (1) Authorization of appropriations.--There is hereby 
     authorized to be appropriated for the Department of Veterans 
     Affairs for the Veterans Health Administration for Medical 
     Care amounts as follows:
       (A) $900,000,000 for fiscal year 2006.
       (B) $1,300,000,000 for fiscal year 2007.
       (C) $1,500,000,000 for fiscal year 2008.
       (D) $1,600,000,000 for fiscal year 2009.
       (E) $1,600,000,000 for fiscal year 2010.
       (2) Supplement not supplant.--The amounts authorized to be 
     appropriated by this subsection are in addition to any other 
     amounts authorized to be appropriated for the Veterans Health 
     Administration for Medical Care under any other provisions of 
     law.
       (b) Funding for Disability Compensation Benefits.--
       (1) Authorization of appropriations.--There is hereby 
     authorized to be appropriated for the Department of Veterans 
     Affairs for the Veterans Benefits Administration for 
     Compensation and Pensions amounts as follows:
       (A) $2,300,000,000 for fiscal year 2006.
       (B) $2,700,000,000 for fiscal year 2007.
       (C) $3,000,000,000 for fiscal year 2008.
       (D) $3,000,000,000 for fiscal year 2009.
       (E) $3,000,000,000 for fiscal year 2010.
       (2) Supplement not supplant.--The amounts authorized to be 
     appropriated by this subsection are in addition to any other 
     amounts authorized to be appropriated for the Veterans 
     Benefits Administration for Compensation and Pensions under 
     any other provisions of law.
       (c) Funding for Infrastructure Improvements for Hospitals 
     Providing Health Care and Services to Veterans.--
       (1) Establishment of fund.--There is hereby established on 
     the books of the Treasury an account to be known as the 
     ``Veterans Hospital Improvement Fund'' (in this subsection 
     referred to as the ``Fund'').
       (2) Elements.--The Fund shall consist of the following:
       (A) $1,000,000,000, which shall be deposited in the Fund 
     upon the enactment of this subsection.
       (B) Any other amounts authorized for transfer to or deposit 
     in the Fund by law.
       (3) Administration.--The Funds shall be administered by the 
     Secretary of Veterans Affairs.
       (4) Use of funds.--
       (A) In general.--Amounts in the Fund shall be available 
     expenditures for improvements of health facilities treating 
     veterans, including military medical treatment facilities, 
     medical centers and other facilities administered by the 
     Secretary of Veterans Affairs for the provision of medical 
     care and services to veterans, and other State, local, and 
     private facilities providing medical care and services to 
     veterans.
       (B) Application for funds.--A non-Federal health facility 
     seeking amounts from the Fund shall submit to the Secretary 
     of Veterans Affairs an application therefor setting forth 
     such information as the Secretary shall require.
       (C) Availability.--Amounts in the Fund shall remain 
     available until expended.

  Mr. GRASSLEY. Mr. President, the problem with the Dodd amendment is 
that it doesn't even do what the author says it does. He says it is 
paid for by using capital gains, but capital gains offsets don't even 
come into play until the year 2009. The author is leading us to believe 
that the military assistance is coming now. But it is not, if it is 
tied to an offset that won't come due until 2009. Our alternative now 
before the Senate will do the same thing as the Dodd amendment, but we 
don't tie it up with an offset that is way down the road 3 years. That 
is not truth in budgeting. I urge support for my amendment.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I yield the 1 minute allocated to our side 
to the Senator from Connecticut.
  Mr. DODD. Mr. President, with all due respect to my good friend from 
Iowa, for the Dodd amendment, the offsets begin next year, 2007, on the 
capital gains and dividends tax breaks. The Grassley amendment I will 
support. I hope the Senator from Iowa will support my amendment. The 
distinction between the two amendments is whether you pay for it. I am 
grateful that the Senator from Iowa has taken my language on veterans 
resources going to veterans hospitals, things such as the Intrepid 
Fallen Heroes Fund facility at Fort Sam Houston in Texas, and others, 
so that we can provide for the 103,000 veterans who come out of Iraq 
and Afghanistan, where there is a shortfall today. If you take my 
amendment, we actually pay for it by asking one-fifth of 1 percent of 
those people who in the year 2007 and 2008 would be beneficiaries as a 
result of capital gains and dividends tax reductions; 99.8 percent of 
all the beneficiaries under the capital gains and

[[Page 737]]

dividends tax reductions would not be touched by the Dodd amendment.
  This is a simple distinction here. If you think we ought to do 
something on behalf of our veterans, then we ought to have the courage 
to pay for it. You have to make choices. A modest reduction in the 
capital gains and dividends tax reduction for 2 years, coming from less 
than one-fifth of 1 percent of the population making over $1 million a 
year is very little to ask for.
  I ask for the adoption of the Grassley amendment. I also urge you to 
adopt our amendment. I don't want to see this amendment drop before it 
gets to the Ohio clock, and I know that is what is going to happen if 
we don't pay for the amendment.
  Mr. GRASSLEY. Mr. President, I raise a budget point of order on my 
amendment, and I also move to waive all provisions of the Budget Act 
and budget resolution necessary for the consideration of the pending 
amendment to this bill and for the inclusion of the language of the 
pending amendment in the consideration of amendments between the House 
and conference report on the bill.
  Mr. DODD. Mr. President, in a bizarre situation, pursuant to section 
904 the Congressional Budget Act----
  Mr. GRASSLEY. I ask unanimous consent that the motion be agreed to.
  The PRESIDING OFFICER. Is there objection?
  Mr. CONRAD. Reserving the right to object, I ask for a quorum call.
  Mr. LEAHY. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The Senator from Iowa has not relinquished the 
floor. Does the Senator from Iowa consent or dissent to a quorum call?
  Mr. GRASSLEY. I have asked for unanimous consent.
  Mr. CONRAD. I object.
  Mr. REID. I object.
  The PRESIDING OFFICER. Objection is heard.
  The Democratic leader is recognized.
  Mr. REID. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. REID. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent to waive all 
provisions of the Budget Act and budget resolutions necessary for the 
consideration of the pending amendment to this bill, and for the 
inclusion of the language of the pending amendment in the consideration 
of an amendment between Houses.
  The PRESIDING OFFICER. Is there objection?
  Mr. CONRAD. Mr. President, reserving the right to object, and I will 
not object.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. CONRAD. Mr. President, this just makes clear that we would not be 
doing something tonight the Senate has never done before: allow direct 
spending on a bill such as this without the chance of it being 
considered in conference and coming back here without any points of 
order prevailing.
  I apologize to colleagues for taking this time, but we cannot be 
engaging in a process never before done in the Senate to spend tens of 
billions of dollars without the ability to review it when it comes back 
from conference. I will not object.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The question is on agreeing to amendment No. 2732.
  The amendment (No. 2732) was agreed to.
  Mr. DODD. I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from Connecticut.


                Amendment No. 2735 to amendment No. 2707

  Mr. DODD. Mr. President, I send an amendment to the desk and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Connecticut [Mr. Dodd], for himself, Mr. 
     Kennedy, Mr. Kerry, Mr. Lautenberg, Mrs. Boxer, Ms. Mikulski, 
     Mr. Akaka, and Mr. Reed, proposes an amendment numbered 2735.

  Mr. DODD. 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 support the health needs of our veterans and military 
  personnel and reduce the deficit by making tax rates fairer for all 
                               Americans)

       At the appropriate place, insert the following:

     SEC. __. FUNDING FOR VETERANS HEALTH CARE AND DISABILITY 
                   COMPENSATION AND HOSPITAL INFRASTRUCTURE FOR 
                   VETERANS.

       (a) Funding for Medical Services.--
       (1) Authorization of appropriations.--There is hereby 
     authorized to be appropriated for the Department of Veterans 
     Affairs for the Veterans Health Administration for Medical 
     Care amounts as follows:
       (A) $900,000,000 for fiscal year 2006.
       (B) $1,300,000,000 for fiscal year 2007.
       (C) $1,500,000,000 for fiscal year 2008.
       (D) $1,600,000,000 for fiscal year 2009.
       (E) $1,600,000,000 for fiscal year 2010.
       (2) Supplement not supplant.--The amounts authorized to be 
     appropriated by this subsection are in addition to any other 
     amounts authorized to be appropriated for the Veterans Health 
     Administration for Medical Care under any other provisions of 
     law.
       (b) Funding for Disability Compensation Benefits.--
       (1) Authorization of appropriations.--There is hereby 
     authorized to be appropriated for the Department of Veterans 
     Affairs for the Veterans Benefits Administration for 
     Compensation and Pensions amounts as follows:
       (A) $2,300,000,000 for fiscal year 2006.
       (B) $2,700,000,000 for fiscal year 2007.
       (C) $3,000,000,000 for fiscal year 2008.
       (D) $3,000,000,000 for fiscal year 2009.
       (E) $3,000,000,000 for fiscal year 2010.
       (2) Supplement not supplant.--The amounts authorized to be 
     appropriated by this subsection are in addition to any other 
     amounts authorized to be appropriated for the Veterans 
     Benefits Administration for Compensation and Pensions under 
     any other provisions of law.
       (c) Funding for Infrastructure Improvements for Hospitals 
     Providing Health Care and Services to Veterans.--
       (1) Establishment of fund.--There is hereby established on 
     the books of the Treasury an account to be known as the 
     ``Veterans Hospital Improvement Fund'' (in this subsection 
     referred to as the ``Fund'').
       (2) Elements.--The Fund shall consist of the following:
       (A) $1,000,000,000, which shall be deposited in the Fund 
     upon the enactment of this subsection.
       (B) Any other amounts authorized for transfer to or deposit 
     in the Fund by law.
       (3) Administration.--The Funds shall be administered by the 
     Secretary of Veterans Affairs.
       (4) Use of funds.--
       (A) In general.--Amounts in the Fund shall be available 
     expenditures for improvements of health facilities treating 
     veterans, including military medical treatment facilities, 
     medical centers and other facilities administered by the 
     Secretary of Veterans Affairs for the provision of medical 
     care and services to veterans, and other State, local, and 
     private facilities providing medical care and services to 
     veterans.
       (B) Application for funds.--A non-Federal health facility 
     seeking amounts from the Fund shall submit to the Secretary 
     of Veterans Affairs an application therefor setting forth 
     such information as the Secretary shall require.
       (C) Availability.--Amounts in the Fund shall remain 
     available until expended.
       (d) Offset Through Modification of Tax Rates on Capital 
     Gains and Dividends for Individuals With $1,000,000 or More 
     of Taxable Income.--
       (1) In general.--Section 1(h) is amended by adding at the 
     end the following new paragraph:
       ``(12) Modified rates for individuals with $1,000,000 or 
     more of taxable income.--If a taxpayer has taxable income of 
     $1,000,000 or more for any taxable year--
       ``(A) paragraph (11) (relating to dividends taxed as 
     capital gain) shall not apply to any qualified dividend 
     income of the taxpayer for the taxable year, and
       ``(B) paragraph (1)(C) shall be applied by substituting `20 
     percent' for `15 percent' with respect to the adjusted net 
     capital gain of the taxpayer for the taxable year, determined 
     by only taking into account gain or loss properly allocable 
     to the portion of the taxable year after December 31, 2006.''
       (2) Application to minimum tax.--Section 55(b)(3) is 
     amended by adding at the end the following new sentence: ``In 
     the case of a

[[Page 738]]

     taxpayer with alternative minimum taxable income of 
     $1,000,000 or more for any taxable year, the rules of section 
     1(h)(12) shall apply for purposes of this paragraph.''
       (3) Effective dates.--
       (A) Capital gains.--Section 1(h)(12)(B) of the Internal 
     Revenue Code of 1986 (as added by paragraph (1)) shall apply 
     to taxable years beginning after December 31, 2006.
       (B) Dividend rates.--Section 1(h)(12)(A) of such Code (as 
     added by paragraph (1)) shall apply to dividends received 
     after December 31, 2006.
       (4) Application of jgtrra sunset.--The amendments made by 
     this subsection shall be subject to section 303 of the Jobs 
     and Growth Tax Relief Reconciliation Act of 2003 to the same 
     extent and in the same manner as the provision of such Act to 
     which such amendment relates.

  Mr. DODD. Mr. President, I offer this amendment on behalf of a number 
of colleagues: Senators Kennedy, Kerry, Lautenberg, Boxer, Mikulski, 
Akaka, and Reed.
  First, I thank the American Legion. I ask unanimous consent that a 
letter from the American Legion endorsing the Dodd amendment be printed 
in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                          The American Legion,

                                 Washington, DC, February 2, 2006.
     Hon. Christopher J. Dodd,
     Hon. Edward M. Kennedy,
     U.S. Senate,
     Washington, DC.
       Dear Gentlemen: On behalf of the 2.8 million members of The 
     American Legion, I would like to offer our support of the 
     proposed amendment to the Tax Relief Extension Reconciliation 
     Act of 2005 that would provide for the unbudgeted costs of 
     health care for veterans returning from Iraq and Afghanistan.
       The amounts offered by this amendment would be in addition 
     to any other amounts provided for medical care under other 
     statutory provisions and would help to avoid funding 
     shortfalls, such as what took place last year, or other 
     problems that arise due to the discretionary funding model 
     currently in place for VA health care. This amendment would 
     also establish a ``Veterans Hospital Improvement Fund'' to 
     provide for improvements in health care facilities treating 
     veterans, including military medical treatment facilities, VA 
     facilities and other facilities (state, local and private) 
     that provide medical care and services to veterans.
       Again, we appreciate your efforts on behalf of our nation's 
     veterans. Your amendment acknowledges the need for adequate 
     funding to ensure our nation's veterans receive the 
     healthcare and other benefits to which they are entitled.
           Sincerely,
                                                 Steven Robertson,
                        Director, National Legislative Commission.

  Mr. DODD. Mr. President, the distinction between this amendment and 
what we just voted on is, of course, paying for this. This amendment 
would provide at least around $18 billion, $19 billion in needed funds 
to serve returning veterans from theater of conflict.
  We know last year that over 100,000 Iraqi veterans returned home. Yet 
the administration's fiscal year 2006 budget for the VA was only 
prepared to handle 23,000 veterans. There are shortfalls in every State 
across the country. There are shortfalls in private facilities as well 
as public ones. This amendment is for us finally to say let's do 
something for these people.
  Last year, we were promised it would be accommodated in the 
appropriations process. It had to be done as almost an afterthought. I 
don't like offering this amendment on this bill. I understand the 
problems associated with it. But if we don't finally do something, 
these veterans will lose the support they deserve. That is why the 
American Legion is so strongly supporting this amendment.
  I urge my colleagues to join me in seeing to it we have the resources 
to pay for this. If we don't pay for it, this amendment will not make 
it past the Ohio Clock. It will be dropped, and, once again, veterans 
will suffer. I urge adoption of the amendment.
  Mr. AKAKA. Mr. President, I rise today with my friends, Senators 
Kennedy and Dodd, to offer an amendment to address the costs of 
providing health care and improved benefits to troops serving in Iraq 
and Afghanistan.
  This amendment we offer today allows VA to provide care for returning 
troops--without displacing those veterans currently using the system. 
Let us never forget the budget disaster last year. Early in the year, 
we knew VA was not making ends meet. The administration, however, took 
months to come to that realization. And just last week, the President 
signed a declaration of emergency funding for $1.2 billion for fiscal 
year 2006.
  We cannot repeat last year's budget scenario. This amendment provides 
more cushion for this fiscal year and future years.
  Early warnings are that this will not be enough to cover expected 
shortfalls for this fiscal year. And VA will surely not have enough 
funding to open the system up to all veterans. In 2003, this 
administration closed the doors to all middle-income veterans who had 
not enrolled prior to that time. To date, more than 250,000 veterans 
who have tried to enroll for VA health care have been rejected. In 
Hawaii alone, 710 veterans were turned away at the door. We have no 
idea how many middle-income veterans never even try to enroll.
  This amendment also sends a message that the Senate wishes to ensure 
that our veterans are appropriately compensated. For many of our 
severely injured veterans, disability compensation is their only 
income--the only way for them to provide for their families. This 
amendment ensures that our wounded warriors receive the compensation 
they have earned.
  This amendment establishes a fund for infrastructure improvements. 
VA's infrastructure has suffered greatly over the past 5 years. Major 
construction projects were held up for some time while we waited for 
VA's own construction study. And while that process still awaits 
conclusion, VA has been trying to catch up with the projects that have 
been stuck in the queue for years. At the same time, the Department has 
faced consistent funding shortfalls that have paralyzed its ability to 
carry out these projects. Its no secret that when the health care 
account is strained, funds are then diverted from ``nonessential'' 
areas--such as maintenance and construction--to be spent on direct 
health care costs.
  Meanwhile, smaller scale projects are put in jeopardy. In my home 
State of Hawaii, we have a need for $6.9 million to build a new VA 
mental health facility in Honolulu.
  The costs of the war we are fighting today will continue to add up 
long after the final shot is fired, mainly in the form of veterans 
health care and benefits.
  I urge my colleagues to join us in this effort to see that they are 
provided the care they are currently earning.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, first, since we adopted the previous 
amendment, we obviously don't need this amendment. But even if we 
consider this amendment, I raise a budget point of order on the 
amendment.
  Mr. DODD. Mr. President, I move to waive all provisions of the Budget 
Act and budget resolutions necessary for consideration of the pending 
amendment to this bill, and for inclusion of the language of the 
pending amendment in the consideration of an amendment between the 
Houses.
  I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion. The clerk will call the 
roll.
  Mr. McCONNELL. The following Senators were necessarily absent: the 
Senator from New Mexico (Mr. Domenici) and the Senator from Wyoming 
(Mr. Thomas).
  Mr. DURBIN. I announce that the Senator from New Mexico (Mr. 
Bingaman) is necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 44, nays 53, as follows:

                       [Rollcall Vote No. 7 Leg.]

                                YEAS--44

     Akaka
     Baucus
     Bayh
     Biden
     Boxer
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Conrad
     Dayton
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Harkin
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln

[[Page 739]]


     Menendez
     Mikulski
     Murray
     Nelson (FL)
     Obama
     Pryor
     Reed
     Reid
     Rockefeller
     Salazar
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--53

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Burr
     Chambliss
     Coburn
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeMint
     DeWine
     Dole
     Ensign
     Enzi
     Frist
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Isakson
     Kyl
     Lott
     Lugar
     Martinez
     McCain
     McConnell
     Murkowski
     Nelson (NE)
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thune
     Vitter
     Voinovich
     Warner

                             NOT VOTING--3

     Bingaman
     Domenici
     Thomas
  The PRESIDING OFFICER. On this vote, the yeas are 44, the nays are 
53. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained and the amendment falls.
  The Senator from Iowa.
  Mr. GRASSLEY. Just not to confuse anybody, we are kind of going 
through the same thing we did on the previous two amendments, so be 
alerted.
  Mr. BAUCUS. Mr. President, the Senate is not in order.
  The PRESIDING OFFICER. The Senator is correct. The Senate will please 
come to order.


                           Amendment No. 2736

  Mr. GRASSLEY. I call up amendment No. 2736.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Iowa [Mr. Grassley], proposes an amendment 
     numbered 2736.

  The amendment is as follows:

   (Purpose: To strengthen America's military and for other purposes)

               TITLE IV--STRENGTHENING AMERICA'S MILITARY

     SEC. 401. SHORT TITLE.

       This title may be cited as the ``Strengthening America's 
     Military Act''.

                      Subtitle A--Military Funding

     SEC. 402. FUNDING FOR MILITARY OPERATIONS.

       There is appropriated, out of any money in the Treasury 
     which is not otherwise appropriated, for the fiscal years 
     2006 through 2010, the following amounts, to be used for 
     resetting and recapitalizing equipment being used in theaters 
     of operations:
       (1) $16,900,000,000 for operations and maintenance of the 
     Army.
       (2) $1,800,000,000 for aircraft for the Army.
       (3) $6,300,000,000 for other Army procurement.
       (4) $10,000,000,000 for wheeled and tracked combat vehicles 
     for the Army.
       (5) $467,000,000 for the Army working capital fund.
       (6) $6,000,000 for missiles for the Department of Defense.
       (7) $100,000,000 for defense wide procurement for the 
     Department of Defense.
       (8) $4,500,000,000 for Marine Corps procurement.
       (9) $4,500,000,000 for operations and maintenance of the 
     Marine Corps.
       (10) $2,700,000,000 for Navy aircraft procurement.

  Mr. GRASSLEY. The same arguments that I made on the previous 
amendments apply here as well. My amendment will do the same as the 
Reed amendment but doesn't raise taxes to pay for it, so it will 
provide more equipment for our troops without increasing taxes. I urge 
support of my amendment.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. I yield 1 minute to the Senator from Rhode Island.
  Mr. REED. Mr. President, the amendment proposed by the Senator from 
Iowa is my amendment. It would meet the supreme need of the military to 
reset, recapitalize, and rehabilitate $43 billion or more of equipment. 
The one big difference is that my amendment will pay for it. It will 
take the responsible step of actually paying to help our military. What 
I will use is dividend offsets. I will offer that later. But we have 
the responsibility to be responsible, not only give the troops what 
they need but pay for it so we do not increase the deficit. I hope we 
respond by supporting my amendment which takes care of the troops but 
does so in a responsible way by providing the resources to pay for this 
necessary equipment.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, again I raise a budget point of order. I 
ask unanimous consent it be exactly the same as the previous one on the 
last two bills. I ask unanimous consent to waive all provisions of the 
Budget Act and budget resolutions necessary for the consideration of 
the pending amendment to this bill and for the inclusion of the 
language of the pending amendment in the consideration of one amendment 
between the Houses--an amendment.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  The question is on agreeing to the amendment.
  The amendment (No. 2736) was agreed to.


                           Amendment No. 2737

(Purpose: To strengthen America's military, to repeal the extension of 
 tax rates for capital gains and dividends, to reduce the deficit, and 
                          for other purposes)

  The PRESIDING OFFICER. The Senator from Rhode Island and the 
Providence Plantation.
  Mr. REED. Mr. President, I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Rhode Island [Mr. Reed], for himself, Ms. 
     Stabenow, Mr. Lautenberg, Mrs. Clinton, and Mr. Kerry, 
     proposes an amendment numbered 2737.

  (The amendment is printed in today's Record under ``Text of 
amendments.'')
  The PRESIDING OFFICER. The Senator from Rhode Island.
  Mr. REED. Mr. President, our Army and Marines face a critical 
problem: $47 billion worth of equipment which they have used in Iraq 
and Afghanistan needs to be repaired and reconditioned. They call it 
reset recapitalization. We have to do this. This equipment is not new 
equipment, it is not transformational, it is the equipment they need. I 
commanded a paratrooper company in the 82nd Airborne Division. I can 
tell you the worst thing for morale is to have soldiers with poor and 
inadequate equipment. We owe it to them.
  My amendment would be the responsible way to do it, pay for it, by 
taking capital gains cuts that are proposed, dividend cuts and others 
that are proposed, and other loopholes. It is essentially very simple. 
Are we going to give a dividend to the wealthiest citizens or are we 
going to give a dividend to our troops, our soldiers, and marines? And 
that dividend is equipment that will work, not only today but in the 
future.
  This is particularly important for the National Guard. Every one of 
your National Guard units has equipment they have left overseas or has 
been run into the ground. If we do not act responsibly--not just act 
but act responsibly, then we will not be able to assure our soldiers 
and marines that the equipment they have is the best equipment, that it 
works, and it will be reconditioned and refit and work in the future.
  I urge passage of this amendment.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Again, I raise a budget point of order on this 
amendment.
  The PRESIDING OFFICER. The Senator from Rhode Island.
  Mr. REED. I move to waive all provisions of the Budget Act and budget 
resolutions necessary for the consideration of the pending amendment to 
this bill and for the inclusion of the language of the pending 
amendment in the consideration of an amendment between the Houses.
  The PRESIDING OFFICER. The Senator from New Hampshire.
  Mr. GREGG. Mr. President, I ask unanimous consent to speak to this 
issue for 2 minutes.
  The PRESIDING OFFICER. Is there objection?
  Mr. REED. Reserving my right to object, if the Senator has 2 minutes, 
can I have an additional 2 minutes?
  Mr. GREGG. I just want to explain the parliamentary situation for the 
record.
  Mr. President, these last two amendments are totally outside the 
traditional process of reconciliation. But the practical effects of the 
motion to

[[Page 740]]

waive, which the Senator from Iowa has made on his amendments, is that 
neither amendment can survive conference. I think it is important to 
understand that reconciliation cannot include spending under this bill, 
and that we would be doing fundamental damage to the process were 
either of these amendments to survive conference. And, therefore, I 
support the motion on this point of order and hope we proceed the same 
way we have with the other points of order.
  Mr. REED. I ask unanimous consent for 1 minute.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered. The Senator from Rhode Island and the Providence Plantation 
is accorded the floor.
  Mr. REED. I have great respect for the procedures and rules of the 
Senate, but we have come too many times to issues--I can recall back 
when we were talking about armored humvees when the objection was made 
this is not the right legislative vehicle to do this. I think we have 
an obligation to our soldiers and marines to help them now and pay for 
it now. This might be the only occasion we can do both.
  I urge passage.
  The PRESIDING OFFICER. Is there objection to the request to waive the 
Budget Act?
  Mr. REED. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second? There is a 
sufficient second.
  The question is on agreeing to the motion. The clerk will call the 
roll.
  The legislative clerk called the roll.
  Mr. McCONNELL. The following Senators were necessarily absent: the 
Senator from New Mexico (Mr. Domenici) and the Senator from Wyoming 
(Mr. Thomas).
  Mr. DURBIN. I announce that the Senator from New Mexico (Mr. 
Bingaman) is necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 44, nays 53, as follows:

                       [Rollcall Vote No. 8 Leg.]

                                YEAS--44

     Akaka
     Baucus
     Bayh
     Biden
     Boxer
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Conrad
     Dayton
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Harkin
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Menendez
     Mikulski
     Murray
     Nelson (FL)
     Obama
     Pryor
     Reed
     Reid
     Rockefeller
     Salazar
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--53

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Burr
     Chambliss
     Coburn
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeMint
     DeWine
     Dole
     Ensign
     Enzi
     Frist
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Isakson
     Kyl
     Lott
     Lugar
     Martinez
     McCain
     McConnell
     Murkowski
     Nelson (NE)
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thune
     Vitter
     Voinovich
     Warner

                             NOT VOTING--3

     Bingaman
     Domenici
     Thomas
  The PRESIDING OFFICER (Mr. Thune). On this vote, the yeas are 44, the 
nays are 53. Three-fifths of the Senators duly chosen and sworn not 
having voted in the affirmative, the motion is rejected. The point of 
order is sustained and the amendment falls.
  Mr. GRASSLEY. Mr. President, I hope we just have one more rollcall 
vote--on final passage. It is my understanding that the Menendez 
amendment has been changed to a sense of the Senate, so that means the 
amendment I was going to offer on AMT will not be offered. 
Consequently, I am hoping we can get this amendment agreed to on a 
voice vote.
  Mr. REID. Mr. President, Senator Menendez told Members he wants a 
rollcall vote.


                           Amendment No. 2705

  Mr. MENENDEZ. Mr. President, I call up amendment numbered 2705.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from New Jersey [Mr. Menendez], for himself, 
     Mr. Schumer, Mr. Kerry, Mrs. Feinstein, Mrs. Clinton, Mr. 
     Lautenberg, and Ms. Stabenow, proposes an amendment numbered 
     2705.

  The amendment is as follows:

  (Purpose: To express the sense of the Senate that protecting middle-
  class families from the alternative minimum tax should be a higher 
 priority for Congress in 2006 than extending a tax cut that does not 
                     expire until the end of 2008)

       At the appropriate place, insert the following:

     SEC. __. SENSE OF THE SENATE REGARDING PROTECTING MIDDLE-
                   CLASS FAMILIES FROM THE ALTERNATIVE MINIMUM 
                   TAX.

       (a) Findings.--The Senate finds that--
       (1) the alternative minimum tax was originally enacted in 
     1969 as a supplemental tax on wealthy tax evaders, but has 
     evolved into a tax on millions of middle-class working 
     families, particularly families in which both parents work, 
     and families with 2 or more children;
       (2) by the end of the decade, the alternative minimum tax 
     will ensnare more than 30,000,000 taxpayers, the majority of 
     which will have adjusted gross incomes below $100,000, and 
     the National Taxpayer Advocate has thus identified it as the 
     most serious problem facing individual taxpayers;
       (3) the alternative minimum tax is often portrayed as a tax 
     that is most problematic for residents of States such as New 
     York, California, Massachusetts, and New Jersey, but the 
     truth is that many other States have a significant percentage 
     of taxpayers affected by the alternative minimum tax, 
     including Oregon, Maryland, Virginia, Minnesota, Ohio, Maine, 
     Georgia, North Carolina, and Pennsylvania, so the problem is 
     of national importance;
       (4) a family with 2 children will become subject to the 
     alternative minimum tax at about $67,500 of income in 2006, 
     and a family with 5 children will start owing the alternative 
     minimum tax at about $54,000 of income, if Congress fails to 
     act;
       (5) the year 2006 is the ``tipping point'' for the 
     alternative minimum tax, as the number of taxpayers affected 
     nationally will explode from 3,600,000 to 19,000,000 if 
     Congress fails to act;
       (6) in 2004, only 6.2 percent of families earning $100,000 
     to $200,000 a year were subject to the alternative minimum 
     tax, and that number will explode to nearly 50 percent if 
     Congress fails to act;
       (7) if alternative minimum tax relief is extended through 
     2006, about two-thirds of the benefits will be realized by 
     families earning under $200,000, with more than half of the 
     total benefits going to families with incomes between 
     $100,000 and $200,000;
       (8) starting in 2008, the average married couple with 2 
     children earning $75,000 or more will find that more than 
     half of the tax cuts they have been expecting from the 
     various laws passed since 2001 will be ``taken back'' via the 
     alternative minimum tax; and
       (9) the temporary relief from the alternative minimum tax 
     (provided in 2001 and extended twice in 2003 and 2004) 
     expired at the end of 2005, but the tax reductions on 
     dividends and capital gains do not expire until the end of 
     2008, making immediate action on those provisions a less 
     urgent matter.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that protecting middle-class families from the alternative 
     minimum tax should be a higher priority for Congress in 2006 
     than extending a tax cut that does not expire until the end 
     of 2008.

  The PRESIDING OFFICER. The Senator from New Jersey.
  Mr. MENENDEZ. Mr. President, this amendment, which is a sense of the 
Senate, which I am offering with Senators Schumer, Kerry, Feinstein, 
Clinton, Lautenberg, and Stabenow, is simply a sense of the Senate to 
try to ensure that 17 million middle-class families do not see a tax 
increase next year through the alternative minimum tax. This tax was 
never intended to raise the taxes of average Americans but, in fact, it 
has--millions of Americans.
  Some think this is more problematic for residents of States such as 
New York, California, or my home State of New Jersey. But the truth is 
a whole host of other States have a significant percentage of tax 
failures affected by the alternative minimum tax, including Oregon, 
Maryland, Virginia, Minnesota, Ohio, Maine, Georgia, North Carolina, 
and Pennsylvania. It is a problem of national importance. This is a 
question of whether the Senate values work and the work of honest and 
hard-working families who are going to be subjected to a tax not 
because they made more income but simply because of the way the tax is 
structured.

[[Page 741]]

  Ultimately, I urge my colleagues to support the sense of the Senate.
  I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. I dispute the presumption we have to choose between AMT 
hold harmless and not extending capital gains and dividends. We can do 
both. The presumption in this bill is that we can and we are going to 
be able to do that in the conference committee.
  Since the amendment reflects the position of what we in the Senate 
previously had anticipated doing anyway, Members ought to vote for the 
amendment. I will vote for it.
  Yesterday afternoon, I took time to respond to Senator Harkin's 
statement that we have an AMT problem to a significant degree because 
of what the Finance Committee did in the 2001 tax bill. Importantly, he 
fails to recognize that we have addressed the problem for 2001 to 2005. 
And, now, we are trying to do the same thing for 2006--to make sure 
that the AMT problem is not worsened.
  To the extent that Senator Harkin suggests, like others who have 
looked at this issue, that the Bush tax cuts are responsible for the 
AMT problem, I respond in this way. Most who have reached that 
conclusion have done so by misusing data provided by the Joint 
Committee on Taxation, JCT, to distort the record on this issue. 
Additional analysis will demonstrate that conclusion to be erroneous. 
To the contrary, the analysis suggests an alternative explanation for 
the AMT problem--Congress's failure to index the AMT for inflation over 
the past 35 years.
  Senator Harkin suggests that the Bush tax cuts are responsible for 
the AMT problem. The conclusion is reached in error because it is based 
on faulty logic. Those who have done similar analyses have based their 
conclusions on the mistaken assumption that a reduction in Federal 
receipts should be interpreted as percentage causation of the AMT 
problem. JCT was asked to project Federal AMT revenue if the Bush tax 
cuts were extended, but the current-law hold-harmless provision was not 
extended--$1.139 trillion--and Federal AMT revenue if neither the Bush 
tax cuts nor the hold-harmless provision is extended--$400 billion. 
From that data, some erroneously concluded and publicly represented 
that the Bush tax cuts are responsible for 65 percent of the AMT 
problem--$1.139 trillion minus $400 billion divided by $1.139 
trillion--and conversely, that the Bush tax cuts tripled the size of 
the AMT problem--$1.139 trillion divided by $400 billion.
  The logic used to reach that conclusion is flawed. That is because 
the many variables affecting the AMT have overlapping results, and the 
order in which one analyzes those overlapping variables will directly 
impact the outcome of the analysis.
  In that way, we can use the same JCT data in the analysis above to 
suggest that failure to index is actually the dominant cause of the AMT 
problem. If one were to first index the current tax system for 
inflation by permanently extending an indexed version of the current 
hold-harmless provision, Federal AMT revenue would be reduced from 
$1.139 trillion to $472 billion over the 10-year period. Thus, 
extending and indexing the current hold-harmless provision for future 
inflation would reduce AMT revenues by 59 percent over the same period, 
referred to in a JCT letter dated October 3, 2005, as ``percentage of 
AMT effect attributable to failure to extend and index hold-harmless 
provision''. A copy of the entire letter is attached. If we then assume 
that the Bush tax cuts are repealed, AMT revenue falls by an additional 
$302.3 billion, from $472 billion to $169.7 billion. That second drop, 
attributable to the repeal of the Bush tax cuts, reduces Federal 
revenues by only 27 percent. Thus, one could argue that failure to 
index is the greater cause of the AMT problem--59 percent vs. 27 
percent. Using logic similar to that undertaken above would also cause 
us to conclude that failure to index is responsible for 59 percent of 
the AMT problem--$1.139 trillion minus $472 billion divided by $1.139 
trillion--or alternatively, that failure to index also nearly tripled 
the size of the AMT problem, $1.139 trillion divided by $472 billion.
  But simple logic suggests that the Bush tax cuts cannot be 
responsible for 65 percent of the AMT problem and failure to index 
responsible for 59 percent of the problem. The anomaly arises because 
there is overlap between the variables being analyzed. Although the 
analysis fairly demonstrates the amount of AMT revenue saved by making 
a particular change to the Federal tax system, it is inappropriate to 
represent that such analysis accurately isolates causation of the AMT. 
Because there is overlap in the variables being analyzed--in these 
examples, indexing and the Bush tax cuts--the order of analysis of 
those variables is crucial to the outcome. JCT acknowledges this point 
to us in a letter dated October 3, stating: ``There is, however, 
interaction between these two contributing factors to the AMT effect. 
In order to avoid double counting of interactions, a stacking order is 
imposed. The apportionment of effects to each contributing factor will 
vary depending on the stacking order, even though the total effect 
remains constant.''
  To this point in time, I have not seen anything that accurately 
suggests that the 2001 tax cuts have worsened the AMT problem to date. 
It is my intention to ensure that we continue to honor that commitment 
and that is an important part of this tax reconciliation legislation.
  I ask unanimous consent that a memorandum be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

     To: Mark Prater and Christy Mistr
     From: George Yin
     Subject: AMT Effects
       This memorandum responds to your request of September 29, 
     2005, for an analysis of the portion of the AMT effect (AMT 
     liability plus credits lost due to the AMT) which can be 
     attributed to the failure to adjust the AMT exemption amount 
     to inflation, assuming alternatively that the EGTRRA and 
     JGTRRA tax cuts (``tax cuts'') are either permanently 
     extended or repealed. We also explain how this information 
     compares to information previously provided to you on August 
     31, 2005 and September 16, 2005.
       For the purpose of this analysis, we have first assumed 
     that the tax cuts are repealed. The first set of figures in 
     Table 1 compares the AMT effect under this assumption if, 
     alternatively, (1) the AMT exemption amount hold-harmless 
     provision is not extended beyond 2005; (2) such provision is 
     extended permanently; and (3) such provision is extended 
     permanently and indexed after 2005, The second set of figures 
     presents the same comparison under the assumption that the 
     tax cuts are permanently extended. All of the information 
     provided in this table was previously provided to you in our 
     September 16, 2005 memo, except in a different format.
                                  ____

     To: Mark Prater and Christy Mistr
     Subject: AMT Effects

                                TABLE 1.
------------------------------------------------------------------------
                                                             AMT effect
                           Item                             (billions of
                                                              dollars)
------------------------------------------------------------------------
Tax Cuts Repealed:
    (1) Hold-harmless provision not extended..............         399.9
    (2) Hold-harmless provision extended permanently......         212.0
    (3) Percentage of AMT effect attributable to failure             47%
     to extend hold-harmless provision (((1)-(2))/(1))....
    (4) Hold-harmless provision extended permanently and           169.7
     indexed..............................................
    (5) Percentage of AMT effect attributable to failure             58%
     to extend and index hold-harmless provision (((1)-
     (4))/(1))............................................
Tax Cuts Extended Permanently:
    (6) Hold-harmless provision not extended..............       1,139.1
    (7) Hold-harmless provision extended permanently......         628.5
    (8) Percentage of AMT effect attributable to failure             45%
     to extend hold-harmless provision (((6)-(7))/(6))....
    (9) Hold-harmless provision extended permanently and           472.0
     indexed..............................................
    (10) Percentage of AMT effect attributable to failure            59%
     to extend and index hold-harmless provision (((6)-
     (9))/(6))............................................
------------------------------------------------------------------------

                                                            
                                  ____
     To: Mark Prater and Christy Mistr
     Subject: AMT Effects
       In the information provided to you on August 31, 2005 and 
     September 16, 2005, we analyzed the portion of the AMT effect 
     attributable to the tax cuts. In the analysis described 
     above, we identify the portion of the AMT effect attributable 
     to failure to adjust the AMT exemption amount to inflation. 
     There is, however, interaction between these two contributing 
     factors to the AMT effect. In order to avoid double counting 
     of interactions, a stacking order is imposed. The 
     apportionment of effects to each contributing factor will 
     vary depending on the stacking

[[Page 742]]

     order, even though the total effect remains constant.
       This phenomenon is illustrated by Tables 2 and 3 below. The 
     first two columns of Table 2 show the portion of the AMT 
     effect attributable to the tax cuts, consistent with the 
     information provided on August 31, 2005 and September 16, 
     2005. The second two columns of Table 2 show the portion of 
     the AMT effect attributable to the failure to extend and 
     index the hold-harmless provision, consistent with the 
     information provided in Table 1 above. Note that if these two 
     contributing factors were completely independent of one 
     another, the information in Table 2 would suggest that the 
     two factors together contribute to more than 100 percent of 
     the AMT effect. In fact, as shown in Table 3, the two factors 
     together contribute to only 85 percent of the AMT effect. 
     Thus, there is substantial overlap between these two factors.

                                TABLE 2.
------------------------------------------------------------------------
                                                             AMT Effect
                           Item                             (billions of
                                                              dollars)
------------------------------------------------------------------------
Baseline..................................................       1,139.1
Repeal tax cuts...........................................         399.9
Difference................................................         739.2
Percentage of baseline....................................           65%
Baseline..................................................       1,139.1
Extend and index AMT hold-harmless provision..............         472.0
Difference................................................         667.1
Percentage of baseline....................................           59%
------------------------------------------------------------------------

                                                            
                                  ____
     To: Mark Prater and Christy Mistr
     Subject: AMT Effects

                                TABLE 3.
------------------------------------------------------------------------
                                                             AMT Effect
                           Item                             (billions of
                                                              dollars)
------------------------------------------------------------------------
Baseline..................................................       1,139.1
Repeal tax cuts and extend and index AMT hold-harmless             169.7
 provision................................................
Difference................................................         969.4
Percentage of baseline....................................           85%
------------------------------------------------------------------------


  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  The yeas and nays have been ordered.
  The clerk will call the roll.
  The assistant bill clerk called the roll.
  Mr. McCONNELL. The following Senators were necessarily absent: the 
Senator from New Mexico (Mr. Domenici) and the Senator from Wyoming 
(Mr. Thomas).
  Mr. DURBIN. I announce that the Senator from New Mexico (Mr. 
Bingaman) is necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 73, nays 24, as follows:

                       [Rollcall Vote No. 9 Leg.]

                                YEAS--73

     Akaka
     Allard
     Baucus
     Bayh
     Bennett
     Biden
     Bond
     Boxer
     Bunning
     Burns
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Cochran
     Coleman
     Collins
     Conrad
     Dayton
     DeWine
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Graham
     Grassley
     Hagel
     Harkin
     Hatch
     Hutchison
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Lott
     Lugar
     Martinez
     McConnell
     Menendez
     Mikulski
     Murkowski
     Murray
     Nelson (FL)
     Nelson (NE)
     Obama
     Pryor
     Reed
     Reid
     Rockefeller
     Salazar
     Santorum
     Sarbanes
     Schumer
     Shelby
     Smith
     Snowe
     Specter
     Stabenow
     Stevens
     Talent
     Voinovich
     Warner
     Wyden

                                NAYS--24

     Alexander
     Allen
     Brownback
     Burr
     Chambliss
     Coburn
     Cornyn
     Craig
     Crapo
     DeMint
     Dole
     Ensign
     Enzi
     Frist
     Gregg
     Inhofe
     Isakson
     Kyl
     McCain
     Roberts
     Sessions
     Sununu
     Thune
     Vitter

                             NOT VOTING--3

     Bingaman
     Domenici
     Thomas
  The amendment (No. 2705) was agreed to.
  Mr. FRIST. I move to reconsider the vote.
  Mr. CRAIG. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The majority leader.


                 Unanimous Consent Agreement--H.R. 4659

  Mr. FRIST. Mr. President, I will have a few announcements to make, 
but, first, I ask unanimous consent that following the vote on passage 
of H.R. 4297, the Senate proceed to the immediate consideration of H.R. 
4659, the PATRIOT Act extension. I further ask consent that there then 
be 10 minutes of debate, equally divided, and that following the use or 
yielding back of time, the bill be read a third time and the Senate 
proceed to a vote on passage, with no intervening action or debate.
  The PRESIDING OFFICER. Is there objection?
  Mr. LEAHY. Mr. President, reserving the right to object, and I 
apologize, were you referring to 10 minutes for debate on the PATRIOT 
Act?
  Mr. FRIST. That is correct.
  Mr. LEAHY. I will not object.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  Mr. FRIST. Mr. President, for the information of colleagues, we do 
have two remaining votes this evening. The next vote will be on passage 
of the Tax Relief Act. And following that vote, we will have 10 minutes 
of debate and a vote on passage of the PATRIOT Act extension. That will 
be the last vote. So, Mr. President, two more votes.
  We will be in session tomorrow, but there will be no votes tomorrow. 
The next piece of legislation we will be considering is the asbestos 
legislation, and it will be necessary to file cloture on the motion to 
proceed to that bill.
  The PRESIDING OFFICER. The Democratic leader.
  Mr. REID. Mr. President, what we would be willing to do, if we are 
not in session tomorrow, we would be willing to allow the----
  Mr. FRIST. If there are no votes tomorrow.
  Mr. REID. Either no votes or not in session.
  Mr. FRIST. All right.
  Mr. REID. We would be willing to agree procedurally on a motion to 
proceed to the asbestos bill. You could file whatever papers necessary 
tonight to do that so we could have a Tuesday cloture vote.
  Mr. FRIST. All right. Mr. President, we will work out on filing the 
motion to proceed here, and I will have an announcement. We will have 
no votes tomorrow. By the end of tonight, we will have Tuesday worked 
out. We will be debating the asbestos bill on Monday. The next vote 
will be on that cloture motion, and we will talk about when that would 
occur Tuesday. In all likelihood, if we have a vote Tuesday, it would 
be around 6 o'clock at night. There are a number of Members who will 
want to attend the funeral of Coretta Scott King, and, as I understand 
it, that will be at noon on Tuesday. Therefore, the next vote that we 
will have will be at approximately 6 o'clock on Tuesday night.


                          Conflict of Interest

  Mr. SPECTER. Mr. President, I would like to call the chairman's 
attention to a serious situation facing a Federal district judge in my 
State of Pennsylvania, who recently contacted me on this matter. He has 
an immediate problem that could be solved with an amendment to this 
bill. This judge was assigned as the transferee judge responsible for 
handling all pretrial matters in very large multidistrict litigation 
involving antitrust claims in the corrugated paper industry from all 
around the United States. He has been working on the case since 1999.
  Late in this last year, a company in which the judge inherited stock 
over 30 years ago merged into another company which happens to be one 
of the plaintiffs in the case. Because of the judge's stock holdings in 
this company, the judge may now have to recuse himself from the case. 
Most of the parties would like the judge to remain on the case because 
of his years of experience and expertise on this case. In order to 
remain as the transferee judge, this judge would have to sell his 
holdings, which would give him a capital gain this year well into six 
figures.
  Last March and again this past November, Ralph Mecham, as Secretary 
of the Judicial Conference of the United States, transmitted on behalf 
of the Conference a legislative proposal to you and to Senator Baucus 
that would resolve this judge's problem and similar problems for 
countless other Federal judges throughout the United States. It would 
permit a judge who

[[Page 743]]

must sell financial holdings in order to avoid a conflict of interest 
to reinvest that money in another holding and defer paying the capital 
gains tax until the substitute financial interest is liquidated. The 
taxes are not forgiven, but deferred and payable at the later date, as 
I just said.
  This same solution to conflicts of interest is already available to 
executive branch officials. The proposal by the Judicial conference 
would simply extend it to Federal judges, as well, bringing parity to 
these two branches of the Federal Government.
  I understand that it is too late at this time to offer the Judicial 
Conference proposal as an amendment. However, I would like to know if 
the chairman would consider taking this matter up during the conference 
with the House on this bill.
  Mr. GRASSLEY. Mr. President, I appreciate the Senator bringing this 
matter to my attention and regret that it is too late to amend the bill 
today on the floor. I will agree with the Senator, however, to review 
this proposal further with the intent of taking it up in conference.
  Mr. KENNEDY. Mr. President, budget reconciliation is a process 
adopted by Congress nearly three decades ago to facilitate the passage 
of legislation to reduce the deficit and to help bring the Federal 
budget into balance. But in recent years, under the Republican 
majority, that process has been repeatedly abused to enact more and 
more tax cuts for the wealthy that make the budget deficit even larger.
  Now, they are trying to do it again, in spite of the urgent problems 
facing the Nation, from the ongoing war in Iraq to the devastating 
hurricane damage along the gulf coast. The Republicans have brought 
before the Senate two reconciliation bills, one now passed, that would 
produce a net increase in the budget deficit by billions of dollars 
over the next 5 years.
  It sounds like deficit reduction, until you look at the tax 
reconciliation bill, which will cut taxes by far more than the savings 
in spending--$70 billion. The net result will be a substantial increase 
in the budget deficit--exactly the opposite of what the reconciliation 
process is supposed to accomplish. Billions of dollars will go from 
programs that assist low income families and senior citizens into the 
pockets of the already wealthy. It takes from the least and gives to 
the most. It is a breathtaking Republican scam on the Nation that can 
only further discredit this Congress in the eyes of the people.
  From day one, the Republican plan has been to use this reconciliation 
process to push through a cut in the tax rate on capital gains and 
dividend income. These are tax cuts that overwhelmingly benefit the 
richest Americans. Over half the tax benefits will go to millionaires. 
These tax breaks were in the original mark proposed by Chairman 
Grassley, and they are in the bill already passed by the Republican 
majority in the House of Representatives. While they are not in the 
current Senate bill, we all know these capital gains and dividend tax 
cuts will reappear in the conference report. Leading Republicans have 
made that clear. The GOP is intent on delivering those tax breaks to 
their wealthy supporters. They will be included in the final bill.
  What is the real cost of these capital gains and dividend tax cuts? 
The Republicans claim the cost of these provisions is $20 billion, the 
real cost of extending the lower rates for another 2 years is $50 
billion. This tax break is particularly unfair, because over 75 percent 
of the tax benefits will go to taxpayers with incomes over $200,000 a 
year. Over half the benefits--53 percent--will go to taxpayers with 
incomes over $1 million a year. The average millionaire will save over 
$35,000 a year from these tax breaks for capital gains and dividends.
  As a result of this shameful Republican let-them-eat-cake proposal, 
millions of working families would pay a substantially higher tax rate 
on their wages than wealthy taxpayers pay on their investment income. 
What could be more unfair? Republicans are penalizing hard work, not 
rewarding it. They are giving a preference to unearned income over 
earned income.
  The Republicans cynically claim that capital gains and dividend 
income deserve special treatment because they will stimulate 
investment. The facts do not substantiate that claim. The stock market 
grew much more rapidly in the early and mid-1990s when investors' 
income was taxed at the same rate as employers' wages than since the 
rates on capital gains and dividend income were cut. The overall health 
of the economy has much more to do with financial stability than 
special tax breaks for the rich. More tax cuts that America cannot 
afford will hurt the economy, not help it.
  There are some provisions in the Senate bill that we do need to 
address. The alternative minimum tax was never intended to apply to 
middle-class families, and they deserve tax relief. In a truly 
outrageous move, the House Republicans took AMT relief for the middle 
class out of their reconciliation bill so they could fit in more tax 
breaks for the rich. The research and development tax credit is 
important to our international competitiveness and should be retained. 
However, those worthwhile tax cuts should be paid for by rolling back 
some of the extravagant tax breaks that this Republican Congress has 
already given to the Nation's wealthiest taxpayers. We simply cannot 
afford more tax cuts at a time when we are facing record deficits.
  The financial mismanagement of the Bush administration has weakened 
our economy and placed our children's financial well-being in peril. 
The national debt has risen to an all time high of $8 trillion. Under 
President Bush, our country has borrowed more from foreign governments 
and foreign financial institutions than in the prior 200 years 
combined. We are losing control of our Nation's future, and all the 
Republicans offer is more of the same. More and more tax breaks further 
enriching the already wealthy, while working families are left to 
struggle on their own in an increasingly harsh economy.
  If we are honest about reducing the deficit and strengthening the 
economy, we need to stop lavishing tax breaks on the rich and start 
investing in the health and well-being of all families. These families 
are being squeezed unmercifully between stagnant wages and ever-
increasing costs for the basic necessities of life. The cost of health 
insurance is up 59 percent in the last 5 years. Gasoline is up 74 
percent. College tuition is up 45 percent. Housing is up 44 percent. 
The list goes on and on, up and up--and paychecks are buying less each 
year. The dollars that go to pay for more tax breaks for the rich are 
dollars that could be used to help these families. Instead, this 
Republican budget plan turns a blind eye to their problems.
  The economic trends are very disturbing for any who are willing to 
look at them objectively. The gap between rich and poor has been 
widening in recent years. Thirty-seven million Americans now live in 
poverty, up 19 percent during the Bush administration. One in five 
American children lives in poverty. Fourteen million children go to bed 
hungry each night. Wages remain stagnant while inflation drags more and 
more families below the poverty line. Two-point-eight million 
manufacturing jobs have been lost. Long-term unemployment is at 
historic highs.
  In his second inaugural address, President Lincoln reminded us of the 
solemn obligation that we have to those who fight our Nation's wars. He 
said ``let us strive on to finish the work we are in, to bind up the 
Nation's wounds, to care for him who shall have borne the battle [and 
for his widow and his orphan.]''
  Over 550,000 brave men and women have served in Iraq and Afghanistan. 
A majority of them have served multiple tours fighting under dangerous 
conditions, and battling an unseen foe. We owe it to them to care for 
their injuries incurred in service of our Nation.
  As of today, over 16,000 of our troops have been injured in battle. 
Of those, over 7,500 were so seriously injured that they could not 
return to duty. We have seen the ravages of war in the wards of Walter 
Reed and Bethesda. While body armor saves lives, many soldiers and 
Marines have lost their limbs.

[[Page 744]]

  Others will survive with major injuries to their spine or brain 
damage. This summer, the Surgeon General of the Army reported that 30 
percent of U.S. troops have developed mental health problems within a 
few months of their return from Iraq. Twenty percent of the troops 
injured in Iraq have suffered head and brain injuries that require a 
lifetime of continual care that could cost as much as $5 million.
  A recent study by the New England Journal of Medicine found that 15 
to 17 percent of Iraqi vets showed signs of ``major depression, 
generalized anxiety, or [Post Traumatic Stress Disorder].'' But of 
those, only 23 to 40 percent are seeking help. Many of them will wind 
up homeless with no other options for their health care than the VA. 
After their service to our country, we should not leave them out on the 
street.
  The increased use of the Guard and Reserve in this conflict has 
created an entirely new category of people who may now make use of the 
VA. The Guard and Reserve make up approximately 40 percent of the 
troops on the ground, and approximately 90,000 have sought care at VA 
hospitals.
  Unfortunately, our current budgets do not reflect this reality. A 
recent study by Nobel Prize-winning economist Joseph Stiglitz and 
Harvard professor Linda Bilmes found that the costs of paying for the 
injured from these wars has not yet been budgeted. To our dismay, we 
learned that the Veterans' Administration needed an additional $2.7 
billion for this fiscal year to care for the veterans returning from 
the war.
  Stiglitz and Bilmes found that, ``the military values the cost of 
those injured by what their medical treatment cost and disability pay; 
and current accounting only reflects current payments in disability'' 
not future payments.
  Based on their calculations, it could cost as much as $24.1 billion 
to pay for these costs over the next 5 years. Of this amount, $9.4 
billion for medical care and $14.7 billion for increased disability 
payments.
  This amendment Senator Dodd and I have introduced would rectify that 
shortfall and keep faith with our men and women in uniform. It would be 
paid for by elimination of the capital gains and dividends tax breaks 
for taxpayers with over $1 million in annual income.
  We owe it to soldiers like Sergeant Peter Damon, a son of 
Massachusetts who lost his arms in Iraq.
  I also express my support for the amendment offered by Senator 
Rockefeller that would provide strong tax incentives for mining 
companies to adopt safer practices and up-to-date safety equipment.
  The recent tragedies at Sago Mine and Alma Mine in West Virginia 
remind us that the safety of the Nation's workers is paramount. This 
year, 21 miners have already been killed on the job. In early January, 
12 miners died when they were trapped after an explosion at the Sago 
Mine. Just 2\1/2\ weeks later, two more miners died in a mine fire at 
the Alma mine. And tragically, yesterday, there were three more mine 
accidents in West Virginia, killing two more men. One miner died in an 
underground mine in Boone County when a wall support came loose. A 
second miner died when a bulldozer struck a gas line, causing a deadly 
fire. Miners have also died this year in Kentucky and Utah.
  Our entire Nation joins the families and the communities in mourning 
these fallen miners. We have a continuing obligation to do everything 
we can to protect the safety of America's workers. It is obvious that 
we are not meeting that obligation.
  Two weeks ago, I traveled with Senator Rockefeller, Health, 
Education, Labor and Pensions Committee Chairman Enzi, and Subcommittee 
Chairman Isakson to meet with the family members of the miners who were 
killed at Sago Mine, and with coalminers, company representatives, and 
health and safety experts. Each of us committed to improving the 
Nation's mine safety laws.
  A critical part of that commitment is to ensure that all of our 
Nation's miners have the best safety equipment available. This 
amendment will encourage companies to adopt up-to-date mine safety 
equipment by providing accelerated deductions for companies that invest 
in these technologies.
  It encourages mines to adopt emergency communications technology and 
tracking devices to locate miners underground. It will also encourage 
coal mines to ensure that workers have access to additional stores of 
emergency oxygen, which will give them extra time to exit a mine or to 
wait for rescue. Finally, the amendment acknowledges the vital need for 
experienced mine rescuers who are familiar with the underground 
geography of a mine. By providing a tax credit to encourage the 
formation of mine rescue teams, we hope to ensure that mines have well-
trained rescuers onsite, saving precious minutes in any rescue attempt.
  These are all safety measures that could have made a difference in 
the terrible tragedies that occurred this year at Sago and Alma Mines. 
By passing this amendment, we take the first step toward preventing 
future such tragedies from occurring.
  I have joined separately in sponsoring legislation introduced by 
Senator Byrd and Senator Rockefeller to require the Mine Safety and 
Health Administration to quickly adopt needed safety standards. Both of 
these measures are critical to improving safety conditions in America's 
mines. Our Nation's miners deserve no less, and I urge my colleagues to 
support this amendment and the Federal Mine Safety and Health Act of 
2006.
  Instead of helping hard-pressed families, the budget reconciliation 
process is being misused to cut the programs and eliminate the services 
that these families need most, while granting the wealthy even more tax 
breaks. It is yet another opportunity squandered--another chance that 
this Republican Congress had to make things better. But once again, 
this Congress has chosen to make them worse instead. The American 
people deserve better.
  Mr. HATCH. Mr. President, I rise to express my support for the tax 
reconciliation bill being debated today. I have listened to the 
comments of my colleagues on both sides of the aisle with much 
interest. Because we have heard a great deal about the wisdom or folly 
of extending the lower tax rate on dividends and capital gains, I would 
like to take this opportunity to offer a few words in defense of the 
extension.
  It is interesting to me that so many of my colleagues have juxtaposed 
the capital gains and dividends provision against the provision to 
relieve temporarily the individual alternative minimum tax. Listening 
to some of my colleagues, it seems they believe that we either must 
include the alternative minimum tax fix or extend the capital gains and 
dividends provision, but not both. My strong belief is that we can--and 
must--do both.
  The reduced rate of tax on dividends and capital gains has been 
attacked repeatedly as being a costly sop to the rich and not much 
else, with little recognition given to its beneficial impact on the 
economy. The simple fact is that the data and basic economics tell us 
the cost of the lower tax rates on dividends and capital gains has been 
minor, and the benefits immense.
  There is ample evidence that clearly shows the lower tax rates on 
capital income have stimulated saving. Alicia Munnell, an economist at 
Boston College and a former official in the Clinton Treasury 
Department, finds that working age households saved significantly more 
in 2003, the year the tax reductions on capital gains and dividends 
passed the Congress, than they did in 2002. Incidentally, Munnell's 
work also shows that the recently announced savings rate of zero is 
misleading--she reports that working families, and by that I mean 
families with breadwinners who have yet to reach retirement age, are 
indeed putting money aside. However, looking at our broad, economy-wide 
measure of net saving, the dissaving done by retired households 
obscures this fact.
  There are other benefits from a lower tax rate on investment income 
besides increased saving. With lower tax rates, capital becomes more 
fluid, making it easier for it to flow to projects with

[[Page 745]]

higher rates of return. Families lock in much less capital for fear of 
the taxman. The Government gets a lower percentage of each sale of 
stock, but it gets more opportunities to tax the money.
  And, Uncle Sam is getting more cracks at it. The amount of capital 
gains realized in 2005 was twice that in 2002. The stock market's value 
has not doubled since then, and we are not twice as wealthy as we were 
then--people are just responding to incentives and they are holding 
their assets for a bit less time. There is nothing necessarily wrong 
with that. If capital is used more wisely, this ultimately benefits not 
just the investors but also the workers, who see their productivity 
increase. When productivity goes up, wages must follow.
  The amount of revenue collected from taxes on capital gains and 
dividends has increased significantly since the reduction in tax rates 
passed. In 2005, capital gains tax revenues amounted to $80 billion, 60 
percent higher than in 2002.
  Now, I am not about to claim that this or any other tax cut ``pays 
for itself,'' but the revenue lost from the lower rates on capital 
gains and dividends is relatively minor precisely because of the 
increased economic activity the lower taxes generate. The jump in 
revenues collected from the two taxes is manifest proof of this.
  The beneficiaries of lower taxes on investment income are not just 
those who own stocks and bonds either, and I would like to point out 
that it is not just the rich who have investments. I hear from retired 
Utahns who are living modestly on a Social Security check, a small 
pension, and their savings. They might not have a lot of money 
invested, and their dividends are not going to buy them a new car or 
luxury condominium, but every little bit helps, they tell me.
  In reality, everyone benefits from lower taxes on dividends and 
capital gains--even those with little or no savings. The primary reason 
for lower tax rates on investment income is that it stimulates the 
economy. This is not a radical idea by any means--Nobel Prize-winning 
economists Robert Lucas and Ed Prescott have argued vehemently in favor 
of this. The logic is simple: Low taxes on the income we receive from 
our savings means we will save more. That ends up making more capital 
available for firms to invest in new plant and equipment, increasing 
productivity as well as wages.
  The strong economic conditions of the 1990s are owed to a number of 
factors, but the most important factor was undoubtedly the resumption 
of high productivity growth in the middle of the decade. It was in the 
latter years of the expansion, when unemployment dropped below 5 
percent, that we finally saw the elusive gains in income of low-skilled 
workers. I believe that the low tax rate on capital gains and dividends 
is an essential ingredient in creating more new jobs and maintaining 
healthy economic growth.
  Some of my colleagues may say they agree that the benefits of lower 
rates are real and ought to be continued, but they do not see the need 
to renew a provision that does not expire until 2008. The simple answer 
is that we need to create some degree of certainty and stability for 
investors. Investors in 2006 care about what the tax rate on a long-
term investment is going to be in 3 years. If they believe that 
Congress will allow tax rates on dividends and capital gains to 
increase to their previously higher rates, they will be less inclined 
to make those investments. That money will go instead to less 
productive, shorter term investments or will simply not be saved at 
all. The end result is that we'll have less capital available and lower 
economic growth.
  We must acknowledge that the budget deficit is a problem--it is 
obvious we need to get our economic house in order soon. The baby boom 
generation is starting to retire and making our budget mess a lot 
worse. However, increasing the taxes on dividends and capital gains is 
not the answer to our budget morass, either in the short or the long 
run. We need every single bit of economic growth we can get for the 
next decade to help fund our obligations, and allowing the tax rates on 
dividends and capital gains to go back up would be a tax increase that 
would reduce growth.
  When we seek to raise revenue by taxing the accumulation of wealth, 
we are essentially punishing a virtuous activity, namely saving. We 
should be doing all we can to encourage families to set aside money, to 
invest, to patiently prepare for the future. Allowing the low tax rate 
on dividends and capital gains to expire would do more than reduce 
productivity and economic growth; it would send a signal that we do not 
value savings in this country. At this point in time, we can afford 
neither.
  Some of my colleagues believe that low tax rates on dividends and 
capital gains benefit solely the rich and no one else and feel that 
they cannot countenance a continuation of the low rates at the expense 
of programs more targeted to low-income households. I do not fault my 
colleagues for their concern, but I believe that the lower rates helps 
everyone in our country. It costs us relatively little in terms of lost 
tax revenue, since the lower rates have resulted in higher dividends, 
higher stock prices, and more sales of stock, with more revenue created 
by each activity. At the same time, every single working family in this 
country benefits from the higher savings engendered by the lower tax 
rates via the improved productivity, wages, economic growth, and the 
number of jobs available. High growth and economic prosperity are not 
the cure to every problem that ails the country, but it can make any 
solution much more attainable. Supporting low tax rates on dividends 
and capital gains is the right thing to do.
  The PRESIDING OFFICER. Are there further amendments to the first-
degree amendment?
  If not, without objection, the first-degree amendment, as amended, is 
agreed to.
  The amendment (No. 2707), as amended, was agreed to.
  The amendment was ordered to be engrossed and the bill to be read a 
third time.
  The bill was read the third time.
  Mr. FRIST. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The bill having been read the third time, the question is, Shall the 
bill pass? The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. McCONNELL. The following Senators were necessarily absent: the 
Senator from New Mexico (Mr. Domenici) and the Senator from Wyoming 
(Mr. Thomas).
  Mr. DURBIN. I announce that the Senator from New Mexico (Mr. 
Bingaman) is necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 66, nays 31, as follows:

                      [Rollcall Vote No. 10 Leg.]

                                YEAS--66

     Alexander
     Allard
     Allen
     Baucus
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Cantwell
     Carper
     Chambliss
     Clinton
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     Dayton
     DeMint
     DeWine
     Dole
     Ensign
     Enzi
     Feinstein
     Frist
     Graham
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Isakson
     Johnson
     Kyl
     Landrieu
     Lincoln
     Lott
     Lugar
     Martinez
     McCain
     McConnell
     Menendez
     Murkowski
     Nelson (FL)
     Nelson (NE)
     Pryor
     Roberts
     Rockefeller
     Salazar
     Santorum
     Schumer
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stabenow
     Stevens
     Sununu
     Talent
     Thune
     Vitter
     Warner

                                NAYS--31

     Akaka
     Bayh
     Biden
     Boxer
     Burr
     Byrd
     Chafee
     Coburn
     Conrad
     Dodd
     Dorgan
     Durbin
     Feingold
     Harkin
     Inouye
     Jeffords
     Kennedy
     Kerry
     Kohl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Murray
     Obama
     Reed
     Reid
     Sarbanes
     Voinovich
     Wyden

[[Page 746]]



                             NOT VOTING--3

     Bingaman
     Domenici
     Thomas
  The bill (H.R. 4297), as amended, was passed, as follows:
  (The bill will be printed in a future edition of the Record.)

                          ____________________