[Congressional Record (Bound Edition), Volume 153 (2007), Part 3]
[Senate]
[Pages 3785-3790]
[From the U.S. Government Publishing Office, www.gpo.gov]




  MAKING FURTHER CONTINUING APPROPRIATIONS FOR THE FISCAL YEAR 2007--
                               Continued

  Mr. ALEXANDER. 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for the quorum call be rescinded.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. ALEXANDER. Mr. President, I ask unanimous consent that I be 
allowed to speak for up to 20 minutes on the continuing resolution.
  The PRESIDING OFFICER. The Senator has that right.
  Mr. ALEXANDER. Thank you, Mr. President.
  A few days ago, I came to the floor deeply concerned because someone, 
someone over in the House of Representatives--first, let me ask the 
Chair, will you please give me a minute's notice when my 20 minutes is 
up?
  The PRESIDING OFFICER. At the conclusion of 19 minutes, the Senator 
will be given notice.
  Mr. ALEXANDER. Thank you very much.
  Someone over in the House of Representatives, before they sent that 
continuing resolution or joint funding resolution over here, had taken 
the Teacher Incentive Fund, which was to be funded at $100 million a 
year, and reduced it to $200,000. In other words, they killed the 
funding. I couldn't imagine someone would do that on purpose, and so I 
came here to say so. I know it was a confusing time and there were lots 
of different priorities to be met. Perhaps, in the difficulty of 
putting together the joint funding resolution, it was just a slip-up. I 
said I hoped it wasn't the signal of what the new Democratic majority's 
education policy would be because I couldn't imagine the new Democratic 
majority--or the old Democratic minority, for that matter--or any of us 
on either side being against the Teacher Incentive Fund.
  What the Teacher Incentive Fund does is almost the most crucial thing 
we need to do in helping our schools succeed. It makes grants to States 
and cities that are doing the best work in trying to find fair ways to 
reward outstanding teaching and to reward good principals. Every 
education meeting I go to, and I have been going to them for years, 
that ends up being the No. 1 thing we need to do. First are parents, 
second are teachers and principals, and everything else is about 5 
percent. In other words, a child who has a head start at home is a 
child who is going to get an education almost no matter what else 
happens. But if you add an outstanding teacher and an outstanding 
principal to whatever happens at home, the school is better and the 
classroom is better and the child succeeds. This is especially true for 
low-income children in America, which is exactly what the Teacher 
Incentive Fund is designed to meet.
  Well, I wasn't disappointed because within 5 minutes after I began, 
the distinguished Senator from Illinois, Mr. Durbin, the assistant 
Democratic leader, came on the floor, and I think I am being fair in 
characterizing his remarks when he said: Whoa, wait a minute. This is a 
good program. In fact, I just received a call this afternoon, said 
Senator Durbin, from the superintendent of the Chicago schools, and he 
said we need this program. He said we have a lot of low-income, poor 
kids who aren't making it, whom we are leaving behind, we want to help 
them, and this helps us do that. He said we have a grant under the 
Teacher Incentive Fund to do it.
  We heard further testimony at a roundtable in our Health, Education, 
Labor, and Pensions Committee that in the Chicago schools they closed 
some schools where children were not learning year after year after 
year. What did they do? They put in a new team--a new principal, a new 
set of teachers. And what did they do with the teachers? They paid them 
$10,000 a year more than they were otherwise making to make sure they 
would go there because they were the teachers known in Chicago to be 
able to help low-achieving students achieve.
  We all know from our experience and research that virtually every 
child can learn. Some children just need a little extra help getting to 
the starting line. If you don't get it at home, you especially need it 
at school. And where you get it at school is from outstanding teachers 
and principals.
  So it wasn't Senator Durbin, who is the assistant Democratic leader 
in the Senate, who was trying to kill the Teacher Incentive Fund. So I 
have been wondering for the last few days, well, then, who was it? Who 
was it? Well, now I know, Mr. President, because they have announced 
it.
  Today comes a letter to me--``Dear Senator Alexander''--on behalf of 
the National Education Association, the NEA, with 3.2 million members, 
saying:

       We urge your opposition to several ill-conceived amendments 
     to the continuing resolution. Specifically, we urge you to 
     vote ``no'' on an amendment to be offered by Senator 
     Alexander, Republican of Tennessee, that would provide $99 
     million for the teacher incentive fund.

  So the NEA, in its brilliance, has written me a letter to ask me to 
vote against my own amendment.
  I am astonished. That doesn't surprise me so much. Any of our offices 
can make a mistake. But what I want the President to know, and I want 
our colleagues to know--I want them to know who is against this, and I 
want the world to know what they are against. What they are against is 
helping find a fair way to pay good teachers more for teaching well and 
to train and help good principals lead schools, especially in big 
cities where we have a lot of low-income children who are falling 
behind.
  This is not some abstract notion. The President had recommended $100 
million for the Teacher Incentive Fund as part of the No Child Left 
Behind legislation. In a bipartisan way it passed several years ago, 
and we are in the midst of a remarkably bipartisan approach to see what 
we need to do about NCLB as we reauthorize it for 5 years, and part of 
it is the Teacher Incentive Fund.
  In a very tight budget, President Bush has recommended not just $100 
million for the next year, he has recommended $200 million.
  I placed into the Record a few days ago Secretary of Education 
Spellings' letter saying this is very important. We have just started 
this program. We made a number of grants to cities all across America, 
16 grants across the country, at least one State--in South Carolina. 
You have cut us off. You stopped us from making an evaluation and 
reporting back to the Senate, to the Congress, how this is working. You 
are disappointing these school districts who have stepped up to do 
this.
  That is what has happened. Just to be very specific, here is the kind 
of thing that the Teacher Incentive Fund grant does. Memphis, our 
biggest city, has an unusually large number of our lowest performing 
schools. It is our poorest big city, one of the poorest big cities in 
America. It has a real solid school superintendent, she's excellent, 
and they are working hard to improve.
  A lot of the Memphis citizens are putting together a special effort 
to say: One of the single best things we can do in Memphis is to take 
every single one of our school principals, put them through a training 
program for a year, hook up with New Leaders for New Schools to do 
that, continuing after the year, and then we will put them back in 
charge of their school. We will give them autonomy to make the changes 
they need to make, and we will see if these children can succeed 
because we know if they can succeed, if we help them the correct way--
we give them extra hours, as we have in our charter schools, give them 
extra training, we know they will succeed.

[[Page 3786]]

  Memphis City Schools and New Leaders for New Schools were awarded a 
grant for $3.1 million in the year 2006, the first year after the 5-
year grant totaling $18 million. Over the 5-year grant, Memphis plans 
to provide training and incentive grants to 83 principals serving 
almost one-third of the schools in the Memphis school system. 
Principals will receive incentive grants of at least $15,000 a year.
  What is wrong with that? Why would the largest educational 
association in America oppose taking a city with low-performing 
students and saying we are going to kill the program that trains your 
principals and pay them $15,000 more a year to do a better job? Why 
would they do that?
  The assistant Democratic leader doesn't agree with that. At least he 
said so on the floor of the Senate. I don't agree with it. I don't 
think the parents of the children agree with it. The school 
superintendent doesn't agree with it, nor does the mayor. Who is 
against this? We are trying to pay more money to the members of the 
association that is trying to kill the program. That is what we are 
trying to do.
  It is not just Memphis. I think it is important that my colleagues in 
the Senate--if the snow and the ice has not caused them to flee to the 
suburbs. I think most of them are in their offices, maybe a few are 
even listening. I want them to know that the National Education 
Association wants to kill the program for the Northern New Mexico 
Network, the Northern New Mexico Network for Rural Education, a 
nonprofit organization, one of the 19 grantees of the Teacher Incentive 
Fund. It is partnering with four school districts. They serve a region 
with high levels of poverty, high concentrations of Native Americans 
and Hispanic students, extreme rural conditions, small schools. So the 
NEA wants to kill the program to help make those teachers and those 
principals better.
  Here's another project, New Leaders for New Schools in the DC public 
schools. This is a coalition with DC public schools and several others, 
to provide direct compensation to teachers and principals who have 
demonstrated their ability to move student achievement.
  What a terrible thing to reward--teachers who have demonstrated an 
ability to move student achievement. Let's kill that program right 
away. We don't want that happening in the District of Columbia, do we?
  Let's go to the Chicago public schools. Chicago has taken a lot of 
steps in their public schools. The mayor deserves a lot of credit for 
that. The school system deserves a lot of credit. They know these 
children can't wait 5 or 10 years to have a good education experience, 
so, as I mentioned earlier, in some cases they are not moving the 
school, they are just transforming it. How do you transform a school? 
There is only one way. You move in a new principal and you move in some 
really good teachers. There is only one way to transform a school, and 
that is it.
  So the Chicago public schools in collaboration with the National 
Institute for Excellence in Teaching proposes the Recognizing 
Excellence in Academic Leadership. At the heart of that is multiple 
evaluations, opportunities for new roles and responsibilities, 
recruitment, development, retention of quality staff in 40 Chicago high 
schools that serve 24,000 students. The NEA wants to kill that program. 
That is the third grantee.
  Let's go to Denver. The Denver public schools proposed a twofold 
district-wide expansion of its professional compensation system for 
teachers--that means we pay them more--to develop and implement and 
evaluate a performance-based compensation system for principals.
  My goodness, Denver wants to pay its best principals more money so 
they might stay in the school? And how are they going to do that? They 
are going to think about it. They are going to work within the system. 
They are going to ask for outside help. They are not just imposing a 
one-time bonus, merit pay system. They are trying to lead the country 
in doing this. The National Education Association says: No, let's kill 
it.
  The National Education Association not only said, no, let's kill it, 
they issued a threat to Members of the Senate. ``Votes associated with 
these issues may be included in the NEA legislative report card for the 
110th Congress.'' That means if you vote against the Alexander 
amendment or anybody else's amendment supporting the Teacher Incentive 
Fund, what we, the National Education Association, will do is write all 
the teachers in Tennessee or Rhode Island or wherever we may be and 
say: Your Senator is anti-education.
  Why is the Senator anti-education? Because he wants to support a 
program to find a fair way to reward outstanding principals and 
teachers who are teaching low-income children and helping them succeed.
  California--my goodness. The Mare Island Technology Academy--here is 
another thing that NEA would like to stomp out. It proposes to extend a 
current project to award incentives to teachers and principals 
instrumental in increasing student achievement. We can't have that in 
California, at least under the NEA.
  The Houston independent school district--maybe Senators Cornyn and 
Hutchison would like to know about this. It is the largest public 
school district in Texas, the seventh largest in the United States. It 
proposes an incentive plan for teachers that focuses on teacher 
effectiveness and growth in learning. We don't want that in any school, 
do we?
  Guilford County, NC--maybe Senator Burr and Senator Dole would like 
to be aware of this because their schools proposed a financial 
recruitment project called Mission Possible and plans to extend the 
program to an additional seven schools, charter schools in various 
States.
  Another project. Alaska--one school district there serves as the 
fiscal agent. They are working on the same sort of progress and 
expanding on a current program with the Re-Inventing Schools Coalition.
  South Carolina Department of Education. A modified version of the 
existing teacher advancement program to implement a performance-based 
compensation system to address problems with recruitment and retention 
in 23 high-need schools in six districts. We wouldn't want 23 high-need 
schools in six South Carolina districts to have a program to pay good 
teachers more for teaching well, would we? We would like to kill that 
in the Congress because the National Education Association might put us 
on their list of not voting for the NEA legislative report card.
  Dallas independent school district--they have a similar program. They 
want to identify and reward principals and teachers based on a 
combination of direct and value-added measures of student achievement. 
Can't have that.
  The school district of Philadelphia, PA. Let's pay particular 
attention to this one. The overall purpose of Philadelphia's initiative 
is to pilot a performance-based staff development and compensation 
system that is teacher pay and principals, that provides teachers and 
principals with clear incentives that are directly tied to student 
achievement, growth and classroom observations conducted according to 
an objective standards-based rubric at multiple points during the 
school year. Twenty high-need urban elementary schools that have 
demonstrated high degrees of faculty buy-in--that means the teachers 
want it--will participate in the pilot.
  Nobody is making them do it. They are volunteering to do it. The 
teachers want it. Leaders from the school district of Philadelphia's 
administration and from two unions, representing all Philadelphia 
teachers and principals, have designed the pilot and will oversee its 
implementation. So the National Education Association says kill the 
program in Philadelphia for a lot of high-need kids, even though the 
program involves the unions who work in those schools. That is a very 
arrogant attitude, it seems to me.
  Ohio, State Department of Education, Eagle County, CO, and Weld 
County, CO--those are just the schools and school districts and the 
States where the Department has made 16 grants in the first year of its 
operation.

[[Page 3787]]

  As you can see, the common thread running through here is, can we 
find a fair way to reward outstanding teachers and help in training and 
reward outstanding principals so they will stay in the classroom, so 
they will have an even better idea of what they are doing, so we can 
honor them, treat them in a more professional way? If we were to do 
that, wouldn't that be better?
  Why wouldn't the largest educational association in America welcome 
this? I know in Chattanooga, TN, when the new Senator from Tennessee, 
Bob Corker, was mayor, he was more effective than I was in working with 
the local teachers association or union, and he did just this--
generally with their participation and agreement. And he helped, in a 
model school system in Chattanooga, TN, find a way to attract teachers 
to the schools where children were having trouble learning and needed 
extra help. These were teachers who had shown an ability to help these 
students achieve more. So they were paid more for that. They were paid 
more for that.
  Let me conclude my remarks. I ask unanimous consent for another 5 
minutes, if I may?
  The PRESIDING OFFICER. The Senator has that right.
  Mr. ALEXANDER. I will conclude my remarks with a little bit of 
history. If you sense, in my voice, a heavy amount of disappointment, 
it is because this goes back a long ways. In 1983, when I was Governor 
of Tennessee, I proposed what then was the first statewide program to 
pay teachers more for teaching well. We called it the Master Teacher 
Program.
  I was astonished, after a term as Governor, to discover that not one 
State was paying one teacher one penny more for teaching well. I could 
not understand how we were going to keep outstanding men and women in 
the classrooms, particularly--this was 25 years ago, almost--now that 
women had many more employment opportunities. The math teacher was 
headed for IBM, the science teacher was going over here. One reason was 
because of the teacher pay scale. You could make more for staying 
around a long time, you could make more for getting another degree, but 
you couldn't make a penny more for being good.
  I went around to try to find out how do we reward outstanding 
teaching, and everybody said you can't do that. Not quite everybody. 
One person who did not say that was Albert Shanker, who was the head of 
the American Federation of Teachers, which is the second largest 
teachers union. Mr. Shanker said if we have master plumbers we can have 
master teachers, and maybe we need to get busy trying to think of a 
fair way to do that. He invited me to go to Los Angeles and speak to 
the convention of the American Federation of Teachers. They were very 
skeptical--which I understand, because professionals who are already 
working in their profession have a right to be skeptical of outsiders 
who would come in and say we are going to grade you. Even though these 
teachers are in the business of grading themselves.
  I spoke to the American Federation of Teachers. I worked with Mr. 
Shanker. I even raised taxes in Tennessee. Guess who was against doing 
what we eventually did? The National Education Association. Their 
President said we are going to send whatever we need into Tennessee to 
defeat Alexander's silly ideas, and we fought for a year and a half and 
finally I won, temporarily, and Tennessee established a career ladder 
program which eventually attracted 10,000 teachers with 10- or 11-month 
contracts who volunteered to go up the career ladder to a second or 
third level. They were called master teachers.
  We raised the pay for every teacher by $1,000, just if they took the 
basic teacher competency test. That was voluntary, too, but more than 
90 percent did it. And 10,000 teachers did. That was quite a number. 
This was sort of the model T of the teacher compensation plans.
  Since then, a lot has happened across the country. Governor Jim Hunt 
and others, with the support of the teachers unions, have developed the 
National Board of Professional Teaching Standards Certified Teacher 
Program, which is one way of certifying a biology teacher in the same 
way you would certify an orthopedic doctor. This is helpful if you are 
on the school board in Providence, you can say: I don't have the means 
to evaluate if this teacher is better than that teacher, but if you are 
a board certified teacher we will pay you $10,000 more a year. That has 
worked pretty well. Some places around the country have found ways to 
do that, but it is not possible for a school board in the town to take 
on the whole mixture of difficulties that go with a fair way to reward 
teachers.
  We did it in 1983 and 1984, and we had to create a panel of teachers 
who were outside the district of the teacher who wanted to be a master 
teacher to avoid politics. We made sure one of those teachers was of 
that same subject. If it was an eighth grade U.S. history teacher, then 
somebody on the panel was an eighth grade U.S. history teacher. 
Principal evaluations were part of it and a teacher portfolio was part 
of it.
  One thing we did not know how to do then and we are just beginning to 
understand in our country is how to measure student achievement. Our 
common sense says a teacher makes a big difference, but how do we 
measure it? The challenge, as we work on schools that need help, is how 
do we make sure they have the best teachers and the best school 
leaders? It is a big challenge, but it is not impossible.
  We are learning, after 4 years of No Child Left Behind, that 80 
percent of our schools I would call high-achieving schools are meeting 
all the adequate yearly progress requirements for No Child Left Behind. 
That means we have about 20 percent of our schools that aren't. In 5 
percent of the schools, they are only behind in one category. So it is 
only 15 percent of the schools where children are chronically not 
learning and being left behind. The ugly fact was, before No Child Left 
Behind, we let that happen.
  Now we put the spotlight on it, and we have to do something about it. 
The best way to do something about it is what? Get a terrific school 
leader and help him or her be a good principal, move in some tremendous 
teachers or reward those who are there and keep them teaching. And the 
National Education Association says kill the program that is the most 
important Federal program to do that? I don't understand that; I don't 
understand.
  I say to my colleagues in the Senate of both parties, I hope this 
approach will have unanimous opposition in the Senate. I hope we say we 
want to reward efforts in Memphis, in New Mexico, DC, Chicago, Denver, 
Dallas, Houston, Philadelphia, Chattanooga, where they tackle the 
problem. No, we are not talking about a one-time bonus pay for people, 
or teacher of the year, who the principal might like. We are talking 
about a more professional system where we can say talented men and 
women who are teachers, we like to honor you. We want to work with you 
in your district to form a way to honor you and raise your pay.
  There is one reason I regret having to make this speech, I had a 
wonderful visit the other day. It came from six or seven members of the 
Tennessee Education Association. Earl Wiman, Guy Stanley, Paula Brown, 
Nita Jones, and Kristen Allen came to my office. We visited for a 
while. I am about to write a handwritten note to Earl Wiman to say how 
much I appreciated the visit. He was a career ladder teacher, making 
$75,000 extra dollars over his tenure. He said ``I want to thank you 
for that.'' We acknowledged there were problems with the master teacher 
program we had in Tennessee as there always are when you start up 
something new. It was a terrific visit from people I greatly respect.
  It reminded me, wherever I go in Tennessee, retired teachers or 
current teachers come up to me and say, thank you for the master 
teacher program. It paid for my child's education. It honored my work. 
It raised my retirement pay. It kept me teaching. You would be 
surprised how many times this happened, so I know this can be done.
  But it cannot be done if the largest educational association in 
America sends out letters such as this threatening Senators with, in 
effect, writing

[[Page 3788]]

every teacher in their district, and saying you are a bad Senator 
because you voted against the NEA legislative report card.
  I would give them an F on a letter for another reason. They said that 
the Teacher Incentive Fund restricts the use of funds to only two 
possible uses: merit pay and tenure reform. That is not true, at least 
not according to the Department of Education. We called over there 
today. This is what they told me: The Department of Education says the 
words ``tenure'' or ``merit pay'' do not even appear in the application 
forms. The specific goals of the teacher incentive fund include: one, 
improving student achievement by increasing teacher and principal 
effectiveness; two, reforming teacher and principal compensation 
systems so that teachers and principals are rewarded for increases in 
student achievement; three, increasing the number of effective teachers 
teaching minority, poor, and disadvantaged students in hard-to-staff 
subjects; and finally, creating sustainable, performance-based 
compensation systems.
  Applicants must outline how they will utilize classroom evaluations 
that are conducted multiple times throughout the school year and 
provide incentives for educators to take on additional responsibilities 
and easy leadership roles.
  The Department also gives extra points to applications that 
demonstrate they have support from a significant proportion of 
teachers, the principal, and community. As I mentioned, in Philadelphia 
or Denver, that means the teachers' union.
  I know in this joint funding resolution it looks as though we are not 
going to have a chance to amend that. That is why I voted against 
cloture. I understand that. Both sides of our aisle did not get our 
work done so we have had to clean it up too quickly this year. The 
Teacher Incentive Fund took a big hit.
  I say earnestly to my colleagues in the Senate, I hope Senators will 
look at the Teacher Incentive Fund carefully. I hope you will think 
about what your ideas are for improving schools with low-performing 
students. I hope you will ask yourself whether what they are doing in 
Chicago, for example, to move in a new principal and to move in a team 
of teachers and to train them more and to pay them more might not be 
one way to do it. If Denver wants to do it this way, and Dallas wants 
to do it that way, and Philadelphia wants to do it that way, and Mayor 
Corker helped Chattanooga do it, why shouldn't we help them?
  We don't want the Federal Government to take over the local schools, 
but clearly one of the appropriate things for the Federal Government to 
do in support of elementary and secondary education and high school 
education is to help solve this tough problem of how do we fairly and 
effectively reward outstanding teaching and outstanding school 
leadership.
  If we don't do this in our current system, we are not going to be 
able to keep the best men and women in our classrooms, especially in 
the most difficult classrooms, which is where our spotlight is going. 
We know that 80 percent of our schools in America are high-achieving 
schools, they are making the advanced yearly progress under No Child 
Left Behind. Five percent more are just missing it, and in the 15 
percent, don't we want to ignore this letter from the National 
Education Association?
  I will answer their letter from here. I am not going to vote against 
the Alexander amendment.
  I hope they will write me often. I hope it is not this kind of letter 
again. I say to my friends from Tennessee who were good enough to 
travel all the way up here and visit with me, I am going to work a 
little harder in communicating with them. I know there will be issues 
upon which we disagree--the Tennessee Education Association and I have 
proved in the past we can disagree.
  What I want to prove to them in the future is there are lots of ways 
we can agree. I know they are dedicated professionals, they are working 
hard every day under difficult circumstances--many with children whose 
parents don't feed them well, don't teach them before they come to 
school, and don't take care of them in the afternoon. I want to be 
sensitive to that.
  In my remarks today I want to send a clear message to the National 
Education Association: I am disappointed in their letter, I am 
disappointed in their attitude. I hope the Senate rejects their 
attitude. But I want to be as clear to my friends in the Tennessee 
Education Association that I greatly appreciate their visit.
  I look forward to redoubling my efforts to work with them. I look 
forward to talking with them over time about support. I encourage their 
ways to honor their professionals, including development of a 
compensation program that rewards outstanding teaching and schools.
  I ask unanimous consent the letter from the National Education 
Association be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:
                                                February 13, 2007.
     Hon. Lamar Alexander,
     U.S. Senate,
     Washington, DC.
       Dear Senator Alexander: On behalf of the National Education 
     Association's (NEA) 3.2 million members, we urge your 
     opposition to several ill-conceived amendments to the FY07 
     Continuing Resolution. Specifically, we urge you to vote NO 
     on:
       An amendment to be offered by Senator Alexander (R-TN) that 
     would provide $99 million for the Teacher Incentive Fund 
     (TIF); and
       Any amendment that would call for across-the-board cuts to 
     already depleted domestic programs.
       Votes associated with these issues may be included in the 
     NEA Legislative Report Card for the 110th Congress.
       NEA strongly opposes the Teacher Incentive Fund, which 
     diverts scarce resources from existing underfunded 
     professional development programs. For example, Title II of 
     the Elementary and Secondary Education Act allows use of 
     funds for the stated purposes of the Teacher Incentive Fund 
     and also gives states and school districts significant 
     flexibility to utilize funds for activities that best meet 
     their needs. In contrast, the Teacher Incentive Fund 
     restricts use of funds to only two possible uses--merit pay 
     and tenure reform.
       The proposed CR would reduce TIF funding, while increasing 
     funding for programs proven effective in maximizing student 
     achievement. We support the CR as proposed and oppose any 
     effort to increase TIF funding.
       NEA also opposes any proposal to reduce funding across-the-
     board, further stretching limited resources among already 
     struggling domestic programs. Although such amendments may be 
     addressing very worthy goals, we believe they are more 
     appropriately considered as part of bills to be debated 
     later, such as Emergency Supplemental legislation. Therefore, 
     we urge your vote against any such amendment.
       We thank you for your consideration of our views on these 
     important issues.
           Sincerely,
     Diane Shust,
       Director of Government Relations.
     Randall Moody,
       Manager of Federal Policy and Politics.

  Mr. ALEXANDER. 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. NELSON of Florida. Mr. President, I ask unanimous consent that 
the order for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Cardin). Without objection, it is so 
ordered.
  Mr. NELSON of Florida. Mr. President, we are in the posture of having 
to pass an appropriations bill that is to none of our liking because 
the Congress is not fulfilling its responsibility in the budgeting and 
the appropriations process. It goes back to the fact that albeit the 
Senate and the Senate Appropriations Committee were responsible in 
producing all 13 appropriations bills, the leadership in the last 
Congress decided they did not want to pass 11 of those 13. To the best 
of my recollection, it was the Departments of Defense and Homeland 
Security appropriations bills that were passed, leaving all the others 
without funding. Each time we have continued emergency stopgap funding. 
The particular law that is in effect now goes until midnight this 
Thursday. That is no way to run a railroad. It puts us in the

[[Page 3789]]

posture of having to take something instead of nothing which would shut 
down the Government. That is not a logical way to do it.
  The entire Federal budgetary process ought to be revamped. In the old 
days, back in the 1970s, the Budget Act was enacted because it was 
giving the new tools available for the Congress to discipline itself on 
spending, to hold down spending. Over 22 years, we have seen the Budget 
Act become not an economic process but a political process in which 
budget documents are submitted--for example, the one submitted by the 
President, completely unrealistic--so that political goals can say they 
are going to be achieved; in other words, moving the budget toward 
balance. The President has pointed that out over a 5-year period. When, 
in fact, the reality is that a lot of the President's assumptions in 
his budget he has sent to the Congress are not realistic. In fact, they 
are fiction.
  For example, there is a tax that is called the alternative minimum 
tax. It was designed years ago so that people with higher incomes that 
had huge deductions couldn't offset all of their income. They would 
have to pay some tax. It was designed to go to that higher income group 
so that they would still pay their fair share. If that alternative 
minimum tax is not allowed to be applied in the future--and I can't 
tell you the technicalities--it comes down and it swoops in a great 
deal of the middle class, which it was never intended to do, middle-
income people, with the result that much higher taxes would be paid in 
the very income levels that the alternative minimum tax was never 
designed to hit.
  Naturally, a Congress in the future is not going to let that happen, 
for that additional tax to go on the middle class. Yet the President's 
assumptions in the budget he has sent are that that alternative minimum 
tax is going to go away and, therefore, the increased revenue is going 
to be coming into the Federal Government from the middle-income 
taxpayers. Therefore, it makes it look like his budget deficit is 
getting smaller and smaller and moving toward balance.
  The same thing is true with the tax cuts that were enacted back in 
2001. Over the next several years, a number of those tax cuts expire. 
Those tax cuts that affect the middle class are not going to expire 
because the Congress is not going to let that happen. If it did, as the 
President has proposed in his budget, the revenues to the Government 
are going to be greater and, therefore, the annual deficit is going to 
be less. But that is not realistic. So what we have is a document of 
political fiction.
  This isn't the first time. This has been going on over the last 
couple of decades. But when it leads us down the path of fiction, 
sleight of hand, a head fake on what the budgetary condition of the 
country is, as the country, indeed, ought to make its staggering steps 
toward balancing the budget, at least down the line in the next 5 to 7 
years, when that is all a political fiction, it undermines confidence. 
It undermines the entire system. In large part, it leads to where we 
are today.
  We are going to pass what is known as a continuing resolution, which 
is an end-of-the-day budget that is pared down, that doesn't address 
priorities as it should. And are the American people served best by 
this kind of process? No.
  This Senator thinks it is time for us to have some major overhaul of 
the Budget Act. There are a lot of other things in the Budget Act that 
could be reformed, many of which are technical in nature and very 
extensive. I will not take the time to go into them today. But when are 
we going to learn? When are we going to stop using the budget of the 
United States as a political tool instead of moving us in an economic 
way toward a sound economic plan to bring our fiscal house in order?
  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. KOHL. Mr. President, I rise today to speak in more detail about 
the ``earmarks'' that some members of this body claim remain in H.J. 
Res. 20. On February 7, 2007, one of our colleagues issued a press 
release on his Web site which was critical of H.J. Res. 20, the 
continuing appropriations resolution. Of note was his claim that the 
resolution continues a number of earmarks. That claim, both generally 
and specifically, is not true.
  The list of ``earmarks,'' stated as fact in this press release, are 
all supposedly found in the Ag Chapter of the resolution. I would like 
to take a minute to address those specific items and explain why this 
information is wrong.
  Our colleague claims that H.J. Res. 20 provides $350,000 for the 
World Food Prize. Although this item was funded in the fiscal year 06 
bill as part of General Provision 790, H.J. Res. 20, in section 21004, 
provides that the amount available for Section 790 is zero. So, 
obviously, that earmark has been removed.
  Our colleague claims that $1.5 million for construction of the 
entrance to the U.S. National Arboretum is funded in H.J. Res. 20. 
First of all, this item was never included in the 2006 bill, which is 
what H.J. Res. 20 is based on. It was, however, included in the 2007 
bill under the agricultural research service buildings and facilities 
account. H.J. Res. 20, in section 20101, provides that the amount 
available for that account is zero. The entire account, not just the 
earmark, is removed.
  Our colleague claims that H.J. Res. 20 contains more than $1 million 
for alternative salmon products, including baby food products. This 
item was funded under the special research grants program of the 
Cooperative State Research, Education, and Extension Service. H.J. Res. 
20, in section 20102, provides that the amount available for that 
program is zero so the earmark is removed.
  Our colleague claims that H.J. Res. 20 contains $591,000 for the 
Montana Sheep Institute. This item was also funded under the special 
research grants account of the Cooperative Research, Education, and 
Extension Service, which, as I stated earlier, was eliminated in 
section 20102 of H.J. Res. 20. Thus the earmark was removed.
  Here is a third ``earmark'' claim under this same account, which was 
eliminated. The Senator claims that H.J. Res. 20 contains $295,000 for 
wool research, again, under the special research grants account of the 
Cooperative Research, Education, and Extension Service. I repeat again 
that H.J. Res. 20, in section 20102, provides that the amount available 
for that program is zero. Again, and I know I am beginning to sound 
like a broken record, but the earmarks are removed.
  In another account, the Senator claims that $232,000 remains for the 
National Wild Turkey Federation. This item was funded under the Federal 
Administration program of the Extension Service. H.J. Res. 20 provides 
that all funds for the Federal Administration program are reduced to a 
level that only protects Federal FTE positions definitely not the 
National Wild Turkey Federation. H.J. Res. 20, in section 20103, 
provides that all other funding in that program, which would include 
funds for the National Wild Turkey Federation, is zero. There are no 
earmarks.
  The Senator claims that $100,000 is contained in the Agricultural 
Marketing Service account to establish a farm-raised catfish grading 
system. However, this item was never included in the 2006 bill, which, 
again, is what H.J. Res. 20 is based on. It was included in the 2007 
bill, which never even passed the Senate floor. There is not, and never 
was, any funding for this activity in a bill that passed the House or 
Senate. There are no earmarks in this account.
  Finally, the Senator's press release states that $2,970,000 is 
continued to maintain a partnership between USDA and the National Fish 
and Wildlife Foundation. This was funding provided by the natural 
resources conservation service conservation operations account to a 
non-Federal entity. H.J. Res. 20, in section 20104, provides that all 
funds for the conservation operations account were reduced to a level 
that only protects federal FTE positions. H.J. Res. 20 provides that 
all

[[Page 3790]]

other funding in that program, which would include funds for the 
National Fish and Wildlife Foundation, is zero. Once again, there are 
no earmarks.
  As our colleagues should now realize, not only does H.J. Res. 20 not 
continue these items, H.J. Res. 20 actually removes the money which 
would make their funding possible, even if the administration wished to 
do so. For even those who wish to claim that money is still provided in 
the resolution which would enable the items to end up getting funded, 
it is obvious that in these claims, specifically listed in a press 
release, that is simply not possible. While I do appreciate zeal for 
finding and making public all earmarks, perhaps a closer reading of 
H.J. Res. 20 would have prevented these misstatements from occurring.
  Mr. CRAPO. Mr. President, I rise today to speak to a global 
competitiveness amendment to H.J. Res. 20 and to call attention to the 
challenges facing U.S. financial markets. The first half of the 
amendment highlights findings from two recent reports that the U.S. is 
already losing ground in the key areas of global initial public 
offerings, IPOs, and over-the-counter, OTC, derivatives. The second 
half of the amendment expresses the sense of the Senate about what 
steps should be taken to bolster the competitiveness of this essential 
sector of the U.S. economy.
  IPOs are critical to our economy because when a company goes public, 
it creates capital--and that means jobs and investment opportunities 
with great potential payoffs. The risk-taking exemplified by IPOs is in 
the most important sense the critical fuel of a market economy. OTC 
derivatives play a critical role in our economy, assisting investors to 
more precisely match their investments to their risk preferences, and 
helping companies to manage or hedge their risks. Additionally, these 
instruments provide liquidity to financial markets and reduce 
volatility by helping to diversify and distribute risk. At the same 
time the OTC derivatives industry attracts highly skilled professionals 
who, by virtue of the demand created by their talents, have the 
potential to contribute significantly to an area's tax base.
  Together, IPOs and OTC derivatives contribute to a robust and dynamic 
capital market which is a tremendously beneficial force for our economy 
and an empowerment to our citizens. It is critical to ensuring economic 
growth, job creation, low costs of capital, innovation, 
entrepreneurship, and a strong tax base in key areas of the country. 
The U.S. financial sector acts as a catalyst for all other sectors in 
the U.S. economy. That is why the decline in global initial public 
offerings in the United States, and the fact that London already enjoys 
clear leadership in the fast growing OTC derivatives market, are such 
worrying trends.
  Fortunately, academics, business leaders, and politicians are working 
together to study this issue. They have identified several specific 
problems that hinder the competitiveness of the U.S. capital markets 
and have issued reports outlining possible solutions. Chaired by former 
White House economic adviser Glenn Hubbard and former Goldman Sachs 
president John Thornton, the Committee on Capital Markets Regulation 
was formed in September 2006 and issued its preliminary report in 
November 2006. Mr. Schumer of New York along with New York Mayor 
Bloomberg released the McKinsey Report on New York Competitiveness in 
January 2007 outlining regulatory, legal, and accounting changes they 
say are necessary to maintain the city's status as a leading global 
financial center.
  Both reports add considerably to the understanding of the challenges 
that American capital markets face and offer solutions that could help 
American markets, companies, and workers to better compete.
  According to the Committee on Capital Markets Regulation:

       A key measure of competitiveness, one particularly relevant 
     to the growth of new jobs, is where new equity is being 
     raised--that is, in which market initial public offerings 
     (IPOs) are being done. The trend in so-called ``global'' IPOs 
     i.e., IPOs done outside a company's home country, provides 
     evidence of a decline in the U.S. competitive position. As 
     measured by value of IPOs, the U.S. share declined from 50 
     percent in 2000 to 5 percent in 2005. Measured by number of 
     IPOs, the decline is from 37 percent in 2000 to 10 percent in 
     2005.

  According to the McKinsey Report on New York Competitiveness:

       London already enjoys clear leadership in the fast-growing 
     and innovative over-the-counter (OTC) derivatives market. 
     This is significant because of the trading flow that 
     surrounds derivatives markets and because of the innovation 
     these markets drive, both of which are key competitive 
     factors for financial centers. Dealers and investors 
     increasingly see derivatives and cash markets as 
     interchangeable and are therefore combining trading 
     operations for both products. Indeed, the derivatives markets 
     can be more liquid than the underlying cash markets. 
     Therefore, as London takes the global lead in derivatives, 
     America's competitiveness in both cash and derivatives flow 
     trading is at risk, as is its position as a center for 
     financial innovation.

  The challenge we are facing is that the U.S. capital markets are 
losing their competitive edge in intensifying global competition. A 
shrinking proportion of international companies are listing shares on 
U.S. stock exchanges and the fast-growing OTC derivatives market are 
growing more rapidly elsewhere.
  This amendment welcomes these reports and encourages Congress and the 
administration to begin to vet and consider their recommendations.
  (1) Congress, the President, regulators, industry leaders, and other 
stakeholders should carefully review the Interim Report of the 
Committee on Capital Markets Regulation, published in November 2006, 
and the McKinsey Report on New York Competitiveness, published in 
January 2007, and take the necessary steps to reclaim the preeminent 
position of the United States in the financial services industry.
  (2) The Federal and State financial regulatory agencies should, to 
the maximum extent possible, coordinate activities on significant 
policy matters, so as not to impose regulations that may have adverse 
unintended consequences on innovativeness with respect to financial 
products, instruments, and services, or that impose regulatory costs 
that are disproportionate to their benefits, and, at the same time, 
ensure that the regulatory framework overseeing the U.S. capital 
markets continues to promote and protect the interests of investors in 
those markets.
  (3) Given the complexity of the financial services marketplace today, 
Congress should exercise vigorous oversight over Federal regulatory and 
statutory requirements affecting the financial services industry and 
consumers, with the goal of eliminating excessive regulation and 
problematic implementation of existing laws and regulations.
  I urge my colleagues to join me in supporting this amendment.
  Mr. CARDIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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