[Congressional Record (Bound Edition), Volume 156 (2010), Part 12]
[Senate]
[Pages 16530-16568]
[From the U.S. Government Publishing Office, www.gpo.gov]




  CREATING AMERICAN JOBS AND ENDING OFFSHORING ACT OF 2010--MOTION TO 
                                PROCEED

  The ACTING PRESIDENT pro tempore. Under the previous order, the 
Senate will resume consideration of the motion to proceed to S. 3816 
which the clerk will report.
  The legislative clerk read as follows:

       Motion to proceed to the consideration of Calendar No. 578, 
     S. 3816, a bill to amend the Internal Revenue Code of 1986 to 
     create American jobs and to prevent the offshoring of such 
     jobs overseas.

  Mr. GRASSLEY. Mr. President, before I start to speak, it is my 
understanding I have 30 minutes for our side and I ask unanimous 
consent that Senator Dorgan be recognized immediately after my time.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. GRASSLEY. Mr. President, I wish to tell my colleagues why I think 
the bill before us, S. 3816, is not a good approach. This bill is being 
sold as somehow having the potential to create American jobs, but it 
would likely have the exact opposite effect. It would lead to a net 
decrease in American jobs. For that reason, I encourage my colleagues 
to vote against this bill.
  The bill has three key aspects: a payroll tax holiday for employers 
hiring U.S. workers to replace foreign workers; a denial of business 
deduction for any costs associated with moving operations offshore; and 
lastly, ending deferral for income of foreign subsidiaries for 
importing goods into the United States. This last provision, according 
to my colleagues on the other side of the aisle, is the principal issue 
of the three, and from that standpoint, in my opposition, I agree. It 
certainly is the most dangerous, so that is the one I wish to address 
in detail.
  To understand this partial repeal of deferral, it is best to consider 
the topic of deferral more generally and then we can consider this 
particular idea in context.
  The term ``deferral'' refers to how U.S. corporations pay U.S. income 
taxes on foreign earnings of its foreign subsidiaries, only when those 
earnings are repatriated to the United States. That is, the U.S. tax is 
deferred until the earnings are paid by means of dividend back to the 
U.S. parent corporation. Deferral is not a new policy. Rather, it has 
been a feature of the tax law since 1918.
  President Kennedy proposed outright repeal of deferral, but the then-
Democratic Congress did not agree with him. Instead, the Congress and 
the President compromised. The compromise was this: For the passive 
kinds of income such as interest, dividends, royalties, and the like 
earned by a foreign subsidiary, the U.S. parent company would pay 
immediate U.S. tax whether or not the foreign subsidiary sent the

[[Page 16531]]

earnings back to the parent. However, for active business income of the 
foreign subsidiary, there would be no U.S. tax until the foreign 
subsidiary sent such money to the parent corporation.
  In short, the compromise during the Kennedy era was this: For passive 
income, deferral was repealed. For active income, deferral was still 
allowed. That compromise is embodied in subpart (f) of the Internal 
Revenue Code. That compromise was hammered out in 1962 and, with slight 
tweaks at the margin, that compromise has stayed in place for the last 
48 years.
  The compromise struck in the John F. Kennedy administration was the 
right one. Passive income is easy to move from one jurisdiction to 
another. If a U.S. corporation had a lot of interest income, it was 
very easy to instead have the foreign subsidiary earn such interest 
income in a low tax jurisdiction. So when interest income was earned by 
a foreign subsidiary of a U.S. parent corporation, there was a high 
likelihood that it was earned in the foreign jurisdiction out of 
motivation for the sole purpose of avoiding the U.S. tax. But with 
active business income, there are usually legitimate nontax business 
reasons for the income to be earned overseas. The reason a U.S. car 
company sells cars in Hong Kong is not out of some desire to avoid U.S. 
tax but, rather, out of a desire to sell cars to customers that live in 
Hong Kong.
  So the underlying rationale to the subpart (f) compromise is this: If 
there is a high likelihood that a particular type of income is earned 
overseas out of a desire to avoid U.S. tax, then deferral will not be 
allowed. If there is not a significant likelihood of that, then 
deferral will still be allowed.
  This is a very sensible rationale that was agreed to during President 
Kennedy's administration in the 1960s, because one of the most 
fundamental tax principles of all this is transactions should not be 
tax motivated but should be motivated by business or other nontax 
reasons. Tax motivated transactions should not be allowed the benefits 
of the favorable tax treatment sought. This fundamental tax principle 
prevents the tax laws from distorting decisionmaking and from 
distorting the economy. And the bill that is now before the Senate 
called the ``runaway plant'' bill cannot be justified by any similar 
rationale. They say they want to repeal deferral for foreign 
subsidiaries having income from importing goods back into the United 
States. But are they claiming that when a foreign subsidiary of a U.S. 
company imports back into the United States, there is a high likelihood 
that the production of the good would have been in the United States 
but for the motivation to avoid U.S. tax? They would have to be 
claiming that, if they wanted to be consistent with a half century of 
reasons why certain specific limitations on deferral have been 
justified.
  But that simply can't be. There are numerous nontax reasons for 
having a foreign subsidiary of a U.S. parent company import goods into 
the United States, and I will mention a few. One reason could be that 
there is only small demand for the product back in the United States as 
compared to the overseas markets. For example, diesel engine cars are 
very popular in Europe, comprising 50 percent of all car sales. Here in 
the United States, diesel engine cars are well less than 10 percent of 
all car sales. So there is a very good reason for having diesel engine 
cars made in Europe and not here. Nonetheless, the bill before the 
Senate acts as if the reason these cars are not made here is because of 
our tax laws.
  It may be that some items simply aren't found in appreciable 
quantities in the United States. For example, there is no diamond 
mining or chromium mining to speak of in the United States. A U.S. 
parent mining corporation with a foreign subsidiary engaged in diamond 
mining or chromium mining where such diamonds or chrome are imported 
into the United States may find deferral repealed. This could be true 
to the extent that the parent had any domestic restructuring at the 
same time it started up any foreign operations. But obviously the 
reason for the diamond and chrome mining outside the United States is 
not tax avoidance. The reason is those minerals are not found here 
within the United States. So I wish the sponsors of this bill to make 
clear whether minerals not found in the United States and imported into 
the United States would be included in this proposal.
  I wish also to know whether this proposal would have applied to the 
Ford Motor Company's ownership of Volvo. Ford owned Volvo cars from 
1999 to 2008. During that time, many Volvos were made in Sweden and 
imported into the United States for sale. If the acquisition had 
happened after the date of enactment, deferral would be denied in this 
situation, at least to the extent that Ford may have been shutting down 
any plants in the United States. However, no one can seriously claim 
that the reason the cars were made in Sweden rather than in the United 
States was from the desire to avoid U.S. taxes.
  Keep in mind that another foreign car company--let's say Volkswagen--
would not be treated the same way Ford's Volvo car income would be 
treated. Volkswagen would be better off taxwise on competing auto sales 
into the United States market over Ford's Volvo, thanks to this bill, 
if it were to pass.
  There are lots of nontax reasons for having foreign subsidiaries of 
U.S. companies import into the United States. But it seems that the 
bill before the Senate does not recognize that fact, or maybe it 
doesn't care. Perhaps the bill is motivated not by a desire to curb 
tax-motivated transactions but by something else. Perhaps the bill has 
an anti-free trade motivation. Perhaps the bill is attempting to make 
it more difficult for American companies to conduct business outside of 
our country. Whatever the case, the bill's sponsors should make the 
rationale clear--is it to curb tax avoidance or something else?
  Perhaps the bill's sponsors will admit that the bill has nothing to 
do with curbing U.S. tax avoidance. Perhaps they will say that it 
instead has to do with preserving and creating U.S. jobs. But if that 
is their position, that cannot be right. In some limited circumstances, 
perhaps it would increase employment in the United States, although 
probably mostly for tax lawyers than anybody else. But whatever the 
case, the net effect would be to decrease employment in the United 
States.
  Allow me to explain why the net effect of the bill would be to 
decrease U.S. employment.
  First of all, if a U.S. parent company has a foreign subsidiary, then 
this creates managerial headquarters jobs in the United States that 
would otherwise not be here. The bill before us might encourage 
American companies to simply sell off their foreign subsidiaries. This 
would, in turn, mean laying off employees in management positions at 
the American headquarters.
  A bigger way this bill would hurt employment in the United States 
would be to discourage assembly jobs in the United States. A U.S. 
parent company could have foreign subsidiaries engage in manufacturing 
parts that are shipped back to the U.S. parent. The U.S. parent, in 
turn, might assemble those parts here in the United States into a 
finished product. So, yes, maybe this bill would encourage the company 
to repatriate the parts production, but it is just as easy to imagine 
that this bill would encourage the company to expatriate the assembly 
jobs. So this bill is an unacceptable gamble with American jobs.
  In the words of the late Senator Moynihan, who preceded me and 
Senator Baucus as chairman of the Senate Finance Committee--he spoke in 
opposition to this proposal 14 years ago, so this issue has been around 
this body for a period of time. He said this: ``Investment abroad that 
is not tax driven is good for the United States.''
  Senator Baucus's concern that this would put the United States at a 
competitive disadvantage is exactly right. I don't have the exact quote 
of Senator Baucus, but it was in Congress Daily recently. I am sorry I 
don't have that quote for my colleagues.

[[Page 16532]]

  Senator Baucus very rightly states it. Phil Morrison, the Treasury 
Department's international tax counsel, criticized this proposal in 
congressional testimony 19 years ago. Mr. Morrison noted that the bill 
would be very hard to administer and that it departed from the 
traditional focus of the limited areas where deferral is denied.
  As President Clinton's international tax counsel, Joe Guttentag, 
explained in 1995, during the Clinton administration:

       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.

  This proposal has been made year after year for 20 years. I ask that 
my colleagues again reject it, in an effort to keep American companies 
globally competitive, to protect American jobs, and to preserve the 
underlying rationale of why deferral should only be denied in limited 
circumstances.
  Finally, I wish to briefly comment on one other aspect of the bill--
the payroll tax holiday. This, too, has provisions that will be 
difficult to administer. For example, do foreign workers actually have 
to be fired to have their employer get the payroll tax holiday in the 
United States or do they need only to be reassigned job roles?
  This provision only scores, according to the Joint Committee on 
Taxation, as costing $1 billion. Let's make sure we are clear on this 
point. The other side is seriously considering raising taxes on small 
businesses--the lead creator of jobs--by tens of billions of dollars by 
letting top individual tax rates go back up in the year 2011. But in an 
effort to support job creation, they offer this $1 billion payroll tax 
holiday.
  According to the Joint Committee on Taxation, 50 percent of small 
business flowthrough income will be hit by a marginal tax hike of 
somewhere between 17 percent, on the low end, and 24 percent, on the 
high end. That tax increase is scheduled to hit these job-creating 
small businesses in just a little over 3 months. Finance Committee 
Republican tax staff calculates the effect of that tax hike to be 50 
times the benefit provided by this bill. On our side, we don't see the 
logic of raising $50 in taxes and providing a complicated tax benefit 
of just $1.
  Why aren't we dealing with the real problem for the folks responsible 
for creating 70 percent of American jobs? Of course, that is small 
business. We ought to take time out on the tax hit that is coming to 
small business this December. That is what we ought to be debating on 
the Senate floor.
  But the Democratic leadership would rather spend valuable time 
talking about a bill that is artfully politically labeled a jobs bill. 
Given that the bill will lead to a net loss in American jobs, it seems 
there might be a truth-in-labeling claim against the Democratic 
leadership.
  Let's have votes on real job creation incentives and get out of this 
gamesmanship. Let's do the people's business and forestall the big tax 
hike coming at American small business.
  I also wish to take some time to address the issue of the estate tax, 
which is going to expire at the end of this year, at the very same 
time.
  The majority party has had control of the Senate since January 3, 
2007. That is 3 years, 8 months, and 24 days ago.
  During the 3\1/2\ years of Democratic control, my colleagues have had 
an opportunity to address the death tax.
  More pointedly, the Democratic leadership had a duty to provide 
certainty in the law as it relates to the estate tax.
  My colleagues have had the duty to address the fact that this ill-
conceived tax will snap back to pre-2001 law on January 1, 2011.
  That is only a little over 3 months away. To be exact, it is 3 months 
and 5 days from now.
  Unfortunately, as this chart shows, the estate tax is not the only 
piece of long overdue tax legislation.
  Mr. President, the practice of ``good government'' is providing 
certainty in the law.
  What I mean is, our country is made up of law-abiding citizens. As 
legislators, we were hired by these law-abiding citizens to make the 
law.
  When we fail to provide certainty in the law, we fail to do our jobs.
  But despite the fact that the Democratic leadership has not acted in 
over 3\1/2\ years we still have 3 months before the estate tax reverts 
back to a 55-percent tax rate and a $1 million exemption amount. So 
Congress still has time to act.
  But I am skeptical that the Democratic leadership will indeed act.
  Why? Because when my friends on the other side of the aisle were in 
the minority earlier in this decade, they blocked--let me repeat 
blocked--Republican efforts to make permanent an estate tax law that 
law-abiding citizens all across America could rely on.
  The first effort was made in 2002. Specifically, on June 12, 2002, 
the Democratic leadership blocked legislation that would have 
permanently repealed the estate tax.
  In 2004, Republicans in the House of Representatives approved a bill 
that would have permanently repealed the estate tax. But due to 
maneuvering by the Democratic leadership, a vote in the Senate was 
never allowed to occur.
  Finally, in 2006, Republicans offered a compromise proposal on the 
estate tax. Under that compromise, the estate tax unified credit 
exemption would have gradually been increased to $5 million. The rate 
would have also been phased in to a 30-percent tax rate.
  But again, the Democratic leadership filibustered the proposal to its 
death.
  Mr. President, I believe on our side were practicing good government 
as it relates to the estate tax.
  We were doing our jobs, and providing certainty in the law.
  Yet the Democratic leadership stymied the practice of good 
government.
  To this day, the Democratic leadership continues to stymie efforts to 
provide certainty in the law.
  So why is the estate tax being held hostage?
  Because a number of liberal leaning Senators would be satisfied if 
the estate tax reverted back to pre-2001 law--that is, a 55-percent tax 
rate and a $1 million unified credit exemption amount.
  And why wouldn't they? There is $233 billion in extra revenue to 
spend.
  Also, in this hyperpartisan environment that is plaguing the Senate, 
many policymakers are politicizing the estate tax issue.
  What do I mean?
  A number of Senators have taken to the Senate floor and characterized 
a reasonable estate tax rate as a ``give-away'' to the rich.
  These Senators also argue that if the estate tax is ratcheted up to a 
55-percent tax rate, we could use that revenue to reduce the deficit.
  I respect every Senator's opinion, but I question whether these 
members are actually going to use this revenue to reduce the deficit.
  Unfortunately, we have seen my friends' desire to spend, spend, 
spend. Increasing the deficit one dollar at a time. Not the other way 
around.
  I will acknowledge that due to the budget rules that we must live by 
here in the Senate, making permanent an estate tax regime at a tax rate 
lower than a 55 percent will result in revenue loss to the government.
  For example, my friend Congressman Pomeroy--a Democratic Congressman 
from North Dakota--sponsored a bill to make permanent the estate tax at 
a 45-percent tax rate and a $3.5 million unified credit exemption 
amount.
  When you compare this proposal against what the estate tax would 
revert to in 2011--a 55 percent tax rate and $1 million exemption--you 
find that this change in the law would cost around $233 billion over 10 
years.
  Now, when you compare $233 billion to the $2.5 trillion health care 
reform bill that was recently signed into law, it is a drop in the 
bucket.
  Also, compare this to our $13 trillion national debt.
  But $233 billion is nothing to sneeze at.
  While it could be used to reduce the deficit, my colleagues on the 
other side of the aisle have made every indication that they will 
simply spend this money.

[[Page 16533]]

  My colleagues on the other side will gloss over their plans to spend, 
and instead attack any proposal that includes a tax rate lower than 55-
percent as a ``give-away'' to the rich.
  I have some news for my colleagues. A large number of Americans who 
would be impacted by a 55-percent tax rate and a $1 million unified 
credit exemption are not ``rich.''
  Let me repeat that. Those taxpayers that would be impacted by the 
estate tax if it reverted back to pre-2001 levels are not wealthy 
people.
  I would like to take a moment and provide my colleagues with a real 
world example of an Iowan who would not consider herself ``rich.''
  Recently, I received an email from Landi McFarland, who is a sixth 
generation Iowa farmer.
  This is what Landi had to say about the impact of the estate tax and 
her ability to continue the family farm:

       . . . As a 6th generation Iowa farmer whose family 
     homesteaded land in Union county 154 years ago, I have 
     concerns about current estate tax law. I am 26 years old and 
     have a dream of pursuing a future in agriculture, the same as 
     the generations that have come before me.
       I currently raise Angus cattle with my parents and 
     grandparents, where we are tax-paying citizens and supporters 
     of our local economy and schools. My grandparents are both 84 
     years old, and own about 90 percent of the land, cattle, and 
     equipment on our farm. Their combined estates will total 
     approximately $7 million (the vast majority of this being 
     farm assets like land and cattle). Recent land values have 
     escalated the values of my grandparents' estate.
       This rise in land values, however, does not increase the 
     value of what the land produces (Angus cattle sell for the 
     same price no matter if the land is valued at $1000 or $4000 
     per acre).
       If my grandparents pass away AFTER 2010, and current estate 
     tax laws are not fixed, my family will not be able to afford 
     to pay the estate taxes without liquidating the herd and 
     selling a large portion of the farm ground. This will put an 
     end to our business that we love, and hence and end to our 
     support of local businesses through daily business 
     operations.
       In the last four years, my family has worked on estate 
     planning to try to help ease the burden of estate tax. This 
     includes taking advantage of the $12,000 tax-free gifting 
     each grandparent can do per person per year.
       However, this only amounts to a total gifting of $48,000 
     per year, a drop in the bucket for a combined $7 million 
     estate.
       We are one of the oldest Angus operations in the country, 
     and is all we wish to do is continue our family business that 
     has been built with our own blood, sweat and tears over the 
     past years. If current estate tax laws are not fixed, there 
     will be thousands of small family businesses like ours put 
     out of business. We need a SENSIBLE and PERMANENT fix.
       Thanks for your help,
       --Landi

  Mr. President, Landi's story is not unique to her. There are more 
farmers like her in Iowa and around the country.
  I want to talk more broadly now about how failing to address the 
estate tax sunset will affect Iowa farmers.
  Over the past few years, farm prices have been escalating 
dramatically. According to the U.S. Department of Agriculture, U.S. 
farm prices have nearly doubled in the last decade.
  While recent economic troubles have led to home prices dropping, this 
has not been the case for farmland. In fact, as reported in a recent LA 
Times article, Wall Street investors have actually turned to purchasing 
farmland in hopes of finding refuge from an unstable stock market. This 
in turn has pushed farm prices higher. Based on a recent survey by the 
Federal Reserve Bank of Chicago, Iowa farm prices are up 8 percent in 
the past year alone.
  Why is this discussion of escalating farm prices significant?
  Because this means that should the estate tax law revert to 2001 law, 
many farmers are going to be surprised to discover they will be 
considered ``rich.''
  Now, I am not talking about wealthy corporate farmers, I am talking 
about many family farmers, just like Landi, who are taking over a farm 
that has been passed down for generations.
  Mr. President, let me walk my friends through some data.
  In 2007, the U.S. Department of Agriculture reported that there were 
92,800 farms in Iowa.
  In 2007, the average Iowa farm was 331 acres.
  According to a survey conducted by Iowa State University, in 2009 the 
average acre was worth $4,371.
  Let's do some simple math. If we multiplied the average acreage of an 
Iowa farm--which was 331 acres as reported in 2007--by the average cost 
per acre in 2009--which was $4,371 in 2009--we find that the average 
Iowa farm is worth $1.4 million.
  Mr. President, $1.4 million exceeds the $1 million unified credit 
exemption amount that would be in place on January 1, 2011, if Congress 
does not act.
  Admittedly, the value of a farmer's farmland does not tell us 
conclusively whether or not the farmer will be subject to the estate 
tax. Farmers sometimes carry debt. That would reduce the value of the 
farm. But they also have assets, including equipment and bank accounts, 
that would increase the value of the estate.
  Let me shift gears and provide my friends with some national 
statistics.
  The Joint Committee on Taxation has told us out of 92,700 estates of 
people dying in 2011, 49,000 of these estates would be taxable under 
the 55-percent rate and $1 million exemption. If the law were changed 
to a 35-percent tax rate and $5 million exemption amount, for example, 
3,900 estates would be taxable. That is a ratio of 13 to 1.
  For every one estate that would be taxable under a 35-percent and $5 
million estate tax regime, a whopping 13 estates would be taxable if 
the law reverted to a 55-percent rate and $1 million exemption.
  Even if the rate were set at 45 percent and an exemption amount of 
$3.5 million, this ratio is 8 to 1. That is, for every one estate that 
would be taxed under the 45-percent rate, with the $3.5 million 
exemption, eight estates would be taxable under the 55-percent rate and 
$1 million exemption if we do not change the law.
  I will conclude this way. Let's now look at farmers who would be 
affected. Based on the Joint Committee on Taxation in 2011, 3,200 farms 
would be taxed if the law included a $1 million exemption amount. 
Compare that to 300 farms that would be taxable if the exemption was 
$3.5 million.
  That means the result of no action will be that 10 times as many 
family farms will be hit by the death tax. The time for action on the 
estate tax is now, not a month from now or 3 months from now. We owe it 
to the farmers and small business owners and their young heirs to give 
them certainty. We need to give to the tax lawyers and consultants who 
advise people on their estate planning some certainty.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Warner). The Senator from North Dakota.
  Mr. DORGAN. Mr. President, I believe by consent I am to be recognized 
for 30 minutes.
  The PRESIDING OFFICER. The Senator is recognized for 30 minutes.
  Mr. DORGAN. Mr. President, we have heard a couple of very spirited 
defenses this afternoon on behalf of jobs in China, which I pose is a 
wonderful thing if you live in China and have a job in China. The issue 
here is what about jobs in our country. What about the people who woke 
up this morning unemployed in America looking for work who could not 
find it? Who is standing on this floor speaking for those folks?
  I have heard a lot of discussion about support for jobs in China, 
Mexico, or elsewhere. But who is standing up talking about the jobs at 
home?
  Let me describe what this issue is about, if I may.
  I think this issue is something most Americans understand because 
they have heard it over and over. In recent years, we have seen 
millions and millions of manufacturing jobs gone from America because 
the very manufacturing plants that were open in this country to 
manufacture goods that had a label on it that said made in America are 
gone from America. They are now in China, they are in Mexico, they are 
in Thailand, they are in South Korea, and elsewhere. Let me talk about 
those jobs and why they have left this country.
  Listening to my colleagues--and, of course, the Chamber of Commerce, 
the

[[Page 16534]]

National Association of Manufacturers, all of the usual suspects who 
get in the same tub and make the same thumping sounds--one would 
believe that what has happened is that we have actually increased 
manufacturing jobs in this country and that moving American jobs 
overseas does not hurt anybody; it helps our country. Of course, that 
is just patently untrue.
  My colleagues were talking about something called deferral. That is 
not something people sit around a coffee shop talking about--deferral. 
It means, in certain cases under this bill, those companies that shut 
their American manufacturing plant, get rid of all their workers, and 
move the manufacturing to China or Mexico, for example--let's take 
China--actually get a tax break from our country that says if they are 
on one side of the street and their competitor is on the other side of 
the street, and they close their plant, fire their workers, scat out of 
town, go to China, hire people there, manufacture the same product, 
ship it back here, their country will be generous enough to say: Good 
for you, we will give you a tax break for doing it. That is what is 
called a deferral.
  In the narrow scope of what is in this amendment they object to, 
deferral says if they leave this country with their jobs, shut them 
down here, move over there, manufacture there with foreign workers, and 
then ship the product back into this country to compete against the 
business men and women who stayed here, who manufacture here, who 
employ people here, they are not going to get a tax cut anymore. It is 
just not going to happen.
  My colleagues say we have to have this principle called deferral. 
What about having every American have the opportunity for deferral? How 
about every American having the opportunity to defer their income taxes 
until it is more convenient for them? No, not everybody gets these 
things. Just the interests at the very top.
  Then when we tried to narrow it a little bit because it gives a 
pernicious incentive to move jobs overseas, we have people standing up 
saying: We support those companies that are moving American jobs 
overseas. We support those jobs in China. God forbid you want to 
interrupt this process.
  My colleague says: In 1962, there was this carefully crafted tax 
agreement on deferral--48 years ago. Do not interrupt that after 48 
years. We made this careful agreement 48 years ago.
  Let me tell my colleagues what has happened since then. I have shown 
this on the Senate floor before. In the last 48 years, the tax system 
has changed a little bit. This is a five-story white house on Church 
Street in the Cayman Islands called the Ugland House. The first time I 
showed this chart--by the way, this is enterprising reporting by David 
Evans from Bloomberg--there were 12,748 companies in this building. It 
is only a five-story small white building on Church Street in the 
Cayman Islands. It was inhabited by 12,748 corporations. A little 
crowded, I would say. Were they there? No, they just got their mail 
there. Why did they get their mail there? So they could slip under the 
American Tax Code and not pay taxes to the U.S. Government.
  When I first showed this chart some years ago, it was 12,748 
corporations. But there was room for more. Now there are 18,857 
entities that call this building home. Is that unbelievable? They must 
enjoy each other's company, or at least their mail must fraternize.
  Mr. President, more than 18,000 companies claim that little building. 
We made this careful agreement in 1962 on deferral? How dare you deal 
with the Tax Code in a way that you would upend that 1962 agreement. 
Everything has changed. There is not a ghost of a chance in 1962 that 
American companies would have even thought of trying something that 
audacious--just gather together in a mailbox in a white building 
someplace to avoid paying your obligation to this country.
  I have shown this as well. Wachovia Bank (formerly First Union Bank) 
bought a sewage system in Bochum, Germany. Why? Did they have sewage 
specialists on their staff? I don't think so. Did they put out 
television advertisements: Come do business with Wachovia Bank because 
we know about sewers or we want to buy sewers in foreign cities? No, 
they did this to avoid paying U.S. taxes. This is Wachovia Bank. They 
did not pay $175 million in U.S. taxes because they bought a sewage 
system from a German city.
  Did they move the sewage pipes? No. Do they know anything about 
sewers? No. They bought it from the German city and leased it back so 
they could depreciate it and not have to pay U.S. taxes. Unbelievable.
  The Tax Code has changed, I say to my friends. It is a punch board of 
gimmicks allowing people to do things they could not previously have 
done before, and the most significant enterprise is to move American 
manufacturing jobs overseas and get a tax break for doing it.
  This amendment is very misunderstood based on the discussions by the 
two previous speakers. There is discussion on the floor of the Senate 
about what is the motivation for moving jobs overseas--to serve, for 
example, a foreign constituency; want to move jobs to China to be able 
to sell into Thailand or Korea. The tax deferral piece of this 
amendment does not affect you. You can win that argument we are not 
having, if you wish, but you are misstating what the amendment 
suggests. The deferral part of this amendment does not do anything of 
the kind.
  This amendment is narrow--narrower than I would have it, as a matter 
of fact. But it says if you are going to get rid of your American 
workers, close your plant, move those jobs elsewhere, and then ship 
back into this country to compete with the American businesses that 
stayed here, you do not get the advantage of deferring the payment of 
U.S. taxes. It is just very simple.
  The question today is not just who is going to stand up for American 
jobs on this floor, who is going to stand up for American businesses 
that stayed here, manufactured here, hired workers here, paid the rent 
here, who is going to stand here and support that? I have not heard it 
yet.
  Let me go through some points. Before I do, let me mention one other 
thing. One of my colleagues just said: There are some things you cannot 
make here. So if you make them abroad, we do not want to punish you in 
our Tax Code from selling them in this country.
  They previously used bananas. I want my colleagues to understand, we 
actually have a banana exemption. We do not actually spell out bananas, 
but because the specter of fruit was raised the last time this was 
discussed, we included a banana exemption.
  Of course, we do not grow bananas in the United States. If somebody 
ships them back here, they will not be affected by this amendment 
either.
  There are a lot of points raised that have nothing at all to do with 
what we are describing in terms of public policy.
  Let me go through a few items. Some people may not know this. I 
described previously in unsuccessful attempts to try to do what we are 
doing that in New Jersey, there are a lot of folks who loved their jobs 
and they worked for a company call Fig Newton. Some actually shoveled 
fig paste. By the way, the company's name was Nabisco, which stands for 
National Biscuit Company. But it was not quite so national because 
Nabisco, the National Biscuit Company, decided the pay they had to 
provide for people to shovel fig paste in New Jersey was way out of 
line, so they just took Fig Newtons right off to Mexico. If you want 
Mexican food, buy some Fig Newtons. It goes on and on. The list is so 
long.
  I want to mention, as I have mentioned before, some of these same 
stories because it is important to understand what motivates people who 
want to stand up for American jobs.
  Pennsylvania House Furniture--I was in Pennsylvania this weekend--was 
made in this country for over 100 years with fine Pennsylvania wood. It 
was a wonderful company making high-end furniture. One day it was sold 
to La-Z-Boy. La-Z-Boy decided: We are going to move Pennsylvania House 
Furniture to China, and we are going to ship Pennsylvania wood to China 
and have Chinese workers put the wood together and ship it back to be 
sold in the

[[Page 16535]]

United States. It had nothing to do with whether the folks at 
Pennsylvania House Furniture were slothful, indolent workers not doing 
their job. It had nothing to do with that.
  What it had to do with is La-Z-Boy did not want to manufacture 
Pennsylvania House Furniture in the United States. They wanted to 
acquire 50-cent an hour labor, 12 hours a day, 7 days a week in China.
  On the last day at work at the Pennsylvania House Furniture 
manufacturing company, these craftsmen--nearly 500 craftsmen--as the 
last piece of furniture came off the line, they turned the cabinet 
over, and then they all gathered round to sign their name on the bottom 
of the cabinet. These wonderful American craftsmen signed that cabinet. 
Somebody has a piece of furniture they are probably not aware has all 
the names of those workers who were fired as those jobs went to China.
  Why did they do that? Because they cared about their jobs and were 
proud of their work, but they could not compete with 50-cent-an-hour 
labor.
  Stanley Furniture in Virginia is a furniture company that was started 
by Tom Stanley, a young dairy farmer in Virginia. He started it in a 
city that now is named Stanleytown. A couple of months ago, it was 
decided that Stanleytown was going to have some pretty bad news. 
Stanleytown was going to find out that these jobs were no longer going 
to be in Stanleytown. Stanley Furniture, another fine furniture 
manufacturer, was going to China.
  Let me read from the Journal of Commerce of this year:

       Stanley Furniture's decision to close its plant in the 
     small town that bears its name fell like a hammer blow on 
     southern Virginia and resounded across an industry, 
     increasingly now moving overseas. More than 500 workers will 
     lose their jobs this year as the manufacturer shuts down its 
     Stanleytown, VA, plant, where the company has made furniture 
     since 1924.

  So it goes--moving jobs overseas. Let me, if I might, go through a 
couple of others.
  I notice the Hershey company--speaking of Pennsylvania--Hershey 
company's York Peppermint Pattie is that silver pattie with the 
``York'' in the middle and the advertisement that says: ``The cool, 
refreshing taste of mint dipped in dark chocolate will take you miles 
away''--in this case, of course, to Mexico because Hershey decided it 
is time to move. So York Peppermint Pattie moves 260 jobs to Monterey, 
Mexico--part of a longer term job strategy by Hershey, they said. Well, 
that is a peppermint pattie. America's manufacturing strategy probably 
doesn't depend on peppermint patties--who knows.
  I have previously mentioned a series of American manufacturers, and I 
have used this one often because they announced with great fanfare some 
years ago that they were going to leave America altogether. Not another 
piece of underwear was going to be made by Fruit of the Loom in the 
United States. The dancing grapes, for all their advertisements, must 
have been unhappy. Their advertisements were always happy and upbeat, 
with guys dressed as grapes and such marching in the meadow. They can't 
have been very happy when Fruit of the Loom said: We are not going to 
make underwear in America anymore.
  Radio Flyer's little red wagon. This was a 100-year-old company in 
Chicago. All gone. Now made in Mexico.
  Here is another company. I have been talking about this one for a 
long time. Last week, my colleague from Ohio talked about this 
company--Huffy Bicycles. You can buy them at Walmart and Kmart and 
Sears. They were made in Ohio--except, no more. No more. All those 
workers lost their jobs. All those jobs are in China. All those jobs 
are done by people who make 50 cents an hour, working 7 days a week, 12 
to 14 hours a day. Huffy said to the workers in Ohio: You know what, 
you can't compete, so you are done. On the last day at work, where they 
parked their cars in the parking lot, those workers who were fired that 
day left a pair of empty shoes in the places where their cars were 
parked. It was the only thing they could do to say: You can move our 
jobs to China, but you can never replace American workers.
  So I could go on and on, but I want to describe what so many here in 
this Chamber wish to ignore. This is a quote from Mr. Paul Craig 
Roberts, one of the top Treasury officials in the Reagan 
administration. Here is what he said this year:

       Outsourcing is rapidly eroding America's superpower status. 
     Only fools will continue clinging to the premise that 
     outsourcing is good for America.

  Only fools will cling to that premise. And I agree with him.
  Again, another quote from Mr. Paul Craig Roberts:

       In order to penetrate and to serve foreign markets, U.S. 
     corporations need overseas operations. However, many U.S. 
     companies use foreign labor to manufacturer abroad the 
     products that they sell in American markets. If Henry Ford 
     had used Indian, Chinese, and Mexican workers to manufacturer 
     his cars, Indians, Chinese and Mexicans could possibly have 
     purchased Fords but not Americans.

  Again, he is absolutely right. It seems to me the question is, Will 
America remain a world-class economic power without a world-class 
manufacturing capability? Does anybody really believe that could be the 
case? You are going to decimate and erode a manufacturing base in this 
country and then say: Things will be just fine; don't worry about it. 
We can all sell hamburgers to each other and things will be just great? 
We know better than that. What is happening before our eyes is a 
hollowing out of America's manufacturing capability.
  There is a lot of discussion about what do we do about jobs, what do 
we do about trying to create new jobs in the country, and that has to 
do with what is called the faucet. If we are trying to put new jobs in 
the tub, they say, turn on the faucet. That is fine, and I support a 
range of policies that try to turn on the faucet to create more jobs in 
this country. But what about the open drain? As we work on the faucet, 
what about the drain, when Stanley Furniture says: Well, I know you are 
trying to create jobs, but we are out of here; or Etch A Sketch in 
Bryan, OH, says: Yeah, we know every kid plays with Etch A Sketch. We 
know we have always made it in America. But we were told by Walmart 
that if we couldn't produce it for $9.99 or less, they wouldn't sell 
it. If they don't sell it, we are out of business, so we are closing 
down our plant and moving to China.
  The list goes on and on. The question is, What do we do about all of 
this? My colleagues--too many of them--say: Let's do nothing. Let's act 
as if nothing is really going on. In fact, let's come in here and say: 
You know, we made an agreement in 1962 on some deferral tax issue, and 
let's stick with it.
  One of my colleagues earlier today said: You know, we have to worry 
about American corporations because they pay some of the highest tax 
rates in the industrial world. Well, that is a little like Penn and 
Teller talking about fiscal policy, and only one speaks and the other 
is silent. It is true that our corporate tax rates, I believe second 
from the top of the OECD countries. But there is another truth. The 
other truth is that our corporations in America pay an effective tax 
rate that is right near the bottom. What is the difference? One is a 
statutory rate--that is what the law says you should pay--and the other 
is how much you pay, which is right near the bottom. Why? Because we 
have a punchboard of gimmicks to allow that to happen. I have described 
a couple: American banks and other companies buying German sewer 
systems, buying German railcar systems, streetcars, buying German city 
halls for the purpose of sale-leasebacks so they can avoid paying taxes 
to the United States. It is pretty unbelievable, when you think about 
it.
  The only reason I have mentioned some of the companies over the years 
when I have talked about this is to give them full credit for what they 
are trying to do. They and all their neighbors should understand that 
they want all the benefits America has to offer, but they don't want to 
sign up for the responsibilities that exist for Americans, including an 
American company.
  I want our corporations to do well. I want American corporations to 
be profitable. But I will tell you this: If you

[[Page 16536]]

have two kinds of corporations, and one decides to stay here and 
manufacture in our country and the other decides to take the jobs and 
move to a low-wage, lower tax alternative, I want to be helpful to that 
corporation that stays here, that hires workers here, that keeps the 
plant open here and is proud to put a made-in-America label on their 
product.
  There is a company called HMC in this country that makes very 
substantial industrial products. You can see that this is a company 
everyone admires. Let me tell you what this corporate CEO has said. The 
CEO of HMC corporation, Robert Smith, said this:

       Offshoring in search of higher profits is a mistake because 
     it ignores manufacturing's larger purpose in U.S. society.

  Here is something else Mr. Robert Smith said, and I compliment him 
because you will find precious few who will say it.

       It is my belief that every American citizen, not only me, 
     should feel strongly about maintaining one of the most 
     important cultures we have, and that is manufacturing. Now, 
     why is it important? Does anybody think we would have 
     prevailed in the Second World War without the prodigious 
     manufacturing capability of our country? If anybody is 
     interested in that, go read Manchester's ``The Glory and the 
     Dream'' and understand what we did and how we did it in 
     manufacturing war planes and ships and tanks and trucks. We 
     had the most unbelievable manufacturing capability in the 
     history of humankind.

  Some say that none of this matters--why should we pick winners and 
losers? If the marketplace says we manufacture products in China or 
Mexico, if, in fact, we actually import more cars from Mexico than we 
export to the entire rest of the world, so what? Don't worry, be happy. 
That is the way the U.S. Chamber of Commerce wants it, and it is what 
the National Association of Manufacturers wants to have happen, 
apparently--except I know of companies that belong to both those 
organizations that have called me and written to me and said that they 
are dead wrong. How about having a chamber in the U.S. Senate stand up 
for American manufacturing?
  I know that when I talk this way and when I say these things, there 
are people in this room--and the Washington Post would be a good 
example--who will instantly say: Aha, I hear all that nonsense. This is 
about protectionism. It is about America becoming protectionist and 
building walls around its country to keep goods out.
  Are you kidding me? Are they nuts when they talk that way? Last 
month, we had a $50 billion trade deficit in 1 single month. In a 
recent year, we had a $750 billion trade deficit. You can make a 
plausible case that our fiscal policy budget deficit is what we owe to 
ourselves. You can make that case, and we will pay it back to 
ourselves. You can't make that case with a trade deficit. The trade 
deficit is what we owe others in the world, and we will repay that with 
a lower standard of living in this country inevitably.
  The question is, When will we start to decide that this trade 
strategy is not working? We are dealing with other countries that are 
engaged in managed trade, and yet we are saying it doesn't matter what 
happens to us. It just doesn't matter.
  We, by the way, spent a century doing what other countries wouldn't 
or couldn't--in most cases, couldn't--and we lifted up this country. We 
had unbelievable battles.
  The other day, I described the battle on workers' rights. In the 
first book I wrote, I described James Fyler. James Fyler was shot 54 
times. I said--and I shouldn't have--that he died of lead poisoning. He 
died because he was shot 54 times in 1917 in Ludlow, CO. He was shot 
because he believed that people who worked underground digging for coal 
ought to work in a safe workplace and ought to be paid a fair wage. And 
for that, he gave his life.
  There are many things we have done over the past century that people 
have died for to lift up standards in America, and now they are 
routine--decent wages, fair labor standards, and safe workplaces. We 
did all that. Other countries, in many cases, have not. So now the 
question is, Is it important for us to lift up others around the world 
or to allow ourselves to be pushed down in terms of the standards we 
have created and fought for over a long, long time? To me, the answer 
is self-evident: Let's stand up for what this country has done.
  I am all for helping others. I want to lift them up, create standards 
that hopefully can mirror ours. I am not interested at all in having a 
Huffy Bicycle management team say to the Huffy workers in Ohio: If you 
can't compete with China's wages and China's workers, you are out of 
work, and we don't care what you think.
  Well, the workers of Ohio said: You know what, we just can't live on 
50 cents an hour, and we can't work 7 days a week, 12 to 14 hours a 
day.
  The law won't allow U.S. companies to hire kids, so the company said: 
That is tough luck. You need to understand that it is a new world out 
there. If you can't compete, you lose.
  Well, this is a race to the bottom in terms of standards.
  Some say: Well, we can innovate. We are the innovators, yes, that is 
true. I chair the Congressional-Executive Commission on China, and so I 
held a hearing last week on counterfeiting and piracy. Do you know 
what? We innovate, and then we see it stolen. Intellectual property is 
stolen and produced elsewhere. It is always produced elsewhere. We 
invented the television set--gone, produced elsewhere; computers--
largely produced elsewhere. I could go through a whole list.
  The question is, What kind of a country do we want to have? For 
example, we have done a lot of free-trade agreements. In fact, let me 
do this. I want to just mention a free-trade agreement with South 
Korea, and I could go through all of the free-trade agreements and show 
how unbelievably ignorant our country has been with respect to its own 
economic self-interest. But let me give one example.
  This chart shows the number of cars in South Korea. In South Korea, 
98 percent of the cars driven on the streets and roads are made in 
South Korea. Now, you might think that is really interesting, that they 
have an appetite for buying those South Korean-made cars. It is not an 
appetite, it is what that country decides it wants. They do not want 
South Koreans to buy foreign cars, so 98 percent of the cars on their 
streets are South Korean cars.
  So let's talk about our relationship with South Korea, and it is 
this: Last year, because we had a recession, we didn't sell as many 
South Korean cars in our country. At one point, it was close to 800,000 
a year. Last year, the South Koreans put 467,000 cars on ships and 
shipped them to America to be sold here in our country. That is 
467,000. Does anybody want to guess how many cars we could sell in 
Korea last year? Six thousand. So 467,000 to 6,000. Why? Because South 
Korea doesn't want us to sell American cars in South Korea, and they 
have dozens of clever devices to stop it.
  Our country negotiates a trade agreement with South Korea--guess 
what, they don't even mention the bilateral automobile problem, not 
even a word.
  Our country did a bilateral agreement with China, a country with 
which we had a $200 billion trade deficit. We had a huge deficit with 
China, biggest in the world. Here is what our country said. We said, on 
bilateral automobile trade we will do this: When you ship a Chinese car 
to the United States we will only impose a 2.5 percent tariff on your 
car, but if we ship an American car to be sold in China, you may impose 
a tariff of 25 percent. You may impose a tariff that is 10 times higher 
than we would impose in bilateral relationship with a country with 
which we had a $200 billion trade deficit. If that is not defined as 
ignorance, then I have missed the definition of ignorance.
  Why wouldn't we step up for our economic interest? China, by the way, 
right now is ratcheting up a very aggressive automobile industry. You 
are going to see a lot of Chinese cars on the streets in this country 
in the years ahead.
  But I rest my case. I mentioned automobiles. I could mention lots of 
other issues. I have written books about this. But the fact is, the 
issue before us today is not somebody coming here and saying, in the 
1962 agreement on deferral--or another speaker talking about

[[Page 16537]]

how if you let people go overseas there will be more jobs here at home.
  Let me finally say, this issue of deferral is that in some cases 
these companies know they never have to pay taxes. The reason? Because 
they defer and defer on foreign profits. This amendment is only about 
if you have profits in a foreign subsidiary, from selling back into 
America, into this marketplace. Some of them can leave to go overseas 
knowing they will get the advantage of deferral and pay lower taxes 
than the company that stayed here, but they will get an even better 
deal. If they hang, we will have somebody in one of these Chambers 
thumbing their suspenders and shuffling around and harrumphing about 
maybe what we should do is say all of those people who have money 
overseas, let's let them bring it back here and pay a 5.25 percent tax 
rate. You say: Oh, they would never do that. Oh, they sure did. It is 
the rest of the people who do not get to pay the 5.25 interest. It is 
just the biggest interests who closed their American companies and 
moved their companies overseas and produced overseas after they got rid 
of their American workers. They were told in addition to getting a tax 
break for doing it, we want to give you something on top of that, the 
cherry on top of the sundae: If ever you do bring it back, you get to 
pay a tax rate that is one-half of the lowest tax rate that the lowest 
income American has to pay. What an unbelievable deal.
  Let me say, as I started, if ever someone wishes to hear the 
strongest defense possible of sending American jobs to China, listen up 
because in the next few hours we will hear some more of it. We have 
already heard some.
  They don't say it quite this way: We think it is nice that if China 
is not competitive, and their government decided they don't need to do 
certain things that we have done to increase standards and lift the 
American standards, we think it is OK if American jobs migrate 
elsewhere because we do not believe we have to long remain a world 
economic power in manufacturing to really be a world economic power.
  They could not be more wrong. This is not a big step. This is the 
smallest of steps that you would take in the direction of saying: You 
know something, we are going to do something about a very serious 
problem. We are trying to work the faucet to put more jobs into this 
country, into this economy, at a tough time. We are also trying to shut 
the drain in circumstances where our Tax Code rewards those who now 
leave our country and move their jobs overseas.
  If we cannot do that now, then, in my judgment, we can perhaps never 
do good public policy that lifts this country's economy, stands up for 
American businesses and American workers.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Kaufman). The majority whip.
  Mr. DURBIN. Mr. President, let me thank the Senator from North 
Dakota. He is retiring. We are going to miss him. He has been a 
powerful voice in the Senate and no more powerful on any issue than on 
this one, talking about American jobs and how we are giving them away, 
literally giving them away.
  Time and time again Senator Byron Dorgan has come to the floor to 
explain that our Tax Code rewards American companies that want to ship 
production overseas. Is that upside down? As Senator Dorgan has said on 
the floor, and I completely agree with him, we should reward American 
companies that keep good-paying jobs in America. That is what our Tax 
Code should reward. If they will pay a living wage and good benefits to 
a worker, and stay in the United States of America, we ought to give 
them every tax break we can give them--help them in every way we can. 
Instead, it is upside down. We create incentives for them to move jobs 
overseas.
  We are a few weeks away from an election. I wish this election would 
be a simple referendum on the debate we are having on the floor of the 
Senate right now. The Senate Republican leader has come to the floor 
and said we should not be talking about this issue. He wants to talk 
about something else. Others, representing the largest corporations and 
businesses in America, say that the position being taken by the 
Democrats to stop the tax breaks for American companies that ship jobs 
overseas should be defeated. I wish to take that question to the 
American voters. You pick the State, you pick the city, you pick the 
neighborhood. I want to be there. I will take our position and I invite 
the Republican Senators and the Chamber of Commerce and whatever other 
groups happen to believe the other point of view for an active debate. 
Who in the world believes we should be rewarding corporations in our 
country for shipping jobs overseas?
  We know what we are going through here. This recession has cost us 
millions of American jobs. Under President William Jefferson Clinton, 
we created 22 million new jobs in America. We had the growth of small 
business at a pace we had never seen. We had minority ownership, woman 
ownership of business at a pace we had never seen. We saw the growth of 
new home construction and new home ownership at a record pace. During 
the course of that 8-year period of time, we generated a surplus in the 
Federal Treasury--a surplus. We had not done that for a decade or more.
  So came the time when President Clinton was leaving office, handing 
it over to President George W. Bush. This is what he gave him: a 
growing economy creating jobs, home ownership and business ownership. 
He said to President George W. Bush: Here is the state of our economy. 
We are reducing our national debt because we are generating a surplus, 
and the entire national debt of America, given from President Clinton 
to President Bush, was $5 trillion.
  President Clinton said to President Bush: In addition to a strong 
economy that is growing, I also want to tell you I am leaving you a 
surplus in the Treasury--$120 billion in the next year, more than you 
need for the expenses of our government. President Clinton said: We 
have been taking the surplus, incidentally, putting it back into the 
Social Security trust fund, and that fund will now guarantee every 
payment with a cost-of-living adjustment through the year 2032. Not a 
bad gift from President Clinton to President Bush. That was when 
President George W. Bush took office.
  What was the state of America 8 years later, when President Bush left 
office, when he said to President Obama: Now it is your turn. It was a 
much different picture. The national debt in America was no longer $5 
trillion. Eight years later, after President Bush, it was $12 trillion. 
In 8 years, only 8 years, President Bush and the Republicans who 
supported him more than doubled the national debt. How do you do that? 
How can you take a debt accumulated from George Washington through 
President Clinton of $5 trillion and make it $12 trillion in 8 years? 
You had to work at it.
  First, you had to engage in two wars we didn't pay for and then you 
did something--President Bush did something no President had ever done 
in the history of the United States. In the midst of a war he declared 
tax cuts. Remember that Republican theory: If we give tax cuts, this 
economy is going to mushroom and grow with jobs? It did not work. In 
fact, it failed miserably. It added to our national debt, more than 
doubled our national debt during the Bush Presidency, so that when 
President Bush left office he handed to President Obama a $12 trillion 
debt--not $5 trillion, $12 trillion. Instead of handing him a surplus 
in the budget of $120 billion for the next year, as he had been given 
when he came to office, he announced it would be a $1.2 trillion 
deficit in the next year. That is what President Obama inherited. And 
of course jobs were melting away--8 million jobs.
  The month President Obama was sworn in as President and took his hand 
off the Bible, we lost 750,000 jobs, a leftover from the Bush economic 
policies.
  Now come the Republicans. They have announced if they are given 
control of Congress in the next election, they have an idea of where we 
should

[[Page 16538]]

go as a Nation. We should go back to the Bush economic policies. That 
is what the Republican plan for America is, go back to the Bush 
economic policies of declaring tax breaks for the wealthiest people in 
America. Senator McConnell stated proudly on the Sunday talk shows 
yesterday that he has had the courage to step up and put a bill before 
Congress of what he thinks we should do as a Nation when it comes to 
economic policy. He did. It was historic. It was so historic that 
Senator McConnell suggested a tax program that would nearly double the 
national debt--nearly double it--during the same period of time: $4 
trillion of new debt for America. How does he do it? On the Republican 
side, by suggesting we continue to give tax breaks to those in the 
highest income categories in America.
  I for one think that is totally irresponsible. In the midst of a 
recession, let us help working families, middle-income families 
struggling to pay their bills, struggling to deal with a home mortgage 
payment where the value of the home may be going down instead of up. 
Help those families. But for those who are making $1 million a year or 
more, why in the world would we add to the national debt to give them a 
$100,000 tax cut a year? Why? It only adds to the national debt.
  The Republican theory is, if you give tax cuts to the wealthiest 
people in America, this economy is going to flourish. I say to the 
Senators on the other side, it is a theory we tested and it failed. It 
is the same theory we tested over the last 10 years of Bush tax cuts. 
If tax cuts for the wealthiest people in America is what we need for 
our economy, I have one basic question after 10 years: Where are the 
jobs? Where are the jobs to show for it?
  Our approach I think is more reasonable, reasonable in that we would 
give tax breaks and tax cuts to those working- and middle-income 
families below $250,000 of income so they can get through this tough 
economy. I don't care if the economists tell us the recession is over. 
As far as I am concerned, to use the vernacular: It ain't over until 
it's over, and it ain't over until we start creating jobs again.
  That is what this debate on the floor of the Senate is about, not 
just tax policy but basically what is our policy when it comes to 
shipping jobs overseas.
  I think American workers are the hardest working, most productive 
workers in the world. Put them up against anybody. Will they work for 
the lowest wages in the world? No. And they should not. We should have 
a standard of living in this country that we are proud of. But our 
workers have shown that when paid a living wage, they are productive 
workers and can compete with anyone.
  Yet American companies have decided they want to ship their jobs 
overseas and see if they can make more money. As far as I am concerned, 
that is their choice. I think it is a wrong one. That is their choice. 
But the last thing in the world we ought to do is give them a tax 
incentive to ship those jobs overseas. We know what has happened to 
American families here over the last 10 years and longer in America. 
They have been falling a little bit behind each and every year, in 
terms of their earning power.
  As the Wall Street Journal, which I do not quote very often, put it 
recently, it was the ``Lost Decade for Family Income.'' The median 
income in America fell almost 5 percent between 2000 and 2009.
  Meanwhile, Merrill Lynch reported earlier this summer the number of 
financial millionaires in America rose by 16 percent. Solid middle-
class manufacturing jobs have been disappearing across the country. The 
AFL-CIO estimates that from 2000 to 2007--that was the period of time 
during the Bush Presidency--the United States lost 5.5 million 
manufacturing jobs.
  In the 8 years before, under President Clinton, we had created 22 
million jobs. Under President Bush, we lost 5.5 million manufacturing 
jobs. By the end of 2009, the fewest number of Americans were working 
in manufacturing since before World War II. But it is not just the jobs 
on the shop floor that disappeared during the Bush administration.
  Goldman Sachs estimates between 400,000 and 600,000 professional 
services and information sector jobs have moved overseas in the past 
few years. That was during a time when these businesses were raking in 
record profits and jobs were leaving America. Then, when the boom 
turned into a bust, those wizards of Wall Street, those captains of 
capitalism, those kings of commerce, those malefactors of great wealth 
experienced a temporary setback. Profits were down, stocks were down, 
and so compensation was down on Wall Street, for about 15 minutes.
  Corporate profits are now surging, the stock market is roaring back, 
and endless bonuses are raining down on the chosen few, just like the 
good old days on Wall Street. But what about the rest of hard-working 
families across America? What about the families who never have made a 
million bucks? That is the vast majority of them. What about the 
families who earned the median wage in this country, about $50,000 a 
year? Those jobs are not coming back fast enough.
  The Recovery Act that we passed last year, with the support of three 
Republican Senators--only three who would join us in this effort--has 
at least slowed down the recession and the loss of jobs. It has not 
produced the turnaround we all want to see. It will take some time. But 
at least it stopped the recession from becoming even worse.
  This recession would not be over yet by anyone's measure had 
President Obama taken the advice from the other side of the aisle. They 
believed we should do nothing--nothing--in the midst of a recession. I 
have heard Senate Republicans come to the floor and criticize President 
Obama for loaning money to General Motors and Chrysler. I will tell 
you, in my home State of Illinois, those automobile manufacturing jobs, 
at General Motors and Chrysler, are good-paying jobs. We have lost a 
lot of them. But the good news is, those companies are back. They are 
profitable. They are selling fewer cars and trucks now, but they are 
selling and they are competitive.
  That would never have happened had the Republicans had their way and 
stopped the President from giving loans necessary to these automobile 
manufacturers. We would have seen maybe one company, Ford, that might 
have survived. The other two probably would not be here today in any 
form, and all the jobs, the tens of thousands of jobs they provide in 
America, would have been lost.
  The Recovery Act saved another 2.7 million Americans from the 
unemployment roles, according to economists Alan Blinder and Mark 
Zandi. In case you think: Well, Durbin, that must be your favorite 
Democratic economist, Mark Zandi happened to be John McCain's economist 
when John McCain ran for President, and he credits the Recovery Act 
with saving 2.7 million jobs.
  But even with all these efforts, there is still a lot to do. It is 
not enough to help the private sector create more jobs. We need for 
them to be created right here in America. There is one line I can use 
anywhere in the State of Illinois, and I will bet across this Nation, 
which I think typifies what most people think about when they think 
about our economy.
  I will bet you I could use this line in the State of Delaware. The 
line is this: I would like to go into the store tomorrow and find more 
products stamped ``made in the USA.'' People start applauding. They are 
sick and tired of all the imports coming in and all the jobs going 
away.
  I know global competition is a fact of life. America could never be a 
wealthy nation if we just did one another's laundry. We need to produce 
goods and services that are competitive on a global basis, and we can 
do it. We have done it in the past and we can do it again. American 
workers can compete with the best in the world.
  But our laws do not give many of our workers a fighting chance. Why 
should companies be rewarded for shipping good American jobs overseas? 
China, Germany and Japan and our other competitors do everything they 
can to generate more work in their home countries so they can sell 
products

[[Page 16539]]

from China and Germany and Japan all around the world.
  Meanwhile, our conglomerates and many corporations and their friends 
in Congress defend offshoring tax loopholes that other countries would 
never allow to stand. That is why I introduced the bill that is going 
to be voted on tomorrow, with the help of my colleagues and friends, 
Senator Harry Reid, the majority leader; Senator Byron Dorgan, who has 
been our leader for years on this issue; Senator Chuck Schumer of New 
York, and many others.
  It is a bill that has three provisions in it. I think they make 
sense. First, we will make two changes to discourage U.S. companies 
from giving out pink slips to Americans while they open the doors at 
their new factories overseas.
  We will say to firms: If you want to shut down operations in the 
United States and move somewhere else--I hope you do not make that 
decision, but if you make it, we are not going to give you a tax break 
to make it easier.
  We will also say to the firms, if you want to sell your products in 
this country that you made overseas, we are not going to let you start 
making those goods overseas, ship them back to this country, and avoid 
paying your taxes on your profits, something called deferral.
  Second, we will make it more attractive for companies to bring good 
jobs back home. This is a provision from Senator Schumer of New York, 
which says to firms: If you bring jobs back from another country, you 
do not have to pay your share of the payroll taxes on those U.S. 
workers for 3 years. It is an incentive to bring these jobs back home.
  There is nothing radical in this proposal. You would think it would 
pass by a voice vote. Who in the world would object to ending tax 
loopholes to send jobs overseas? Who would object to creating tax 
incentives for bringing jobs from overseas back home?
  But that is what this debate is all about. The defenders of these tax 
loopholes have wasted no time in launching an aggressive lobbying 
campaign against the bill: The Chamber of Commerce, the National 
Association of Manufacturers have written in opposition to the bill, 
and the Republican leader has already spoken on the floor against even 
debating this bill. He does not want us to bring it up.
  The message they send is clear: Corporate profits are more important 
than American jobs. I could not disagree more. I have watched too many 
hard-working, middle-class families lose their livelihoods as companies 
fire American workers and then use the Tax Code to make shifting jobs 
overseas more profitable.
  In August, I was in Rock Falls and Sterling, IL. A woman named Julie 
came. She had worked at the local national manufacturing company there 
for 34 years. She was a grandmother, raised her family, and was trying 
to help with her grandkids. She had just been notified that company was 
moving overseas.
  I said to her: As painful as it is for you to get that pink slip 
after 34 years of service to that company, I am sorry to tell you that 
our Tax Code made it easier for that company to leave town, made it 
easier for them to do away with your job.
  I ran into other workers around Illinois as well. To add insult to 
injury, after a lifetime of working for these businesses, some of these 
businesses actually bring in the workers from China and Mexico and ask 
the American workers, in their last week or two of employment, to train 
the foreign workers to do their jobs. Can you imagine how hard that 
must be--to realize that tomorrow you are out of work, and the person 
sitting across the table, whom you are training, is going to have your 
job?
  Then, how about this? How about the fact that the cost of bringing 
that foreign worker over here to be trained is now tax deductible under 
our Tax Code? What is wrong with this picture? A good example of a 
company moving good American jobs overseas happened in Hennepin, IL. 
The local steel mill there was built in 1966. I remember it. I was a 
college student out here at the time, and we were so exited. It was 
Jones Laughlin, if I am not mistaken, when it first started. It changed 
ownership over the years. It was a big employer in the region around 
Hennepin.
  They employed 600 people at their peak in a steel mill. Imagine that. 
As of last year, they still had 300 people on the payroll. Arcelor-
Mittal, the huge steel conglomerate, bought the plant in 2005. Many in 
the community said: This is a break, a godsend. That huge company is 
going to invest in this plant and we are going to keep our jobs.
  It did not happen. Arcelor-Mittal decided last year that the 
profitable plant in Hennepin--they were making money--the profitable 
plant, was no longer worth keeping open. Just like that, 300 solid, 
middle-class jobs disappeared.
  I received a lot of letters from members of the community. A 10-year-
old girl wrote to me:

       My dad . . . got laid off by Lakshmi Mittal, at Mittal 
     Steel. You see, instead of selling the plant, Lakshmi decided 
     to ship all of the parts over the oceans . . .--

  This 10-year-old wrote to me and said--

       I think the plant should not be closed because if he 
     shipped the parts all over, then hundreds of peoples' jobs 
     will be lost. Please Help Us!

  The heartbreaking news for that young girl is that our Tax Code 
rewarded the plant for shipping the equipment overseas. This 10-year-
old girl, wise beyond her years, heartbroken that her dad had lost his 
job, may not understand the global implications of plant closings, but 
she sure knows what it means to her family.
  Here is what a 30-year veteran of that plant wrote:

       The plant was shut down in the spring even though it made a 
     profit. . . . Being the father of two college freshman, I 
     have to wonder what the future will hold for my children . . 
     . American industry, the backbone of our country, cannot 
     exist in this environment.

  Well, I agree. That is why I am on the floor. That is why this bill 
is on the floor. We have to do something about it. Here is another one. 
This is a company that once operated in my home State of Illinois, 
Honeywell International. They closed their plants in Freeport, Rock 
Island, Spring Valley, and Springfield and then sent the jobs to India, 
China, and Mexico.
  The Department of Labor certified these workers lost their jobs 
because the jobs were actually sent overseas. In my hometown of 
Springfield, the plant closing cost us 120 jobs in the capital city. 
This was a plant that had been in production since 1938, long before I 
was born, when it produced the world's first electric clock for 
automobiles. The plant also supplied electrical products to support our 
troops during World war II. In an instant, this piece of American 
history vanished to Juarez, Mexico.
  I received a letter from a victim of this particular example of 
offshoring good American jobs. Here is what he wrote to me:

     . . . stop rewarding Honeywell and other corporations that 
     ship jobs out of the country . . . They don't deserve tax 
     money for making the US unemployment rate go up further.

  Well, that is exactly what this bill before us wants to stop. Let me 
show you one other illustration. U.S. multinationals are increasing 
hiring abroad and decreasing hiring at home. In total, between 1999, at 
this end of the chart, and 2008, multinational corporations in the 
United States added 2.4 million jobs overseas, a 30-percent increase.
  Well, there is nothing wrong with companies growing. But look what 
happened here at home. Here is the problem. During the same period, 
these American companies cut 1.9 million jobs in America, an 8-percent 
decrease. It is obvious. The jobs are being shipped overseas and killed 
at home. This notion by some companies that if you let us produce 
overseas it will help our jobs back home, it is not happening. Exactly 
the opposite is happening--jobs overseas, loss of jobs in the United 
States.
  Well, enough is enough. We need to stop rewarding companies, through 
our Tax Code, for killing American jobs, and we need to create 
incentives to

[[Page 16540]]

bring those jobs back home. This bill is very straightforward. It is a 
clear choice. Senators can decide. Do they want to stand with American 
workers? Do they want to stand with those corporate interests that want 
to ship jobs overseas? Do they believe our Tax Code should reward good 
American companies that pay good wages and good benefits to American 
workers and stay here or do they want to create an incentive to ship 
those jobs overseas?
  That is what this bill is all about. I hope there will be at least 
one Republican Senator who will join us in this effort. It would be a 
breakthrough. I hope it is more than one. But I hope they are hearing 
the same thing back home. I would just ask those who oppose it to go to 
your home State, pick the community, pick the town, and invite me to 
come and debate you, if you are on the other side of the this issue.
  You pick it. I want to be in on that debate.
  I believe the bottom line is this: The American Tax Code should be 
designed to help American companies create good-paying jobs right here 
in the United States. Our focus ought to be to make sure when people 
walk in stores across America, they can flip that product over and see 
made in the USA again. With this vote, Senators will be given a choice 
where they want the next round of job creation to be. Do they want it 
in the United States or in China? Middle-class families in this country 
have been struggling for a long time. They are upset. They want more 
jobs. They want a Congress that will stand up and fight for them. With 
this vote, they will find out who is going to be on their side.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Maine.
  Ms. COLLINS. 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.
  Ms. COLLINS. I ask unanimous consent that the order for the quorum 
call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                             Tax Extenders

  Ms. COLLINS. Mr. President, I rise to express my concern that the 
Senate may adjourn this week without extending the 2001 and 2003 tax 
relief provisions which are slated to expire on January 1.
  These tax laws include important reforms such as the 10 percent tax 
rate, relief from the marriage penalty, and the child tax credit. They 
provide tax relief to nearly 90 percent of all Mainers. If they are not 
extended, virtually every Maine family and many--indeed, most--of our 
small businesses will see their taxes increase. If these tax relief 
provisions are not extended, the typical American family of four with a 
household income of approximately $50,000 will see their taxes increase 
by about $2,900 next year. That is right. Coupled with tax increases 
that are included in the new health care reform law, which I opposed, 
the result would be one of the largest tax increases in our history.
  Many economists contend this is the worst possible time to increase 
taxes because our economy is so fragile. I fully agree. I cannot 
imagine anyone even contemplating increasing taxes in the midst of a 
recession. The consequences for small businesses would also be dire. 
Higher taxes would take critical investment dollars away, leaving less 
for innovation and expansion, not to mention employee wages and 
benefits. Raising taxes when the economy is still weak would make it 
difficult and in some cases impossible for small businesses to start, 
grow, and create jobs.
  Peter Orszag, President Obama's former OMB Director, recently penned 
and op-ed for the New York Times in which he argued that this is no 
time to raise taxes. As he pointed out, the failure to extend existing 
tax relief would ``make an already stagnating job market worse.'' He 
went on to say:

       Higher taxes now would crimp consumer spending, further 
     depressing the already inadequate demand for what firms are 
     capable of producing at full tilt.

  I hope President Obama will heed the advice of his former budget 
director and abandon his plan to raise taxes at this critical time.
  It is important to understand that many small businesses are 
passthrough entities such as sole proprietorships, partnerships, and S 
corporations. These small businesses must report their earnings on 
their owner's individual income tax returns. The Joint Committee on 
Taxation has estimated that there are some 750,000 passthrough small 
businesses in the top two tax brackets.
  I wish to share with my colleagues examples of a couple small 
businesses in Maine that would be hurt by this tax increase. They are 
representative of many others, of course.
  This August, I toured several remarkable businesses in my home state. 
Their products are diverse and their histories vary greatly, but they 
share the traits of ingenuity, energy, and a commitment to excellence. 
The employees and the owners of these small businesses work so hard. An 
example is D&G Machine Products of Westbrook. Its name and products may 
not be familiar to the general public, but it is internationally known 
and respected throughout the pulp and paper, high technology, power, 
petrochemical, food processing, aerospace, and defense industries. Its 
precision design machining and fabrication operations put Maine on the 
cutting edge of innovation. As is so often the case, success started 
small with this small business. D&G was founded in 1967 by Dave Gushee 
and Fred Loring in a one-car garage behind Dave's home. They 
specialized in producing custom tooling and dyes for equipment 
manufacturers in the Portland area and soon added fabrication and 
welding services. D&G's founding principles of quality, attention to 
detail and delivering unsurpassed customer satisfaction paid off.
  Within a few years, this young company outgrew the tiny garage and 
expanded into sophisticated design and engineering services. Today D&G 
has more than 100,000 square feet of shop space and more than 130 
highly skilled and dedicated employees. I met many of them during my 
tour last month.
  Duane Gushee, who now runs the company, tells me he is very concerned 
about the impact higher taxes would have on his company's ability to 
compete. Duane pointed out to me that his company does not compete 
primarily against other Maine firms or even against other U.S. 
companies. It has to compete successfully with companies all around the 
world for markets and customers. Without constant innovation and 
investment in cutting edge technology, D&G will lose its customers, and 
its employees will lose their jobs. If we don't act, the tax increase 
that will hit D&G on January 1 will take money out of its bottom line, 
money that is needed to upgrade equipment and stay ahead of foreign 
competition.
  Another small business I visited is Pottle's Transportation, a 
trucking company headquartered in Bangor. This company was founded in 
1972, and it has grown to more than 200 employees with 150 trucks. 
Pottle's now provides service throughout the continental United States 
and Canada, although it concentrates its efforts in the Northeast. It 
is known for maintaining an impressive on-time delivery record without 
sacrificing safety. In fact, it has received award after award in 
recognition of its safety record. Pottle's is also known for its 
commitment to the environment. Pottle's is a member of EPA's Smartway 
Program and received the EPA Environmental Merit Award in 2008.
  The past few years have been very tough on the trucking industry. 
Barry Pottle, who runs the company, tells me that 1,100 trucking 
companies around the country have gone under so far this year. His 
company is in the black right now, but it is a real struggle to 
generate the capital needed to keep his trucks on the road. Pottle's 
needs to buy 25 to 30 trucks every year just to maintain its fleet. New 
trucks used to cost the company about $100,000, but in the past few 
years, the cost has gone up by another $25,000. Barry tells me this is 
due to an excise tax on heavy trucks

[[Page 16541]]

passed in 2006 and new environmental regulations that require $13,000 
in emissions equipment on each new truck. Together, these changes have 
raised Pottle's annual cost of doing business by about three-quarters 
of $1 million. On top of this, Barry has to worry about the tax 
increases his company will face if the 2001 and 2003 tax relief laws 
expire at the end of this year.
  Visiting these businesses and others, reading what economists such as 
Peter Orszag have said, has confirmed my belief that the administration 
must reverse its present course, which is stifling job growth, 
discouraging entrepreneurship and risk taking, and hobbling the 
economic recovery. Americans should be proud of the spirit, the drive, 
and the determination that has produced small business success stories 
such as D&G Machine Products and Pottle's Transportation.
  We in Washington must recognize that the policies we adopt or the tax 
laws we fail to extend have an impact on whether these companies can 
start up, grow, prosper, and, most of all, create good jobs. So what I 
have suggested we do as a compromise is to extend these two important 
tax relief laws for another 2 years. That will get us through this 
recession. It will send a strong signal to the business community.
  I cannot tell you how many businesses have told me they are holding 
on to capital right now. They do not dare invest to create much needed 
jobs because of the uncertainty of what is going to happen on tax 
policy. We know we need to revamp our Tax Code. We need to make it 
fairer. We need to make it simpler. But for right now the best thing we 
could do would be to extend those two laws--the 2001 and 2003 tax 
reform laws--for an additional 2 years to provide certainty to 
businesses and to send a strong signal that we get it. We know we 
should not increase taxes in the midst of a recession.
  One of the most startling conversations I had during August was with 
a small businessman who owns a small community grocery store. He told 
me he had an opportunity to buy a second store in another rural Maine 
town. He said he had the financing in place to make the purchase, and 
he would like to create more jobs and keep this small business going 
serving the needs of the community.
  I said to him: Well, why don't you just do it? Interest rates are 
low, so it seems like a good time. Is the uncertainty about what is 
coming out of Washington keeping you from acting?
  He said: You know, Senator, it is not so much the uncertainty. It is 
the certainty, the certainty of higher taxes, of more regulation, of 
having to pay more for health insurance for my employees. It is the 
certainty of more spending. That is what is discouraging me.
  So I hope we could come together right now, and before we go home 
pass a 2-year extension of the current tax law, to provide some 
certainty that we are not going to impose higher taxes on the American 
people and our small businesses.


                          U.S. Postal Service

  Mr. President, in my remaining time, I would like to speak today 
about the future of the U.S. Postal Service.
  The Postal Service is in the midst of a dire financial crisis. The 
data are grim. In the first three quarters of fiscal year 2010, the 
Postal Service posted a net loss of $5.4 billion. By the end of this 
week, when the fiscal year ends, I expect that number may hit $7 
billion that the Postal Service will be in the red for this fiscal year 
alone.
  Obviously, faced with this much red ink, the Postal Service needs to 
do everything possible to increase its revenue and reduce costs. Yet 
the Postal Service's plan for regaining its fiscal footing relies too 
heavily on service cutbacks, relief from funding its known liabilities, 
and the hope that enormous rate increases will be approved.
  I am a huge supporter of the Postal Service, and I want it not only 
to survive but to thrive. It is a vital American institution that 
serves our Nation and whose roots are found in our Constitution.
  To help the Postal Service identify additional areas for cost 
reductions, I asked the Postal Service inspector general to review 
three areas: the benefits the Postal Service pays on behalf of its 
employees, the Postal Service's contracting policies--which is an area 
where Senator Claire McCaskill, who has been a real leader in 
procurement reform, joined with me--and, third, the Postal Service's 
area and district field office structure to see if there were 
efficiencies that could be realized there.
  I must say, I was both dismayed and outraged when I received the 
results of the IG's audits.
  The IG found stunning evidence of contract mismanagement, ethical 
lapses, financial waste, and excessive executive perks which, if 
remedied, could allow the Postal Service to realize in excess of $800 
million in savings next year alone. That is at a minimum.
  Let me give you some startling facts the IG found. For a long time, 
we have known the Postal Service has been more generous in paying the 
health insurance and the life insurance premiums of its employees, most 
of whom participate in the same health insurance and life insurance 
programs as Federal employees.
  But what we did not know until this review was conducted is that the 
Postal Service pays 100 percent of the health insurance premiums for 
835 of its top executives, an expensive perk that no governmental 
agency appears to provide.
  This costs the Postal Service an estimated $10 million annually. If 
the Postal Service brought the contribution for these executives into 
line with federal agencies, it could save $2.8 million per year on this 
change alone.
  It is unbelievable to me the Postal Service--awash in debt and asking 
for huge postal rate increases--is paying the full health care premiums 
for 835 of its executives.
  The Postal Service is now paying 79 percent of health insurance 
contributions for its rank-and-file employees, in comparison to 72 
percent for the average Federal employee. It is a little hard for the 
Postal Service to make the case to its employees that it needs to 
reduce health insurance if it is paying 100 percent of the premiums for 
835 of its top executives. If the Postal Service brought its benefit 
contributions in line with other Federal agencies, it could save more 
than $700 million next year alone.
  But that is not all. When Senator McCaskill and I requested that the 
IG review the Postal Service's contracting practices, the IG discovered 
unfair and unethical practices replete with no-bid contracts and 
examples of apparent cronyism.
  The Postal Service's contract management did not protect it from 
waste, fraud, and abuse. Indeed, it left the door wide open. The Postal 
Service could not even identify how many contracts were awarded without 
competition. The inspector general found that 35 percent of the no-bid 
contracts it did review lacked justification. As part of its review, 
the IG discovered that more than 2,700 contracts had been awarded to 
former postal employees since 1991. Of these contracts, 359 were 
awarded as no-bid contracts to former postal employees in the last 3 
years. Seventeen of them were noncompetitive contracts to career 
executives within 1 year of their leaving the Postal Service.
  Some former executives were brought back at nearly twice their former 
pay--an outrageous practice the IG says raises serious ethical 
questions, hurts employee morale, and has tarnished the Postal 
Service's public image.
  In one particularly egregious example, an executive received a 
$260,000 no-bid contract just 2 months after retiring. The purpose? To 
train his successor.
  The findings of these three investigations show that the Postal 
Service must get more serious about cost cutting. Clearly, there are 
savings to be had.
  Faced with shrinking mail volume and a declining workforce, the 
Postal Service understands the need to reduce unnecessary costs but its 
efforts have fallen short.
  For example, the Postal Service can realize structural efficiencies. 
Even after the Postal Service consolidated 1 area office and 6 district 
offices last year, the structure still includes 8 area offices and 74 
district offices, costing

[[Page 16542]]

approximately $1.5 billion during fiscal year 2009.
  To determine if additional efficiencies exist, the inspector general 
reviewed area and district offices, which handle administrative 
functions but do not actually handle any mail. In doing so, the IG 
identified several options for consolidating the area and district 
field office structure.
  One option, which would entail closing area and district offices that 
have less than the mean mail volume and work hours, could save the 
Postal Service more than $100 million annually.
  Another, more conservative, option could save the Postal Service some 
$33.6 million annually by closing district offices that are within 50 
miles of one another.
  Management at headquarters reported that last year's consolidations 
went smoothly, with no negative impact on operations. That result 
clearly shows that the Postal Service should continue its strategic 
efforts to consolidate.
  After receiving the results of these three IG investigations last 
week, I wrote a letter to the Postmaster General, urging him to 
implement the inspector general's recommendations immediately.
  In my letter, I emphasized that the IG reports had found concrete 
ways for the Postal Service to cut sizeable expenses. Reducing costs is 
a far better solution than reducing service and increasing rates 
remedies that run the risk of driving away even more customers.
  Additionally, the Postal Service should increase cross-craft training 
and collaborate with high-volume customers to increase mail volume 
through initiatives like the ``Summer Sale.''
  It also should work with OMB and OPM to access the more than $50 
billion which the Postal Regulatory Commission believes USPS has 
overpaid into the Civil Service Retirement System fund.
  I have been pressing the Office of Personnel Management to change its 
method for calculating the Postal Service payments into the CSRS 
pension fund consistent with the 2006 Postal reform law. The OPM, 
however, stubbornly refuses to change its methodology or to even admit 
that the 2006 Postal law permits them to do so.
  I have continued to stress the importance of this change to both OPM 
and the administration. Clearly, the Postal Service's refund of a more 
than $50 billion overpayment would greatly aid its current financial 
condition.
  In sum, the Postal Service must devote more energy and adapt a laser 
focus to reducing costs, such as those identified in the recent IG 
reports. It also must develop customer-first programs that can enhance 
revenue, increase volume, and earn loyalty.
  The Postal Service is at a crossroads. It must choose the correct 
path. It must take steps toward a bright future that allows it to grow 
and thrive. It must reject the path of service reductions and ongoing 
postal rate hikes, which will only alienate customers.
  The Postal Service must reinvent itself by embracing change that will 
revitalize its business model and enable it to attract and keep 
customers. These actions are within its reach and will help protect and 
preserve this vital American institution.
  Thank you, Mr. President.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. BINGAMAN. Mr. President, I wish to speak on the legislation that 
is pending, the Creating American Jobs and Ending Offshoring Act, but 
also more generally on the issue of the loss of jobs, particularly in 
the energy sector, as we go forward.
  When BP Solar closed its Frederick, MD, plant earlier this year, 320 
Americans saw their jobs sent overseas to China and India. Bloomberg 
said the announcement ``signal[ed the] exodus of US renewable-energy 
jobs,'' which it obviously did. In fact, BP Solar's move followed 
General Electric's closing of its Newark, DE, solar panel plant, 
Evergreen Solar's shifting of hundreds of jobs from Danvers, MA, to 
China, and Gamesa's shutting down of its wind turbine factory in 
western Pennsylvania.
  Given the broad enthusiasm for creating clean energy jobs, few seem 
to notice this alarming trend. But we cannot afford to sit idly by as 
clean energy jobs steadily and stealthily move overseas. So as we 
debate this Creating American Jobs and Ending Offshoring Act--which the 
majority leader is trying to bring forward for Senate consideration, 
and which I support--I rise to call on the Senate, also, in addition, 
to pass three commonsense, bipartisan measures that will enable the 
United States to retain existing clean energy jobs and capture millions 
of new ones that the burgeoning global demand for clean energy will 
soon create.
  To begin, let me dispel the myth that the United States cannot lead 
in producing clean energy technology. In fact, we once were the leader. 
As recently as 1997, we had a ``green trade'' surplus of $14.4 billion. 
By 2008, that surplus had become a deficit of nearly $8.9 billion. The 
reversal was triggered largely by a steep fall-off in domestic 
renewable energy technology manufacturing. For instance, only a decade 
ago, U.S. solar cell manufacturers controlled 30 percent of the world 
market. By 2008, that had been reduced to 6 percent. Meanwhile, Chinese 
production has grown from nonexistent in 1999 to 32 percent of the 
world total in 2008. Similarly, European manufacturers now account for 
more than 85 percent of the global wind component market. Today, only 1 
of the top 10 manufacturers is an American firm.
  What happened to bring about these changes? Simply put, other 
countries enacted policies to attract investment, both ``push'' 
incentives such as tax incentives and direct subsidies to attract 
manufacturers, and ``pull'' incentives to create domestic demand. As a 
result of the incentives they enacted, China displaced the United 
States last year as the world's leading destination for clean energy 
investment. Its total investment was nearly twice that of the United 
States. Measured as a share of gross domestic product, domestic clean 
energy investment places us--the United States--in the bottom half of 
the G20 countries. If the trend continues, we will fall further behind.
  Over the next 5 years, government investment by China and Japan and 
South Korea is expected to outstrip U.S. Government investment by 3 to 
1. This public investment will drive trillions in private sector 
investment within those same countries.
  With global clean energy investments expected to reach $2.3 trillion 
by 2020, we cannot afford to delay measures that will ensure U.S. 
leadership in this area. We must look to create jobs across the clean 
energy value chain--from engineering to installation to sales. In 
particular, we must focus on manufacturing jobs, because failing to 
grow a domestic clean tech manufacturing base will result in trading 
our imported oil dependency for an imported clean energy component 
dependency. In fact, we are already seeing how shortages in renewable 
energy components and systems have slowed domestic renewable energy 
production. As we have begun to see, offshoring manufacturing is 
quickly followed by offshoring of research and development capacity.
  To grow our manufacturing base, Congress needs to take decisive 
action this year to enact, at a minimum, the three commonsense, 
bipartisan measures I alluded to before. First, we must send the 
appropriate market signal by enacting the renewable energy standard I 
have introduced along with Senator Brownback. Expanding demand for 
clean energy is essential to raising demand for domestically produced 
goods. For instance, every gigawatt of installed wind capacity--that is 
roughly enough to power all the homes in Atlanta--is estimated to 
create 4,300 jobs, more than three-fourths in manufacturing. European 
firms that now dominate U.S. wind turbine sales developed technical and 
marketing expertise by serving their own home markets first. Expanding 
domestic demand will enable American firms to catch up.
  As I indicated, Senator Brownback and I have introduced this 
legislation and we hope very much that in the short session of the 
Congress after the election, that can be brought up and dealt with in a 
positive way.

[[Page 16543]]

  But a demand-side strategy for clean energy cannot suffice. We also 
need to focus on the supply side to ensure that policies spurring clean 
energy demand will not only be filled by imports from overseas. So the 
second call is to expand the Advanced Energy Project, or section 48C 
tax credit that we created as part of the Recovery Act. That credit 
allows qualifying companies to claim a credit for up to 30 percent of 
the cost of creating, expanding, or reequipping facilities to 
manufacture clean energy technologies. The Recovery Act authorized the 
Departments of Energy and the Treasury to award $2.3 billion in tax 
credits.
  There are many success stories about funding that was way 
oversubscribed. The government received $10 billion in applications for 
the $2.3 billion in tax credits that were available under the Recovery 
Act. In December I joined with Senators Hatch, Stabenow, and Lugar in 
filing the American Clean Technology Manufacturing Leadership Act. That 
bill would add another $2.5 billion in tax credit allocation authority. 
President Obama has called for $5 billion in additional funds to be 
made available this way.
  The third of the initiatives I wish to focus on today is the need to 
address financing challenges that companies face in establishing 
onshore clean energy manufacturing facilities. Five years ago, Congress 
created a loan guarantee program at the Department of Energy. But from 
its start, the program has faced bureaucratic delays. So far, there are 
only 14 loan guarantees that have been issued, all of them in the past 
14 months and 10 within the last year. The Recovery Act promised to add 
$6 billion to the program which would leverage about $60 billion in new 
loans for clean energy projects. Unfortunately, this Congress has seen 
fit to treat this funding as a piggybank and withdrew $3.5 billion as 
offsets for unrelated purposes. We need to restore that funding.
  We need to restore it as well as retool the loan guarantee program. 
The Energy Committee, which I chair, reported a bill that would create 
a robust successor to that program called the Clean Energy Deployment 
Administration, or CEDA, and I urge the Congress to enact that 
legislation as well.
  Alongside these three measures to retain and create clean energy 
manufacturing jobs, we also need to pass two important additional 
bipartisan packages. The Energy Committee has unanimously supported a 
bill to address the largest oilspill in our Nation's history. The 
American people are waiting for us to enact it. We should do so as soon 
as possible. The Tax Code is an increasingly important mechanism for 
delivering clean energy incentives. In fact, more than three in five 
Federal dollars spent on energy are delivered through tax provisions.
  I will return to the floor later this week to discuss a bipartisan 
package of incentives for clean, renewable energy and energy efficiency 
and I hope that package will receive priority attention by the Congress 
before it adjourns as well.
  Some have said the United States cannot regain its footing in the 
clean energy manufacturing arena. Those who doubt the potential of this 
sector think that clean energy jobs can flow only to low-wage countries 
such as China. We need only look at what has happened in Germany where 
employment in the clean energy industry is second only to the nation's 
strong automotive industry.
  We are deservedly proud of our Nation's tradition as a leader in 
research and development, in innovation, and in venture-backed 
investing. With the right policies, we can guarantee that clean 
technology investment will come to our shores. Let's enact the job-
creating legislation pending in the Senate today and then move swiftly 
to enact legislation creating a renewable electricity standard and a 
Clean Energy Employment Administration, and expanding the section 48C 
credit.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. HARKIN. Mr. President, this is what we are here to talk about 
once again: making it in America.
  On Friday, the Department of Labor made available more than $500,000 
to assist 183 Iowans laid off from the ThermoFisher Scientific plant in 
Dubuque. All of the workers were certified as eligible for trade 
adjustment assistance. This grant was designed to help unemployed 
Iowans as they attempt to find new work in an economy that is already 
desperately short of new jobs.
  I am certainly grateful for the temporary assistance from the Federal 
Government, as I am sure are the unemployed workers and their families. 
But what is wrong with this picture? Once again, we find ourselves 
lending modest assistance to American workers whose jobs have been 
eliminated--whose economic security has been destroyed--because U.S. 
manufacturing is being shipped overseas. I would note that 
manufacturing jobs, which are generally high paying, have been 
particularly hard hit in this economic downturn.
  In my State of Iowa, there has been a steady, relentless drumbeat of 
layoffs and plant closings as companies from Electrolux to Cummins shut 
down their plants and move to other countries--including Mexico and 
China and other countries--that offer low wages, lower workplace safety 
standards, and only minimal environmental oversight. This is happening 
despite the fact that American workers, while paid more, tend to be far 
more efficient and productive.
  Adding insult to injury, these newly unemployed American workers must 
reckon with the fact that the United States Tax Code actually rewards 
companies for sending their jobs overseas. That is right. Most 
Americans don't know this, but the Tax Code actually incentivizes 
companies that shut down operations and kill jobs in the United States.
  This betrayal of American workers is outrageous on its face. And with 
the official unemployment rate stuck near 10 percent--that is the 
official rate; the actual rate is closer to 18 percent--it is simply 
intolerable.
  That is why I have come to the floor to speak in strong support of 
the Creating American Jobs and Ending Offshoring Act of 2010. This bill 
would take three urgent steps to reduce and begin to reverse the 
bleeding of jobs from America.
  First, the bill would end subsidies for plant closing costs. That is 
right. There are subsidies if you close a plant. It would prohibit a 
firm from taking any deduction, loss, or credit for costs associated 
with reducing or ending the operation of a trade or business in the 
United States and starting or expanding a similar trade or business 
overseas. Let me note that the bill would not apply to any severance 
payments or costs associated with placement services or employee 
retraining provided to those who lose their jobs as a result of the 
offshoring.
  Secondly, the bill would end the tax breaks for runaway plants, for 
companies that reduce or close a trade or business in the United States 
and start or expand a similar business overseas for the purpose of 
importing their products back into the United States. Under current 
law, U.S. companies can defer paying U.S. tax on income earned by their 
foreign companies or subsidiaries until that income is brought back to 
the United States. This is known as deferral. Deferral has the effect 
of putting these firms at a competitive advantage over U.S. firms that 
have stayed here and that hire U.S. workers to make products in the 
United States. Imagine that. So you take your company and ship it 
overseas. All of the money that plant makes over there, you don't have 
to pay taxes on it. You keep your money there and keep expanding your 
plant, or make another plant in another country that is low wage and 
has low environmental oversight.
  What an advantage they have over good companies, good businesses in 
America that want to stay here. So we have to close that loophole.
  The third loophole we have to close is the encouragement businesses 
get right now to create jobs that go overseas. We have to create 
incentives for businesses that expand here. This bill would provide 
businesses with a 2-year break

[[Page 16544]]

from paying the equivalent of the employer's share of Social Security 
payroll tax on wages paid to new U.S. employees performing services in 
the United States that used to be performed overseas. In other words, 
if they have a plant and a business here and can bring jobs back to the 
United States, guess what. For 2 years, they get a tax break; they 
don't have to pay the employer's share of the payroll tax. We will pick 
it up--the Federal Government, the taxpayers--because those jobs will 
come back here; people will be hired; and they will be paying into this 
economy.
  Mr. President, I salute the Senator from Illinois, Senator Durbin, 
for introducing this bill. I also salute the senior Senator from North 
Dakota, Senator Dorgan, who has been such an outspoken champion of 
American manufacturing. He has fought long and hard to end the 
provisions in the Tax Code that have the perverse effect of actually 
encouraging and rewarding U.S. companies that ship jobs overseas. I 
also commend the Senator from Ohio, Sherrod Brown, who also is a 
tremendous champion of the focus and attention to try to do everything 
we can possibly do to keep our jobs here. Ohio has especially been hard 
hit. If we look at all of the statistics, Ohio has been especially hard 
hit over the last decade, during the last 8 years of the Bush 
administration, from all of the jobs that left Ohio and were shipped 
overseas.
  Let me give an example of the destruction that is caused by this. 
Almost exactly 1 year ago, workers at the Cummins Filtration plant in 
Lake Mills, IA, a small community, were gathered together on the shop 
floor. Company officials, surrounded by a phalanx of security 
officials, announced that some 400 jobs would be moved to Cummins 
manufacturing plants in Mexico.
  This announcement came out of the blue. The employees immediately 
went into mourning, trying to make sense of their new status--victims 
of the outsourcing of their jobs to Mexico. Thirty-five married couples 
worked at the plant. So many families lost two jobs in one fell swoop. 
In one case, the couple had worked at Cummins for 30 years. As one 
plant employee said:

       This is going to be terrible for people, terrible for this 
     town. It's going to hurt everybody, the gas station, the 
     grocery store.

  Mr. President, this is the kind of personal tragedy and devastation 
that we are seeing in thousands of towns all across America as 
companies lay off employees and/or shut down operations and move 
overseas.
  Since 2001, some 42,000 American factories have closed their doors. 
Roughly three-fourths of those employed over 500 people. Not 42,000 
jobs, Mr. President, but 42,000 American factories closed their doors 
since 2001.
  The manufacturing sector lost 1.3 million workers in 2009 alone, 
continuing the disturbing loss of more than 5 million U.S. 
manufacturing jobs from 2001 to 2009. That is right, 5 million 
manufacturing jobs lost.
  It is bad enough this is happening, but what is absolutely 
intolerable is that our Tax Code actually encourages companies to kill 
these U.S. jobs and take their operations overseas.
  Senator Dorgan, many times, has cited the example of Levi jeans and 
Huffy bicycles.
  What can be more American than Levi? They moved their production to 
Mexico and to other parts of the world. They don't make any Levis here 
anymore. They contract with foreign companies who make Levis for the 
Levi Company.
  As Senator Dorgan said about Huffy bicycles in Ohio--Senator Brown's 
home State--workers there made $11 an hour making those bicycles. But 
they got fired, laid off, and Huffy bikes are now made in China at 30 
cents an hour. The Huffy Corporation reaped millions of dollars in tax 
breaks as a result of this offshoring.
  Then, as this chart shows, is Fruit of the Loom, another signature 
U.S. company that has outsourced many thousands of jobs over the last 
decade. The company has closed plants in Kentucky, Mississippi, 
Louisiana, Texas, and elsewhere, and shipped those jobs to Asia, the 
Caribbean, and Morocco, and the U.S. Tax Code has handsomely rewarded 
Fruit of the Loom for doing so.
  Mr. President, these are the Fruit of the Loom guys on the chart, 
which shows them leaving for Mexico, and they took 3,200 U.S. jobs with 
them.
  It is time to end this outrage, with the U.S. Tax Code actually 
encouraging companies to lay off employees and ship operations 
overseas, even as we struggle to recover from the worst economic 
downturn since the Great Depression.
  The way to grow our economy and drive our recovery is to create jobs 
in America and remove policies that encourage companies to ship 
American jobs overseas. We built the middle class by building things in 
America. We can do it again by giving companies incentives to bring 
jobs back to America and create new ones here as well.
  I encourage and urge my colleagues to support the Creating Jobs and 
Ending Offshoring Act of 2010.
  I assume our time has expired.
  The PRESIDING OFFICER. There is 7\1/2\ minutes remaining.
  Mr. HARKIN. Mr. President, I will take a couple more minutes.
  First of all, I don't know how anybody can argue with this bill. It 
just says, one, we are going to end subsidies for plant closing costs. 
In other words, right now, a company could close a plant here and move 
it overseas. All of the costs of closing down that plant and ending 
that operation would take a deduction--or they could take losses or 
credit against taxes for the cost of closing that down. If they shipped 
it overseas--if a plant goes belly up, and they can't make it anymore, 
or whatever they have made is not being purchased anymore, that is one 
thing. I can see providing for credits and losses and deductions for 
that. But if they are closing it down and starting or expanding a 
similar trade or business overseas, they should not get any tax 
benefits whatsoever. That is what this bill does; it ends that 
loophole.
  It ends the tax break for runaway plants when they expand their 
businesses overseas. Why should we allow companies that, as I say, are 
not good citizens--they take their plant overseas and the money they 
make over there--first of all, they don't have the same environmental 
protections. They have terrible working conditions and low wages. But 
they take all those profits--and a company that is here making the same 
products in America pays workers more, pays into Social Security, pays 
higher taxes, has environmental concerns to deal with--but this plant 
in America has to pay taxes on their earnings. The company over in 
China, making the same product, can defer those taxes, as long as they 
don't bring the money back here.
  You might say, as long as they don't bring the money back here, why 
should they not get a deferral? Because they take those profits and 
expand operations in that country or other countries, further putting 
at a disadvantage the good companies that stay in America. We ought to 
end that loophole.
  Third, this bill provides actual incentives for companies to 
repatriate jobs into this country--bring jobs back into this country. 
They get a 2-year break from paying their company's share of Social 
Security taxes. That is a good tax break for companies coming back into 
America.
  For those three reasons, I don't see how anybody can argue with us. I 
am not here to say we have to stop every plant and put laws into effect 
to stop them from going overseas. That is not what I am saying. I am 
saying don't have the Federal Government subsidize that. That is what 
we are doing with our trade laws. I am not going to get into that now. 
That is for another debate maybe later this year or next year about 
redoing our trade laws and what we are doing in the WTO.
  Why does China get away with undervaluing their currency, which makes 
their imports into this country cheaper, and we do nothing about it? At 
least Japan did something--raised tariffs to equalize the difference 
between what the currency could be worth on the open market. That is 
what we ought to look at in this country. China should not be allowed 
to get by with this undercutting of their currency just to

[[Page 16545]]

make their exports to this country cheaper because it is taking more 
American jobs away.
  Again, that is not part of this bill. That is a discussion we need to 
have, and we need to have it soon in order to, again, have us take a 
more or a stronger position in world trade than we have been taking in 
the last couple of decades.
  With that, I yield the floor.
  The PRESIDING OFFICER. The Senator from Nebraska is recognized.
  Mr. JOHANNS. Mr. President, I rise today to discuss what I consider 
to be a rather disturbing trend on the floor of the Senate. I am 
observing more and more the majority bringing legislation to the floor 
for political reasons, knowing it doesn't have enough votes to pass.
  Rather than working to address our economic woes in any kind of 
meaningful way, we instead find ourselves voting on what I would 
describe as ballot box topics designed to gain favor with select groups 
just weeks before the November elections.
  Is it any wonder that the American people continue to give Congress 
such a dreadfully low approval rating? Is it any wonder that the people 
of this country look at what is going on and have come to the 
conclusion that the problems they are facing every day are not being 
solved?
  Back in August, when I was going across the State, I did 14 townhall 
meetings, open events, where anybody could show up and offer their 
thoughts. What I heard over and over is that people are just exhausted, 
sick and tired of the games and the election year politicking that is 
going on, when we should be working to deal with the problems this 
country faces.
  You see, the people don't care who is scoring political points. They 
care about their jobs, they care about finding a job if they have lost 
their job, and they care about keeping food on the family's table. For 
all too many people in this country, they care about the fact that the 
job they once had may never come back. They want action. In fact, they 
are crying out for action.
  They want thoughtful approaches to our Nation's problems--not 
populist rhetoric devoid of any real solutions or a serious attempt to 
find solutions.
  We find ourselves on the floor of the Senate this week debating a 
bill that has been labeled a jobs bill. Let me point out that there 
have been no hearings. There has been no debate on the proposal 
currently before the Senate. There has been no give-and-take in the 
hearings process to try to figure out if there is a way to come up with 
an approach that would make sense to create a jobs bill. None of that 
has happened.
  You see, what this bill tries to do is seek to punish U.S. companies 
that do business overseas under the very misguided assumption that 
doing so will somehow result in economic growth and job creation at 
home.
  This bill would not create jobs. What it will do is hurt U.S. 
companies that do operate globally. Let's take a look at exactly what 
is in this bill and set aside the rhetoric.
  The first part is a payroll tax holiday. I want to be the first to 
admit that I supported the payroll tax holiday when the Senator from 
Arizona, Mr. McCain, offered it during the stimulus debate. It is so 
amazing because when that was offered by Senator McCain, our friends on 
the other side of the aisle wanted no part of the idea whatsoever. 
Instead, what they wanted was to shove tens and tens of billions of 
dollars into government spending, leaving businesses essentially out of 
the stimulus equation entirely.
  Now we are seeing an eleventh hour, last-ditch effort that ties 
strings and redtape to tax relief for businesses.
  Yet this proposed payroll tax holiday is different from Senator 
McCain's. Senator McCain, appropriately so, said: If we are going to 
get this Nation's economy going again, we need to include all employees 
in an attempt to bring money to the economy, back to the workers' 
wallets, where they could better spend or better decide how to spend 
those dollars.
  What we have here is just a narrow element--only for those businesses 
that replace a foreign worker with an American worker. How many jobs 
will that really create? When faced with a tsunami of uncertainties, 
ranging from increased taxes to a hostile business attitude in this 
administration--a downright antibusiness attitude--will a business 
really choose to hire because of this 24-month supposed tax holiday? 
There are some business groups out there that have answered that 
question for us. Let me quote from the chamber of commerce. They said 
this:

       The concept of economic growth is not a zero-sum game. 
     Replacing a job that is based in another country with a 
     domestic job does not stimulate economic growth or enhance 
     the competitiveness of American worldwide companies.

  At a time when we have a 9.6-percent unemployment rate and an 
underemployment rate in the double digits, do we really want to enact 
legislation that will set back job creators and threaten our ability to 
compete in this world? Why does it leave out mom-and-pop, Main Street 
businesses? Why are they left out in the cold? Even if these small 
businesses wanted to hire to get a 2-year payroll tax holiday, they 
could not because they do not have any foreign employees. How absurd. 
The payroll tax holiday before us today is designed to only help the 
biggest of the big multinational conglomerates. Talk about standing up 
for the little guy. Are you kidding me? It tells Joe's Garage or 
Smith's Tool Shop: You are just simply out of luck. Considering the 
fact that 65 percent of all new jobs are created by those small 
businesses--businesses such as those on Main Street in Nebraska--
excluding them from hiring tax incentives simply defies any rational 
logic whatsoever. But that is, unfortunately, what this legislation 
does.
  Let's keep examining the so-called jobs bill.
  The next part of the legislation is a provision that would 
immediately tax the earnings of foreign subsidiaries. In other words, 
the legislation would repeal the so-called deferral rule. Currently, 
firms are able to defer taxation on their foreign-generated income 
until it is brought back to the United States. At a time of sluggish 
economic growth, enacting policies that will threaten U.S. business is 
downright unwise, and it is reckless economic policy. Repealing the 
deferral rule will only further hurt the ability of U.S. companies to 
compete against other companies around the world.
  The United States imposes a 35-percent corporate tax rate. That is 
already one of the highest in the world. In fact, we are behind only 
Japan in how aggressively we tax our corporate businesses. Only Japan 
has a higher tax rate. The average for the other G7 countries is just 
under 29 percent, while the group of industrialized nations that make 
up OECD average only 19.5 percent. Let me say again that we are at 35 
percent. We are punishing the job creators already. How can we expect 
these companies to compete with their foreign counterparts when the 
foreign companies have such a lower tax burden, when their countries 
say: Look, we want these companies to be successful and have kept the 
tax burden low. How do our companies compete with that? The simple 
answer is, they cannot. If we really want to spur job creation, we 
would be lowering our corporate rate, not trying to punish our 
multinational firms that are trying to compete in the international 
marketplace.
  Once again, do not believe me. Go to people who are in the midst of 
this. The National Association of Manufacturers said of the bill:

       Manufacturers are concerned that the bill's proposed tax 
     increases would impose new costs on American manufacturers, 
     making them less competitive in the global marketplace and 
     jeopardizing U.S. job creation.

  Let me repeat the last piece of that: ``. . . making them less 
competitive in the global marketplace and jeopardizing U.S. job 
creation.'' This is not a jobs bill at all. It is a political 
punishment bill.
  Once again, the majority has sought to villainize a piece of our 
economy hoping that somehow by villainizing them, it improves their 
chances. First, it was the credit card companies. Then

[[Page 16546]]

it was the student loan makers. Next it was the insurance providers, 
the energy companies. And the list goes on and on. Unfortunately, this 
time they are trying to villainize companies that are trying to compete 
in an international economy.
  But this bill also misses a very key point. A big part of the reason 
companies are not hiring is because of the vicious onslaught of bad 
policy Washington is throwing at them. I talk with businesses in our 
State. They are paralyzed with fear over what Washington will do next.
  Let me share a story. I had a business roundtable in an area of 
Nebraska, Sarpy County, NE. A group of small businesspeople were 
sitting there. I was asking them: What can be done to help your 
businesses grow so you can hire people?
  There was one lady there, and she said: Mike, I have a business 
franchise in both Lincoln and Omaha. Our business in Omaha actually is 
not too bad. But I have looked at this health care bill. I have 
gathered information on this health care bill, and I have come to the 
conclusion that if I grow my business beyond 50 employees, which is 
right where I am today, I get tangled up in this mess. I do not want 
anything to do with it, so I am not hiring.
  That is what I am hearing all across our State. And this payroll tax 
holiday for those who bring back workers to the United States is not 
enough compensation for all of the other looming tax increases 
businesses are facing. It is not going to offset the problems that have 
been created by this onslaught of higher taxes and regulation.
  I am so disappointed that in these last days before we recess, a 
decision was made to take up such a flawed piece of legislation. Yet 
what is going to happen is this messaging attempt will take up our 
time. We will recess until after the elections, and we will miss the 
opportunity to take an important vote on what is headed to be the 
largest tax increase in our Nation's history. A vote on preventing the 
looming tax increases would have given individuals and some businesses 
some certainty about the future. We cannot expect any meaningful 
economic recovery to occur until businesses are provided with some 
certainty about what is happening in Washington.
  Every day, I get calls from constituents. Every time I am home in 
Nebraska, people are saying: Mike, please tell me what is going to 
happen on these tax issues. Tell me what to expect on January 1.
  I can tell you that it is no consolation to them for me to say: We 
are debating a bill that everybody knows is not going to pass. That is 
how we are using our time between now and a recess that will extend 
well into November.
  It does not make any sense whatsoever. No tax credit will prevent the 
punitive measures that are headed toward our population. Again, do not 
take my word. The National Federation of Independent Business has 
described it this way:

       Uncertainty about the economy and looming tax hikes has 
     kept this sector from hiring new workers, resulting in a weak 
     economic recovery and slow to nonexistent job growth.

  The NFIB went on to say:

       Congress can take an important step to address the 
     uncertainty by holding a vote and passing legislation 
     extending all of the expiring tax rates. No small business 
     owner should face higher taxes.

  I could not agree more.
  As I go across my State--and I doubt it is any different in any other 
State--Americans are struggling to meet this month's payroll. They do 
not need legislation designed only to gain political points at the 
polls. They want us to come here, to have a debate about what is going 
to happen on January 1 of next year, and that is the largest tax 
increase in our Nation's history. These good people deserve real 
solutions, not populous slogans meant to fool the electorate and 
somehow gain favor between now and November.
  I know what is happening out there, and if we all think about it, 
what we are seeing is the American people are not fooled. They simply 
will not be fooled. They know that this latest bill supposedly meant to 
create jobs will not do a darn thing to address their concerns--looming 
tax increases, mounds of new regulations, and new 1099 paperwork 
mandates.
  If I were going to design the perfect strategy for economic growth in 
our country, here is what I would say the people of Nebraska are 
telling me. They are saying: Extend all of the 2001 and 2003 tax 
reductions. Why? Because that is what makes the most sense for our 
economy. They see this massive tax increase out there, and they are 
asking themselves: How could you let that happen in these economic 
times?
  Second, they would say: Repeal the 1099 mandate. We had a vote on 
that issue recently, as you know, Mr. President, on an amendment I 
offered. In that health care bill buried at section 9006 is a provision 
that says to every small business, every large business, every medium-
sized business in America: Thou shalt do it this way, and this way is 
that if at any time during the year you buy more than $600 from any 
vendor, you have to produce and provide to that vendor a 1099 form and 
provide a copy to the Internal Revenue Service. It doesn't stop there. 
It also applies to churches, to nonprofits, to State and local 
governments. It is an absolute wave of new paperwork. One business 
group estimates it would increase paperwork by 2,000 percent. What have 
I heard from my businesses in Nebraska, especially our small 
businesses? They are saying: At a time when we need your help, what you 
are doing to us is burying us in paperwork, and we don't have the 
employees to deal with this.
  This is a crisis that is hitting our job creators, and I am extremely 
disappointed with where we are today. We are literally not advancing 
the cause of creating jobs in this country. We are taking a course of 
action, instead, that is all about populism, that is all about gaining 
favor between now and November.
  But I will say again: The American people have figured this out. They 
get it, they understand it, and they are watching us very closely. The 
bill we are debating is nothing more than an election year stunt, when 
we could be acting to prevent the largest tax increase in our Nation's 
history.
  In those 14 townhall meetings, as I traveled from the largest 
community in our State--the city of Omaha--to some of the smallest 
communities in our State--Benkelman, in the very southwestern part of 
our State--I heard a common message. People wanted me to come back to 
Washington and fight for them against whom? Against a Washington 
government that they think has lost touch with their real problems, 
their real concerns. They wanted me to come back and speak on their 
behalf about what Washington politicians are doing to their businesses, 
to the job creation which this country depends upon, and to their 
pocketbooks. They asked me to come back and speak on their behalf 
because they see this tsunami of legislation that has come their way 
and they do not like any part of it.
  It is no surprise to me whatsoever that what we are seeing out there 
are people who are sick and tired of what is going on here. They are 
sick and tired of a health care bill that is raising their premiums, 
forcing them into individual mandates, and complicating business 
creation literally to the extent where a job creator says to me: I 
can't grow this business beyond 50 employees because of what you have 
done to us in this health care bill.
  It is a remarkable day in our Nation's history when the people of 
this great Nation are asking their elected representatives to come back 
here and fight against their government, but that is exactly what is 
happening. They are asking us to stand for them and to say to what is 
going on here: Enough is enough. We have punished the American people 
with endless regulations and with endless tax increases. At the end of 
this week, every Member of this body will be forced to go home and say: 
In a week where we could have made a difference and given you certainty 
and extended the 2001-2003 tax cuts, it wasn't done. Instead--instead--
during this time, politics was played and nothing happened; just like 
we know today that politics is being played.

[[Page 16547]]

  I think it is an unfortunate situation. I think we can do better for 
the American people than what is being displayed.
  With that, I yield the floor, and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Ms. STABENOW. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Ms. STABENOW. Mr. President, this evening, we will be discussing--
debating--a very important principle; that is, whether we are going to 
focus on making things in America and whether we are going to stop the 
incentives that ship our jobs overseas. This debate is about our 
efforts, through a bill we will be voting on tomorrow, to stop shipping 
our jobs overseas. That is what this is about.
  We know we are in a global economy. We understand we need to do 
business around the world, but we want to export our products, not our 
jobs. Right now, we are exporting too many of our jobs. Frankly, there 
has been no State that has been hurt more from this set of policies as 
well as inactions than my home State of Michigan. No State has been 
hurt more.
  For too long, we have not been enforcing our trade laws. We allow 
China to manipulate their currency so they can bring products into our 
country at a cheaper price artificially, which is against WTO. It is 
against the law. But they have been allowed to do that. I am very 
pleased the House is going to be taking action this week to address 
that. A number of us, Senator Schumer and I, Senator Lindsey Graham and 
a number of others, have legislation to do that, and we will be 
addressing that as we move forward in the Congress the rest of the year 
to get that done.
  So enforcing our trade laws, stopping currency manipulation, stopping 
countries from stealing our patents, from artificially blocking us from 
going in and selling to them, this is very important. But we also know 
there are policies in place that have put the wrong incentives in 
place--the wrong incentives. That is what the bill we will be voting on 
tomorrow will eliminate. We have two areas where we want to take away 
incentives right now to shift jobs overseas and we want to put in place 
an incentive to bring back jobs--three provisions in our bill.
  There is an incentive to create American jobs by allowing a company 
that, after the passage of the bill, brings back a job--hopefully a lot 
of jobs--to the United States sometime in the next 3 years. They would 
get a holiday of the payroll tax for 2 years, for 24 months, if they 
are bringing jobs back and it is clear that job was coming back from 
overseas. If they are stopping a job overseas, creating a job here, we 
want to create an incentive.
  We also want to take away those things that have encouraged jobs 
being shipped overseas. The second provision would deny business 
deductions of any costs associated with moving jobs overseas.
  The third provision would end corporate tax deferral of overseas 
income.
  Why in the world American taxpayers would want to subsidize 
essentially shipping jobs overseas through our Tax Code is beyond me. 
That is what we want to change. Someone should not be writing off the 
costs of moving the jobs overseas and setting up shop somewhere else. 
This legislation would take away that tax deduction, that business 
deduction for writing off those costs you use to ship jobs overseas.
  I have seen the devastation in communities around Michigan from 
efforts where a business will close up shop and will take jobs 
overseas. In many cases it is over the river to Canada or down to 
Mexico. I remember Electrolux, in Greenville, MI--it was 2,700 jobs in 
a community of 8,000 people--making refrigerators. They were 
productive, doing a great job. There was a second shift, in some cases 
a third shift. But they decided a few years ago to close up shop, 2,700 
jobs lost, and they went to Mexico--where they could pay $1.50 an hour, 
by the way.
  We have a Tax Code that would allow Electrolux to write off the 
business expenses to take those 2,700 jobs down to Mexico. This 
legislation stops that. It would provide incentives for bringing jobs 
back.
  We cannot have an economy unless we are making things. That is the 
second part of what we are doing. We want to stop jobs being shipped 
overseas, but we want to make it in America. We want to make things in 
America again. We do not have an economy, no country has an economy, 
unless we make things and grow things and add value to them. I am very 
proud to say in Michigan that is what we do: We make things, we grow 
things, we add value to things. If we focus on making things in America 
again, we will not only bring jobs back, we will bring the middle class 
back because, as we have learned painfully, after seeing the last 
decade a focusing on cheap prices but not where things are made, that 
if we do not have manufacturing in this country and if we are not 
focused on where things are made, we will lose good-paying middle-class 
jobs. We have lost many of them.
  In fact, from 2001 until 2009 we lost 4.7 million manufacturing jobs 
in America. Nearly 27 percent of the jobs in manufacturing were lost 
during the last administration, from 2001 to 2009. We want to turn that 
around. In fact, we have been focused on turning that around. We have 
been focused in a number of ways to grow manufacturing, for example, in 
the Recovery Act with the Advanced Manufacturing Tax Credit--48C it is 
dubbed--which has brought a number of new businesses to Michigan and 
others around the country, focusing on other kinds of clean energy 
manufacturing, to make things in America. We have begun to see the 
manufacturing numbers go up--way too slowly, but one of the ways to 
make sure it moves more quickly is if we close the incentives to ship 
the jobs overseas. If we close those incentives for shipping jobs 
overseas and, instead, put the right kinds of incentives in place, we 
will bring jobs back and we will be able to partner with businesses to 
be able to do that.
  One example I was pleased to author in the Energy bill passed a 
couple of years ago is a retooling loan program to help automakers and 
others manufacturing to be able to retool older plants and to be able 
to bring jobs back. We have seen a wonderful case of that with Ford 
Motor Company bringing the Ford Focus production back from Mexico to a 
plant in Wayne, MI, partnering with the Federal Government on the right 
kind of incentives to retool a plant--from a truck plant down to an 
energy-efficient, fuel-efficient car plant. Those are the kinds of 
incentives we need to have in place, not incentives that say if you 
ship jobs overseas you can write off the costs on your taxes.
  We know the kinds of incentives that can work. We have seen them 
work. We have to have a much more aggressive policy about making things 
in America and making sure that we are closing the loopholes that have 
stopped the efforts to take our jobs overseas.
  There is so much we need to do. I feel a tremendous sense of urgency 
about this issue of making things in America because of my great State, 
where we make not only automobiles, we make appliances, we make medical 
equipment--you name it and somebody in Michigan is probably making 
parts for it.
  We have created a whole generation and a middle class because of our 
ability to make things in America. Then we see what has happened, where 
we have seen the pressures coming in an international marketplace with 
other countries rushing to have a manufacturing policy--China, Korea, 
India, Germany, of course Japan--rushing to have a manufacturing 
economy and doing whatever they can, cutting corners, not following the 
law, stealing patents, manipulating currency, and putting up trade 
barriers.
  We are in a marketplace where we have to fight for our businesses and 
our workers, to keep the opportunities to make things here in America, 
not fold up and assume that your jobs are going to be lost and, in 
fact, incentivize that by tax policy.

[[Page 16548]]

  The legislation we have in front of us is one of the most important, 
fundamental pieces of legislation that we have voted on this year, in 
terms of jobs and turning the incentives around. We want to make things 
in America and we want to stop shipping our jobs overseas. We want to 
incentivize companies to bring jobs back by giving them a 2-year 
payroll holiday for jobs that are coming back from other countries and 
putting people to work. We want to take away the ability to defer taxes 
on profits made on businesses overseas and to use business deductions 
from the American tax system to be able to deduct from American taxes 
those costs that are being expended to ship jobs overseas.
  This is a time to be focused on fighting for America, on fighting for 
good-paying jobs and for workers and for businesses that have done the 
right thing. People who do nothing more than get up and go to work in 
the morning are proud of their skills. We have the best, most skilled 
workforce, the best engineers. We create the innovation in this 
country. But our tax policies encourage that to go overseas to create 
jobs. That is what this legislation is meant to address. This is about 
fighting for America, fighting for our American dream. It is about 
making sure that our priority is to make things in America again and to 
stop the policies that are shipping our jobs overseas.
  I see my colleague from California here, who is such a champion on 
this issue, who has spoken out so many times on behalf of her State of 
California. We share many things, actually, in terms of innovation. In 
fact, we talk about innovation oftentimes as created in California, 
that we are buying it and putting it in our automobiles as well as 
creating it ourselves in Michigan. We have a great partnership.
  You have more computer power in your automobile than anything else 
you own and we are very proud of that, and we are proud of the 
partnership we have--I am proud of the partnership with my friend from 
California, who is such a fighter for her people and a fighter for 
jobs.
  I will relinquish the floor at this time, but let me say this is very 
simple and the vote tomorrow is very simple. We want to stop shipping 
jobs overseas. We want to make it in America again.
  The ACTING PRESIDENT pro tempore. The Senator from California is 
recognized.
  Mrs. BOXER. Mr. President, I want to thank Senator Stabenow for her 
leadership on this and so many issues relating to jobs--jobs here in 
America. I had the opportunity to listen to a bit of the debate back 
and forth. I heard some of my colleagues who were not in favor of this 
very important bill that we hope to move tonight, to reward companies 
that produce jobs and create jobs in America and take away the tax 
breaks from those who ship jobs overseas and then try to import those 
products back to America. We are saying let us reward those who create 
the jobs here in America. That is as simple as it gets.
  I have heard my colleagues on the other side say in a very convoluted 
way that when we give tax breaks to companies that ship jobs overseas, 
it actually winds up creating more jobs in America. I wonder if they 
have met some of the people I met, who actually went to other countries 
to train their replacements. They went to other countries to train 
their replacements.
  We just passed a very important small business jobs bill. I saw the 
President today sign it into law. It is going to create jobs right here 
in America because, guess what, it is setting up a lending system, a 
deficit-neutral fund through our community banks. That $30 billion 
deficit neutral fund will be leveraged to $300 billion and we will see 
a half million jobs created through the small business community. They 
need access to capital.
  This is a good step. We cannot stop there. We have to do more. That 
is why, as we wind down before the election, we are trying to say to 
our colleagues: Please, all join together on the way out of this 
particular session. We will be back after the election. But on the way 
out the door now, let's do something for the American workers, for 
American families.
  For too long the Tax Code has rewarded companies that ship jobs 
overseas. It seems to me it is common sense. You can make it complex. 
Some of my colleagues have made it complex. But when somebody tells you 
something like this--it is complicated--challenge them, because most 
ideas are not complicated. People make them complicated. If you create 
jobs here in America, guess what, we are going to give you a tax break. 
Not only that, we are going to give you a tax holiday, for the workers 
that you employ right here in America. We are not going to say if you 
move jobs overseas you get big tax break and big tax writeoffs. It is 
pretty simple. That is it. People who oppose this, I believe, simply do 
not believe it is important to create jobs here in America. I want to 
see the words ``Made in America'' again.
  Manufacturing is an essential part of our economy. We have to do all 
we can to promote a strong manufacturing base here at home. In my State 
of California, over 1.2 million Californians work in the manufacturing 
sector, and the products these men and women make contribute $180 
billion to our State's economy.
  But in recent years, manufacturing businesses have left the United 
States and they have taken their production lines to countries such as 
China, India, Mexico, and hundreds of those of jobs left my State.
  The number of U.S. companies with foreign manufacturing affiliates 
increased 14 percent in the last 20 years, and it continues even during 
the recession. I think it is important to make a distinction between 
companies that sell abroad--all right, we want that--and companies that 
close down manufacturing here and then manufacture abroad and then 
reimport those products back to America.
  That is what we are talking about. We want our companies to get out 
there, make products here and sell them abroad. I think that is very 
important, and I want to reward that. I do not want to reward people 
who close down their manufacturing plants and open a new operation 
abroad, produce their product, and then bring it back to America.
  That is what we have been rewarding. A Duke University study tells us 
the number of companies with a corporate offshoring strategy in place 
more than doubled in the last 3 years. A lot of us know Senator Dorgan 
has been a real champion on this issue of ending tax breaks for 
companies that shift jobs overseas. I was proud to support his measure 
to end those tax breaks at least four or five times. He has come to the 
floor to tell the stories of American companies that have uprooted 
their production lines in the United States, relocated to foreign 
countries, only to resell their products made by foreign workers to 
American customers, while receiving a tax break for doing that.
  What is so important about these stories is, it is not just the job 
losses associated with companies shipping jobs overseas that hurts, it 
is that these companies have served as the center, the heart, of many 
of our communities. When a bicycle manufacturer closed its last factory 
in Ohio, 1,000 Americans lost their jobs to foreign workers who now 
build bicycles for American children to ride. So my colleagues on the 
other side can talk about how great that is for the workers, but 1,000 
Americans lost their jobs. That is clear.
  On the day the company left town:

       Nearly 1,000 union workers streamed from a dark factory 
     into the sun-drenched day. One worker, then another, then 
     dozens and maybe hundreds removed their shoes. They walked in 
     their socks to their cars and trucks and drove off the 
     property for the last time. In their wake was a parking lot 
     littered with rows of shoes set neatly on the asphalt. The 
     message: Try filling these.

  When an appliance company announced it would leave Indiana for 
Mexico, a woman who had worked decades at the plant wondered what would 
happen to her friends and neighbors.

       Will they be able to stay and find work? Where is our 
     community headed?

  A candy manufacturer closed plants in Pennsylvania and Oakdale, CA.

[[Page 16549]]

About 3,000 jobs were lost between the two shutdowns. At the Oakdale 
plant, a number of employees broke into tears when they were told of 
the plant closure. Said a worker who had been at the plant for 26 
years:

       I was one of the ones who was expecting it, but there were 
     a lot of people in denial who took it really hard. There were 
     a lot of people crying. It's shocking. It is so fast.

  So my colleagues are going to tell you this is complicated. They are 
going to tell you: Oh, but you ship these jobs over here and we get 
more jobs here. Talk to those people--3,000 jobs. Talk to them.
  This is a quote from the executive director of the nonprofit 
California Commission for Jobs. He said the plant closure ``kind of 
tears at your heart strings because it is such a piece of Americana.''
  There are so many examples in my State of companies shipping jobs 
overseas. Here is what they include: a medical device manufacturer that 
moved 1,200 jobs to Mexico; a speaker electronics company in Chatsworth 
that shut down its plant and moved to China; an aviation technology 
company that closed its manufacturing facility in Hayward and moved 
jobs to China; a printer manufacturer in Camarillo that is moving its 
production line to China, costing 400 jobs; an optical lens 
manufacturer that cut 700 jobs in Petaluma and moved production to 
Mexico.
  Here is the thing about our bill. What we do is very smart. We have a 
carrot-and-stick approach. These companies moved American jobs 
overseas. They were eligible for tax breaks on their way out of town, 
and they are selling American products back to us, back to American 
consumers, that used to be made by American workers. The Tax Code, as 
it is now, gives tax breaks to these companies. In so many ways it 
encourages them, encourages them to move. Close your plant and moving 
it to China. Right now, the Tax Code gives you the ability to take tax 
deductions, tax credits, write off losses associated with closing your 
factory and moving it overseas. It is wrong.
  U.S. companies have taken great advantage of this tax benefit, 
slashing workers, moving production abroad, and receiving billions in 
tax credit as a result. It seems to me this must end, and we need to 
reward companies that stay in America, that stay in California, that 
employ our American workers.
  Earlier this year, we passed legislation to keep over 16,000 teachers 
in California in the classroom, and we paid for that bill by closing 
tax loopholes for companies that ship jobs overseas. That was an 
important step. But more needs to be done to bring those jobs back home 
to help American businesses invest in our economy.
  I have talked to American businesses that are creating jobs here at 
home. They are thrilled to do it. But they look at me and say: Why 
would you reward people who pack up, move out, and slash the American 
workforce? My answer is: I should not be doing that, and thank you for 
raising the subject with me.
  That is why this legislation is so important. It will end tax 
subsidies businesses can receive for closing U.S. factories and moving 
them overseas. Remember, we are not talking about foreign sales. So do 
not let anybody confuse you on it. We are talking about manufacturing, 
production. We are talking about a company that produces a product here 
and decides to move that operation abroad. They are encouraged to do so 
by our Tax Code.
  Today, we are saying--and we hope we get support from our 
colleagues--let's end those incentives and incentivize those who create 
jobs in America. The bill promotes job creation here at home. It 
includes, as I said, a 2-year payroll tax holiday for U.S. companies 
that hire new American workers to replace foreign employees, creating 
incentives for companies to bring jobs back home and invest in 
America's economy--in America's economy.
  When people say: I am a jobs creator, I want them to mean, I am 
creating jobs in America, not in India, not in China, not in Malaysia 
but right here at home. I want to see those words ``made in America'' 
again. That is what this debate is about. I want to rebuild our 
manufacturing base, creating jobs here at home by taking advantage of 
American innovation to help lead us toward new technology, including 
clean energy technology.
  We know the world is going green. Everyone in the world wants clean 
energy. We need to create those right here in America--right here in 
America--and export those products to the world. I am very proud of my 
State of California. We have led the way when it comes to creating 
clean energy jobs. But we should be incentivizing those companies and 
making sure they stay in America, that they do not move their 
manufacturing abroad.
  That is why our legislation is so crucial. The Pew Charitable Trust 
looked at California through this recession. You know what they found? 
That because of our clean energy laws in California, we have seen 
10,000 new businesses and we have seen 125,000 new jobs created and the 
words ``made in America,'' again, are on those technologies. They are 
making the solar panels. They are installing them, and people are very 
excited about this.
  But if we incentivize companies to move overseas, we could lose that. 
We want to be the innovators, the creators. We also want to be the 
producers. So it seems to me, if we proceed to this bill, we are taking 
a big leap forward, and that leap forward means we are sending a clear 
signal: If you choose to create jobs in America, we want to give you 
every incentive--tax breaks, tax holidays--for your employees. But if 
you choose to close shop and send those jobs elsewhere, to China, to 
India, wherever, what we are saying is: You can do that, but we are not 
going to give you a reward for it.
  It is as simple as that. I ask unanimous consent that the Senate 
proceed to the immediate consideration of Calendar No. 578, S. 3816, a 
bill to amend the Internal Revenue Code of 1986 to create American jobs 
and to prevent the offshoring of such jobs overseas; that the bill be 
read three times, passed, and the motion to reconsider be laid upon the 
table; that any statements be printed in the Record.
  The ACTING PRESIDENT pro tempore. Is there objection?
  Mr. ROBERTS. Mr. President, reserving the right to object.
  The ACTING PRESIDENT pro tempore. The Senator from Kansas.
  Mr. ROBERTS. The distinguished Senator from California said that if 
we choose to proceed, we will have a vote tomorrow at 11:30 on this 
bill. I think her actions are premature, so I do object.
  The ACTING PRESIDENT pro tempore. Objection is heard.
  The Senator from Minnesota is recognized.
  Ms. KLOBUCHAR. Mr. President, I ask unanimous consent to speak for up 
to 5 minutes.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Ms. KLOBUCHAR. I have come to the floor today in support of the 
Creating American Jobs and Ending Offshoring Act, which I believe, as 
was well stated by the Senator from California, will go a long way 
towards promoting job creation in the private sector and leveling the 
playing field for American workers.
  In recent months, reports have shown that retail sales are up, hourly 
wages are rising, and household debt is at its lowest point in a 
decade. We have seen some particularly promising bright spots in 
Minnesota, where our manufacturing exports increased 19 percent in the 
second quarter to $4.3 billion.
  Minnesota also has one of the lower unemployment rates, 7 percent, 
compared to 9.6 percent nationally.
  But while the numbers are starting to point in the right direction, 
too many Minnesotans, and too many Americans are still out of work. As 
one of my constituents recently put it, ``unemployment may be 7 percent 
in the rest of the state, but it's 100 percent in my house. That is 
what matters to me.''
  He is not alone. Nationwide, there are still 15 million Americans out 
of work, and another 6.6 million who have joined the ranks of the long-
term unemployed.

[[Page 16550]]

  I received a letter from one of them just the other day--a 
constituent of mine named Jon, from Northfield, MN--and I would like to 
share what we wrote. He says:

       I am 63 years old and I have worked my whole life. I lost 
     my job in January 2009, and I've applied for every job I've 
     seen since--even for some that'd pay half of what I 
     previously earned. What's being done now for the millions of 
     us without work?

  The bill we are discussing today is not a silver bullet solution to 
our economic woes. But it will help answer Jon's question, a question 
that is on the minds of millions of Americans right now.
  First, it will create a payroll tax holiday for businesses by 
eliminating the employer share of the Social Security payroll tax on 
wages paid to new U.S. employees. This will be available for 2 years 
and applies to any new American worker who is hired to replace a 
foreign employee.
  For far too long, we have seen our homegrown jobs shipped overseas. 
It is time to level the playing field for American workers, and the 
payroll tax holiday creates a market-based incentive for that. It 
encourages companies that might otherwise hire foreign employees to 
create jobs here at home--in places like Northfield, MN, not Mumbai, 
India.
  Second, this bill will close the tax loopholes that have put our 
workers at a competitive disadvantage, a provision that will also 
encourage companies to bring jobs back to the U.S.
  That is important, but I want to point out that this bill is about 
more than just job creation. It is about rebuilding our economic 
foundation. It is about reviving our manufacturing base and moving away 
from the mindset of the last decade, a mindset that glorified debt, 
consumption and the empty churn of money.
  What we need now are policies that allow us to be a country that 
thinks, invents, and makes things again, a country where you can walk 
into any store on any street in any neighborhood, purchase the safest 
product at the best price and be able to turn it over and see the 
words: ``Made in the USA'' stamped on the bottom.
  As Tom Friedman, the New York Times columnist and Minnesota native, 
has put it, we need to be doing some ``nation building in our own 
nation.''
  I often think about the opening ceremonies at the 2008 Summer 
Olympics in Beijing, the ones that featured that perfectly synchronized 
2,000-man drumming routine. Well, those drumbeats are only getting 
louder and louder.
  While China builds the world's leading solar energy industry, we 
sadly still have not passed an energy bill, despite some that call for 
a renewable energy standard. While India encourages invention and 
entrepreneurship, we give our innovators the runaround. And while 
Brazil produces more engineers, we let our students fall behind.
  The world is moving ahead fast. But we are not going to let it pass 
us by.
  As a country, we have always been home to the most productive, 
innovative, and resourceful workers in the world. I am talking about 
the men and women who have mined, manufactured and constructed every 
great product of American innovation, from cars to airplanes to solar 
panels to satellites.
  In other words, the men and women who are doing the kind of work our 
country was built on, the kind of work that made America great in the 
first place.
  We have before us a bill that makes sure that work is done right here 
in America, in our factories, in our office buildings and in our 
manufacturing plants. It is a good step towards not only rebuilding our 
domestic industry, but towards putting more Americans back to work, and 
I urge my colleagues to support it.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Kansas is 
recognized.
  Mr. ROBERTS. Mr. President, it is my understanding--and I am asking 
the Presiding Officer--that under rule VI, No. 4, at 7 we are going to 
be presented with a live quorum call. Is that not correct? Is that the 
schedule for the Senate? I am asking to determine how much time I have 
between now and 7 o'clock.
  The ACTING PRESIDENT pro tempore. The Chair is under the impression 
that a live quorum call will be made at 7. The Senator has 30 minutes.
  Mr. ROBERTS. It says, for those who take the time to be familiar with 
proceedings of this distinguished body, that:

       Whenever upon such roll call it shall be ascertained that a 
     quorum is not present, the majority of the Senators present 
     may direct the Sergeant at Arms to request, and, when 
     necessary, to compel the attendance of the absent Senators, 
     which order shall be determined without debate; and pending 
     its execution, and until a quorum shall be present, no debate 
     nor motion, except to adjourn or to recess pursuant to a 
     previous order entered by unanimous consent, shall be in 
     order.

  So I thank the President for making that very clear. Hopefully, that 
sheds some light on what we are doing on a Monday evening, which some 
Senators would simply call a bed check. We are scheduled to vote at 
11:30 tomorrow on whether to proceed with a debate that has been taking 
place here on the Senate floor. I think that obviously would be the 
time for the debate. But I think I have about 20, 25 minutes here to 
make my comments. I shall proceed.
  We are really talking about a tax bill. I know the authors of the 
bill, the people who have spoken before, obviously think it is a major 
issue. It is a very important issue, but what we are really talking 
about is bringing to the floor a debate that raises taxes on U.S. 
companies and makes them less competitive globally. I don't think that 
is a very good idea, a tax increase on these companies, given the 
difficult times we have and given the difficult times we have in our 
export markets, to make our U.S. companies that deal overseas less 
competitive. But I don't think we should be surprised, given that the 
majority has not yet acted to keep taxes from increasing for families 
and small businesses--everybody--come next January. That is the real 
bill we should be considering. That is the bill we certainly should be 
considering before we adjourn until the lameduck session of Congress 
which I assume is still being planned.
  It is most unfortunate that we are going to a lameduck session of 
Congress. I had a constituent say: Lameduck; that is going to be a 
Daffy Duck. I think that is a little harsh given the intent of both 
Houses of Congress, but what we really ought to be talking about is the 
tax increase that is going to take place in less than 90 days unless 
Congress acts. I know there was a great discussion within the majority 
caucus as to whether we should move on that, whether we should take a 
vote on that, both in the House and the Senate. That is really why I 
come to the floor.
  This is a looming tax increase that will take effect next year. It is 
going to hit every American who pays income taxes. There has already 
been a great deal of debate about who will pay these higher taxes. The 
President and many of his supporters in Congress say they will not 
raise taxes on those families earning under $250,000 or individuals 
earning under $200,000. That was a campaign pledge of the President.
  The American dream--or at least it was when I was growing up, and I 
had hoped it would be for my kids and grandkids meant one could climb 
the ladder of success, the ladder of economic success as high and far 
as they wanted, and nothing government-made or manmade would stand in 
their way, except they had to do the climbing. Now we find that when 
you hit $250,000, if you are filing a joint tax return or if you are 
earning $200,000 individually--you are rich. They describe people who 
earn over $200,000, $250,000, and regardless of their obligations, 
regardless of whether it is a small business, and regardless of what 
those circumstances may be, bingo, they are going to have to pay that 
higher tax rate. So we have somebody in Washington describing in 
manifest detail who is rich and who is not in the United States. I find 
that to be the antithesis of the American dream, at least as I 
understood it. I think now there is a hue and cry of, let's level 
everybody with everybody else. I do not think that is where we want to 
be in terms of our national intent.

[[Page 16551]]

  The health care reform law has already broken the pledge in regard to 
that of the President, the $250,000 and the $200,000, because that 
imposes a slew of new taxes on small businesses and health care 
consumers, including those earning well under these income levels. So 
we should be weary of any pledge by the President or the majority to 
protect taxpayers from the harmful tax increases that are set to take 
effect in January. With less than 90 days--about 3 months--left in the 
year, this administration and the majority in Congress have done 
nothing except talk about it in their caucuses and to find out where 
the votes were and to find out how it was playing before the election. 
That is the truth. Nothing to prevent this massive tax hike on American 
families and small businesses.
  Now it is September. I don't think most families are really thinking 
about their income taxes right now. They should, but they are not. They 
put the frustration of April 15 behind them. Tax freedom day is 
somewhere down the road in April or May. That is when you are paying 
all the taxes, and that is where all of your income goes to government 
and you finally have tax freedom day. That becomes something that comes 
to their mind right off the bat in the spring. But some families were 
fortunate enough to able to take a vacation as of this summer or late 
summer. However, many were working instead and very happy to do so, 
given the situation in regard to jobs. They are just happy to have a 
job to provide for their families. But none of them are probably 
thinking about what is going to happen on January 1. They will be 
handing more of their paycheck over to Uncle Sam. That is exactly what 
is going to happen if the administration and the majority in Congress 
do not act and do not act soon. We should act before a lameduck 
Congress.
  Some have dubbed this tax relief package the ``Bush tax cuts,'' 
saying they only benefit the wealthy. Let me point out, that is simply 
not correct. I don't see how continuing existing tax policy that has 
been in effect for 10 years constitutes a tax cut. It is preventing a 
tax increase. If we want to get partisan about it, it is not about a 
Bush tax cut, it is about a President Obama tax increase that we are 
trying to prevent.
  Let's take a minute and look at how this tax relief passed on a 
bipartisan basis and supported by several Senators in the majority who 
are still serving in this body let's take a look at it and how it has 
benefited families and small businesses across all income levels.
  The bipartisan tax relief doubled the child tax credit from $500 to 
$1,000. This credit amount will be cut in half next year. The bill 
lowered capital gains and dividend tax rates to benefit families who 
invest long term and save for their future.
  These taxes will go up dramatically next year. If you read any 
financial publication, are aware of any think tank that deals with 
taxes and finances and the economic outlook for this country, you find 
out that is going to have a dramatic effect--a very unfortunate law of 
unintended effects. Those taxes will go up, as I said, very 
dramatically next year by as much as 33 percent for capital gains and 
164 percent for dividends.
  This bill lowered income tax rates for every taxpayer who pays 
taxes--I am talking about the 10-year existing tax relief--whether you 
are a lower income taxpayer, a middle-income taxpayer or an upper 
income taxpayer. So unless we act soon--and that is in the hands of the 
majority--taxes will go up for every taxpayer as of next year, and that 
is the bill we should be considering now, not a bill that is going to 
cause quite a bit of harm to every company that does business overseas.
  Here are just a few examples of what this will mean to working 
families if the majority allows these provisions to expire: A single 
parent with two children who earns $30,000 will see a tax increase of 
$1,100 a year. A family of four who earns $50,000 will see a tax 
increase, on an average, of $2,100 per year.
  Clearly, these families are earning well below the $250,000 threshold 
the President promised not to raise taxes on, these folks. Yet in just 
3 months, that is exactly what is going to happen. So you might want to 
think about it, America, as well as what is going to happen down the 
road a little bit. You have Halloween. That is about when the lameduck 
Congress comes back. You have Halloween and then you have Thanksgiving, 
Christmas--not the time you are thinking about a big tax increase that 
is going to whack you right in the forehead, but that is exactly what 
is going to happen.
  The President's supporters in the Congress have yet to introduce a 
bill to prevent this tax hike. It is that simple. We certainly do not 
see any language on a bill to prevent these massive tax hikes that go 
into effect on January 1.
  However, the President and his supporters in the Congress say they 
want to extend tax relief for everyone but those taxpayers they say are 
wealthy. Who are these folks? Who are these wealthy taxpayers? Well, 
under the President's proposal, and presumably the proposal supported 
by most in the majority, it is any individual who earns more than 
$200,000 in income per year or any family who earns more than $250,000.
  I know there are some who earn much less than these amounts who think 
that sounds fine. Well, maybe to some it does. It is always:

       Don't tax me. I won't tax thee. Tax the guy behind the 
     tree.

  There is a little bit of envy here that goes on among all of us, I 
think, in our hearts when we look at people who earn huge salaries. 
Somehow, some way that we have now defined those people at $250,000 and 
$200,000.
  I think that is unfortunate because we all benefit--we all benefit--
when incomes increase and people become successful. That is how the 
economy gets turned around. That is how we have people who are 
entrepreneurs and they invest and they provide more jobs. When incomes 
go up and people have more of their own money to spend and invest as 
they see fit, more businesses are started, expanded, more jobs are 
created and--guess what--more income comes into the government.
  There is a lot of money sitting on the sidelines waiting. If you do 
not take more money out of people's pockets, you will see, I think, a 
burst of economic activity that results directly or indirectly to the 
Federal Government.
  I was just reading in the Wall Street Journal an article about that. 
I intended to bring it over, but I failed to do so. You can just take 
it from me. When incomes go up and people have more of their own money 
to spend and invest as they see fit, more businesses are started and 
expanded and more jobs are created.
  To see the harm in raising the top two tax rates, to target those 
earning over the $200,000/$250,000 threshold, we only have to look at 
what allowing this tax relief to expire means for small businesses to 
see the danger in allowing this tax increase to take place.
  Because many small business owners pay their taxes on their 
individual income taxes, if the top two income tax rates are increased 
as the President proposes, small business owners in these tax brackets 
will pay those higher income tax rates.
  The administration says these higher taxes will affect only 3 percent 
of small businesses, so we should not be concerned about raising these 
taxes. If we have heard 3 percent, we have heard that enough over and 
over and over again: only 3 percent. But those numbers downplay the 
impact of raising taxes on small businesses.
  Let's look at what such a tax hike would mean for America's small 
businesses. Keep in mind, these are the same businesses that, by the 
President's own admission, are the Nation's job creators. They create 
70 percent of the jobs in this country--70 percent. Yet under the 
President's proposal, tax rates would increase by at least 17 percent 
on small businesses.
  According to the nonpartisan Joint Committee on Taxation, that means 
three-quarters of a million businesses--750,000 small businesses--will 
pay higher taxes.
  Allowing the top rates to expire subjects nearly $500 billion--
another $\1/2\ trillion--in small business income to higher taxes. This 
is a very conservative number. Further, small businesses with between 
20 and 299 workers

[[Page 16552]]

employ about 25 percent of the U.S. workforce. So we are taking action 
to raise taxes on 25 percent of the U.S. workforce.
  These small businesses will have to recover the cost of higher taxes 
somewhere. It may come from lower wages. Will they lay off workers? 
Will they reduce benefits or raise the cost of their products? That is 
dicey, given this kind of environment in regard to consumers and what 
they are able to do. None are good options.
  With unemployment holding steady at over 9 percent, common sense 
would indicate, that raising taxes on those businesses that are 
creating jobs is a very bad idea. As small businesses face a 
significant tax hike come January, workers will inevitably pay the 
price. By one estimate, an increase in the top tax rate would cost jobs 
by reducing small business hiring by as much as 18 percent. That is 18 
percent we do not need.
  Raising taxes on small businesses will also likely slow the already 
weak economic recovery. We see a lot of headlines saying: The recession 
is over. But let's talk about the economic recovery we all wish--both 
Democrats and Republicans, all of us wish--would take place. The 
National Federation of Independent Businesses, the NFIB, has said the 
second most cited concern of small businesses is taxes. As a result, 
small businesses are sitting on the sidelines until they know whether 
they are going to be facing higher taxes come January 1. That ought to 
be obvious. Small businesses need certainty about how much they are 
going to owe in Federal taxes.
  Yet, once again, this administration's rhetoric on small business 
does not match the reality of its proposals. The administration says it 
wants to help small businesses, and it has touted the recently passed 
small business bill as proof of that. Yet this same administration 
pushes through a health care bill that Americans do not want that 
imposes higher taxes on small businesses. Now it wants to raise taxes 
even further on these same small businesses by increasing their Federal 
income taxes.
  It seems a bit ironic to watch the majority touting the small 
business bill that the President is, in fact, signing into law today. 
They said small businesses needed this tax relief so they could grow, 
expand, and create jobs. During debate on this bill, they criticized 
Republicans for holding up important tax relief for these businesses.
  So it is curious now, that many in the majority who supported this 
relatively modest tax relief and who repeatedly stressed the importance 
of tax relief to small businesses are the same ones who oppose 
extending income tax relief that benefits small businesses.
  Let me make it as clear as I can. The same members of the majority 
who supported the small business bill and who insisted we must provide 
them tax relief are the very ones who oppose extending income tax 
relief that will benefit small businesses. That is a contradiction. 
That is tough to explain, it seems to me. I am pretty sure a lot of 
people are simply not going to understand that, especially in the next 
month or in November.
  If it is so important to provide tax relief to small businesses in 
this bill, why isn't it equally important to extend other small 
business tax relief? We will not get our economy back on track until 
small business begins hiring, period, and they are not going to hire if 
they have to pay more taxes in January on top of what they have already 
been burdened with in the health care bill. Yet that is precisely what 
the administration's proposal will do.
  Why would our colleagues on the other side of the aisle want to allow 
income taxes to go up at the end of this year for hundreds of thousands 
of small businesses? Why are we having a vote tomorrow on proceeding to 
another bill that could be very hurtful in regard to our competitors 
overseas. How does that aid the economy? How do higher taxes help put 
unemployed Americans back to work? How does a higher tax burden allow a 
small business to grow and expand? How do higher taxes on small 
businesses aid the economy?
  The answer is pretty straightforward. Small businesses are hurt by 
higher taxes. They cannot hire new workers and they cannot buy 
equipment or a new building or make other investments that can help 
their business grow.
  This approach by President Obama and the majority is absolutely the 
wrong approach to take if we want to ensure job creation and grow our 
economy. We need to continue the tax relief passed in 2001, by a big 
bipartisan majority, that has lowered income tax rates for all 
taxpayers and encouraged families to save and businesses to invest. 
Continuing this tax relief, rather than more spending, will help get 
our economy back on track.
  What I usually hear from my friends--and I want to comment on it--on 
the other side of the aisle, especially when you talk about tax cuts--
you say: tax cuts, and then, bingo, for the rich, for the wealthy. We 
are beating a dead ``class warfare'' horse, it seems to me. But that 
simply is not an accurate picture of the massive tax increases that are 
facing American families next year.
  The majority has been in power for nearly 4 years. They have had 
plenty of time to address this issue, plus estate tax reform, plus the 
AMT, plus all the other things we say we are going to do as members of 
the Finance Committee. I am privileged to serve on that committee. Yet, 
similar to a child who has not done his homework, they have put this 
off until the last minute, creating enormous uncertainty for families 
and small businesses.
  They try to justify these massive tax hikes by saying this bipartisan 
tax relief contributed to the Nation's current fiscal problems.
  The popular refrain Americans have heard from the President and his 
supporters in the Congress is that they inherited the current deficit, 
and that it is a result of the tax relief we passed, again, on a 
bipartisan vote, in 2001.
  But the numbers do not add up. Did you know the Federal deficit 
decreased as the 2001-2003 tax relief took effect? The deficit stood at 
$412 billion in 2004 but dropped to $161 billion in 2007. That is the 
year the majority took control of the Congress. I was here. I know. I 
could list Senators on both sides of the aisle who made tremendous 
progress in regard to reducing that deficit from $412 billion in 2004 
down to $161 billion in 2007--tough to do. We had Katrina, had all 
sorts of problems, Iraq, two major wars, but we did that.
  Three short years later, the deficit has more than quadrupled and 
this year is estimated to come in at approximately $1.3 trillion--not 
billion, trillion. ``Trillion'' has become the watch word of the day; 
not billion, trillion.
  That is a direct result of the massive spending agenda the President 
and his supporters in Congress have undertaken, including a failed 
stimulus bill, bailouts of failed companies, and a health care bill 
that a majority of Americans do not want--growing by the day when they 
find out the details of the bill.
  What is particularly ironic about all of this is that the President 
has seen no reason to offset the billions in Federal Government 
spending that he and his supporters have put in place--billions in new 
Federal spending on a failed economic stimulus program and billions to 
failed companies, billions that have contributed to the largest deficit 
in this country's history.
  Further, the President has already said he doesn't plan to pay for 
the cost of extending about 74 percent of the expiring tax relief--that 
is about $2 trillion--that benefits lower and middle-income taxpayers. 
I am for that. Everybody here is for that. And that number is actually 
expected to go higher. Yet the remaining 26 percent of the tax relief--
that tax relief that in part benefits small businesses--the President 
doesn't want to extend. Why not? Here is the kicker. He says we can't 
afford it.
  We can't afford it? This, from the same President whose spending 
spree has driven up the deficit to unprecedented levels? The same 
President who spent well over $700 billion on last year's failed 
stimulus program? The same President who handed out billions in Federal 
tax dollars to failed

[[Page 16553]]

businesses? That is right. The President says we can't afford to extend 
income tax relief for small businesses to help them create jobs, grow, 
and continue to employ more than 20 million Americans who work for 
small businesses.
  Well, we have a saying for this in Dodge City. It sort of resembles a 
lot of what we have in our Dodge City feedlots, but I am not going to 
go into that.
  A recent observation by Kevin Hassett and Alan Viard with the 
American Enterprise Institute writing in the Wall Street Journal sums 
this up very nicely:

       The administration is right to view the deficit as a 
     serious issue, but this sudden commitment to fiscal 
     responsibility is bizarrely inconsistent. The administration 
     professes deep concern about the $700 billion revenue loss 
     from extending the tax cuts at the top, but apparently views 
     the revenue loss of nearly $2 trillion from extending the tax 
     cuts for the middle class as too inconsequential to mention.

  I repeat, again, we are all for that.

       They continue:
       Nor has the administration's concern about the deficit 
     driven it to reduce federal spending.

  That is the key. It seems to me it is disingenuous for this 
administration to say we cannot afford to provide tax relief that helps 
small business and gets our economy moving in the right direction when 
the same administration has pursued failed policies of unrestrained 
spending that do little but grow the deficit.
  We can and should provide tax relief to all taxpayers, and that 
should be the business of the day, not a live quorum call or a bed 
check and then go out this week and then come back in a lameduck 
Congress to debate that. Then it would be, what, 40 days before the ax 
would fall in regard to every American paying more taxes.
  The PRESIDING OFFICER (Mr. Merkley). The time of the Senator has 
expired.
  Mr. ROBERTS. I ask unanimous consent for 30 seconds.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. ROBERTS. Thank you. We can and should provide tax relief to all 
taxpayers--tax relief that helps families keep more of their hard-
earned dollars and tax relief that provides certainty to small 
businesses so they can make investments and create jobs without the 
fear that their taxes will go up. We need to extend this tax relief 
that keeps money in the hands of families and small businesses rather 
than putting it in the pocket of Uncle Sam.
  I yield back the remainder of the time that the distinguished 
Presiding Officer granted me.
  Mr. CARDIN. 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, and the 
following Senators entered the Chamber and answered to their names:

                          [Quorum No. 5 Leg.]

     Akaka
     Alexander
     Bond
     Cardin
     Collins
     Kohl
     McCain
     McConnell
     Merkley
     Reid
     Roberts
     Vitter
     Webb
  The PRESIDING OFFICER. A quorum is not present.
  Mr. REID. Mr. President, I move to instruct the Sergeant at Arms to 
request the presence of absent Senators, and 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. DURBIN. I announce that the Senator from Indiana (Mr. Bayh), the 
Senator from Delaware (Mr. Carper), the Senator from North Dakota (Mr. 
Conrad), the Senator from Connecticut (Mr. Dodd), the Senator from 
North Dakota (Mr. Dorgan), the Senator from North Carolina (Mrs. 
Hagan), the Senator from Massachusetts (Mr. Kerry), the Senator from 
Arkansas (Mrs. Lincoln), the Senator from Maryland (Ms. Mikulski), the 
Senator from Washington (Mrs. Murray), the Senator from Florida (Mr. 
Nelson), and the Senator from New Hampshire (Mrs. Shaheen) are 
necessarily absent.
  Mr. KYL. The following Senators are necessarily absent: the Senator 
from Kentucky (Mr. Bunning), the Senator from Texas (Mr. Cornyn), the 
Senator from Georgia (Mr. Chambliss), the Senator from Idaho (Mr. 
Crapo), the Senator from Wyoming (Mr. Enzi), the Senator from South 
Carolina (Mr. DeMint), the Senator from South Carolina (Mr. Graham), 
the Senator from Utah (Mr. Hatch), the Senator from Texas (Mrs. 
Hutchison), the Senator from Georgia (Mr. Isakson), the Senator from 
South Dakota (Mr. Thune), the Senator from Alaska (Ms. Murkowski), the 
Senator from Idaho (Mr. Risch), and the Senator from Arizona (Mr. Kyl).
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 48, nays 25, as follows:

                      [Rollcall Vote No. 241 Leg.]

                                YEAS--48

     Akaka
     Baucus
     Begich
     Bennet
     Bingaman
     Boxer
     Brown (MA)
     Brown (OH)
     Burris
     Cantwell
     Cardin
     Casey
     Durbin
     Ensign
     Feingold
     Feinstein
     Franken
     Gillibrand
     Goodwin
     Harkin
     Inouye
     Johnson
     Kaufman
     Klobuchar
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     McCaskill
     Merkley
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Sanders
     Schumer
     Specter
     Stabenow
     Tester
     Udall (CO)
     Udall (NM)
     Warner
     Webb
     Whitehouse
     Wyden

                                NAYS--25

     Alexander
     Barrasso
     Bennett
     Bond
     Brownback
     Burr
     Coburn
     Cochran
     Collins
     Corker
     Grassley
     Gregg
     Inhofe
     Johanns
     LeMieux
     Lugar
     McCain
     McConnell
     Roberts
     Sessions
     Shelby
     Snowe
     Vitter
     Voinovich
     Wicker

                             NOT VOTING--27

     Bayh
     Bunning
     Carper
     Chambliss
     Conrad
     Cornyn
     Crapo
     DeMint
     Dodd
     Dorgan
     Enzi
     Graham
     Hagan
     Hatch
     Hutchison
     Isakson
     Kerry
     Kyl
     Lincoln
     Menendez
     Mikulski
     Murkowski
     Murray
     Nelson (FL)
     Risch
     Shaheen
     Thune
  The motion was agreed to.
  The PRESIDING OFFICER. A quorum is present.
  The Senator from Missouri.
  Mr. BOND. Mr. President, what is the pending business?
  The PRESIDING OFFICER. The pending business is the motion to proceed 
to S. 3816. The time is organized in 30-minute alternating blocks.


                   Unanimous Consent Request--S. 3072

  Mr. BOND. Mr. President, I ask unanimous consent that the pending 
business be set aside and that the Committee on Environment and Public 
Works be discharged from further consideration and the Senate proceed 
to the immediate consideration of S. 3072, introduced by my colleague 
from West Virginia, Senator Rockefeller, that would delay for 2 years 
U.S. EPA implementation of carbon regulations; I further ask unanimous 
consent that if the majority is serious about protecting American jobs, 
that we must be allowed to take bipartisan action to protect the 
American people from the backdoor national energy tax coming in the 
form of new job-killing carbon regulations from EPA; that the bill be 
read three times and passed, and the motion to reconsider be laid upon 
the table.
  The PRESIDING OFFICER. The Senator from Illinois.
  Mr. DURBIN. Mr. President, reserving the right to object, I say to my 
colleague from Missouri, clean energy jobs are the jobs of the future. 
As we create more clean energy jobs, we will find a way to compete with 
China and other nations that are trying to take over this whole area. 
They know the whole world is moving toward more sensitivity to 
emissions and the environmental damage they cause. As a result of that, 
I object.
  The PRESIDING OFFICER. Objection is heard.
  The Senator from Missouri.
  Mr. BOND. Mr. President, the regulations the EPA is proposing will 
hit every American family with higher electric bills, more expensive 
food and clothes, and more pain at the pump.

[[Page 16554]]

American workers, especially those in energy-intensive manufacturing 
jobs, will face job loss or more difficult job prospects.
  We have bipartisan language. Six Democrats have already stated on the 
floor they favor this. Whatever one thinks about the cap and tax, I 
believe there is a strong majority who thinks a regulatory agency 
should not establish it bureaucratically.
  There is a lot of work we need to do in energy. We need to develop 
our own energy. When we talk about nuclear power, when we talk about 
clean coal technology, when we talk about biofuels and woody biomass, 
all of these things are good. But when we talk about wind power and 
solar power, how much is it going to cost us? We have found that the 
costs are overwhelming.
  I welcome a discussion of this issue, but the first thing we need to 
do is make sure our country is not shut down by overreaching EPA 
regulations. That is why I proposed the unanimous consent request. I 
understand the leader on the majority side has promised we can vote on 
the Rockefeller bill. We need to vote by the end of the year.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Wyoming.


                  Unanimous Consent Request--H.R. 3617

  Mr. BARRASSO. Mr. President, I will offer a unanimous consent request 
in a moment that will permanently lock fairness into the Tax Code.
  American taxpayers are currently allowed to deduct either State 
income or sales taxes on their Federal tax return. Americans who live 
in States with a State income tax have always been able to deduct their 
State taxes. Since passage of the 1986 tax reform, Americans living in 
States without a State income tax have been out of luck.
  With the leadership of Senator Kay Bailey Hutchison, Congress 
responded by reinstating a deduction for State sales tax. This 
provision provided financial relief for millions of taxpayers, and it 
brought back some fairness to the Tax Code. Americans in States that 
have no income tax, such as Wyoming, Texas, Alaska, Florida, Nevada, 
South Dakota, and Washington, finally received relief similar to 
individuals in States with State income taxes.
  The sales tax deduction needs to be made permanent. Now is not the 
time to raise taxes on American taxpayers.
  Mr. President, I ask unanimous consent that the Senate proceed to the 
immediate consideration of H.R. 3617; that all after the enacting 
clause be stricken and the text of S. 35, a bill to provide a permanent 
deduction for State and local general sales taxes, be inserted; I ask 
unanimous consent that the bill, as amended, be read a third time and 
passed, the motion to reconsider be laid upon the table, and that any 
statements relating to the measure be printed in the Record.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I reserve the right to object. This is one 
provision we need to pass. There are, however, many other provisions we 
need to pass. They are in the category of tax extenders.
  Clearly, the State and local sales tax deductions should be passed 
into law. Senator Murray from the State of Washington has been working 
hard. Washington, obviously, is a State that needs this deduction. 
There are many States that need it.
  Unfortunately, the provision called for by the Senator from Wyoming 
is not paid for. It is going to add to the deficit. I might add that 
the other provisions that must get passed which expired at the end of 
last year, I say with embarrassment, must be passed this year, and 
State and local sales tax deduction is one of them.
  What are some of the others? Research and development tax credit, we 
have not extended that. It expired in the last year, as did the State 
and local sales tax deduction. It expired in the last year. There are 
many others that expired in the last year.
  What is the Senate doing? The answer is nothing because the other 
side of the aisle would not let us bring up the package of extenders. 
The Senator from Wyoming picked out one little one. The fact is, we 
have to get them all passed; otherwise, many people are going to be in 
a very disadvantageous economic position.
  I object to the request made by the Senator from Wyoming.
  The PRESIDING OFFICER. Objection is heard.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the Finance 
Committee be discharged from further consideration of H.R. 4994----
  The PRESIDING OFFICER. The Senator does not have the floor.
  Mr. BAUCUS. Mr. President, I seek recognition.
  The PRESIDING OFFICER. The Senator from Wyoming has the floor.
  Mr. BARRASSO. Mr. President, at this time, it is my understanding 
that this time is reserved for the minority party.
  The PRESIDING OFFICER. That is correct.
  Mr. BAUCUS. What is the parliamentary procedure?
  Mr. SESSIONS. If the Senator wants just 1 minute, I would----
  The PRESIDING OFFICER. The Senator from Wyoming has the floor.
  Mr. BAUCUS. I thought we were going back and forth.
  The PRESIDING OFFICER. No.
  Mr. BAUCUS. Mr. President, I ask unanimous consent to speak for 1 
minute.
  The PRESIDING OFFICER. Is there objection?
  Mr. SESSIONS. I would be pleased to yield.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                  Unanimous Consent Request--H.R. 4994

  Mr. BAUCUS. I thank my colleague.
  Mr. President, I ask unanimous consent--it is on the same subject--
that the Finance Committee be discharged from further consideration of 
H.R. 4994, taxpayer assistance; that the Senate then proceed to its 
immediate consideration; that all after the enacting clause be stricken 
and the text of the Baucus substitute amendment, the text of Calendar 
No. 572, S. 3793, be inserted in lieu thereof; that the substitute 
amendment be agreed to, the bill, as amended, be read a third time and 
passed, and the motion to reconsider be laid upon the table; that the 
title amendment, which is at the desk, be considered and agreed to.
  The PRESIDING OFFICER. Is there objection?
  Mr. BARRASSO. Mr. President, reserving the right to object, I would 
say that Senator Thune has a bill similar in design to deal with a 
number of needed concerns and considerations, and in light of the fact 
that Senator Thune's legislation has been objected to and not yet been 
able to get clearance from the other side, I do object.
  The PRESIDING OFFICER. Objection is heard.
  The Senator from Alabama.


                         Global Competitiveness

  Mr. SESSIONS. Mr. President, the World Economic Forum recently 
published its global competitiveness survey. It shows that the 
competitiveness of the United States has declined from first place in 
the world to fourth place since President Obama took office in January.
  What is the main reason for this decline? Too much debt and too much 
spending. There are other reasons, but that is the primary one they 
cited. I would suggest that the proposals to drive up the cost of 
energy by regulation and cap and tax--supposedly to create green jobs--
are another form of anticompetitiveness that hurts our productivity as 
a nation. A study of Spain, which has some of the most powerful 
alternative energy proposals and has taken some of the most dramatic 
action, has shown that even though there are green jobs created, the 
overall rise in the cost of energy in Spain has cost that nation more 
jobs than were created by the green activities.
  According to the Washington Post, a senior economist at the World 
Economic Forum said:

       It was government debt and the country's overall economic 
     outlook that pushed the United States down.

  The article goes on to note:

       Government debt affects a country's competitiveness by 
     limiting its ability to respond to crises or to make 
     infrastructure and other investments that could boost future 
     productivity. It may also lead to higher interest rates.


[[Page 16555]]


  I would note also that the EU has a corporate tax rate of 19 percent, 
whereas the United States has a corporate tax rate of 35 percent, and 
that costs jobs in America. I talked to a CEO recently who said that 
200 Alabama jobs were lost because of the higher corporate tax rate in 
the United States. We cannot sustain that.
  How high is our debt today? It is $13.6 trillion or $44,000 for every 
man, woman, and child in America, and it is 93 percent of our gross 
domestic product, which is significant because a famous study produced 
earlier this year by economists Kenneth Rogoff and Carmen Reinhart 
demonstrated that economic growth slows substantially--it reduces GDP 
growth by 1 percent--when debt exceeds 90 percent of GDP. We are 
already over that. And when our economy is only growing at 1.6 
percent--as it was in the second quarter--an extra 1 percent is a lot 
when you are talking about growth. They talk about a new normal where 
we may be showing only 1, 2, 3 percent growth for years to come. So if 
you lose a percent based on debt, that is very damaging to the American 
economy. Well, do we have a plan to reduce it? Have we taken any steps? 
Actually, the President's budget makes the problem worse. It shows that 
the gross debt by 2019 would go to $23 trillion--106 percent of GDP.
  Look at this chart on interest payments. It is so stunning that I 
think every American needs to examine it. It reflects the analysis by 
the Congressional Budget Office, our professional budget office that 
serves us, the leadership of which is hired by the Democratic majority. 
They are good people, and this is what they have calculated. In 2009, 
the interest we paid on all the debt in this country was $187 billion. 
By 2020, they calculate that the 1 year's interest payment would be 
$916 billion--almost $1 trillion. This is a stunning figure. Last year, 
the baseline budget--or at least 2 years ago--on highways was about $40 
billion. I think the spending on education totally is about $100 
billion.
  So we are talking about $900 billion in interest now because the 
public debt will triple from last year to 2019 under the budget 
submitted by the President. You would think we would be talking about 
that in Congress and we would be dealing with a budget and plans to try 
to bring that under control, would you not? Surprisingly, we haven't 
had any real discussion about the budget this year. Indeed, we haven't 
debated the budget on the floor of the Senate at all. This will be the 
first year since the modern budget process was created in 1974 that 
Congress has not even considered a budget. It was not brought up. It 
has not even been produced here.
  Mr. WICKER. Mr. President, would the Senator yield for a question on 
that point?
  Mr. SESSIONS. I would be pleased. I see my colleague from Mississippi 
is here.
  The PRESIDING OFFICER. The Senator from Mississippi.
  Mr. WICKER. Let me make sure the people within the sound of our 
voices tonight understand this. For the first time in the history of 
the modern-day Budget Act, the Congress has not even brought forward a 
budget plan to be debated, much less amended and voted on by the 
elected representatives of the people; is that correct?
  Mr. SESSIONS. That is correct.
  Mr. WICKER. And this is astonishing in light of what the Senator has 
pointed out with regard to where we are going on payment of interest on 
the national debt. Anytime we are paying interest, that is money that 
can't be used for highways, for infrastructure. If someone wanted to 
try a stimulus for small businesses by cutting their taxes, that is 
money that is not available to us for that purpose.
  I wonder whether the Senator would like to talk about his particular 
plan, a bipartisan plan, that at least attacks the exponential growth 
we have had in discretionary spending. I think the Senator has a plan 
with the Senator from Missouri that would attack this issue at the 
discretionary level, virtually freeze domestic discretionary spending, 
and, at least for that small part of the budget, give us some relief; 
is that correct?
  Mr. SESSIONS. That is correct, and I thank my colleague for 
mentioning that.
  Senator Claire McCaskill, my Democratic colleague from Missouri, and 
I have offered legislation that would essentially take the budget that 
was submitted last year, which had a 5-year number. The first-year 
numbers were not very good.
  I will show some of the spending increases last year in our baseline 
accounts. I know my colleagues will find this hard to believe because 
it is so stunning, but the State Department and Foreign Operations got 
a 32-percent increase in baseline spending last year. EPA got a 35-
percent increase. Commerce, Science, Justice, that is, the Commerce 
Department and the Justice Department, received 12.3 percent. The 
Treasury-HUD number was 23 percent; Agriculture, 8; and Defense, 4.1.
  So we have been spending rapidly, but the budget called for less 
spending this year and next year and the next year. It was a 5-year 
budget. So we asked our colleagues: Let's, on a bipartisan basis, pass 
legislation very similar to what was passed in the 1990s. That really 
was a critical act in achieving a balanced budget in the late 1990s, 
and this action would say that if you went above that spending level, 
which is basically projected to be 1 percent or so, it would take a 
two-thirds vote of the Congress. This would help us maintain spending, 
wouldn't my colleague agree, if we had a two-thirds vote?
  Mr. WICKER. If the Senator would continue to yield, I would say that 
I think it would certainly be a start. And I daresay that if Senator 
Sessions and I were the sole deciders on this issue, we might find a 
way to cut spending even further. But on a bipartisan basis, we ought 
to at least be able to say: Mr. President, let's bring to the floor for 
discussion a proposal that would virtually freeze domestic 
discretionary spending for 1 year.
  I would commend to my colleagues a letter dated July of this year 
from every Republican on the Senate Appropriations Committee pointing 
out, No. 1, the enormity of the Federal debt and the problem and direct 
threat it poses to national security; the need for a long-term plan; 
the fact that the committee is compelled, outside of a budget because 
we didn't even get a chance to debate one, to come up with a top-line 
number; pointing out the Sessions-McCaskill legislation that would 
essentially freeze nondefense spending, and, importantly, every 
Republican on the Appropriations Committee said we were committed to 
that number. I think that as the American people begin to look at us, 
particularly as we move toward this crucial vote on November 2, it is 
important for them to understand that Republican appropriators have 
made that commitment and made it in writing as long ago as July of this 
year.
  Mr. SESSIONS. Well, I think that is important to note, and I would 
further note that every single Republican supported the McCaskill-
Sessions amendment, but also 18 Democrats supported that. I believe 
that if we had the leadership just say yes instead of no, it would pass 
easily. It would be a healthy thing because it would send a message to 
the financial markets worldwide that we at least have some fiscal 
discipline, and it would be very unlikely that spending would go above 
this level if we had a two-thirds supermajority point of order to 
object to spending over that level.
  I would note that the amendment is supported by a number of 
bipartisan groups, including the Concord Coalition, the Committee for a 
Responsible Federal Budget, the National Taxpayers Union, the Heritage 
Foundation, former Congressional Budget Office and OMB Director Alice 
Rivlin--she served under President Clinton--and former CBO Director 
Douglas Holtz-Eakin. So this is a bipartisan piece of legislation that 
would bring us to a point that, I believe, we can say to the world that 
we are going to stand by the numbers the President gave us last year--
not Republican numbers but the President's numbers.
  Remember, the baseline budget increases are already there. So I think

[[Page 16556]]

what we are really going to have to do--when we really get a budget and 
get some new leadership and get committed after this election, when we 
get a spanking by the American people--is to get budget numbers based 
on the 2008 spending levels. It will not bankrupt us. The country is 
not going to sink into the ocean. If we went back to the 2008 levels, 
the 2007 levels, and then had some modest increases based on inflation 
rates, we would see an even larger improvement in our financial 
situation and be more competitive.
  Mr. WICKER. If the Senator would yield one more time--I know we are 
limited on time--some other people are scheduled at the top of the 
hour, but I think this is very important.
  We were spending an enormous sum of money in fiscal year 2008. I do 
believe that in this crisis we have, we can get back to that level and 
make do. That is so important in light of what this Congress and this 
administration have done to the national debt in 3 short fiscal years. 
Last year, this government added $1.4 trillion to the national debt. 
That is $1.4 trillion we spent here in Washington that we didn't have. 
This year, it will be almost that much--$1.34 trillion. And if things 
don't change, the national deficit, which will add to the debt, the 
next fiscal year will be $1.42 trillion. It is a crisis. We need to 
address it, and this legislation is a start.
  The PRESIDING OFFICER. The time of the Senator has expired.
  Mr. SESSIONS. I thank the Chair and yield the floor.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. SANDERS. Mr. President, I am going to be talking about a very 
serious crisis of offshoring, but before I do, I want to say a word 
about the budget. I am glad to hear my Republican colleagues being so 
very concerned about our budget deficit. My question is, where were 
they during the Bush administration when the budget debt of this 
country nearly doubled? We went to a war in Iraq, which some of us 
voted against, which will end up costing this country $3 trillion--
unpaid for. I did not hear a concern at that point.
  They gave many hundreds of billions of dollars to the top 1 percent 
in tax breaks, unpaid for. We didn't hear about the national debt 
concern there.
  They brought forth legislation to bail out Wall Street, unpaid for; 
they passed a Medicare Part D prescription drug program, unpaid for.
  I am very glad today our Republican friends are concerned about the 
deficit and the national debt. It would have been helpful to this 
country if they had been concerned about that issue 5 or 6 years ago, 
while they were in the process of doubling our national debt.
  But the issue I did want to talk about this evening is, as I think 
most people understand, the middle class of this country----
  Mr. WICKER. Was the Senator asking a rhetorical question or would he 
yield for an answer to that question?
  Mr. SANDERS. I will be delighted to, when it is your time.
  Mr. WICKER. Clearly it was a rhetorical question.
  Mr. SANDERS. Mr. President, one of the major reasons the middle class 
of this country is in decline and why the working class is being 
decimated and why real wages are going down for millions of American 
workers who are working longer hours for low wages is that for a number 
of years now we have been hemorrhaging manufacturing jobs. While this 
trend has in fact been going on for decades, it accelerated during the 
8 years of the Bush administration. During that period, those 8 years, 
we went from 17 million manufacturing jobs to about 12 million. We lost 
somewhere near 5 million manufacturing jobs during that 8-year period, 
a decline of about 30 percent in manufacturing jobs. Today, here in the 
United States, we now have the fewest number of manufacturing jobs 
since the beginning of World War II.
  As Senator Durbin pointed out on the floor today, from 1999 to 2008, 
multinational corporations based in the United States laid off nearly 2 
million American workers at exactly the same time period as they were 
hiring over 2 million workers abroad. They laid off 2 million workers 
in this country and hired 2 million workers abroad.
  Under President Bush, our trade deficit with China more than tripled, 
and our overall trade deficit nearly doubled. Today our trade deficit 
is over $370 billion. In other words, we are importing $370 billion 
more than we are exporting.
  There are a number of reasons why manufacturing jobs are 
disappearing, but a very major one is that corporate America continues 
to increase its bottom line by hiring workers in China, Mexico, 
Vietnam, and other developing countries instead of employing American 
workers at decent wages in this country.
  In my view, if large corporations want us to buy their products--and 
they certainly do; you cannot turn on television without corporate 
America telling us how much we should be buying their products--the 
time is long overdue for them to reinvest in the United States and 
build manufacturing plants here and not in China. A country that cannot 
produce the goods its consumers require and becomes more and more 
dependent on other countries for what it needs is not a country that 
will remain a major economic power in this global economy.
  The legislation we are debating today, the Creating American Jobs and 
Ending Offshoring Act, is a good first step. This bill uses the Tax 
Code to begin to bring more manufacturing jobs back into America. But 
let us be clear: This is just a beginning. Much more needs to be done. 
The simple truth is that American workers cannot and should not be 
asked to compete against desperate people in developing countries, 
people in China, Mexico, Vietnam--other countries, where workers there 
are paid pennies an hour, where they may go to jail if they try to form 
a union, and where there are very few environmental standards. It seems 
to me to be absolutely unacceptable that our people are forced to 
compete against folks who are earning so little.
  What we should be engaged in is a race to the top, not a race to the 
bottom. Yet that is exactly what is happening. If the United States is 
to remain a major industrial power, producing the products our people 
need and creating good-paying jobs, we must develop a new set of tax 
and trade policies that work for the American worker and not just for 
the CEOs of large corporations. The American people are sick and tired 
of losing decent-paying jobs to China, to India, to Mexico, as 
multinational companies throw American workers out on the street, go 
abroad, produce their products for pennies an hour, and then bring 
those products back into the United States.
  In August I had about a dozen town meetings throughout the State. In 
every single town meeting I had in Vermont, people stood up and they 
said: It is becoming increasingly difficult to buy a product 
manufactured in the United States of America. How are we going to 
create jobs for our kids if we don't have a manufacturing sector?
  I very much agree with that sentiment. We have to stop giving large 
profitable corporations tax breaks for shipping jobs overseas and start 
giving immediate tax relief to businesses that bring jobs back to the 
United States. That is exactly what this bill would do and that is why 
I am a strong supporter of it. But let's let there be no doubt, much 
more needs to be done. As somebody who voted against NAFTA when I was 
in the House, as somebody who voted against Permanent Normal Trade 
Relations with China, I think the evidence is now overwhelming that we 
need to fundamentally rewrite our trade policy to benefit the middle 
class of this country and to raise the living standards of people 
around the world instead of promoting a destructive race to the bottom, 
which is what we are seeing now.
  Supporters of unfettered free trade told us over and over how their 
policies were going to lead to more jobs and a better life for the 
majority of Americans. Unfortunately, they have been proven dead wrong. 
NAFTA turned a trade surplus with Mexico into a huge trade deficit and 
we lost over 1 million jobs as a result. That is what NAFTA has done.
  As a direct result of Permanent Normal Trade Relations with China, we

[[Page 16557]]

lost over 2 million jobs to China and our trade deficit with that 
country nearly tripled. Anyone who has shopped at a Wal-Mart or any 
other large store in this country knows it is almost impossible to find 
anything made in the United States of America today. We are not just 
talking about sneakers; we are talking increasingly about high-tech 
products.
  Let me give a few examples. Today, 80 percent of toys sold in the 
United States are made in China. Today, about 90 percent of vitamin C 
sold in the United States is made in China. Today, 85 percent of 
bicycles sold in the United States are made in China. Today, over 80 
percent of all shoes sold in the United States are made in China. 
Today, about 90 percent of U.S. furniture production has moved to 
China. On and on it goes.
  We have to recognize that if this country is going to remain a major 
economic force in the global economy, if we are going to have decent 
jobs for our kids and our grandchildren, we must rebuild the 
manufacturing sector of this country. We must demand and develop 
policies that enable corporate America to start rebuilding our 
manufacturing sector rather than moving abroad in underdeveloped 
countries. The legislation we have before us is a good start but, as I 
have indicated before, much more has to be done. I hope when we come up 
with a cloture vote tomorrow we can at least get the support of several 
Republicans, just a couple who are prepared to stand with the American 
worker, who are prepared to help us rebuild our manufacturing base so 
we can create the desperately needed good jobs we have to build.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Ohio.
  Mr. BROWN of Ohio. Mr. President, I wish to echo the comments of the 
Senator from Vermont who has been discussing and debating and 
critiquing and understanding these issues of job sourcing as well as 
anybody in this institution. I am incredulous that we are fighting to 
bring this legislation to the floor, this legislation which will help 
us rebuild our industrial base, which will help us create, enlarge, 
strengthen the middle class, which helps us with our budget deficit and 
our trade deficit and will help us again become a country that knows 
how to make things.
  In my State of Ohio we know how to make things. We know how to make 
chemicals and paper and cement and steel and autos and aluminum and 
glass. We led the Nation in many of those things. Yet look around and 
we see what has happened in our country.
  The bill we are debating today is about helping Americans, not 
appeasing the Fortune 500, which is what the Republicans are doing 
tonight. It is about saving jobs. It is not about padding corporate 
bonuses. As they have done again and again over the last year and a 
half, my Republican colleagues are selling out the middle class.
  I wonder if my Republican colleagues have met people who have lost 
their jobs to China; if they know anybody who has seen a plant close 
and they know what it does to the family. They lose their job, they 
lose their health insurance, they sometimes lose their house. They have 
to explain to their teenage children: Sorry, we are going to have to 
move. You are not going to have your own room anymore. I am not even 
sure what school district you are going to go to.
  Do they know people such as that when they stand up on an issue this 
important, and their answer is to talk about the budget deficit as if 
they didn't run the largest surplus in American history 10 years ago 
into the largest budget deficit in American history in 8 short years of 
George Bush government, of tax cuts to the rich, wars that were not 
paid for, bailouts to the drug and insurance companies in the name of 
Medicare privatization, deregulation of Wall Street and these trade 
agreements that continue to send jobs overseas?
  Let me put up a chart here to show some examples in my State of some 
companies that are pretty well known: ``American Standard Company 
factory in Tiffin To Close.'' If you go into a restroom, most of the 
plumbing equipment was once made by American Standard in Tiffin, OH. 
Bain Capital out of Massachusetts, Governor Romney's company, came in 
and basically did away with that company.
  ``Etch A Sketch Leaves Home.'' Etch A Sketch is called the Ohio Art 
Company, in Bryan, OH.
  A small town at the corner of Senator Stabenow's Michigan and 
Indiana. Walmart came to Ohio Art Company and said: We want to make 
Etch A Sketch. We want to sell it at Walmart for under $10. The only 
thing that Ohio Art Company could do was shut down that part of the 
factory and move it to China.
  One hundred years of vacuum cleaner production comes to an end in 
Stark County in Canton, OH. Same story. To the lowest bidder go the 
lowest paying jobs. Huffy Bicycle, Celina OH, on the Indiana border. 
Senator Dorgan has talked about what happened to Huffy Bicycle. So they 
moved that bicycle production to China. These were good-paying, 
industrial, union jobs usually--not all union jobs. They do not have to 
be union jobs. But they were jobs that created a middle class.
  But do you know what has happened? Not since colonial times has 
American business had a business plan where they lobby Congress to 
change the rules. My Republican friends all go along with them because 
it is part of the big corporate agenda; they lobby Congress to change 
the rules, they then shut down their plants. In Burlington, VT, in 
Providence, RI, in Detroit, MI, and Toledo, OH, they shut down their 
plants, they move them to China, they obviously exploit the lowest paid 
workers they can get.
  They then sell the goods back to their home country. They shut down 
the plants here, they move them 7 or 8 or 9 or 10,000 miles away. Then 
they sell the produced products back home to the United States. Look 
what that does to individual people.
  Again, to my colleagues on the other side of the aisle, do they know 
people who lost their jobs when a plant closed and went to Mexico? Do 
they know people who lost their health insurance when a plant shut down 
and went to China? Do they know people who had their homes foreclosed 
on because they lost their jobs and their health insurance and they 
have nowhere else to turn?
  Yet, instead of debating this, instead of their standing and arguing 
in support of these tax laws and trade laws that have started to 
bankrupt our country, and surely have caused our industry to decline, 
they just change the subject. They do not want to debate it. Senator 
Durbin said--and I would echo it and make the same offer. I will go to 
any State in the country with any of my Republican colleagues and we 
will have an open, fair debate on this tax law and on this trade law.
  I would love to go anywhere in the United States and have a public 
debate to show the public and show the American people how much this 
has undermined our sovereignty, our wealth, our manufacturing base. 
They are not willing to debate it. But when we bring this forward, you 
know they will object, and you know what the Senate rules are. One 
person can stand and object and we cannot pass the bill. They are more 
interested, way more interested in scoring political points than they 
are in debating the merits and showing what exactly we need to do as a 
nation to begin to restore our manufacturing base.
  I would conclude with this. I hear my Republican colleagues talk and 
be critical of everything President Obama has done. That is fine. That 
is politics. But what they are arguing that we should do is go back to 
the policies that got us into this.
  Let me put in a little bit of historical context. Eight years of 
President Clinton, January 20, 1993, to January 20, 2001. Those 8 
years, 22 million private sector net job increase in this country. 
Eight years, from January 20, 2001, to January 20, 2009, 8 years of 
George Bush, 1 million jobs created, not enough to even keep up with an 
increase in population.
  The 8 years of President Clinton, wages went up for the great 
majority of Americans. Eight years of George Bush, wages went down for 
the majority of Americans. Eight years of Bill

[[Page 16558]]

Clinton, at the end of his eighth year, he left a budget surplus that 
was the highest in American history. After 8 years of George Bush, he 
left a deficit that, at the time, was the highest in American history, 
and they have the gall to be critical of everything Barrack Obama has 
done, like he created this.
  They have the gall to argue that the voters should choose them to go 
back to the same philosophy. They are not saying do anything different. 
They still say tax cuts for the richest Americans. They still say 
privatization of Medicare and privatization of Social Security. Thank 
God we did not pass that 5 years ago.
  They still say more trade agreements that outsource jobs. They still 
say do not change the tax laws no matter how much damage they have done 
to us. They still say we should deregulate Wall Street. That is the 
contrast. That is what this debate is all about, the contrast.
  Do we want to move forward? Do we want to move forward and write tax 
law and trade law that will create a middle class so we do not see 
another American Standard close in Ohio and another Ohio Art Company 
close and another vacuum cleaner producer and another Huffy Bicycle 
company close in Ohio and move offshore.
  In the end, it speaks volumes about Republican loyalties, loyalty to 
these large corporations that outsource jobs, no real loyalty to 
communities, no real loyalty to these small companies, and no real 
loyalty to workers. When a plant closes, we know the heartache it 
brings to the worker, to the families. We know the damage it does to 
communities as they lay off teachers and firefighters and mental health 
counselors and libraries and police officers and we know what it does 
to the wealth of our country and the standard of living of far too many 
people.
  The question ultimately is: Whose side are you on? One thing for 
sure, it is clear who is on the side of working families in 
communities. That is why this legislation is so important. That is why 
we need to move on fixing our trade law and our tax law, so 
manufacturing jobs begin to move back to this country, and we can 
protect that industrial base that is so important for our national 
security and so important for the economic security of our families and 
of our communities.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. SCHUMER. Mr. President, first, I wish to thank my colleague who 
has spoken before me. The reason we are here tonight is because 
Senators Brown and Sanders said: Why talk about outsourcing of jobs, 
let's do something about it. That is what we are trying to do tonight. 
We are trying to actually do something about it. This is not just 
verbiage.
  We see before us the faces of the people who have lost their jobs. We 
see the families, we hear the children, and so there is an urgency to 
do something. Every place I go in New York--it can be in upstate, an 
old manufacturing place; it can be on Long Island, supposedly the new 
economy--I hear about jobs leaving New York and leaving America and 
going overseas.
  Then, there is some talk as if this is inexorable. It is not 
inexorable. That is what we are here to say tonight. We can do 
something to stop this, and stop it we must. Manufacturing used to be 
the backbone of our economy. It supported millions of families, was the 
staple of middle-class communities. It is no secret what happened.
  Company after company after company began sending jobs to China and 
Vietnam and Malaysia, to Mexico and Brazil and parts of South America. 
These countries have lax enforcement of work rules, environmental 
rules, and pay rules. So it is cheap to produce goods. We have heard 
the statistics, how the United States lost millions of manufacturing 
jobs in the last 10 years--in New York, 90,000 manufacturing jobs in 
the last 3 years alone. One-third of our manufacturing base has 
disappeared nationally. In fact, I recently read that the United States 
has lost 42,000 factories since 2001, and 75 percent of those factories 
employed more than 500 workers. The bigger factories leave. Forty-two 
thousand factories closed, most of them employing more than 500 people.
  I think of the people I have met who have lost their jobs. I go 
around my State and sit down with people who cannot find work. They 
come from all walks of life. I wish to tell you about Clay, a high 
school graduate who rose to the top of his industry in tool and die. He 
had a great life, married, six children, so his wife did not work.
  Clay lost his job a year and a half ago because his company 
downsized, because they were sending jobs overseas. Here is what Clay 
does every day, every week. He wakes up Sunday night in upstate New 
York, drives down to Virginia. He looks for work in his field--he is a 
highly skilled tool and die worker--in Virginia. Tuesday, he goes to 
Washington, Baltimore; Wednesday, to Philadelphia, Allentown and 
others; Thursday, in the New York City area; and then goes back home 
Friday to find a job.
  When he comes in the door Friday night, there is his wife and the 
kids, aged 2 to 14. You can bet a majority of them look at him and say: 
Well? These are not just statistics. There is a Clay in every 
community, many Clays in every community. That is just manufacturing.
  Service sector jobs are going. I think of Dorothy, whom I met. 
Dorothy lost her job in the service industry, also because the company 
was moving jobs overseas. Dorothy told me she lost her job in June of 
2008. I talked to her in January of 2010. She is about 50, did not have 
a family. Her life was her work. She loved her job. Here is what 
Dorothy told me. When you sit down and talk to people who have lost 
their jobs, little things stick with you. Here is what Dorothy told me. 
She said: Christmas morning I usually wake--she is a religious person. 
She goes to church and then goes to open the gifts with her nieces and 
nephews who are in her community.
  She said: Do you know what I did this Christmas morning? I got up at 
6 a.m. and I went online because I had this brilliant idea the night 
before, that maybe there would be jobs posted Christmas morning and no 
one else, everyone else would be too busy to go online and I would find 
it and get the job.
  These are the people we are talking about. Whether it is in 
manufacturing or service, one of the most cited studies--and it is 
cited among conservatives--predicted that by 2015, 3.3 million U.S. 
service jobs will have moved offshore. So if you think you are safe 
because you are in a manufacturing job, forget it. No one is safe. No 
one. Whatever your income level is, whatever part of the country you 
are in, whatever industry you are in, no one is safe. By one estimate, 
about one-fourth of all U.S. jobs possess characteristics that make 
them susceptible to outsourcing within the next 10 to 20 years.
  Sherrod Brown, my colleague, talked about Ohio and New York. Fisher 
Price Toys, well known. Three locations in western New York--started 
there. In 1990, they stopped manufacturing in East Aurora and Holland. 
In 1997, they closed the plant in Medina. Two thousand jobs were lost 
when the three manufacturing plants closed. In 2001, they moved all 
their manufacturing to Mexico. Fisher Price still has a call center in 
East Aurora as well as its headquarters. Now they are considering 
moving the call center to India--both manufacturing and service.
  Syracuse China. Famous. Founded in 1871. These are companies that go 
with the communities. They started and grew with them. It is in Geddes, 
a suburb of Syracuse. Onondaga Pottery Company is what the name was 
when it started.
  If you went to a restaurant or a hotel, you were eating off Syracuse 
China, one of the region's oldest manufacturers. In 2008, after 
considerable downsizing, they closed their plant in Salina, 275 jobs. 
You can still get Syracuse China. It says ``Syracuse China'' on the 
plate or on the cup or on the saucer, but it is made in China, not in 
Syracuse.
  Watson Pharmaceuticals, high-end company, Putnam County. Five hundred 
jobs, high-end jobs in Putnam County, a growing suburb, moved to India.

[[Page 16559]]

  NXP Semiconductors. Again, you think: Oh, semiconductors, that is a 
big, new growing industry. I am going to be safe--600 jobs. East 
Fishkill, Dutchess County. Europe and Singapore.
  Pfizer, largest pharmaceutical company in the world, used to have 
significant manufacturing operations in Rockland County. But as part of 
their worldwide restructuring, after Pfizer purchased Wyeth, 1,500 jobs 
gone to Ireland, Belgium, Canada, Puerto Rico.
  We could all tell a few stories in every one of our States. I guess 
some of us, I hope everyone on both sides of the aisle knows the 
Dorothys and the Clays and the others who give this reality.
  But there is another element to this debate. When companies move 
production overseas, it takes a human toll. Here is the most telling 
statistic of the last 10 years. From 2001 to 2007, a period of 
prosperity, median income went down. Even though we were prosperous, 
even though average income went up, wealth went up, GDP went up, but 
for the average middle-class person, income buying power went down. 
There are no statistics, but it would be hard not to assume that a good 
amount of it was because of outsourcing.
  Last week, there were headlines quoting economists saying that, 
technically speaking, the recession was over. Let me tell my 
colleagues, to the average middle-class person whose paycheck is lower 
because they have less income, the recession ain't over. To most 
Americans, it sure doesn't feel like a recovery yet. The bottom line is 
that there won't be a true recovery until we create jobs in America, in 
the U.S.A. If we want to get our economic prosperity back, we need to 
bring the jobs back. We need to have ``make it in America'' become a 
reality on the floor of this Senate legislatively.
  With this bill, we make our boldest attempt to reverse the trend of 
outsourcing. We do it in three ways.
  First, the legislation eliminates tax breaks for firms that move 
facilities offshore.
  Amazingly, right now if a company were to shut down a factory in 
Syracuse and move those jobs overseas, the company could deduct from 
their taxes the expense of closing that factory and the expense of 
shipping the materials. This legislation would end that.
  Second, the legislation ends the Federal tax subsidy that rewards 
U.S. firms that move their production overseas. Under current law, U.S. 
companies can defer paying U.S. tax on income earned overseas until 
that income is brought back to the United States. This provides an 
incentive to keep that income overseas and employ people there.
  Our bill says that if you close down your operations here in the 
United States and reopen overseas, you no longer get to defer paying 
your taxes.
  This should be a no-brainer.
  It is perverse that American taxpayers provide benefits to firms that 
offshore jobs. By rewarding the companies that bring jobs back to 
America, this legislation puts the incentive back where it should be.
  Some say that this provision puts U.S. companies who open foreign 
subsidiaries at a competitive disadvantage to U.S. companies that 
don't. But I say that is just plain false. Under current law, if you 
have two companies in Oswego that are both going to expand capacity and 
create 100 jobs, our Tax Code puts the company that chooses to keep the 
plant in Oswego at a competitive disadvantage over the company that 
chooses to move jobs to China. Our bill would level the playing field, 
so that companies that keep jobs here aren't penalized.
  These two measures will go a long way towards fixing the problem of 
outsourcing. But our bill doesn't just rely on sticks, it also contains 
a big carrot.
  That carrot comes in the form of a major tax cut. We propose giving 
companies a tax cut--an actual cut, not a credit--for every position 
they bring back to America from overseas.
  As long as the company can prove the employee is doing work that was 
once done overseas instead, the company won't have to pay the 6.2 
percent social security payroll tax for that employee over a two year 
period.
  For a $60,000 factory worker, that is a $7,440 tax cut. For a 
$100,000 manager, it is a $12,400 tax cut. That is real money. And it 
is not a tax credit that a business has to wait a year to receive. It 
is tax revenue that isn't collected in the first place, much like the 
HIRE Act that we passed back in March. So it is a tax cut that puts 
cash right in the pocket of a business, small or large, with no strings 
attached.
  For once, rather than reward outsourcing, let's give employers an 
incentive to bring jobs home. I don't think that anyone who supports 
the motion to proceed on this bill believes that this modest piece of 
legislation is a silver bullet that will end offshoring. We need to do 
much more. We need to enforce our trade laws; we need to push China on 
its currency practices; we need to reform our tax code to make it 
simpler and more streamlined and representative of the modern economy; 
we need to get our fiscal house in order; we need to invest in science 
and education and infrastructure. We still have a lot to do to put 
America firmly on the road to prosperity.
  But every step counts.
  Earlier this year, as I just mentioned, this chamber passed the HIRE 
Act, a measure I worked on with Senator Hatch. It provided a payroll 
tax break for companies that hired an unemployed American. Already, 
through September, 5.6 million eligible employees have been hired under 
the act.
  Just today, President Obama signed the small business bill that 
Republicans repeatedly tried to block in this Chamber. As a result, 
1,400 small businesses signed the dotted line today on a loan that no 
bank would provide. That is $730 million worth of credit that flowed 
just today.
  Under that same bill, eight new tax cuts for small businesses became 
effective today.
  These are real results. So we should not stop trying things.
  Right now, no issue bothers Americans more than the nonstop flow of 
jobs overseas. With this bill, we have a chance to do something about 
it. We can help the American dream launch a comeback.
  This is not a Democratic or a Republican issue. Every single one of 
us has factories that have closed. Families don't have it easy anywhere 
in the country.
  Politics is supposed to stop at the water's edge. The flow of jobs 
should, too.
  So before we leave for the year, let's come together to take up and 
pass this measure to reverse this trend.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Mr. BROWN of Massachusetts. Mr. President, I am a little under the 
weather, so if my voice fades in and out, I will do my best to muscle 
through it. It has been a tough three against one in a battle like I 
will have to do for the next half hour.
  I enjoyed the signs. I didn't bring one. Maybe I can borrow that sign 
because I agree, it should be made in America. How are we going to do 
that when we make America uncompetitive, when we don't give America the 
tools and the resources businesses need to be competitive worldwide? 
This is not a U.S. economy solely where we just sell to Americans; we 
have to sell and compete worldwide.
  I know I have said this before, but I am the new guy. I am the second 
newest guy here now. What I have observed is that there is plenty of 
blame to go around. We talk about President Clinton and everything 
wonderful he did. Yes, he did some great things, but he did it with a 
Republican Congress and their help as well. It was a bipartisan effort 
to solve problems. Unless I am mistaken, the majority party has been in 
the majority for the last 5 years, with the Presidency for almost 2 
years. You don't hear about the problems we have had since that 
happened. I say there is plenty of blame to go around. Quite frankly, 
the rhetoric is white-hot. We should try to solve problems instead of 
pointing fingers at each other and saying that back then this happened 
or back then that happened and we should do it this way or that way. We 
have to focus on today, what is happening today.

[[Page 16560]]

  Right now, we are not competitive. To think this effort to so-called 
close a corporate loophole is going to help--have you actually gone out 
to businesses and asked: Will this help you? Are you in favor of this?
  It doesn't work unless we also lower the corporate tax rates to make 
them competitive worldwide; otherwise, if we keep the corporate tax 
rate the second highest in the world, we are just going to chase huge 
amounts of jobs overseas. We are going to exacerbate the problem we are 
experiencing now.
  I often wonder, why does it take the Chinese less than a year to 
build, say, a 500,000-square-foot building? I have experiences with 
shopping malls, just to put on an addition, and it takes years, the 
siting, the permitting, the regulation at the local level, the 
harassment businesses get. If you are a business or a corporation, the 
mentality is that you are evil, that you are not good. We should be 
embracing businesses for employing. What is a corporation? Last I 
heard, it is a group of individuals forming together to take advantage 
of protections and opportunities to expand and be competitive globally. 
Since when did being a corporation become a bad name in Washington? Am 
I missing something? How do you think we are going to get out of this 
economic mess? It is not going to be by hammering corporations and 
small mom-and-pop businesses and raising taxes in the middle of a 2-
year recession. Are you kidding me? It makes no sense. High taxation, 
overregulation, reregulation, siting, permitting--take the municipal 
laws and regulations, couple them with State laws and regulations and 
Federal laws and regulations, then throw in the EPA just for the heck 
of it, or any other agency--the National Labor Relations Board; just 
pick an agency--then throw in the taxation levels at the city and town 
levels, State levels, the Federal level. Why do you get out of bed to 
turn on the lights? Are you kidding me? What is the incentive for 
people to actually keep jobs in the United States of America?
  In Massachusetts, the NFIB and AIM, Associate Industries of 
Massachusetts, have deemed Massachusetts the worst business climate in 
decades. That feeling is around the country. When I got elected, they 
sent a very powerful message. They were tired of business as usual in 
Washington, the disconnect when we deal with taxes and regulation and 
debt and spending. You don't seem to have learned the lesson.
  We are going to do something right now where we are going to offer a 
little piece of candy by offering a potential tax break for closing a 
corporate loophole. The majority party is apparently protecting Main 
Street. Isn't that nice. Apparently, I, the new guy here, am protecting 
Wall Street, apparently, and big corporations. I didn't know that. I 
thought I was fighting for the people of Massachusetts to get this body 
working together to solve real problems.
  Enough of the rhetoric. Enough of the blame. Enough of the posturing 
for the upcoming November elections. How about just solving problems? 
How about getting our country moving again and get us competing 
globally?
  We just can't wave a magic wand and all of a sudden the tax policy in 
the United States is competitive with the world. If we do this, if we 
move this forward, we will be in deep, deep trouble, especially if we 
don't mirror it with a corporate tax rate reduction to counter the 
moves that will absolutely happen almost overnight.
  If you think that by doing this, jobs are going to come flooding 
back--if you fire a foreign worker and hire a U.S. worker, you get a 
tax credit. Oh, that will really work. How about if you do this, you 
get a payroll tax reduction. Correct me if I am wrong, I made that 
offer about 3 months ago, a payroll tax reduction paid for by 
unallocated stimulus dollars. I got four votes.
  Want to talk about jolting the economy and giving money to people? 
Want to talk about helping corporations and businesses stay 
competitive? How about making the R&D tax credits permanent. How about 
fixing that 1099 mess? How about accelerated deappreciation for small 
and medium-size businesses to give them incentives to create jobs? Do 
you know how much money is on the sidelines? I have done my homework. 
In this position, I have to be prepared or else. Do you know how much 
money is actually on the sidelines?
  Corporations and businesses are saying: You know what, the health 
care bill, that is going to cost me about $440 million.
  One corporation in Massachusetts, one of the biggest employers, has 
the market on a device that saves people's lives; hires, I guess, about 
25,000 people throughout the world. If we do this, if we close this 
loophole, so-called, those jobs that were in Massachusetts in the 
United States are going. So let me see, it costs them $200 million 
because they are a medical device company. Then with the implementation 
of the health care bill, that is another $240 million. So that is $440 
million. So where does that come from? R&D, employees, expansion? Why 
would they hire or even talk about hiring workers? Why?
  That is just one effort, one thing that has been passed by this 
Congress and this administration to crush jobs. It crushes 
Massachusetts' businesses and jobs. We already had 98 percent of our 
people insured. Now we are getting lesser coverage, potentially longer 
lines, $\1/2\ trillion in Medicare cuts. Give me a break. There is no 
end in sight. The true numbers are coming out.
  So why would a corporation or a mom-and-pop business or anybody who 
is even thinking of starting a business make that effort? Why would 
they even bother to open the door? There is the high cost of doing 
business, transportation costs, energy costs. They are concerned about 
cap and trade. They are concerned about maybe card check. They are 
concerned about a whole host of things that are keeping them on the 
sidelines. To take this and throw this in, forget about it.
  The one thing I didn't hear and I thought I would was that Main 
Street--you know, you guys in the majority party, you are protecting 
Main Street. I didn't hear that I am protecting corporate America. I 
hear it in everything else. It is usually Wall Street. Up until this 
year, I have never been on Wall Street. I think I walked through it 
once. I am fighting for the people of this country, the people of my 
State, to get us financially viable, to get us to solve problems.
  Sometimes I am the 41st Senator. I am. When it comes to debt and 
spending and taxation, I am going to be the guy who is going to hold it 
up to make sure we don't go further in debt. When I got here, $1.95 
trillion was the national debt. It is over $13.2 trillion now, in 7 
months.
  I have been blessed. I am so honored to be here. You can't even 
imagine my life. I am the most honored guy to be here in this Chamber. 
I have been honored to visit the troops in Afghanistan. I went to 
Pakistan, Dubai, Israel, Jordan in that 7-month period. The thing that 
was fascinating to me was, from the kings and queens and prime 
ministers and leaders all over those regions, all they talked about was 
jobs. That is all they talked about: jobs so al-Qaida would not 
infiltrate their youth, to get produce to market, to secure the region 
so we can leave--jobs, jobs, jobs.
  I am sorry, Mr. President. If I faint, will you save me? Thank you. I 
felt it was that important to come and make my point that I have been 
here about 7 months, and we have spent 10 days talking about jobs. Am I 
on a different planet or something? We should be talking about jobs 
every single day we are in session. We have spent 4 days, 3 or 4 days 
talking about the DISCLOSE Act. Give me a break. Do you think the 15 
million, give or take, unemployed people throughout the country are 
concerned about the political content of political ads in the middle of 
an election season to give one party a tactical advantage or are they 
concerned about jobs? I know the people I speak to in Massachusetts and 
throughout the country want to talk about jobs.
  How can we do it immediately? We can talk about the R&D tax credit 
and making that permanent. That 1099 bill--there is no reason we can't 
take that separately and put it forth in a bipartisan manner, clean up-
and-down vote to protect the small businesses

[[Page 16561]]

that are getting crushed through paperwork. There is no reason we 
should not be able to fix that. If we can't do that, we are in deep 
trouble. Accelerated depreciation, an across-the-board payroll tax 
reduction, a freeze on Federal hires, a freeze on Federal pay 
increases--I know it is not popular, but we have to look at these 
things. We have to look at entitlements. We have to collect moneys owed 
to us from contractors whom we overpaid or through fraud and abuse. 
Common sense, folks.
  The thing I kind of get sad about--I know it wasn't popular in some 
circles for me to work on the financial reform bill. I got a lot of 
heat. But I looked at it, and I said: That doesn't include Fannie or 
Freddie. I know that. Do we do nothing? We do nothing, right? We don't 
fix the regulations that have potentially been outdated for 50 years? 
We don't prohibit the closing of an entire industry overnight? We allow 
dentists and doctors and people who are going to finance the fillings 
in your teeth to be all encompassed in this thing? We are going to 
allow that? I am not going to allow it. I knew they had the votes 
anyway, but I took the time to work it through. I will tell you what. 
Since I have been here, that is the most proud I have been to work 
across the aisle with people for what we did--11 weeks, I think, 
working with every thinker and leader in this country when it dealt 
with financial issues.
  I have to admit, I learned a lot, sleeping 5 hours a day maybe, slept 
in my office trying to figure it out and do it right. I was the most 
proud to work on that bill in a bipartisan manner. I am part of 
history. Is it the best bill? No. Is it going to get better? I hope so. 
Can we fix it after November? I hope so. Did we close TARP? Yes. Did we 
stop too big to fail? Yes. Did we stop the bank tax? Yes. Did we do a 
lot of things people are concerned about? Yes. Did we do some things 
wrong? Yes. But--do you know what--ever since we got back after July it 
is as though we do not talk anymore. We are just filing bills with no 
hope of them passing.
  The Defense authorization bill--give me a break. I remember being in 
committee on the Defense authorization bill. I was sitting there in the 
Armed Services Committee, all eager, ready to go, being someone who was 
in the military. ``Gosh, I am going to make a difference. I am going to 
make a difference, everybody.'' You get there, and it was an 
invigorating process. We worked our tails off. The chairman said: ``You 
know, Scott, the things you are concerned about that affect 
Massachusetts and the New England area, we will do it on the floor.'' 
``Oh, good.''
  I find out when it gets to the floor the amendment tree is filled. We 
were offered 20 amendments. That is not good enough. The process is 
about just scoring points, political points for November. I think the 
American people are fed up. They are tired of the rhetoric. They are 
tired of the finger pointing. They are looking for leadership. They are 
looking for somebody to say: Do you know what? Sometimes I am going to 
be the 41st Senator, but other times when it comes to getting this 
country moving, I am going to be the 60th Senator. I do not care if I 
get reelected or not, but while I am here, I am going to fight every 
single day to get this country moving again because we are in deep 
trouble, folks. And if you do not recognize it, by doing this piece of 
legislation--this is helpful? It is not helpful on its own. They say: 
Well, it is the first step.
  Do not come to me with a first step. Come to me with a real plan, one 
that is comprehensive and can actually work and that can get some full 
support from your own party. Tell me you have every member of your 
party and I will say you are not being truthful. And then try to blame 
us as the party of no. With all due respect, since I have been here 
that has changed. But do you know how many times the majority party has 
voted with me? Zero. OK. So the party of no thing, I will tell you 
what, it is getting a little old--from the administration and the 
majority party, a little old. The numbers do not speak for themselves 
on that one.
  I do not want to seem like a downer, Mr. President, because you are a 
good man. I respect you greatly, and I respect the people who spoke 
prior to me. Being here and being in this historic Chamber--are you 
kidding me? To be part of this process is like the greatest honor in 
the world. Aside from my marriage and the birth of my kids, this is it. 
And to think we are wasting this amazing opportunity, this amazing 
opportunity to get our country competitive again and to get us firing 
on all cylinders.
  You cannot tell me we cannot find one thing to agree on. The leaders 
cannot get together and find one thing? Take the Energy bill. You are 
telling me we cannot do one thing, take the easiest thing everybody 
agrees on and do one thing, make it clean and get it through, and send 
it over to the House and make sure it comes clean and not filled with a 
substitution bill and comes back clean? Can we do one thing--just one? 
Am I the only one who believes this?
  I get that the bill on the floor tonight is important to the majority 
party, and I respect that. I do. I get it. And pollsters, if you listen 
to them--which I tend to not--when they talk about companies that ship 
jobs overseas, I get that too. I understand that is bad. But it is what 
is in play now. If we change this one thing and not change and reduce 
the corporate tax rate to make them have an incentive to staying, it is 
not going to work.
  I believe without a doubt this bill will cause real harm to the 
economy, and that job creators are united in their opposition to this 
legislation. I guess it is bad to make money in America, to pay the 
bills. I am in favor of corporations making money. I am in favor of the 
employees making money. I am in favor of free trade and free 
enterprise. I am also in favor of government regulation. It has its 
place. But the government needs to know when to get out of the way too 
and to stop overregulating. There is a role for government, absolutely. 
But government needs to know when to get out of the way, to let free 
enterprise, free market--you cannot regulate every single thing. You 
cannot do it.
  I have gone around. I have tried to do my research. As I said, I have 
to. The major employers in Massachusetts whom I have talked to--and we 
have a tremendous amount, thank goodness. They are not hiring, but they 
are there. They are not going to expand because of health care and 
regulation and taxation and the uncertainty of the business world.
  I remember I read it or I heard it, Senator Baucus, chairman of the 
Finance Committee, said he was worried that this bill would put the 
United States at a ``competitive disadvantage.'' Those words are his, 
not mine. This bill puts the United States at a ``competitive 
disadvantage.'' I believe that in my heart. Again, echoing his words, 
this bill will make American multinational companies less competitive. 
So it is not just Republican Senators. My colleague, whom I have great 
respect for on the other side of the aisle, is questioning also the 
wisdom of this legislation.
  Having the second highest corporate tax rate--I notice my colleagues 
who spoke earlier said--well, I do not want to characterize how they 
speak. But the companies that are going overseas, yes, they are taking 
advantage of lower tax rates. Absolutely. But you would believe, in 
listening to them, that there are also lower labor costs as well. Yes, 
in some countries that is absolutely true. But in places such as 
Belgium and Ireland, I respectfully disagree. Companies are doing this 
to get a good solid workforce, paying good wages, but taking advantage 
of the 11-percent, 12-percent corporate tax rate versus a 35-percent 
corporate tax rate.
  But I have to take exception to the statement that everybody is going 
overseas to take advantage of the tax rates.
  Well, yes, this is a global economy. We are fighting a battle here. 
And when China can do the things they are doing and basically provide--
well, let's step back. I remember growing up, and you would look at 
space exploration, roads and bridges, and teachers, and all that, R&D 
tax credit money, all that great stuff we would use to lure businesses 
from other parts of the world here. Do you know where that is now?

[[Page 16562]]

It is all debt service to China. So when I see and when I speak to the 
companies back home in Massachusetts, and they say: We need A, B, C, 
and D, I am like, we have no money. It is all in debt service to China 
right now. I would love to give it to you.
  So how do we get our financial situation moving forward? We are not 
going to do it by having the tax cuts expire. We need to address the 
tax extenders. We cannot play games and push it off and push it off. 
How about the death tax? Oh, my God, how many billionaires have died 
and we have not gotten a penny? Good for them. One over on the 
government. But is it good for the Federal Government to not get a 
piece? I am all for people getting money, but we have not even 
addressed the death tax.
  I remember in my first caucus, when I went in, we were talking about 
it, and in the second caucus, the third caucus, the fourth caucus, and 
on and on. It is time to kind of come together to solve some real 
problems so tax planners and families can kind of get their planning 
done. It is all about uncertainty. The reason we are in part of this 
mess is because of the financial uncertainty associated with the 
continued overregulation, the fear of more taxation, the fear of 
governmental interference, and the things we are trying to do. You can 
go on and on and on.
  So as I said, what is the point? Why even bother getting out of bed?
  Mr. President, may I ask, how much time do I have?
  The PRESIDING OFFICER. The Senator has 6 minutes 20 seconds.
  Mr. BROWN of Massachusetts. Six minutes 20 seconds.
  Mr. President, I am fading fast, and I would ask if my colleague 
wishes to take the remaining part of my time.
  The PRESIDING OFFICER. The Senator from Florida.
  Mr. LeMIEUX. Mr. President, I thank my colleague from Massachusetts. 
Before I walked down to the floor tonight, I was watching him on 
television as he gave his remarks. I know he is more than a little bit 
under the weather. I thank him for his comments, and I thank him for 
his refreshing point of view because he comes here as a common man to 
try to do the best he can for the people of Massachusetts and the 
people of this country, and he knows in the short time he has been here 
that this system is broken. It is not working for American families. It 
is why Americans are so upset at their government.
  It is not America that is broken. It is the government that is 
broken--a government that is now saying: We do not want you to profit. 
We do not want the business to succeed, sending all the messages that 
say America is not open for business, with too much regulation, too 
much taxes, too much spending, too much uncertainty, too much of 
Congress pulling these big levers on government and on the economy that 
stops job creators in their tracks.
  When I visit businesses in Florida, as I often do, they tell me: 
Look, Senator, we do not know--actually, they call me George--we do not 
know, George, what is going to happen with our business. We do not know 
what this 2,000-page health care bill is going to do for our business. 
Are we going to hire one more employee and fall under some new fine or 
mandate? Is this financial regulation bill going to make business more 
expensive?
  Small businesses, medium-sized businesses, and the few large 
businesses we have in Florida are frozen in their tracks. They will not 
hire. Worse still now, we have these tax cuts that are set to expire at 
the end of the year, and these businesses do not know what their taxes 
are going to be. Is their tax on their dividends going to go up? Are 
capital gains going to go up? Are they going to be paying a higher tax 
rate themselves because they file as if they are an individual because 
they are a subchapter S corporation? All of this uncertainty, all of 
this regulation, all of this taxing, too much debt, too much spending, 
too much borrowing freezes business in its tracks.
  Now we have this Creating American Jobs and Ending Offshoring Act. I 
am new here too. I have been here about a year. But you can mark my 
words, when you hear a title like that, you better read the details. 
Boy, it sure sounds good. We want to end the offshoring of jobs. Who 
would not be for that? It sounds great. But the truth of it is, you are 
going to tax American corporations that are doing work in foreign 
countries. You are going to double tax them under this proposal and 
make them uncompetitive.
  So when Caterpillar sends bulldozers to India, they are going to be 
taxed more, which is going to hurt the folks in this country who are 
building bulldozers. You can apply that to any business that is doing 
work overseas. We do not need to be discouraging exporting. We need to 
be encouraging exporting. We know when we invest in exporting we get a 
huge return on investment. That is what we should be doing. But that 
does not make a nice sound bite. That does not sound good right before 
an election.
  We should not be imposing more taxes on businesses that are trying to 
create jobs overseas which employ more people in this country. That is 
uncompetitive. That does not make any sense. What we should be doing is 
reinstating these tax cuts that have been around for 7 and 9 years 
respectively and not raising taxes in the middle of a recession. Can 
you imagine that we are going to go back for the next month and 
businesses in our country are not going to know what their tax rate is 
next year. And people wonder in this Chamber why people are not hiring. 
Because there is too much uncertainty. They do not know what their 
taxes are going to be.
  Do you know what businesses want? They want a level, fair playing 
field, and they want predictability. All this government does, all this 
Congress does, is change the rules every couple months to make things 
unpredictable.
  I heard my colleague from New York talking about the fact that the 
last decade was lost to the middle class, that they lost wages, that 
they actually went down, not up. That is something that appeals to all 
of us. But government is not going to be the solution to that problem. 
Government is not going to fix that. The private sector is going to fix 
that.
  Why are we demonizing business? Why are we demonizing profits? This 
has never been a country where we said we are going to bring you up by 
pulling other people down. This has been a country where we said we 
will give you the opportunity to succeed, and then you can be rich too 
someday.
  That is the American dream. That is what separates us from every 
other country in the world. We look on these other countries such as 
India and China and say, look, they are going to overtake us. They are 
more competitive. They are not playing by the rules. They are doing 
things cheaper in those countries, opening call centers, stealing 
American jobs.
  Let me tell you, I have had the opportunity to travel to some of 
these countries in my stead as a Senator. And on its best day, India is 
not as good as we are on our worst. There is nothing America can't do. 
There is nothing Americans can't do.
  The thing that is failing America now is this Congress and this 
government. What we should be doing is creating certainty. What we 
should be doing is approving the three free-trade agreements that we 
still have outstanding with Colombia, Panama, and South Korea. That 
would get Americans back to work. What we should be doing is cutting 
the payroll tax across the board for every employee and every employer. 
Let's cut it temporarily by 3 percent. Let's give every employee a 3-
percent pay raise and every employer 3 percent more that they can use 
to hire new employees, buy new equipment, and get Americans back to 
work.
  People in this Chamber are willing to work across the aisle to be 
problem solvers. I did that on the small business bill because it was 
the right thing for Florida, and it was the right thing for this 
country.
  Let's not demonize each other. Let's not demonize American business 
because we know American business is what creates jobs. We don't need 
to create more government jobs. We need to create more private sector 
jobs. That is what is going to get this economy back up and running.

[[Page 16563]]

  What I fear is what Senator Brown talked about and his notion of why 
you get up in the morning. Is the next Bill Gates who started 
Microsoft, is the next Hewlett Packard who started that company in 
their garage--the next innovator, the next entrepreneur--just going to 
say: Look, there is too much taxes, too much regulation, too much 
uncertainty; I am not going to go pursue that idea. Have we taken away 
the American dream? As someone just recently said to the President in a 
townhall meeting: Is this my new reality? Is the American dream lost?
  It is not. We will get through this. But we are only going to get 
through this when we realize that government is not the creator of 
jobs, the private sector is the creator of jobs. Our obligation is to 
have regulation for it to be fair, to make sure people don't cheat; 
otherwise, our job is to get out of the way and let business succeed to 
employ our people and allow them to achieve their dreams. This bill 
doesn't do that. It makes us less competitive. It will hurt jobs.
  What we should do is reinstate the tax cuts to create certainty and 
not raise taxes in the middle of a recession. We should cut payroll 
taxes, we should approve the free-trade agreements, and we should focus 
every day we are here on jobs, not on campaign election laws, not on 
this frolic, not on this detour but on jobs.
  The American people are hurting. The people in my State are hurting 
badly. It is the worst recession that anyone can remember in Florida--
the worst recession that anyone can remember. Unemployment is near 12 
percent. In some cities it is 14 percent. When we figure in the 
underemployed, it is more than 20 percent--people who want to work but 
can't. Let's give them certainty. Let's not raise taxes on them, and 
let's make sure we have a level playing field for business so business 
can do what business does best, and that is create jobs.
  With that, I see my time has expired. I yield the floor.
  The PRESIDING OFFICER. The Senator from Michigan.
  Ms. STABENOW. Thank you, Mr. President.
  I have found it interesting, having the opportunity to spend this 
evening listening to colleagues on the other side of the aisle. A lot 
of things have been talked about except the bill we are going to be 
voting on tomorrow. We certainly want to focus on the legislation we 
will have an opportunity to vote on together tomorrow to decide whether 
we are going to take up a bill that will stop shipping our jobs 
overseas. That is what this is about. We want to make things in America 
again and stop the incentives for shipping jobs overseas.
  I also wish to indicate that today, talking about certainty--and I 
agree with my friends on the other side of the aisle that we need 
economic certainty. I agree with that. It would be so helpful if 
everything was not filibustered and there wasn't sand thrown in the 
gears at every turn when we are trying to move forward and create 
economic certainty, making it take much longer in terms of trying to 
get to economic certainty. But I agree, and we agree, that we need 
certainty.
  I wish to commend the Senator from Florida for working with us on the 
small business jobs bill that was just passed. The previous speaker 
said we need bonus depreciation. Well, but that particular Senator and 
the majority of the Senators voted against that in the small business 
bill. We need to extend expensing provisions, we were told a while ago. 
Well, the majority of Republicans voted against that. We need tax cuts 
for small business, we were told. Well, we just had a bill with $12 
billion in tax cuts for small businesses that the majority of the 
Republicans voted against. Again, with all due respect to my colleague 
from Florida who reached across the aisle and helped make that happen--
and we are very grateful--but I have been listening all evening to 
people talking about how we need tax cuts who just voted against tax 
cuts. They have talked about how we need certainty, and certainly one 
of the areas where we need certainty is in small business lending, and 
we have just created that.
  In fact, tomorrow, we are told, the SBA is going to provide about 
1,400 loans for small businesses to be able to grow and expand and hire 
people--tomorrow--because of what was signed today. So that creates a 
little bit more certainty. We certainly need more of that. I am all for 
doing that, and I am all for creating the kind of level playing field 
that was talked about as well.
  We want to export our products, not our jobs. But at every step of 
the way, from the Recovery Act we passed 18 months ago to focus on 
manufacturing--making things in America, clean energy, advanced battery 
technologies, jobs and infrastructure--from that time until now we have 
seen nothing but delay tactic after delay tactic after delay tactic, 
slowing down the economic certainty that colleagues are now talking 
about this evening. So we want that certainty.
  We want certainty for middle-class families in this country who have 
been torn apart because of the fact that we have lost jobs. We have 
lost 4.7 million manufacturing jobs in this country under the policies 
of the last administration that now, we were told last week, they want 
to do again. The proposals unveiled by our Republican colleagues are 
exactly the same proposals that cost my State 1 million jobs. We are 
not interested in going back to that. We want to keep on a course that 
is going to get us out of the hole.
  So what is this bill about? I will soon turn this over to my 
colleagues to speak as well. What are we really talking about tonight? 
We are talking about doing three things that will bring jobs back that 
have been lost overseas. These jobs have been lost to China time and 
time again. They have been lost to India, lost to Brazil, lost to 
Mexico, and lost to many other countries because of a system we have 
that doesn't have a level playing field on trade, is not enforcing our 
trade laws, having some trade agreements that are not fair, and then 
having incentives that reward companies to write off their costs here 
while the jobs are shipped overseas. So we want to stop that.
  This bill, in fact, would prohibit a firm from taking any deduction, 
a loss or credit, for amounts paid in connection with reducing or 
ending the operation of trade or business in the United States and 
starting a similar trade or business overseas. What is that about? 
Well, we don't think American taxpayers should have to pay the bill 
through a deduction or a credit while their jobs are being shipped 
overseas. Companies shouldn't be able to write that off their taxes.
  We are also saying through this bill that we want to end the Federal 
tax subsidy that rewards U.S. firms that move their production 
overseas. Finally, we want to provide a carrot to say, if in the next 3 
years a company closes down operations and brings jobs back--and we 
have success stories like that to tell of companies that are doing 
that--but if they do that, close operations in the next 3 years, bring 
the jobs back, they will get a 2-year payroll tax holiday. So they will 
get a tax cut if they bring jobs back.
  That is the simple bill. It is very simple. It is very 
straightforward. We want to take away the incentives to ship jobs 
overseas--the subsidies that cause Americans to lose their jobs--
turning around and then subsidizing the jobs overseas, and we want to 
create incentives to bring jobs back. That is what this is about. This 
adds to what the President signed today in terms of the small business 
bill that creates jobs. This is another step in our effort to make sure 
we are focusing on American jobs.
  We want to make sure we are making it in America again. It is no 
surprise we have lost the middle class as we have lost manufacturing. 
Our ability to have good-paying American jobs is built on the premise 
of a foundation that says we are going to make things in this country. 
We are going to make things. We are going to grow things. We are going 
to add value to it. That is what has created the middle class of this 
country. We are losing that. People are losing their jobs, losing their 
futures, their ability to care for their families, as we are seeing 
these jobs

[[Page 16564]]

shipped overseas. This bill is about bringing them back. It is one 
piece of the puzzle. Take away the tax deductions and bring them back. 
That is what this is about.
  Tomorrow, the question is, Do you want to debate it? Do you want to 
move to the bill? It is not final passage; it is voting to move to the 
bill so we can have the debate about creating that certainty and 
creating jobs and making things in America again.
  I see my friend from Rhode Island, and I wish to turn things over to 
him because I know he is a passionate advocate for jobs, as I am. We 
often share, unfortunately, the same kinds of concerns about jobs in 
Rhode Island and Michigan. I know the Senator from Rhode Island cares 
passionately about bringing those jobs back to America.
  The PRESIDING OFFICER (Mr. Durbin). The Senator from Rhode Island.
  Mr. WHITEHOUSE. Mr. President, let me first thank the Senator from 
Michigan who has worked so long and hard on this. We do, indeed, have 
in Rhode Island the distinction of being in the top three or four 
States for unemployment for month after month after month. Rhode Island 
is still hovering near 12 percent unemployment.
  For a State that was once the manufacturing capital of the world, for 
a State that was once the place where the industrial revolution was 
sparked off, to be in this situation is very painful for a lot of Rhode 
Islanders, and it is particularly painful and frustrating to have that 
situation exacerbated by our country's tax and trade laws. At last we 
are getting around to doing something about it.
  So I am here today in strong support of the Creating American Jobs 
and Ending Offshoring Act. I wish to speak a little bit about the bill 
itself because one of the things I have noticed about my colleagues on 
the other side is that they have spoken about anything and everything. 
They have spoken about taxes. They have spoken about the deficit. They 
have spoken about wages. They have spoken about every economic issue 
they can bring to mind, but they haven't spoken about this bill. Nobody 
has said this is a bad piece of legislation; they just don't want to 
get to it. They want to give long speeches about macroeconomics rather 
than look at this bill and how it will help. It is a shame because we 
are just trying to get to this bill.
  Last week, Leader Reid made a procedural motion that the Senate take 
up this legislation to address the epidemic of companies laying off 
American workers and moving their jobs overseas.
  I was just in a facility in Rhode Island a few weeks ago and there 
were machines running and there were people working. But if you walked 
around the machine shop floor, you could see marks on the floor marked 
off in tape with holes where bolts had been taken out. Those were 
machines that had been taken out of a Rhode Island factory and shipped 
to South America so that South American workers could work those 
machines and sell the exact same products that had been made in Rhode 
Island back into America.
  So this is a very real and practical problem we have to face. With 
the kind of unemployment we have still in this country, I hope every 
one of my colleagues, Republican as well as Democrat, will acknowledge 
that this is a topic that is worthy of debate in the Senate.
  Senator LeMieux from Florida was just here. He is a very 
distinguished Member of this body, and I consider him a personal 
friend. He came forward with a great list of ideas he believed we 
should be considering in order to improve our jobs posture and move 
America forward. Those were all fine ideas, and every single one of 
them he could have offered as an amendment if he would vote yes to go 
to this bill.
  Where we are is the Republicans saying we are not even going to 
discuss this piece of legislation. So every good idea or what they 
consider to be a good idea we have heard about tonight, bear in mind 
their votes will prevent them from offering amendments to implement 
those very ideas that they are claiming are good ideas.
  This is a basic, smart piece of legislation. The Creating American 
Jobs and Ending Offshoring Act would close some really perverse 
loopholes in the Tax Code that, right now, reward American companies 
for moving American jobs overseas. The law, right now, permits 
companies that close down American factories and offices and move those 
jobs overseas to take a tax deduction for the costs associated with 
moving the jobs to China or India or wherever. Those machines that were 
unscrewed, unbolted from that Rhode Island shop floor and shipped to 
South America so that South American workers could run them--the cost 
of that was a tax deduction subsidized by the American taxpayer. That 
simply doesn't make sense.
  If we want to send a message that we are tired of sending American 
jobs offshore, then giving people a tax deduction for doing that should 
be a practice that ends. We would end those taxpayer subsidies for the 
expenses of moving American jobs overseas.
  That taxpayer subsidy is just the cherry on top--the big prize--for 
companies that are offshoring jobs. The real money comes from their 
ability to defer paying taxes on profits they earn overseas. Here is an 
example. Let's say a company manufactures a boat in my State of Rhode 
Island. That company pays taxes on its profits from selling that boat 
every year that it earns a profit. Let's say there is a company right 
across the street--a competitor--that also makes boats, and it decides 
that it is going to take its manufacturing and move it overseas to 
China. They will make the same boat but will make it in China and then 
sell it back to the same U.S. customer. They are identical except that 
one company moved its jobs overseas. The company that moved its jobs 
overseas is not obliged to pay income taxes on its profits from the 
overseas manufactured boat at that time. It can strategically defer and 
maneuver its taxing to pay it later and use the money in the meantime 
instead of having to borrow capital or pay it at a time when it has 
offsetting deductions. This deferral gaming can be quite lucrative for 
the companies that move jobs overseas, and it can be quite costly for 
taxpayers. So we close this loophole too.
  These tax loopholes that reward shipping jobs overseas have served as 
powerful incentives for companies to do so, and the numbers bear this 
out. According to our Bureau of Economic Analysis, 1999 to 2008, the 
number of U.S. employees of multinational companies declined by nearly 
2 million--1.9 million jobs--out of America from multinational 
corporations. During the same period, these same companies increased 
their foreign employment by 2.4 million--2 million jobs out of this 
country and into foreign countries by American multinationals.
  Some people think that is a wonderful idea. These are our friends at 
the U.S. Chamber of Commerce. This is a letter they sent on September 
23 to the Members of the Senate from the Chamber of Commerce of the 
United States of America:

       Replacing a job that is based in another country with a 
     domestic job does not stimulate economic growth or enhance 
     the competitiveness of American worldwide companies.

  This is our U.S. Chamber of Commerce, the same entity that is out 
running ads trashing candidates on behalf of Republicans, the same 
entity that represents all the big multinationals--Exxon, BP, the big 
insurance companies, the big banks, the folks charging you a 30 percent 
interest rate on your credit card. That is whom these people represent. 
Again, they bring this idea to the table:

       Replacing a job that is based in another country with a 
     domestic job does not stimulate economic growth or enhance 
     the competitiveness of American worldwide companies.

  I will tell you what it does. It will enhance the heck out of the 
economic growth of the family who gets that domestic job. It will 
enhance the heck out of the economic competitiveness of a neighborhood 
that doesn't have a factory shipped overseas so that the company can 
move the jobs offshore. I don't know whom these people are interested 
in--the U.S. Chamber of Commerce--but it is definitely not the

[[Page 16565]]

American family, the American neighborhoods or the American worker. 
``Replacing a job that is based in another country with a domestic job. 
. . .'' That is really astounding.
  So we need to get to this bill, and we need to begin to reverse the 
decades-long decline in U.S. manufacturing. This cannot do everything, 
but it would be a first step.
  When we were growing up, the vast majority of the clothes we wore, 
the cars on our roads, and the food on our tables was all produced in 
the United States. That time has passed, that time is gone, that time 
is no more. Today, you would be hard-pressed to find items in a 
department store that were made domestically. Just go to Walmart--it is 
China-mart.
  It is not just consumer goods either. Earlier this year, I had a 
meeting with an organization in Rhode Island that runs one of our major 
ports. Together with Senator Reed, we were able to argue successfully 
for one of the TIGER grants in the economic recovery bill to help 
support this port so that they can grow jobs and add to the business 
that comes to Rhode Island. Part of what they need to do is purchase 
and install a big cargo crane, a port crane to offload the goods that 
come in and stack them so they can go onto trains and trucks and off 
into commerce. Guess what we discovered. We discovered that the Rhode 
Island organization didn't plan to buy the multimillion-dollar crane 
from an American company. Do you know why that is? That is because no 
American company any longer makes a port crane. No matter how much you 
want to buy a crane for an American port from an American company, you 
can't do it. We don't make them any longer. Something has gone badly 
wrong when you go to the biggest retail outlet in America and you can't 
buy American-made products--it is 90-plus percent from China--and when 
you go to a port and the crane that is unloading the Chinese goods 
cannot even be made in America any longer.
  So we need to get to work. We need to support our American 
manufacturing base, and we need to take the wrinkles out of the Tax 
Code that make it advantageous for a company to move those jobs 
overseas, with taxpayer subsidies and competitive advantage against a 
company that is struggling at home trying to do the right thing and 
keep jobs here.
  All we are asking of our colleagues is that they allow us to go to 
the bill and have this debate. When they come to the floor and object 
to this procedural motion, and they have nothing to say about this bill 
but only general bromides--I have had so many bromides that I am ready 
for some Bromo-Seltzer. They won't talk about this bill. The reason is 
that it is a good bill, and it would help American jobs, and they don't 
want anything to pass now. I urge them to change their minds. It is too 
important to let this opportunity pass.
  I yield the floor.
  I see my colleague from Alaska.
  The PRESIDING OFFICER. The Senator from Alaska is recognized.
  Mr. BEGICH. Mr. President, I have to say to the Senator from Rhode 
Island, we will get some of that water that fizzes because we will need 
it as the night goes on.
  The point is simple. To the American people, to the Alaskans who are 
watching, this process we go through here, which is really about 
getting us to a bill--that is what we are trying to do so we can have a 
debate across the aisle, have a discussion about what is the right 
policy when it comes to jobs and how to make sure we do the right thing 
regarding our economy. Instead of having to debate, they would rather 
stop the motion to proceed and end the story.
  I rise this evening for the same reason many other folks are talking 
tonight--in support of the Creating American Jobs and Ending Offshoring 
Act. I believe we should reward companies that keep Americans working 
here in our country.
  As a former mayor, and really longer than any time I have served in 
public office, as a small business owner--that is what I spent my life 
around. I understand the impact of legislation and what it means for a 
business owner. As I have said in the Budget Committee and on the 
floor, I am probably one of the few who have filled out--in one of the 
debates we had a couple weeks ago--1099 forms. I understand what it 
means for a small businessperson to spend the time to try to build 
their business and what it means.
  Tonight, in my view, it is unacceptable that we currently reward 
companies that ship American jobs overseas while businesses that are 
doing their best to provide decent wages and benefits are struggling 
just to make payroll. We should reward businesses that don't just keep 
but create jobs here at home. It makes no sense to me, when you think 
about it--you have business A and business B both doing the same 
product. But the one that decides to invest in America, to invest in 
Alaska, who competes against the person across the street who decides 
to close up and go overseas, who gets tax breaks and special benefits 
and subsidies and other things, the person here who is working hard 
every day to keep Americans working is at a disadvantage. It is clearly 
time that we stop shipping our jobs overseas and make it right here in 
America.
  American manufacturing jobs have been some of the hardest hit by the 
economic downturn. States that have significant manufacturing bases are 
those with the highest unemployment rates.
  This legislation is a commonsense response to our job crisis. Under 
the bill, payroll tax relief will be rewarded to companies that hire 
employees domestically during a 3-year period, beginning now. The tax 
cut would come in the form of relieving the companies of paying Social 
Security payroll taxes on each job that was brought back home to this 
country for the next 2 years.
  This legislation also eliminates tax breaks for companies that move 
jobs overseas. I will repeat that because people who might be watching 
are saying: What do you mean, we give companies tax breaks for moving 
jobs to another country and not reward people who work here? That is 
the case. We actually give breaks, which include deducting expenses for 
companies that close their factories in the United States and move them 
overseas. I don't know about all other taxpayers, but I am taxpayer and 
a businessperson, and that seems ridiculous that we would give a tax 
break to companies that ship jobs overseas. Taxpayers subsidize these 
companies. As I mentioned, our tax laws currently reward these 
companies in many different ways for moving jobs overseas.
  Here is a startling reality--the data. We hear a lot from the other 
side, and they are kind of good sound bites and they get on the news 
and get coverage, but here is the data. This is how people should 
measure the success or failure of the policy we have had regarding this 
issue. That is why we need to pass this new legislation. Between 
February 2001 and February of 2009, almost 4.7 million manufacturing 
jobs were lost to overseas operations--4.7 million American jobs that 
were shipped overseas, like a parcel package. They are gone. Between 
1999 and 2008, employment of foreign affiliates of American parent 
corporations grew from 7.8 million jobs to 10.1 million. That is an 
increase of 2.4 million jobs or 30 percent. Again, there are jobs that 
have been shipped off, and then these American companies then produce 
jobs overseas that could have been produced here in this country. But 
they have not done it.
  To my friends across the aisle, many of you seem to have the 
impression that extending tax cuts for the wealthiest Americans will 
mean more jobs.
  I just got back from a weekend in Alaska, for 2\1/2\ days moving 
through cities, talking with folks. I have to be honest. Only the 
people across the aisle are thinking that because that is not what I 
hear back home. They see through it. The 97 percent who will receive a 
tax break, a tax cut, middle-class Americans see that benefit. But the 
small 3 percent, 2.5 percent, they are not going to create jobs with 
that money, no question about it. As we all remember back in the Bush 
administration, President Bush decided to extend these tax cuts to the 
wealthiest

[[Page 16566]]

Americans in the middle of the Iraq war. The thought was this would 
spur our economy and create new jobs.
  Not surprisingly, the exact opposite happened. The national debt 
doubled. When President Obama was sworn into office, just before he was 
sworn in, over half a million jobs were lost just in that month alone 
before he was sworn in. We have to stop shipping jobs overseas and make 
it right in America.
  I implore my colleagues on the other side to allow the debate, to 
allow us to proceed. It is not complicated.
  I will end on this comment and say, when I was a mayor, anybody could 
bring any idea to the table. You could debate it. Sometimes we debated 
until midnight, sometimes we started the next day and debated some 
more, but ideas were debated.
  We are recovering from an economic crisis. We are, at the moment, to 
look at some new options, new opportunities to have our businesses 
thrive and move forward. I ask our colleagues on the other side: Allow 
the debate to occur. As a small businessperson, as a Member of the 
Senate, I ask them to step to the table and let us move forward.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Pennsylvania.
  Mr. CASEY. Mr. President, I commend the remarks by the Senator from 
Alaska and before him the Senator from Rhode Island and others tonight. 
One of the reasons we are here tonight is because we have been trying, 
over the last 18 months, to get some of our colleagues on the other 
side to join us in job creation strategies. We had almost no Senators--
at the time just three on the other side--join our side to pass the 
American Recovery and Reinvestment Act. That legislation, which we 
passed in the early part of 2009, has created--one rather conservative 
estimate--about 3 million jobs. But in an economy where we lost 8 
million, we have to keep going and put in place other strategies.
  We passed the HIRE Act not too long ago. When we pass a lot of 
legislation, it goes right by people. That HIRE Act provided a payroll 
tax credit for the hiring of an individual who has been unemployed for 
60 or more days. That has created a number of jobs.
  We just passed a bill, and the President signed into law today, the 
Small Business Jobs and Credit Act, a direct infusion to small 
businesses across the United States of America--$12 billion in tax 
breaks directly to small businesses.
  In addition to that, there is a loan fund for our smaller banks, our 
community banks, to provide most of the capital to most of the 
businesses in America because we know small businesses create most of 
the jobs.
  We have been taking step after step. None of it is perfect. Not one 
bill will lead to a full recovery. But we have been trying to push this 
economy--the image of coming out of the ditch we have all used is a 
good analogy. One bill is one push. One bill is not enough to get this 
economy fully recovered, but we have been making progress.
  Today we come together, once again, to try something we have 
advocated again: to try to take some steps to stop the offshoring of 
jobs, the shipping of jobs overseas because we have the wrong tax 
policies in place.
  What does this bill do? What does the Creating American Jobs and 
Ending Offshoring Act do? Basically, three things. It is not 
tremendously complicated for those who are running businesses but 
critically important to our jobs, our families, and our future.
  No. 1, it would create a payroll tax holiday for companies that 
return jobs to the United States from overseas. What happens there is 
we would be providing relief from the employer's share of the Social 
Security payroll tax on wages paid to new U.S. employees performing 
services in the United States. It is as simple as that. We should have 
done it a long time ago. We could have taken these steps before, but 
our friends on the other side, just like they have blocked almost every 
job creation bill I can think of in the last 18 months, they blocked 
this over and over again.
  No. 2, this bill would end subsidies for plant closing costs. As some 
of my colleagues have noted, the bill would prohibit a firm from taking 
any deduction loss or credit for amounts paid in connection with 
reducing or ending the operation of a trade or business in the United 
States, starting or expanding a similar trade or business overseas. We 
have made it easier. We have created incentives to ship jobs overseas 
instead of creating disincentives for companies to send jobs overseas. 
It would end that basic policy that ships jobs overseas.
  No. 3, we would end tax breaks for runaway plants--plants that go 
overseas and have no penalty applied to moving jobs overseas, instead 
of keeping jobs in America.
  I mentioned before the HIRE Act, legislation that provides a payroll 
tax credit for the hiring of an individual who has been unemployed for 
60 or more days. We are building on that policy. I commend our majority 
leader, Senator Reid, Senator Durbin, our Presiding Officer, Senator 
Schumer, and others for building upon what we did in the HIRE Act 
earlier this year and introducing this bill to provide employer relief 
from the employer share of the Social Security payroll tax on wages 
paid to a new U.S. employee performing services here.
  In other words, we are trying to bring jobs back to the United 
States. We are not saying this bill is a magic wand that solves all our 
economic problems. One bill is not a recovery, but it is another 
forward step in furtherance of that objective to lift this economy 
completely out of the ditch it has been in for far too long.
  We know this did not happen overnight. We know our economy did not 
fall into a ditch overnight. We also know the loss of manufacturing 
jobs did not just occur over the last several years. It occurred over 
many years. But if you just look at the last 9 or 10 years, I know, for 
example, in Pennsylvania we lost over 200,000 jobs. The best estimate 
is 207,000 jobs just in Pennsylvania that are categorized as 
manufacturing jobs. In some States it is a lot higher than that. My 
colleague from Michigan, Senator Stabenow, was remarking earlier that 
Michigan had lost over 1 million jobs in that time period, just 
manufacturing jobs.
  We know the unemployment rate across the country is intolerably too 
high. In our State, fortunately, it is below 10. A lot of States cannot 
say that. But 9.3 or 9.5 roughly in Pennsylvania over many months 
equates to almost 600,000 people. It got as high as 592,000 people out 
of work. Now we are down a little but down to only 585,000 people out 
of work.
  I went across Pennsylvania during the latter part of the summer. In 4 
weeks, I was in some 31 counties, most of them small and rural 
counties, most of them counties that have a lot of small towns in them 
and a lot of geography, a lot of space. Whether you go to a county such 
as Potter County, which has less than 20,000 people in it and almost 
100 percent rural, their unemployment rate is 11.5 percent.
  Philadelphia, the biggest city and biggest county as well, has an 
unemployment rate of 12 percent now. More than 75,000 people are out of 
work in the city of Philadelphia.
  Whether you go to a small town or rural community or whether you go 
to the biggest city in our State, the unemployment rate is far too 
high.
  It is my obligation to not just say the Recovery Act created 3 
million jobs. It may not have been perfect or popular, but it created a 
lot of jobs. But that is not enough. That is why we supported the HIRE 
Act. That is why we supported the Small Business Jobs and Credit Act. 
The community bankers, by the way--this is not a number from a 
Democratic office--tell us it will create 500,000 jobs.
  What if they are off by a big number? What if it is only 400,000? My 
goodness, if we can pass any bill that will create 400,000 jobs, that 
will be remarkable. If they are right, it will be more than that. It 
will be 500,000 jobs.
  We are pushing and pushing to move this economy fully out of the 
ditch, to have a full and robust recovery because we know what happens 
when the economy recovers. We saw it in the late 1990s, during 
President Clinton's two terms in office. We not only had recovery but 
tremendous growth. We were

[[Page 16567]]

investing in priorities such as health care and education and the 
skills of our workers for the future for a stronger economy. We had not 
only eliminated the deficit--the Congress and the President at the 
time--but the surplus was $236 billion when President Clinton left 
office. He handed that to President Bush.
  When President Bush handed over the keys to the White House, so to 
speak, to President Obama, the $236 billion in surplus was now $1.3 
trillion in deficit. That is where we are today. We are still 
recovering, despite a lot of steps, to have a full recovery. But we 
cannot fully recover if we are going to continue to subsidize the 
movement of jobs overseas.
  It is hard to comprehend the strange and almost perverse policy that 
has led to taxpayers being called upon because of the policy that has 
been in place for far too long, the policy where taxpayers are 
subsidizing the costs associated with the closing of a plant in the 
United States of America. We should not just lament that, we should end 
the policy and instead have taxpayer support strategies to keep jobs 
here or support strategies that actually pull jobs back from overseas.
  You cannot lament the movement of jobs overseas and then just keep 
voting the way some are voting against tax policies to keep jobs in 
America. You cannot lament job loss and vote against, whether it is a 
Recovery Act, the HIRE Act or the Small Business Jobs and Credit Act. 
You cannot say you are in favor of helping small business and then turn 
around the next day and vote against $12 billion in tax cuts for small 
business.
  You cannot say you support small communities and the small banks in 
America and then vote against a loan fund that will help those very 
same small banks across America help their small businesses to invest 
and grow and hire more people and help us recover.
  What tomorrow's vote is about is not the bill itself. Tomorrow's 
vote, of course, as everyone knows, is just to get over that procedural 
hurdle to allow us to debate. Having a debate about ending the 
offshoring or doing everything we can to end the offshoring of jobs is 
worthy of at least 1 day or a couple hours of debate.
  Someone over there might say: I am not going to vote for this bill 
for this or that reason. They have that right. It is hard to say I do 
not like the fact we have been shipping jobs overseas and have tax 
policies that incentivize that and we have other policies we can put in 
place to change that and to turn that around and move in the direction 
of helping taxpayers keep jobs here and pulling jobs back from 
overseas, you cannot say all that, make a big speech on it and then 
vote the next day and say: I am not only going to vote against the bill 
but vote against any debate on the bill. That is a pretty hard argument 
to make. I am not sure there are many people who can make it with a 
straight face and with any degree of integrity.
  We will see what they do. We will see if they are going to vote 
against debating obviously one of the most important issues for people, 
stopping jobs from going overseas. I hope the other side does not do 
what it did with the small business bill and say it supports small 
businesses and then vote against tax cuts and vote against community 
banks to help our small businesses.
  Maybe tomorrow there will be a flash of light in the darkness of this 
political debate and folks on the other side will let us debate this 
for a couple hours and then maybe vote the right way: to stop jobs from 
going overseas. But we will see. We will see what the morning light 
brings.
  Mrs. FEINSTEIN. Mr. President, I rise today to support the Creating 
American Jobs and Ending Offshoring Act. The bill before us utilizes 
both carrots and sticks. It ends certain egregious tax breaks that 
promote the movement of American jobs overseas, and provides a payroll 
tax holiday to companies that relocate jobs back to the United States.
  I thank Senators Durbin, Reid, Schumer and Dorgan for their 
initiative in crafting legislation designed to create more jobs on 
American soil at a time when it is critical. This bill is a positive 
first step.
  Robust industry has always been the hallmark of American 
competitiveness.
  It once was that you could see the ``Made in America'' logo on the 
back of a t-shirt, on a shoe, a dress, a coat, and knew that you had a 
product that was both high quality and safe.
  But from 2000-2005, U.S. companies slashed 2.1 million jobs in the 
United States while hiring 784,000 jobs internationally. This is from 
the Bureau of Economic Analysis.
  Examples are the iconic little red wagon company, ``Radio Flyer'' 
eliminated half its workforce in Chicago and moved its manufacturing 
operations to China in 2004; Levi Strauss cut its workforce by roughly 
20 percent, closing factories across the country and outsourcing its 
manufacturing work to Latin America in 2002; Motorola has laid off over 
40,000 workers and invested more than $3 billion in China in 2001; and; 
recently, the Whirlpool Corporation announced it will close a 
refrigerator plant in Evanston, Indiana, resulting in the loss of 
hundreds of jobs. Whirlpool has plans to open a new plant in Mexico.
  And Hewlett Packard is opening a global call center in Chongquing, 
China. The reason for all these relocations is plain and simple--less 
cost.
  Today, the ``Made in America'' logo is not often seen, and with its 
demise has been the loss of good American jobs.
  It is time for the United States to refocus on a modernized 
industrial policy that promotes global competitiveness and creates jobs 
for the American people.
  And this legislation is a beginning.
  Simply put, we can no longer hang our hats on American inventiveness 
and ingenuity while ignoring the steady stream of jobs lost to our 
international competitors.
  Americans have always had good ideas, but those good ideas used to 
lead to good jobs here in the United States. Now, our intellectual 
property contributes to abundant employment opportunities, but many are 
often in other countries.
  American industry has changed the world. From the automobile to the 
airplane, from landing a man on the moon to developing the Internet, 
the combination of revolutionary ideas and productive labor has been 
the backbone of American strength for generations.
  But we should not be willing to cede that essential part of our 
American identity. We must find a way to ensure that American ingenuity 
creates American jobs.
  Statistics indicate that we are losing our identity as a 
manufacturing power--and that is bad news for this country.
  Thirty years ago, the founder of Sony and the head of the august 
Keidanren in Japan said to me: ``When America ceases to be a 
manufacturing power, she will become a second-rate power.''
  I have thought a lot about those words over the decades as I have 
seen American jobs go overseas.
  The slow bleed of manufacturing jobs has been a stark reality for 
years. From 1997 to 2007, the U.S. manufacturing sector lost 3.5 
million jobs--an estimated 20 percent of the workforce.
  But offshoring isn't just a problem for factory workers, it is having 
a growing impact on the service sector as well. Today, even highly 
skilled workers can no longer rely on their education or training to 
obtain a job or have any measure of job security. It is estimated that 
1.2 million white-collar jobs were sent offshore between 2003-2008; the 
Bureau of Labor Statistics estimates that 31 percent of service-sector 
jobs are currently at risk of being sent overseas; at the current rate, 
25 percent of all U.S. jobs may be in danger of being shipped overseas 
in the next 10 years, from the CRS.
  Several studies indicate that up to 250,000 American jobs may go 
overseas by 2015; and this includes highly skilled fields like computer 
science and mathematics, which are becoming increasingly vulnerable to 
being sent overseas.
  The Creating American Jobs and Ending Offshoring Act is a first step 
toward addressing these trends. The bill provides a payroll tax break 
to companies that move jobs back to America--

[[Page 16568]]

employer share--roughly 8 percent of salary--2 year holiday; eliminates 
the tax breaks that have provided incentives to companies to move 
production and jobs overseas--eliminates tax deduction, loss, or credit 
for costs associated with moving operation overseas; and; ends tax 
deferral for companies that move production overseas, only to sell 
those products back in the U.S.
  The time has come for Congress and the business community to come up 
with an industrial policy that will promote American competitiveness 
and create jobs.
  While we have promoted trade and globalization, we have overlooked 
the negative effect it has on job creation here in the U.S. Many of our 
businesses have thrived in the modern global marketplace, but our 
policies here at home lag behind.
  Free trade may reduce the price of goods, but this doesn't do much 
good if unemployed Americans can't afford to buy them.
  We need to look at the structure of taxation, of education, and of 
health care. We need to decide what must change in order to achieve our 
goals.
  In August I spoke to a gathering of the top business minds in Silicon 
Valley. With California's unemployment rate lingering at 12.4 percent, 
much of the discussion turned to maintaining American dominance in a 
way that would engender job creation in my home State.
  I asked them to work with me to find common ground on these issues.
  Today, I ask all of us in the Senate to do the same.
  The provisions included in the Creating American Jobs and Ending 
Offshoring Act are a positive first step.
  However, to profoundly impact the future of American industrial 
competitiveness, we cannot rely solely on carrots and sticks.
  We as a government must lay a stable foundation upon which American 
business ingenuity can foster top down growth. And the business 
community must focus not only on the bottom line. It must rededicate 
itself to the pursuit of a thriving American economy and labor force.
  Bottom line: These are the things we must do if we are to maintain 
America's position as the driving force of the global economy. This 
legislation is a good first step down this road.
  Mr. CARDIN. Mr. President, the Senate will have a cloture vote 
shortly on the motion to proceed to S. 3816. I hope that we will 
overcome a procedural roadblock to the Senate considering this 
legislation and proceed to the bill and pass it. While the National 
Bureau of Economic Research, NBER, has determined that the recession is 
over, it is clear that we have much more work to do getting Americans 
back to work. According to NBER, the recession lasted 18 months, which 
makes it the longest of any recession since World War II.
  It is important to note that NBER did not conclude the economy has 
returned to operating at normal capacity. Rather, NBER determined only 
that the recession ended in June 2009 and a recovery began in that 
month. According to NBER:

       (E)conomic activity is typically below normal in the early 
     stages of an expansion, and it sometimes remains so well into 
     the expansion.

  Aggregate employment frequently reaches its trough after the NBER 
trough for overall ``economic activity'' and the 2007-2009 recession is 
no exception. That is why this jobs bill is critically important. The 
economy is still fragile; everyone knows that. So let's do something 
about it.
  S. 3816 has incentives to create jobs here in America and 
disincentives to moving American jobs overseas.
  Earlier this month, the U.S. Department of Labor certified a Trade 
Adjustment Assistance, TAA, petition brought on behalf of human 
resources personnel at Hewlett-Packard in 10 different States, 
including Maryland--Ellicott City--that have seen their jobs shipped to 
Panama. Now, if H-P employees have questions about their pay or their 
leave or their benefits, they have to call Panama. It is exactly that 
type of shipping jobs offshore that we need to prevent.
  S. 3816 removes tax incentives that allow companies such as H-P to 
eliminate jobs here, outsourcing that work with the products or 
services consumed in the U.S. market.
  Just since the beginning of 2007, the Department of Labor has 
certified 50 TAA petitions involving laid-off workers who live in 
Maryland.
  In many cases, the firms involved in these certifications had U.S. 
tax incentives to ship jobs overseas. S. 3816 helps to eliminate those 
incentives.
  To encourage businesses to create jobs here in the United States, the 
bill allows businesses to skip the employer share of the Social 
Security payroll tax for up to 2 years on wages paid to new U.S. 
employees performing services in the United States. To be eligible, 
businesses have to certify that the U.S. employee is replacing an 
employee who had been performing similar duties overseas.
  This payroll tax holiday is available for workers hired during the 3-
year period beginning September 22, 2010. The Social Security trust 
fund will be made whole from general revenues, a provision that costs 
$1.09 billion over 10 years.
  The bill eliminates subsidies that U.S. taxpayers provide to firms 
that move facilities offshore. It prohibits a firm from taking any 
deduction, loss, or credit for amounts paid in connection with reducing 
or ending the operation of a trade or business in the U.S. and starting 
or expanding a similar trade or business overseas.
  This provision raises $277 million over 10 years.
  The bill would not apply to any severance payments or costs 
associated with outplacement services or employee retraining provided 
to any employees who lose their jobs as a result of the offshoring.
  S. 3816 also ends the Federal tax subsidy that rewards U.S. firms for 
moving their production overseas. Under current law, U.S. companies can 
defer paying U.S. tax on income earned by their foreign subsidiaries 
until that income is brought back to the United States. This is known 
as ``deferral.''
  Deferral has the effect of putting these firms at a competitive 
advantage over U.S. firms that hire U.S. workers to make products here 
in America.
  The bill repeals deferral for companies that reduce or close a 
business in the U.S. and start or expand a similar business overseas 
for the purpose of importing their products or services for sale in the 
United States. U.S. companies that locate facilities abroad in order to 
sell their products overseas are unaffected by this proposal.
  Ending deferral raises $92 million over 10 years.
  I think there is a huge need and a great deal of merit in considering 
a bill to encourage American firms to keep their plants and factories 
here in America and to hire American workers.
  Too many Americans are looking for work and can't find jobs. The 
recession hasn't ended for them. I hope the Senate will move forward on 
legislation that will keep jobs in America and put Americans back to 
work and begin to put this terrible recession behind us. It is time to 
ship American goods and services--not American jobs--overseas.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BEGICH. 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. BEGICH. Mr. President, the score is 10 to 0.
  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. CASEY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Begich). Without objection, it is so 
ordered.

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