[Congressional Record (Bound Edition), Volume 156 (2010), Part 4]
[Senate]
[Pages 5571-5588]
[From the U.S. Government Publishing Office, www.gpo.gov]




                    CONTINUING EXTENSION ACT OF 2010

  The ACTING PRESIDENT pro tempore. Under the previous order, the 
Senate will resume consideration of H.R. 4851, which the clerk will 
report.
  The assistant legislative clerk read as follows:

       A bill (H.R. 4851) to provide a temporary extension of 
     certain programs, and for other purposes.

  Pending:

       Baucus modified amendment No. 3721, in the nature of a 
     substitute.
       Coburn amendment No. 3726 (to amendment No. 3721), to pay 
     for the full cost of extending additional unemployment 
     insurance and other Federal programs.
       Coburn amendment No. 3727 (to amendment No. 3721), to pay 
     for the full cost of extending additional unemployment 
     insurance and other Federal programs.

  The ACTING PRESIDENT pro tempore. The Senator from Oklahoma is 
recognized.
  Mr. COBURN. Madam President, I appreciate Senator Reid working with 
us. We are going to try to work through the amendments we have left 
today and hopefully get this taken care of tonight. Our intent has not 
been to slow down but to pay for this.
  I wish to discuss amendment No. 3726, which has already been called 
up and is pending. I don't believe there is another pending amendment 
at this time; is that correct?
  The ACTING PRESIDENT pro tempore. Amendment No. 3727 is also pending.
  Mr. COBURN. That is my amendment as well. Thank you.
  Yesterday we defeated, by a vote of 51 to 46, actually smart 
financial management that would have paid for all the costs for the 
next 60 days for the unemployment insurance. What we were doing was 
utilizing money that we are already paying interest on that is sitting, 
not being used, by taking a portion of that to pay for this so that we 
don't go and borrow another $18.2 billion. The wisdom of the Senate 
said, no, we don't want to do that.
  We are going to have today two other opportunities on a way to 
finance that. This amendment basically takes the agreed-to tax 
loophole, which we agreed to before we left for the spring work period, 
and adds to that half as much of the financial management money that I 
recommended we do yesterday and the amendment was defeated. So we have 
about $9.5 billion worth of tax loophole closures that we have already 
agreed to in this amendment and $20 billion, which will save $10 
billion in terms of the way CBO scores it--it is ridiculous the way 
they score it, but in terms of the way they score it, we have to move 
$20 billion so we can save $10 billion.
  The point is that we get an option: we can borrow another $18.2 
billion to pay for this or we can take money we are already utilizing 
very inefficiently and pay for it. We are going to choose not to do it 
again, and we will probably get another 46 or 47 votes. But we are 
going to choose to transfer the cost of helping people today to our 
grandchildren because in my lifetime we are not going to pay back any 
of this money. We are going to be borrowing and paying interest on this 
$18.2 billion over the next 30 years. So the cost really isn't $18.2 
billion; it is $18.2 billion times 6 percent, times 106, times 106, 
times 106. It will end up costing our kids $60 billion or $70 billion 
because we are going to refuse to pay for something we ought to be 
doing.
  What we are also not going to do is make tough choices about 
priorities, as every family in this country has to do. We are going to 
refuse to do that. We are going to say we are going to keep the bad 
habit, the thing that got us $12.85 trillion in debt, the thing that 
got us $75 trillion in unfunded liabilities. We are going to continue 
that process. We are going to continue that process until such time 
that we can no longer borrow the money. That is what it seems like to 
me. In other words, only until we cannot go to the world markets and 
finance debt against our children's future are we not going to change 
the habits in the Senate or in the Congress.
  Of every dollar we spend this year, 43 cents will be borrowed. What 
are the long-term consequences of that? Very plainly speaking, it is a 
lower standard of living for those who follow us, a marked decrease in 
opportunity, a loss of freedom, an inhibition in entrepreneurial 
spirit, and truly an unwinding of what was the gift that was given to 
us, which was this great opportunity and this great freedom.
  We don't often make the connection between freedom and debt as a 
government, but we do personally because when we are highly in debt as 
individuals, our choices start to get limited. If you are in a business 
that has a high degree of debt, your choices are limited by those who 
loan you the money because they start getting involved in your 
decisionmaking process.
  If you really look at our foreign policy today, that is happening to 
us with what we are trying to do in terms of sanctions on Iran. What 
are the two nations that own the most of our debt and are also least 
likely to agree with us on harsh sanctions for Iran? They are China and 
Russia. They are the No. 1 and No. 2 holders of our bonds. So we are 
giving up tremendous flexibility and freedom.
  I put forward that if we cannot find $18.2 billion in our Federal 
Government as we run it today, which will spend over $4 trillion this 
year, none of us need to be here. We need a whole new 100 Senators if 
we cannot find $18.2 billion. But the institutional stodginess of 
always doing it the same old way is inhibiting us from creating a 
bright future for our children.
  I won't detail the exact tax loophole closures we have, but we have 
agreed they can be utilized for this purpose--Senator Baucus, Senator 
Reid, Senator McConnell, and myself--and they come to a total of $9.756 
billion. To properly manage our money instead of having money sitting 
that has been appropriated but not obligated--and there is almost $900 
billion sitting out there this year in the agency that is not 
utilized--to not utilize that money is foolhardy.
  My hope is that my colleagues will consider at some point in the 
future that we have to start making harder choices.
  I understand the bias against it. It eliminates somebody's control of 
power. But where should the power be in this country? Should it be in 
the Senate or should it be in the American people?
  Do the American people want us to pay for this? Absolutely. Five to 
one

[[Page 5572]]

think anything we are doing new we ought to be paying for. Yet it is 
going to skid through here today, and we are going to add another $18.2 
billion over the next 60 days that we do not have to, but we are going 
to choose specifically to do so.
  I wish to leave with one last point on this amendment. When we say 
there is nothing else that we can eliminate in the Federal Government 
to pay for this legislation, what we are saying is all the waste, all 
the fraud, all the duplication is more important than helping people 
with unemployment insurance. If it was less important, we would 
eliminate it and pay for the unemployment. But by not paying for it, by 
not making the choice to pay for it, what we have said is we have 
elevated everything else above this as a priority. We refuse to do what 
every other business, what every other family, what every other 
organization, except the Federal Government, has to do; that is, make 
tough choices.
  In my State of Oklahoma, the legislature and the Governor right now 
are making tough choices. They are going to cut several hundred million 
dollars from our budget. I promise you, they are going to look at what 
is least important so they can continue to fund what is most important. 
We will have none of it. We have demonstrated none of it. We lack the 
character and courage to do what is best for the future.


                           Amendment No. 3727

  Now let me talk about amendment No. 3727, which is, again, another 
opportunity, another way to pay for this good thing we want to do. It 
also has two components.
  The first component utilizes the agreed-to closure of tax loopholes 
of $9.7 billion. But then it gives us a real chance to do some real 
good things to eliminate spending that is low priority.
  There are 14 spending provisions that I propose eliminating in this 
amendment. Many have been endorsed by President Obama and President 
Bush and, before him, President Clinton. In the past 3 months, the 
President has endorsed five of these offsets, the House passed four of 
them, and the Senate passed one identical to one section in section 
203.
  What is the first one? According to the Government Accountability 
Office, we paid out $1.1 billion to dead farmers. That is over the last 
7-year period. Forty percent of those payments were people who had been 
dead more than 3 years. Most people in America would say: Maybe you 
ought to eliminate that. Maybe farmers who have been dead for more than 
3 years should not continue to get payments from the government. It 
will save us $1.1 billion over 10 years if we hold the Department of 
Agriculture accountable to not continue to make payments to people who 
are not deserving of them.
  We recently passed a Feingold amendment to the FAA bill that rescinds 
any DOT earmarks that remain 90 percent or more unobligated after 9 
years of being appropriated, with the possibility of holding funds one 
more year for earmarks the agency head believes will be funded within 
the following 12 months.
  The only difference between what we passed and this amendment is that 
this section applies to all agencies, not just the Department of 
Transportation. The Secretary of the Department of Transportation 
endorsed the Feingold amendment.
  If it works for the Department of Transportation, why would we not do 
that everywhere on earmarks? It is $500 million in savings immediately. 
We cannot quantify through the CBO what it will be in the future, but 
it will probably be at least that every year.
  Another section is the President's request to eliminate a duplicative 
bus grant program. This would repeal the Inner-City Bus Security Grant 
Program. President Obama recommended this $12 million program be 
eliminated because the grant awards are not based on risk and it is 
duplicative of the Public Rail Transit Security Grant Program that is 
already out there and much less important than any other homeland 
security priorities. It saves us $120 million.
  In other words, the President does not want it, the Department of 
Transportation does not want it, but somebody who is getting that grant 
somewhere is going to say: No, we cannot do that, even though there is 
a duplicative program already in place to take care of it.
  Section 235 of this amendment would repeal the Resource Conservation 
Development Program. President Obama recommended this $51 million 
program be eliminated because it has outlived its need for Federal 
support. It was first begun in 1962 as a temporary program. It was 
intended to build community leadership skills through the establishment 
of RC&D councils that would access Federal, State, and local funding 
sources. These councils are now up and running--secure funding with 
continued operation without any money coming from RC&D. It saves $510 
million. Why would we continue to spend the money? The President, the 
leader of our country, agrees with it. It has been voted on several 
times. But it will be voted against today because somebody somewhere is 
still sucking off this in a way that is not efficient and is not a 
priority for the country.
  Section 236 would repeal the Brownfields Economic Development 
Initiative. President Obama recommended this program be eliminated 
because it is duplicative of a larger, more efficient Federal program, 
and local governments have access to many other public and private 
funds that address the same purposes.
  This was designed to assist cities with redevelopment of abandoned, 
idle, and underused industrial and commercial facilities where 
expansion and redevelopment is burdened by real potential environmental 
contamination. They eliminated almost all of those, and we have a 
better program now taking care of it, which goes back to the habits of 
Congress. We create new programs to address the need of what some may 
think the present program is not doing rather than change the present 
program.
  Here the administration, as well as the Bush administration, agreed 
we should eliminate that program. That is $180 million over 10 years.
  Section 237: This provision would repeal water and wastewater 
treatment projects administered by the U.S. Army Corps of Engineers. 
President Obama recommended eliminating these projects. They are 
duplicative, and they are outside the scope of the Corps of Engineers. 
That is what private civil engineering firms do. They plan, build, and 
organize these events. The Corps of Engineers has stated they do not 
have the expertise to do these projects, which the Environmental 
Protection Agency normally funds through other grants in the Revolving 
Fund Loan Program.
  Since these programs were first funded in 1992, they have been 
exclusively funded through earmarks. In other words, somebody put 
something special in for one city or one place through an earmark. It 
may not be the highest priority for the country. It may very well just 
be a priority for the State, but it has been exclusively funded through 
earmarks, special interests, lobby-generated earmarks. It saves $1.29 
billion over 10 years.
  Section 238: This provision would repeal the Rail Line Relocation 
Program. President Obama has twice recommended eliminating this program 
because it is not merit based--in other words, if you are well 
connected, you get it, but if you have a real need and somebody else 
has a lower need, you are not going to get it--and it duplicates other 
Federal programs that are larger and that are merit based.
  The grant program is primarily earmarked, again; 75 percent of it 
gets earmarked every year. What happens is the administrators of the 
grants do not get the grants based on need and merit because a Senator 
has already said it will go here instead of into a pool of the greatest 
need. Again, duplicating an existing program that is more efficient, 
that is based on merit. It is a slush pot of money for earmarks.
  We will hear lots of complaints about eliminating that program, even 
though the administration wants to get rid of it as well. Savings: $340 
million.
  Section 239: Enacting rescissions offered and passed by the House 
leadership. This would rescind $112 million from a Commerce Department 
program

[[Page 5573]]

designed to provide coupons to households to help people buy analog-to-
digital converter boxes. This has been used. The program is not going 
anywhere because everybody has converted. Why should we continue to put 
money out to a program that nobody is going to utilize? That money was 
used for an offset for a summer job youth program already this year but 
did not come here. Estimated savings: $115 million.
  Section 241: Enacting the USDA nutrition rescissions amendments 
offered and passed by the House leadership. This would rescind almost 
$362 million of unobligated reserved stimulus funds for the WIC 
Program. This offset was selected because it was identified by the 
House appropriators and they unanimously voted to use these funds to 
offset another program.
  It is obviously a low priority. It is a reserve fund. It has not been 
utilized. It is sitting there, and we need to eliminate it rather than 
borrow the money.
  There are three or four other sections. There is a next-to-final 
section on Federal real property disposal. We have 21,000 buildings we 
own that we do not use, but yet we do not have a clear way to allow 
government agencies to dispose of property.
  Last year, on these 21,000 buildings that we cannot get rid of 
because we have created a block to do so, we spent $8 billion 
maintaining them, even though we are not using them. We could sell 
those, we could give them to the States, we could do a lot of things 
that would immediately save us $8 billion. But if we sold them and we 
saved $8 billion a year, over the next 10 years that is $80 billion, 
not counting anything we might get for selling them. We might have some 
costs associated with razing some of them.
  According to the Office of Management and Budget, 46,745 buildings 
that are underutilized with a total value of the ones we should be 
selling are worth $83 billion. We are going to hear people say: You 
can't do that; you can't sell those buildings. Why? Why would we borrow 
money when we could sell buildings we are not using for $83 billion? 
Almost enough in properties that we do not need and are having to 
maintain to pay for this entire bill. The estimated savings this year 
alone from starting this would be $4 billion--just from starting it--
that process would save us at least $4 billion this year.
  Section 244: What we know is, at least 28 Federal programs, totaling 
over $9 billion, support job training and employment. Eighteen of these 
programs fall under the Labor Department's jurisdiction, and the agency 
spends $130 million administering its training and employment programs. 
We have 18 programs rather than 1. We are spending $130 million just to 
manage them--this is just inside the Department of Labor--rather than 
have one job training program with one set of administrators and not 
duplicating that administrative cost all the way across the board. 
Savings is probably $100 million to $130 million annually. There is 
well in excess of $22 billion to $24 billion in this second amendment--
No. 3727.
  So the question becomes this, if we continue down this road: Fair to 
our kids, fair to us because the Senate refuses to act responsibly?
  Oh, I have heard the harsh rhetoric: You don't care about people who 
are unemployed because you think we ought to pay for it. You know, I 
think there are two sets of people we ought to be caring for. I think 
we should be caring for the unemployed, making sure they have 
sustenance and their needs fulfilled, as long as they qualify. But I 
think we should care about those who are going to follow us, those who 
are going to have to pay back this $18.2 billion. Are they not both 
important, especially when we know we waste, through fraud and 
duplication, $300 billion a year in the Federal Government? I have just 
come up with $20 billion of it.
  We have enough fraud, waste, and duplication in the Federal 
Government to pay for this the whole rest of the year, to pay for the 
war supplemental that is getting ready to come, without borrowing 
another penny against the backs and future opportunities and freedom of 
our children.
  I am pretty cynical about whether we are ever going to do that. I 
think the American people will have to change who is here before we 
will ever get to the point where we are going to make the hard choices 
that families have to make. But I think that is a fight worth having to 
protect our future. I think it is a fight worth having for my grandkids 
and everybody else's grandkids.
  I was born in 1948, right after the end of the war, and we had the 
highest debt ratio we have ever had in this country. But because we had 
a limited government, what happened was we moved greatly and expanded 
both growth opportunity, innovation, and wealth through the hard work 
and great character and spirit of the American people, and we handled 
that. We can do that again. But we can't do it if we don't have the 
leadership that is necessary to do it. We have to start sometime to 
start paying for what we are doing. We have to start making choices. 
That is a rare occasion in Washington, but it is one I sense the 
American people are going to start demanding.
  I have been working at this for 5\1/2\ years, or almost 5\1/2\ years. 
I have not made much progress other than to make sure the American 
people are informed of the absolutely atrocious amount of stupidity, 
waste, and duplication that goes on here. It is time we act. And since 
the majority controls the outcome, and they will let a few Senators 
vote for these amendments, we will get a high number of them, but not 
enough to make a difference.
  So the question we ought to be asking is, What is so wrong with 
trying to pay for what we are doing? Well, we have always done it as an 
emergency. We have always charged it to our kids. Well, we haven't 
always been $12.8 trillion in debt. We haven't always been to the point 
that in 2010 we are going to have a debt-to-GDP ratio of 90 percent, 
which means we are going to have about $20 trillion in debt, and that 
is going to suppress and depress our economy by 2 percentage points in 
terms of growth. We have never been here before in terms of the risk to 
our economy.
  I see the chairman of the Finance Committee here, and I will close by 
saying we are going to start doing this. The question is when. The 
question is, Should we be doing it when we are in control or when the 
bankers outside of America are in control--the sovereign nations 
outside who will tell us how we do it and what we can't do, just like 
what is happening in Greece today. The leadership in Greece is making 
decisions not because they want to but because they have to. They are 
not necessarily nice choices for the people of Greece. That can and 
will happen to us if we don't change.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Montana.
  Mr. BAUCUS. Madam President, yesterday, the Senate tabled the 
amendment offered by the Senator from Oklahoma by a vote of 51 to 46. 
That motion to table was successful, and shortly I will move to table 
the two pending Coburn amendments. The Senate should reject these two 
amendments offered by the good Senator from Oklahoma for the same 
reasons the Senate rejected the other amendment yesterday.
  The Senator makes basically the same argument for each of his three 
amendments. They appear to be pretty much a set in terms of amendments. 
The Senator argues this emergency temporary extension of unemployment 
insurance benefits is the place to draw the line. It is the place to 
draw the line on which we need to take a stand to balance the budget.
  Madam President, I agree with him the Nation should turn to serious 
budget negotiations. Our high budget deficits are unconscionable and 
must be addressed. We should balance the budget over the life of the 
business cycle. We should balance the budget as quickly as we possibly 
can. But we should not balance the budget while in the grips of the 
worst recession since the Great Depression. Doing that would only put 
more people out of work.

[[Page 5574]]

  I might say, Madam President, that at a hearing held yesterday by the 
Finance Committee, the well-known economist Mark Zandi, who was an 
adviser to Presidential candidate John McCain, volunteered that this is 
not the time to draw that line in terms of deficit reduction. We should 
not force people who are unemployed to bear the brunt of offsets at 
this time. This is not the time to balance the budget, now that we are 
facing this recession.
  I might also point out that we should not balance the budget on the 
backs of unemployed Americans who, through no fault of their own, are 
struggling to get by in this recession. They need these unemployment 
benefits, and if we were to adopt the amendment offered by the Senator 
from Oklahoma, first of all, it would be a mistake; and second of all, 
it would have to go to the House, and the House has said they wouldn't 
accept it. So for another couple of days people who deserve 
unemployment insurance benefits would not be getting them.
  This Congress failed to act some time ago. As a consequence, 
unemployment benefits have expired and people who deserve unemployment 
benefits are not getting those unemployment benefits. Again, if we were 
to adopt the Coburn amendment and send it to the House and have it come 
back, then it would be a longer period of time that people who are 
waiting for their benefits would not be getting them.
  It is just wrong for Congress not to have passed this extension a 
short while ago. It is wrong, but it is something that happened so we 
are here trying to correct it. Hundreds of thousands of Americans are 
already going without unemployment insurance benefits because we have 
not passed this bill. Hundreds of thousands more will go without 
unemployment insurance benefits if we do not pass the bill this week.
  I will repeat myself: If we were to adopt either of the Coburn 
amendments, the House of Representatives has made it clear they will 
simply send it back to us again without the Coburn language. So 
adopting either of these amendments would simply further delay the 
needed aid to unemployed Americans struggling to get by. So I urge 
Senators to vote for the motion to table so we can temporarily extend 
the benefits that so many people justly deserve.
  Madam President, I yield the floor, and I suggest the absence of a 
quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BAUCUS. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. BAUCUS. Madam President, I ask unanimous consent that at 12:10 
p.m. today, the Senate proceed to vote in relation to the Coburn 
amendment No. 3726, to be followed by a vote in relation to amendment 
No. 3727; that prior to the second vote, there be 2 minutes of debate 
equally divided and controlled in the usual form; that no amendment be 
in order to either amendment prior to a vote in relation thereto; 
further, that the time until 12:10 be equally divided and controlled in 
the usual form.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. BAUCUS. Madam President, I yield such time as she may consume to 
the Senator from New Hampshire.
  The ACTING PRESIDENT pro tempore. The Senator from New Hampshire.
  Mrs. SHAHEEN. Madam President, I rise today to join so many of my 
colleagues in urging that we pass critical extensions of Federal 
unemployment benefits, the COBRA health insurance subsidy, flood 
insurance, and other vital programs that expired at the end of March.
  I applaud my colleagues on the other side of the aisle who, despite 
opposition from their leadership, have joined us in moving this 
legislation forward. But despite the progress we seem to be making, 
these extensions have been held up too frequently for too long, and the 
American people deserve better.
  Sadly, twice this year individual Senators have blocked extensions of 
Federal unemployment benefits right as the programs were about to 
expire. Those actions have put struggling families at risk, and already 
this month over 200,000 Americans have lost their benefits, with 
another 30,000 losing their benefits every day until we pass an 
extension. What is of particular concern is that we continue to deal 
with filibusters and delays and obstruction, even though almost every 
Member of this body says they want to extend unemployment. After weeks 
of delay, when extensions finally come up for votes, they have passed 
overwhelmingly.
  We have had three situations now where this has occurred since last 
fall. In November, when the vote on extending unemployment benefits 
finally came to the floor, that vote was 97 to 1. In December, when the 
extension came to the floor, the vote was 88 to 10. In March, it was 78 
to 19. Given those majorities, I do not understand how the other side 
of the aisle can justify obstructing votes on these issues in the way 
they have.
  As important as this short-term extension is, the Senate must do more 
to address the long-term challenge of joblessness. Of the 15 million 
Americans who are out of work today, nearly 6 million--so more than 1 
in 3--have run through the 6 months of benefits provided by their 
States. In fact, the average period of unemployment currently stands at 
a record high of nearly 8 months. We need to pass a longer term 
extension to provide some stability for the millions of people who are 
going to need unemployment benefits in the months to come. I applaud 
Senator Baucus who has been working to try to bridge this gap.
  While some people may think it is no big deal to wait a week or two, 
even short-term expirations have damaging results. When State workforce 
agencies are forced to shut down and restart complicated Federal 
benefits programs, they experience huge backlogs in their systems that 
delay getting checks out the door, even to people who are not affected 
by the expiration.
  Phone lines at call centers are jammed with claimants holding up 
others from filing for benefits while lines at one-stop centers get 
longer and longer. In the best of circumstances, individuals who lost 
their benefits during this expiration will have to wait weeks before 
they begin receiving checks again. That is a very long time when you 
are supporting a family on an unemployment check.
  There is also the uncertainty and the fear that comes when parents 
open the mail to find a notice that, although their benefits are 
supposed to last for months to come, this is the last check they are 
going to receive. Families cannot afford to make the responsible 
choices to budget and plan for the future when we cannot guarantee the 
future of their benefits and of their safety net.
  The fact is, when somebody is unemployed, it is an emergency in their 
family. We need to treat this situation, extending benefits, as an 
emergency in our Federal programs as well.
  I want to conclude by sharing a letter I got from one of my 
constituents named Jo Ellen, who is from Canterbury, NH. She wrote:

       On April 3, my State unemployment benefits maxed out. I am 
     in my 60s, a nurse and psychotherapist who has been out of 
     work since the end of December 2009. Seeking work constantly, 
     I am getting no responses from employers, probably due to my 
     age. I have worked my entire life caring for others. My 
     husband's salary is much lower than what I brought in, but I 
     have never had to rely on others. Unemployment checks are 
     allowing us to at least pay our bills. It plays havoc with 
     one's body and psyche, affecting one's health and causing 
     monumental anxiety when a vote is taken on a monthly basis to 
     extend benefits. It is the never knowing for sure. Those of 
     us who are in this situation are hard-working citizens who 
     have come upon bad times. I cannot believe you won't take 
     care of this horrendous situation immediately.

  Unfortunately, like so many in this Chamber, I have received dozens 
of e-mails and letters and phone calls in the last 2 weeks from Granite 
Staters such as Jo Ellen. Unemployment benefits

[[Page 5575]]

allow them to take care of their families, to fill up their gas tanks 
so they can go out and look for work. But the obstructionism that has 
kept us from passing meaningful long-term extension of unemployment 
benefits is having real effects on the financial, physical, and mental 
health of our communities. Jo Ellen is right; it is horrendous.
  I am hopeful we are finally going to see agreement from the other 
side of the aisle that we can move this legislation forward, that we 
can extend unemployment benefits for those thousands of people who are 
losing them every single day.
  The ACTING PRESIDENT pro tempore. The Senator from Montana.
  Mr. BAUCUS. Madam President, how much time remains?
  The ACTING PRESIDENT pro tempore. Six minutes remain.
  Mr. BAUCUS. Six minutes? I yield six minutes to the Senator from 
Illinois.
  The ACTING PRESIDENT pro tempore. The Senator from Illinois.


                              TAX DAY 2010

  Mr. BURRIS. I thank the distinguished Senator from Montana. I hope I 
can do my brief remarks in 6 minutes.
  It is tax day, I say to the Senator. I hope your taxes are filed.
  Madam President, as my colleagues and the American people are 
undoubtedly well aware, today is tax day.
  Across the country, hundreds of millions of people are filing their 
returns, paying what they owe or calculating the refunds they will 
receive.
  Now, even in the best of times, paying taxes is not something most 
Americans look forward to.
  In fact, in the wise words of George Washington, ``no taxes can be 
devised which are not more or less inconvenient and unpleasant.''
  But even Washington and the other Founding Fathers recognized that 
taxation is a necessity--and that paying taxes is every American's 
patriotic duty.
  When they are levied--not by some tyrannical monarch across the 
ocean, but by a representative government--taxes are ``the price we pay 
for a civilized society,'' in the words of Oliver Wendell Holmes.
  It is the only way a modern government can function.
  We are each asked to contribute a percentage of our income, and in 
return we expect our government to provide certain essential benefits:
  A strong, highly-capable national defense. Adequate roads, bridges, 
and other infrastructure. Quality schools.
  Emergency responders, so there is someone to answer the phone when 
you call 911.
  Basic regulation and consumer protections, so you can buy food and 
other products without fear of getting sick or suffering injury.
  A safety net to help you get back on your feet in tough economic 
times.
  All of these programs and services are supported by our tax dollars.
  They serve functions we cannot perform for ourselves--and it is 
appropriate that the government steps in to fulfill this role.
  That is why my Democratic colleagues and I are fighting Republican 
obstructionism to extend unemployment insurance and other benefits 
people desperately need.
  And that is why I am proud to report that, this year, roughly 70 
percent of Americans will get a tax refund.
  But even so--my colleagues and I are all painfully aware that, 
especially in difficult economic times, taxes can be a burden.
  They can be hard on families that are already stretched to the 
breaking point--struggling to make ends meet in the face of pay cuts, 
reduced hours, or even unemployment.
  That is why my Democratic colleagues and I have been working hard to 
ease the burden on these families.
  We have committed ourselves to fight for the interests of working 
Americans.
  Our economic recovery remains fragile.
  The national unemployment rate stands just under 10 percent--and in 
my home State of Illinois, it exceeds 11 percent.
  And among minority communities, it is much higher.
  Roughly 16 percent of African Americans are currently unemployed, 
along with 12 percent of Hispanics.
  That is why my Democratic colleagues and I have taken action. We 
passed a sweeping stimulus package that brought us back from the edge 
of economic disaster.
  While Republicans filibuster unemployment benefits, my colleagues and 
I are fighting to extend them. While they drag their feet on COBRA, we 
are fighting to increase access to this important program.
  And, while they talk about enacting responsible tax policies, 
Democrats are actually getting it done. We are working hard to make 
sure that everyone pays their fair share of taxes--but no one is asked 
to contribute more than they can afford.
  This is an issue that has defined our party for many years, 
especially under recent Democratic administrations:
  From the middle-class tax relief provided by President Clinton, to 
the largest tax cut in American history, which was proposed by 
President Obama and ratified by my Democratic colleagues and I just 
last year--time and again, we have proven our commitment to commonsense 
tax policies.
  We have passed fair, targeted reforms and responsible tax cuts for 
those who need it most. We have stood squarely on the side of the 
American people, despite what some of my Republican friends might 
claim. And in fact, when you examine their record--when you look at the 
truth behind the Republican rhetoric--it is quite different from what 
many of them would have you believe.
  For decades, Republicans have claimed to be both fair and responsible 
when it comes to tax policy. But the reality is that they have 
consistently failed to deliver for the American people.
  Since the days of President Reagan, Republicans have slashed tax 
rates for corporations and the super-rich, while squeezing the middle 
class for everything they are worth.
  This is a country that has always encouraged personal initiative and 
respected success in the business world. But my friends on the other 
side are making it harder and harder for ordinary folks to attain 
prosperity and realize their dreams. It has never been harder to get 
rich in America--but it has never been easier to stay rich, as long as 
you can arrange a seven-figure bonus or a golden parachute every time 
the economy starts to look bad.
  But for those of us who can't, Republican tax policies have brought 
nothing but headaches.
  Under President George W. Bush, Republicans passed a massive tax 
break for the top 1 percent of wage earners, and did little or nothing 
to help the vast majority of Americans. In fact, this massive tax cut 
was not even paid for--every penny of it was added directly to the 
deficit.
  So let's cut through the political rhetoric and talk about what this 
really means.
  My Republican friends exploded the deficit by more than a trillion 
dollars, so they could give tax breaks to the richest of the rich. Now 
they are expecting us to pay down the deficit using the tax dollars of 
regular, middle class Americans.
  These are folks who did not benefit from the original tax cut--but 
now Republicans expect them to foot the bill?
  Not on my watch.
  These tax policies are irresponsible. They are outrageous. And the 
American people have had enough. Even now, my friends on the other side 
think we should spend even more money we don't have, on people who 
don't need it.
  My Democratic colleagues and I strongly disagree. We believe 
significant tax breaks should be targeted to middle-class Americans who 
need help, and that is why we passed legislation that accomplished 
exactly that.
  We believe in responsible tax policy, which asks each and every 
American to pay their fair share without placing an unfair burden on 
any segment of the population.
  My Republican friends will try to tell you they believe in the same 
values. So I would urge the American people to

[[Page 5576]]

ask them: If that is the case, why did every single one of them vote 
against the largest tax cut in history?
  The Democratic record is clear. We believe in American prosperity on 
Main Street, not just Wall Street.
  So I urge my Republican friends to join us in standing up for 
ordinary folks, not just Wall Street bankers and the richest of the 
rich.
  Unfortunately, taxes will always be necessary, and they will never be 
pleasant. But if we embrace commonsense tax policies and fight for the 
principles that have guided Democrats for many years, we can make these 
tough times just a little bit easier for ordinary folks.
  Pay your taxes, enjoy America, and let's make sure that everyone pays 
their fair share.
  I yield the floor. I suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BAUCUS. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mrs. Hagan.) Without objection, it is so 
ordered.
  Mr. BAUCUS. Madam President, what is the pending business?
  The PRESIDING OFFICER. The question is on agreeing to the Coburn 
amendment No. 3726.
  Mr. BAUCUS. I move to table the Coburn amendment and ask for the yeas 
and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  Mr. DURBIN. I announce that the Senator from Florida (Mr. Nelson) and 
the Senator from Virginia (Mr. Warner) are necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 50, nays 48, as follows:

                      [Rollcall Vote No. 113 Leg.]

                                YEAS--50

     Akaka
     Baucus
     Begich
     Bingaman
     Boxer
     Brown (OH)
     Burris
     Byrd
     Cantwell
     Cardin
     Carper
     Casey
     Conrad
     Dodd
     Dorgan
     Durbin
     Feinstein
     Franken
     Gillibrand
     Hagan
     Harkin
     Inouye
     Johnson
     Kaufman
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     McCaskill
     Menendez
     Merkley
     Mikulski
     Murray
     Reed
     Reid
     Rockefeller
     Sanders
     Schumer
     Shaheen
     Specter
     Stabenow
     Tester
     Udall (NM)
     Webb
     Whitehouse
     Wyden

                                NAYS--48

     Alexander
     Barrasso
     Bayh
     Bennet
     Bennett
     Bond
     Brown (MA)
     Brownback
     Bunning
     Burr
     Chambliss
     Coburn
     Cochran
     Collins
     Corker
     Cornyn
     Crapo
     DeMint
     Ensign
     Enzi
     Feingold
     Graham
     Grassley
     Gregg
     Hatch
     Hutchison
     Inhofe
     Isakson
     Johanns
     Kyl
     LeMieux
     Lincoln
     Lugar
     McCain
     McConnell
     Murkowski
     Nelson (NE)
     Pryor
     Risch
     Roberts
     Sessions
     Shelby
     Snowe
     Thune
     Udall (CO)
     Vitter
     Voinovich
     Wicker

                             NOT VOTING--2

     Nelson (FL)
     Warner
       
  The motion was agreed to.
  The PRESIDING OFFICER. The Senator from Montana.


                           Amendment No. 3727

  Mr. BAUCUS. Madam President, I might ask my friend from Oklahoma, I 
think we are----
  Mr. COBURN. Go to the vote.
  Mr. BAUCUS. Madam President, I yield back my time. I think the 
Senator from Oklahoma wants to yield back his time so we can go 
straight to the vote.
  I move to table Coburn amendment No. 3727, and I ask for the yeas and 
nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. DURBIN. I announce that the Senator from Florida (Mr. Nelson) and 
the Senator from Virginia (Mr. Warner) are necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 53, nays 45, as follows:

                      [Rollcall Vote No. 114 Leg.]

                                YEAS--53

     Akaka
     Baucus
     Begich
     Bingaman
     Boxer
     Brown (OH)
     Burris
     Byrd
     Cantwell
     Cardin
     Carper
     Casey
     Conrad
     Dodd
     Dorgan
     Durbin
     Feinstein
     Franken
     Gillibrand
     Hagan
     Harkin
     Inouye
     Johnson
     Kaufman
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     McCaskill
     Menendez
     Merkley
     Mikulski
     Murray
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Sanders
     Schumer
     Shaheen
     Specter
     Stabenow
     Tester
     Udall (NM)
     Webb
     Whitehouse
     Wyden

                                NAYS--45

     Alexander
     Barrasso
     Bayh
     Bennet
     Bennett
     Bond
     Brown (MA)
     Brownback
     Bunning
     Burr
     Chambliss
     Coburn
     Cochran
     Collins
     Corker
     Cornyn
     Crapo
     DeMint
     Ensign
     Enzi
     Feingold
     Graham
     Grassley
     Gregg
     Hatch
     Hutchison
     Inhofe
     Isakson
     Johanns
     Kyl
     LeMieux
     Lugar
     McCain
     McConnell
     Murkowski
     Risch
     Roberts
     Sessions
     Shelby
     Snowe
     Thune
     Udall (CO)
     Vitter
     Voinovich
     Wicker

                             NOT VOTING--2

     Nelson (FL)
     Warner
       
  The motion was agreed to.
  Mr. BAUCUS. Madam President, I move to reconsider the vote, and I 
move to lay that motion on the table.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The motion to lay on the table was agreed to.
  Mr. BAUCUS. Madam President, for the information of all Senators, I 
am aware of only one more amendment on this bill. The Senator from 
Arizona has an amendment on the value-added tax. I am hopeful the 
Senate can consider that amendment at about 1:30 or so this afternoon 
and perhaps vote on the amendment shortly thereafter.
  I yield the floor.
  Mrs. BOXER. Madam President, I supported the motions to table the 
three Coburn amendments to the Continuing Extension Act of 2010.
  These amendments would delay important legislation to provide a short 
term extension of unemployment and health care benefits to Americans 
who have lost their jobs through no fault of their own. This bill is 
critical to families that have bills to pay and are struggling to put 
food on the table.
  Yesterday, I voted to table the Coburn amendment that would have 
rescinded $40 billion in unobligated funding. This amendment did not 
say where the cuts would be made. As the chairman of the Appropriations 
Committee explained, many important homeland security, national 
defense, and Veterans Administration priorities could have been 
drastically reduced or eliminated by this amendment. There is no 
telling how many jobs would have been lost had this amendment been 
adopted.
  The two Coburn amendments considered today both include funding 
offsets that have already been included in a bill to create jobs and 
reduce taxes. This legislation, which has already passed the Senate and 
is pending in the House of Representatives, would also extend 
unemployment insurance and health care benefits until the end of the 
year. Adoption of the Coburn amendment today would jeopardize this 
critical bill.
  Extending unemployment insurance and health benefits are an emergency 
for those who have lost their jobs. We should come together as a body 
and pass this bill as soon as possible.
  Mr. FEINGOLD. Madam President, it is vitally important that we extend 
COBRA and unemployment benefits for the millions of Americans who 
continue to find themselves out of work in the midst of the worst 
economic crisis since the Great Depression. At the

[[Page 5577]]

same time, we should work to offset the cost of this additional funding 
through cuts in other Federal spending instead of passing this debt on 
to future generations.
  That is why I opposed efforts to table three amendments by Senator 
Coburn that would have offset the additional spending, and was 
disappointed those amendments were all defeated. In fact, amendment No. 
3727 even included two provisions from my Control Spending Now Act, a 
proposal to cut the deficit by around $\1/2\ trillion over the next 10 
years.
  While I fully supported the majority of the cuts in this amendment, I 
did have reservations about a few of the proposals. In particular, I 
had serious concerns about the idea of consolidating all federal job 
training programs. While the amendment would not have cut funding to 
any of these important job training programs, many of these job 
training programs serve specific populations of Americans, such as 
dislocated workers or young adults, and are carefully tailored to serve 
the unique needs of those workers. Nonetheless, the principle of taking 
steps to balance our Nation's checkbook is one I fully support.
  The PRESIDING OFFICER. The Senator from Georgia.
  Mr. CHAMBLISS. Madam President, I ask unanimous consent to speak for 
up to 10 minutes as in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                      Financial Regulatory Reform

  Mr. CHAMBLISS. Madam President, last month the Senate Banking 
Committee reported out a bill to overhaul the financial regulatory 
system in this country--a bill that was, unfortunately, designed to 
invite Republican opposition from committee members, as evidenced by 
the party-line vote on reporting it out. At that time, I felt some 
sympathy for my Banking Committee colleagues who wanted to play a role 
but were shut out of the process.
  As the ranking member of the Agriculture Committee, we have a history 
of producing bipartisan legislation. We always respect each other and 
seek to forge compromise in the name of advancing good public policy. 
The chairman of the Committee on Agriculture, Senator Lincoln, is 
always more interested in getting the policy right than engaging in 
partisan debates. So I held out hope that the Agriculture Committee 
could consider our contribution to the financial regulatory reform 
legislation in a more productive environment than my colleagues on the 
Banking Committee faced.
  The issues involved in financial regulatory reform are complex, very 
important, and involve both the jurisdiction of the Banking Committee 
and the Committee on Agriculture. The Agriculture Committee has a 
responsibility to ensure that the Commodities Futures Trading 
Commission continues to effectively carry out its duties, including any 
new authorities and responsibilities to regulate derivatives that 
Congress requires.
  Before we make a big policy change, we need to ask ourselves whether 
the solutions that have been proposed by the administration and which 
are largely reflected in Banking Committee Chairman Dodd's bill will 
even address the underlying problem. Why take a chance in these 
uncertain times to make legislative and regulatory changes that could 
possibly make things worse, potentially dry up capital, force the cost 
of doing business higher, and ultimately even drive these markets 
overseas?
  Let me be clear. I am not proposing a do-nothing approach. In fact, I 
believe there are a number of ways in which we can more appropriately 
regulate derivatives, and it is Congress' job to write this 
legislation. We seek input from the administration and our regulatory 
agencies, but it is our responsibility to consider their suggestions, 
take into consideration the opinions of the American public, and put 
forward that which will become law.
  Many businesses that use derivatives and swaps to manage risk in 
their everyday course of business are concerned that as Congress tries 
to reduce overall systemic risk in our financial markets--including 
regulation of over-the-counter derivatives--Congress might actually 
limit their risk management options. I am not talking about large 
financial institutions. I am not talking about Wall Street financial 
institutions. I am talking about businesses that provide goods and 
services and employment opportunities in each of our States.
  These companies are concerned about aspects of the administration's 
proposal that would require them to clear standardized transactions and 
execute their transactions on a trading facility. Many of them have 
told me this would add considerable costs that would be passed along to 
customers or consumers, or perhaps prevent their businesses from using 
swaps and derivatives as a risk management tool altogether.
  These companies are not antiregulation; they are supportive of 
increased transparency to the regulator, and they are willing to endure 
any additional burdens that go along with that. Clearly, the recent 
past has taught us that the regulator needs more data in order to view 
and police the entire marketplace, but I am not sure the lesson of the 
recent market meltdown warrants increased costs to businesses that had 
little, if anything, to do with creating this financial crisis.
  Beyond requiring more transparent market data for the regulators, the 
Agriculture Committee has been exploring how most effectively to apply 
greater regulation to swap transactions. If Congress is truly 
interested in addressing the problem as opposed to politicizing a 
solution, we can no longer ignore the complexities of these markets. We 
must devote time to understanding these instruments and their 
applications. We must seek to understand the legitimate purposes these 
complex instruments serve for large and small businesses in each of our 
States. Chairman Lincoln and I have devoted a great deal of time to 
understanding the over-the-counter derivatives market, its complexities 
and its unique and legitimate utility. That is our job as Senators on 
the committee of jurisdiction.
  Unfortunately, our bipartisan negotiations have now been halted due 
to political influence from the administration. It seems that the 
administration fears a bipartisan deal on any aspect of financial 
reform legislation. As the Banking Committee members moved toward a 
bipartisan deal, the administration launched an attack on such efforts, 
and as Chairman Lincoln and I were about to conclude our negotiations 
and release a bipartisan draft on derivatives reform, the 
administration stepped in once again to shut down the process.
  The American public should be aware of what is going on here. 
Republicans on the committees of jurisdiction have been more than 
willing to constructively participate in the development of new 
regulations aimed at addressing what went wrong with our financial 
system. But the current administration seems more interested in 
political gain than in addressing this critical issue. It seems that, 
instead of seeking meaningful reform both Democrats and Republicans can 
support, the administration is more interested in trying to divert 
attention away from health care by changing the subject as we head into 
the election season.
  The administration seems intent on going far beyond finding 
bipartisan solutions to address what caused the financial meltdown, and 
instead is pursuing reckless policies that could be dangerous for our 
markets and ultimately our consumers who depend on these markets.
  However, it seems to me that the American public is well aware of the 
financial meltdown, because they live with it every single day. The 
last thing they want is for Congress to spend months talking about it 
some more.
  I want to be very clear. A week ago, I was prepared to support a 
bipartisan compromise on reforming our derivatives market--a compromise 
that I believe an overwhelming majority of the Senate, Republicans and 
Democrats, could have supported and one that would have been 
implemented quickly to provide much-needed regulation, and

[[Page 5578]]

then the White House stepped in and basically said a bill with 
Republican support is not worth advancing. They want an issue, not a 
solution, and want to drag this issue into the November elections in 
the hope that voters will be focused on reforming the financial system 
and forget about how angry they are about the passage of the recent 
health care legislation.
  I will say one more thing about the regulation of derivatives for 
folks to keep in mind as this process moves forward, which is that 
Republicans and Democrats generally agree on the major issues relating 
to derivatives regulation. We all generally agree there needs to be 
greater transparency, registration, more clearing, and compliance with 
a whole host of business conduct and efficient market operation 
regulations. This is important because it is a 180-degree shift away 
from current law where today over-the-counter swaps are essentially 
unregulated.
  Within this general agreement that swaps need to go from unregulated 
to fully regulated, we have some significant areas of disagreement 
about whether everyone needs to clear in all instances, and how best to 
require swaps to be transacted and reported. These disagreements are 
significant because they involve real burdens and duties, which will 
result in real costs to businesses and consumers. As Republicans, we 
want to make sure our new regulations serve a useful purpose.
  As we begin the debate on derivatives regulation and Republicans 
start to get painted--as we have already seen--as the party of Wall 
Street and against reform, I want folks to know and understand this is 
disingenuous. Republicans believe there is a need to regulate the 
currently unregulated swaps market. We support doing so in a way that 
is responsible and that meets the risk management needs of Main Street.
  I remain very hopeful that at the end of the day, we can strike a 
bipartisan agreement--not just on the title that refers to swaps and 
derivatives but also on the titles to the financial regulatory reform 
that deal with regulation, as well as the consumer protection finance 
agency.
  With that, I ask unanimous consent to speak as in morning business.
  The PRESIDING OFFICER (Mr. Burris). Without objection, it is so 
ordered.


                       Honoring Our Armed Forces

                     1st Lt. Robert Wilson Collins

  Mr. CHAMBLISS. Mr. President, I rise today to honor the life and 
selfless commitment of 1LT Robert Collins to the U.S. Army and to our 
Nation.
  While many other young Americans his age were headed back to school 
from spring break, LT Collins died April 7, when an improvised 
explosive device detonated near his vehicle on the streets of Mosul, 
Iraq. He was 24 years old.
  It is time the American people know a bit more about this young man 
who sacrificed for his country his life, his family and all his 
potential, giving up all that he had, and all that he was going to be.
  LT Collins was both a native Georgian, and was based in Georgia.
  He hailed from the small town of Tyrone in Fayette County, where he 
played football under the Friday night lights at Sandy Creek High 
School, where he became a standout student that would take him to the 
halls of West Point, and where he attended Hopewell United Methodist 
Church with his family on Sunday mornings.
  Later, he became a member of the local American Legion Post 105 in 
Fayetteville, GA.
  For me, the death of LT Collins is particularly sobering. Robert was 
one of my first nominees to the U.S. Military Academy at West Point in 
the fall of 2003, and was offered an appointment there the following 
spring. He graduated from West Point in 2008.
  He became one of the stalwarts of B Company, 1st Battalion, 64th 
Armor Regiment, 3rd Infantry Division based at Fort Stewart, GA. He 
deployed to Iraq in the autumn of 2009.
  LT Collins served as his platoon's commander. While in Iraq, his unit 
was charged with improving security and the quality of life for the 
people of Iraq. He and his men also provided security for the recent, 
successful Iraqi elections. They were dedicated to the goal of a 
peaceful, democratic Iraq, and sought to help its people lead normal, 
safe lives.
  It is said that the measure of a man can be taken by what those who 
knew him say when he is gone. Robert's friends have described him as a 
man of great compassion, a leader with an excellent personality and an 
infectious laugh. They say he was always there for friends and family, 
for when they needed him. They say they are better people for having 
known him.
  LT Collins found his voice in the honor and patriotism of the Army. 
With both his mother and his father retired Army officers, he was a man 
with the military in his blood. They both survive him, as does his 
girlfriend, Nicole, who was Robert's high school sweetheart.
  I extend my deepest sympathies to LT Collins' family and friends, and 
ask that my colleagues--and all Georgians--keep them in their prayers 
during this time of sadness.
  Robert performed his duty courageously, devotedly, without 
hesitation, without reservations. He was, after all, a soldier.
  The world may be occupied with other things on this beautiful spring 
day, and the media with other stories.
  But one of those should surely be the procession that will bring LT 
Robert Collins' body home today, winding its way from Falcon Field in 
Peachtree City through downtown Tyrone. It should also be about the 
Americans who knew him, who will line the roads to welcome him home a 
final time, recalling the words of A.E. Housman:

     Today the road all runners come,
     Shoulder-high we bring you home,
     And set you at your threshold down,
     Townsmen of a stiller town.

  Mr. President, I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. CARPER. 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. CARPER. Mr. President, I ask unanimous consent to engage in a 
colloquy with Senator Ensign and Senator Scott Brown.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                    Trip to Afghanistan and Pakistan

  Mr. CARPER. Mr. President, last week was the second of 2 weeks of the 
Easter recess. A number of us took that opportunity to travel to places 
around the world where our Nation is involved and has great interests. 
Senator Ensign, Senator Scott Brown, Senator Tom Udall, and a 
Congressman from Virginia, the First Congressional District of 
Virginia, named Rob Wittman, and I together visited--it was a 6-day 
trip--several days in Afghanistan and a couple of days in Pakistan as 
well, places I suspect the Presiding Officer has been or will be 
visiting.
  I led a similar congressional delegation almost 10 months ago to both 
countries, Afghanistan and Pakistan. I had gone there right after the 
President had laid out his strategy for making progress in Afghanistan 
to restore the rule of law, to make sure the Taliban does not come back 
into power and provide sanctuary for al-Qaida to launch attacks against 
us or any other nation.
  The President, at the time, my colleagues may recall, said we were 
going to do a couple of things. He suggested a year ago that we launch 
a military offensive, almost like a military surge on a modest basis, 
and we do the same thing with a civilian offensive. What he called for 
a year ago was to commit an additional 10,000 marines, commit 7,000 
Army troops, commit 4,000 U.S. trainers to train the Afghan National 
Army and Afghan national police, and to also send over about 150 
additional Black Hawk helicopters. That would be matched by a civilian 
surge as well to complement the military increase in resources.
  When we were coming out of Afghanistan, we did a press availability 
with some reporters back home. One of the

[[Page 5579]]

reporters asked me the question: What is our exit strategy in 
Afghanistan?
  I replied: I think our exit strategy is to implement well the 
strategy the President outlined in April of last year. That was the 
additional marines, additional Army troops, additional trainers, 
additional Black Hawk helicopters for mobility, and the civilian surge 
to help us with the Afghans; to diversify the economy, the poppy seed 
trade where they produce enough opium to meet the demands of the world, 
to help them raise the kinds of agricultural commodities they used to 
raise to feed themselves and a lot of the folks in that part of the 
world.
  We want to help them diversify their economy with respect to the 
mining and minerals industry. We want to make sure they would have the 
opportunity to exploit the oil and gas reserves, which are about three 
times what was envisioned a couple of years ago; at the same time, on 
the civilian side, work with the Afghans in cleaning up corruption 
which is rampant in most levels of Afghanistan and to help them to 
start developing a governmental institution to provide services, 
actually serve the people of that country. That is what was laid out a 
year ago.
  I have been joined by Senator Ensign. I will yield to him in a 
moment.
  In my mind, when I returned almost a year ago to America, I thought 
it was a smart strategy. The key is to implement it well. We met with 
the Afghanis last week, and we had an opportunity to see what we are 
doing well and not doing well. I think what is key in almost every 
endeavor I have been part of is leadership.
  We spent time with General McChrystal, our top military leader, and 
Ambassador Eikenberry, who used to be a four-star general and is now 
Ambassador to Afghanistan. We met with President Karzai and the 
civilian and military leadership of Afghanistan, as well as the 
civilian leadership of the United States.
  I came home not hopeless, not euphoric, but more hopeful than not 
that we have the right strategy, that we are beginning to implement it 
well. We have some 40 other nations involved with us in this endeavor. 
We are committing the resources to make this strategy potentially 
successful.
  That is my take on it. I yield at this time to the Senator from 
Nevada, Mr. Ensign. I have already asked unanimous consent to engage in 
a colloquy. I will not ask that again. This is what it is about. It is 
not a monologue for me. I very much enjoyed the time I spent on the 
road with my colleagues, especially my colleague from Nevada. I was 
happy to be his partner and lead the delegation.
  Mr. ENSIGN. Mr. President, I thank Senator Carper. I appreciate him 
and his staff. Wendy was absolutely terrific in setting up this trip 
and all the various briefings and places where we traveled in both 
Afghanistan and Pakistan. I thought we had a great team put together 
among the Senator from Delaware, myself, Senator Brown, Senator Udall, 
and the Congressman from the First District of Virginia, Congressman 
Wittman, whom I did not know before the trip but with whom I was very 
impressed.
  My general impression of what is going on in Afghanistan--I was 
initially very skeptical when I went over there. I thought we got an 
honest assessment. I thought they talked about the positives, the 
negatives, and the challenges ahead.
  I agree with the Senator from Delaware. I was very impressed with 
both the civilian and military leadership we have in the country. I was 
impressed with the plan they put in place. The key to the plan, which 
is very similar to what we had in Iraq, is we have to clear, basically 
provide security. Then we have to hold that security, not just go and 
clear and then leave. We have to clear and then hold it. Then we have 
to build. We have to give people opportunities, economic opportunities, 
and some reason to hope. Once we build, then we need to transfer the 
authority to, in this case, the Afghan people, the Afghan Government.
  The first part is a lot of our responsibility, although a lot of the 
clearing and holding is in combination with the Afghan Army. As a 
matter of fact, I don't think a lot of Americans realize there have 
been more Afghan soldiers killed in Afghanistan than American soldiers 
or coalition soldiers. But the challenge is going to be in the 
transfer. We saw that the Afghan Army is being built up and trained 
fairly well.
  Two big areas of concern are, one, the Afghan police. It has taken a 
lot longer to train them than we hoped. We experienced some of the same 
problems in Iraq. The Afghan police are not even close to being fully 
trained. There is a lot of corruption in the police. There are a lot of 
challenges to overcome there, but they are challenges that, given the 
right plan, given the right amount of time and resources, can be 
overcome.
  Another huge problem in Afghanistan is development of infrastructure. 
I have heard Afghanistan described as an 18th century or 19th century 
country. However, one can really describe it as a second century 
country. There are many parts of it where people are living in mud 
structures with no electricity, with no running water, with none of the 
modern conveniences or technologies we think about.
  In those areas, and the vast majority of the country, there is no 
governmental infrastructure. There is no rule of law. There is nothing 
to build on there. It literally has to be built from the ground up. 
There is neither a lot of experience not the necessary resources in 
Afghanistan to do that. That may be the major problem going forward in 
that transfer that I think the members of the delegation learned while 
we were over there. It is also why we questioned, when we came back, if 
we have the right strategy with the best chance of being successful. 
None of us know whether our strategy is actually going to be successful 
in the future. But it is worth attempting. It is in our vital national 
interest to do it. Then we have to pray it is successful in the future.
  I think all of us came away thinking the American part of it, the 
international coalition part of it, will be successful. What we do not 
know will be successful is the transfer of authority to the Afghan 
government, the part at the end.
  Is that the same impression the Senator from Delaware had?
  Mr. CARPER. Mr. President, if I may respond, the Senator summed it up 
very nicely. One of the things Senator Ensign and I and our colleagues 
discussed with President Karzai and with the military leadership of 
that country and the civilian leadership of Afghanistan and with our 
own folks over there is the nature of the economy of Afghanistan. We 
heard a lot about corruption and heard a fair amount about their 
agricultural economy, which is largely dependent on raising poppies 
which feed the opium trade that provides a lot of money selling heroin 
around the world and to the Taliban and other insurgent groups.
  The question on which Senator Ensign and I have gone back and forth 
with our folks over there and the Afghan leaders is, What is likely to 
be the most successful approach for us to take to eventually stop the 
addiction of the Afghan farmers to raising poppies? It was not that 
long ago that they had the ability to raise plenty of wheat and cotton 
and all sorts of fruits and nuts.
  They make a fair amount of money on poppies. One problem is it is an 
illicit trade. It is an illicit and bogus way on which to base their 
economy. It subverts the government and corrupts the whole system over 
there. This is an important issue going forward. How do we help wean 
the farmers off an illicit agricultural economy to do something they 
used to do?
  We sort of agree we need a tough love approach. We have to encourage 
and provide opportunities--seeds, fertilizer, advice, tactical 
assistance--on how to raise the kinds of products they used to raise.
  Someone told us in one of our meetings that the people of India, not 
that far away from Afghanistan, would consume every pomegranate the 
folks in Afghanistan would raise. There are plenty of big markets and 
lots of hungry people to buy those commodities. The question is: Do we 
go out and

[[Page 5580]]

eradicate all the poppies in the fields like, next week, or do we allow 
the poppies to be harvested but make it clear that is it? Then, next 
year we will help folks plant a different kind of crop, but we are not 
going to stand by next year and allow them to harvest poppies.
  It is an issue that I think can be resolved, but I think it is a 
tough love approach. It is important, if we want to get rid of 
corruption in the government, in the country, we cannot avoid the 
widespread effect on it from poppies.
  Mr. ENSIGN. If the Senator will yield.
  Mr. CARPER. Yes.
  Mr. ENSIGN. First of all, we were flying over the Kandahar Province 
in the southern part of Afghanistan in these Black Hawk helicopters, 
visiting a few of the forward operating bases--one for training, the 
other one for trying to provide stability for the region. As we were 
flying over, it was surprising how many agricultural fields there were 
in that part of the country. It was a very fertile area, and it seemed 
to me that 80 to 90 percent of the crops I saw from the air were 
poppies. This is just an estimate, but it was pretty easy to see them 
because the poppies were in bloom. They were everywhere, including 
right next to our bases, because we have stopped the eradication 
program. There has been a change in policy. This change was the one 
element of policy which I disagreed with over there. I think we do need 
to reevaluate, as the Senator from Delaware talked about, this tough 
love approach. I do think that is the way to go because you do have to 
have the positive incentives in there to grow other crops. But I don't 
believe you can do that without the negative consequences if farmers do 
decide to grow the poppies. In other words, if the positives are not 
strong enough, they may decide they are going to grow poppies anyway.
  A couple problems with the poppies is, one, the Taliban wants to grow 
them because it helps fund the Taliban; and two, poppies are a very 
drought-resistant crop and Afghanistan has been in a drought for about 
8 years. So growing poppies is a stable source of income for the Afghan 
farmers.
  The other thing the Senator from Delaware mentioned is that other 
countries in the area would love to have their produce. The problem is 
getting that produce to market. They do not have anywhere to store the 
produce. They have a guaranteed market there for the poppies with the 
transportation. The Taliban is not going to attack their transport, if 
that is what they are growing. So this is very much a difficult 
situation, but it isn't a situation that is, I believe, without a 
solution. I believe we can come to a solution on this, and that is why 
I think we need to reevaluate what we are doing in Afghanistan by not 
including eradication as part of the process. Because when we talk 
about the police--and I see Senator Brown has joined us, one of our 
colleagues who was on the trip--there is corruption in the police 
force. Well, in every country in the world that has a serious drug 
problem, it leads to corruption in the police, which leads to 
corruption of any kind of judicial system, officials in the government 
and on and on and on.
  I would be curious to hear from my colleague, our newest Senator, the 
Senator from Massachusetts, who was a real joy to have with us on the 
trip.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Mr. BROWN of Massachusetts. First of all, I wish to begin by thanking 
our leader on the trip, the Senator from Delaware, Mr. Carper. It was a 
joy to be on a trip with people who had different experiences, 
different military experiences, and take that experience and work it 
together in such a short period of time to form such a powerful team. 
If this is how every CODEL is going to be, I am excited to be a part of 
that experience.
  This trip enabled me--now that the campaign is over--to learn and 
make sure that everything we were talking about then was accurate. If 
that is so, how do we take that and use it in a productive way to give 
the troops the tools they need to be, No. 1, safe; and No. 2, to finish 
the job. My analysis is, General McChrystal's effort to do just that--
the new combined effort working with the Afghan police and national 
army, as well as local tribal leaders and our coalition forces in the 
military--has enabled us, I think, in all sincerity, to have the best 
chance to do just that; to keep our troops safe and ultimately to 
finish the job.
  What is finishing the job? Finishing the job, to me, and to General 
McChrystal and others, is to provide that safety, that security net 
around the citizenry in Afghanistan, to protect them and to allow them 
to flourish and start to grow and weed out the corruption and not rely 
so much on the poppy fields and ensure that they can bring their 
produce to market or keep their government safe and secure so they can 
start to be more self-sufficient. Working with our coalition partners, 
President Karzai, and others, I think gives us the best chance of 
success.
  I wish to thank the team members for their patience. It was a long 
haul, long flights--12- to 15-hour flights. We weren't partying there, 
I can assure you. We were there, up at the crack of dawn and going to 
bed late at night, working with the Ambassadors, the Presidents, the 
Foreign Ministers of every country we visited. It made me feel, first 
of all, proud to be an American and thankful that I am an American. In 
recognizing the true challenges other parts of the world face--and I 
know the leader of our team will talk briefly about the refugee camp we 
saw in Pakistan with 150,000 people and kids from 3 years old up to 18 
years old in school, with the smiles on their faces, and seeing the 
hope and the excitement that they were learning for the first time in 
their lives--it made all of us look at each other and say: Geez, can we 
come back in August and help out? Because it was so intellectually 
rewarding, and it made me, and I know other Members, so excited to be 
there and to see the hope.
  What does education do in countries such as Afghanistan and Pakistan? 
It gives them the tools to make sure they know how to deal with the 
Taliban and other entities coming in to try to influence their lives. 
It gives them the knowledge to be able to say no. It is almost like the 
DARE program, the drug program we have in Massachusetts, where it is 
the resistance education program where they give you the tools to not 
succumb to peer pressure and take drugs and make bad choices. When I 
left that refugee camp, I felt there was hope there.
  I will defer to our leader to continue with this conversation.
  Mr. CARPER. I see Senator McCain is on the floor, and if I am reading 
his body language right, it looks like he wants to say something about 
our visit to Afghanistan and to Pakistan last week. I don't know if he 
wants to be a part of this colloquy or if he wants us to get out of his 
way so he can talk about something else, but I yield to the Senator 
from Arizona.
  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. McCAIN. Mr. President, I just wanted to congratulate my three 
colleagues for taking that trip. It is of the utmost importance that my 
colleagues are able to see the situation on the ground, meet with our 
leaders, meet with the leaders of Afghanistan and Pakistan, and meet 
with the men and women who are serving in the military.
  One thing I know is, the word spreads. The word spreads throughout 
the men and women of our military that Senators took time from their 
schedules, from our recess, to be with the men and women who are 
serving. There is no better way to express our appreciation, but also 
it is very much noticed by the men and women serving over there.
  I know my colleagues come back better informed. Also, as the 
situation in Afghanistan continues to evolve, we will be much more 
qualified and informed as we engage in what is appropriate for the 
Senate to engage in--discussion and debate over our strategy and our 
goals in Afghanistan.
  So I thank my colleagues for going. I thank them for their service. 
The Senator from Delaware has proven that even a former Navy person can 
understand the issues that confront the Army and the Marine Corps.

[[Page 5581]]


  Mr. CARPER. Mr. President, if I can reclaim my time.
  The PRESIDING OFFICER. The Senator from Delaware.
  Mr. CARPER. Senator McCain, along with Senator Brown, spent a lot of 
time in uniform. I know our Senators felt a special pride in our troops 
who are serving over there. They are serving with troops from 40 other 
countries, and not all countries send troops. Countries such as Japan 
sent money. They are quadrupling their salaries so they can hire some 
decent people and keep them. But in the Army, Navy, Air Force, and 
Marine personnel we met with, morale was good. They understood their 
mission, they understood the importance of their mission, and they were 
proud to be serving. We are very proud to support them.
  Before our time expires entirely, I will yield back to Senators 
Ensign and Brown for any closing comments they want to make, and then I 
think Senator McCain wants to talk a little.
  Mr. ENSIGN. I have a couple of other observations and comments to 
make. I expressed this to General McChrystal and Ambassador Eikenberry 
when we had one of our briefings regarding the various aspects of the 
international coalition including USAID, the State Department, the 
military, all the members that make up what are called PRTs, provincial 
reconstruction teams. In that meeting, I asked the question about how 
much money we were spending now. It was very clearly a concern, when we 
were talking about the economy of Afghanistan and whether it would be 
able to support this large army and large police force we are putting 
into place. So I asked the question: How much money are we spending 
now, how much money is going to be needed in the future, and for how 
long is that money going to be needed?
  President Obama has talked about us starting to withdraw troops about 
the middle of 2011. As we are to start drawing down some troops there 
around July 2011, it became obvious to me that we are going to have a 
commitment there for some time, and I think it is important for us to 
be honest with the American people, first of all, about how much it is 
going to cost. I think a conservative estimate, for many years to come, 
is that we are going to be talking about spending at least $10 billion 
a year--around $6 billion to support their army and their police force 
and another $4 billion as far as helping build their economy.
  The Afghan economy can eventually take over if their natural 
resources come to be what the U.S. Geological Service says some of 
their minerals are worth; what they think the oil and gas reserves 
potentially are. China is coming in to build probably the largest 
copper mine in the world there, but it is going to take years to 
develop these resources. So that is one of the things I came back with. 
We need to be a little more open with the American people that we are 
going to be there for a while and it is going to cost us quite a bit of 
money. We should be able to say to our constituents back home: Here is 
how much we are going to be spending and here is why it is in our vital 
national interest.
  The other thing we haven't taken a lot of time to talk about is 
Pakistan. First of all, we have some great leaders over there, as well 
as Ambassador Patterson and Vice Admiral LeFever. They are the military 
leaders over there, and their teams are impressive as well.
  As Senator Brown mentioned, we visited a refugee camp, and we also 
visited a base that we built over there for Pakistanis to train. The 
Pakistanis who train there are called the frontier scouts and they work 
in the tribal areas to help fight the Taliban. It is in our interest to 
be able to do that.
  I was very encouraged by what I saw in Pakistan, by the new leaders 
there giving up some of their power voluntarily, the new President, and 
seeing Pakistan as much more of an ally to the United States in the 
future. In general, I thought that part of our trip to Pakistan was 
very much worthwhile.
  I would conclude my remarks with that, and turn it over to the 
Senator from Massachusetts.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Mr. BROWN of Massachusetts. Mr. President, in conclusion, I concur 
with all the comments made by the Senators before me. One of the things 
I found most interesting--and I have a hearing in about an hour on the 
Afghan police and the contracting associated with our supporting the 
police force in Afghanistan--is that I was able to ask very direct 
questions to our Ambassadors and to the military and civilian leaders 
who helped me better understand where the $6 billion we have spent to 
uplift the Afghan police force has gone.
  Another reason I went there was self-serving in that it gave me the 
tools to make sure I can better inquire to find out on behalf of the 
American people where their money is going, how it is being spent, and 
whether we can find a way to spend it better.
  In addition to that, one of the things that was glaring to me is that 
even in Pakistan there is an illiteracy problem that needs to be 
addressed. I think that illiteracy problem, if not addressed, will be 
fertile ground for the Taliban to come in and try to influence the 
youth of that country. They have a lot of hope, yet they have some very 
serious problems.
  Once again, I thank our leader. I have great respect for him, someone 
I didn't know before we went. I encourage others to do that and have 
that bipartisan feel, as I tried to do often. We saw Senator Baucus 
over there with his team kind of shadowing us, making sure we were 
actually working. It was a lot of fun to see them over there as well, 
even with their travel problems. But I am looking forward to doing it 
again.
  I thank the Presiding Officer for allowing me to speak.
  Mr. CARPER. Let me just close it down for our side. I say to Senator 
Brown, it was a great opportunity to travel with him and get to know 
him and to learn. I thank him so much for being a great part of our 
team. I also thank Wendy Anderson, who helped put that together, and 
Army MAJ Jen McDonough.
  We have been joined on the floor by Congressman Robert Wittman from 
the First District of Virginia. I say, with him sitting there, how 
impressed we were with him and how delighted we were to serve with him.
  The road ahead in Afghanistan won't be easy. It is an important road 
for us to travel. It is not one we have to travel by ourselves. A lot 
of other nations are involved in this with their time, their treasure, 
and their people.
  We need the best efforts from the leadership of Afghanistan. We know 
he is under a lot of pressure. We made it very clear to President 
Karzai that we have no intention of being an occupying force. We have 
every intention of bringing our folks home within a reasonable period 
of time. This is not an open-ended commitment. My hope is it will not 
run up the cash register as much as Senator Ensign has suggested, but 
nevertheless it is an important use of our resources. This is the 
battle, in my judgment, this is the war we should have been fighting 
all along.
  I thank my colleagues for their patience, and I yield.
  The PRESIDING OFFICER. The Senator from Arizona is recognized.


         Amendment No. 3724, as Modified, to Amendment No. 3721

 (Purpose: Expressing the sense of the Senate that the Value Added Tax 
 is a massive tax increase that will cripple families on fixed income 
and only further push back Americas's economic recovery and the Senate 
                       opposes a Value Added Tax)

  Mr. McCAIN. Mr. President, I ask unanimous consent to call up 
amendment No. 3724 and that it be modified with the changes at the 
desk.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report the amendment as modified.
  The bill clerk read as follows:

       The Senator from Arizona [Mr. McCain] proposes an amendment 
     numbered 3724, as modified:

       At the appropriate place insert the following:

     SEC. ___. SENSE OF THE SENATE REGARDING A VALUE ADDED TAX.

       It is the sense of the Senate that the Value Added Tax is a 
     massive tax increase that will cripple families on fixed 
     income and only further push back America's economic recovery 
     and the Senate opposes a Value Added Tax.


[[Page 5582]]

  Mr. McCAIN. Mr. President, as my colleagues well know--today is tax 
day. Earlier today I came to the floor to speak about the enormous 
burden Americans bear every year in order to comply with today's 
deadline for filing their Federal tax returns. We have a complex, 
antiquated and oversized Tax Code that wreaks havoc on American 
taxpayers and, according to the National Taxpayers Union, will require 
them to spend $103 billion this year in compliance-related expenses. 
When we have a 2,000-plus page Tax Code which requires over $100 
billion in compliance costs--something is clearly wrong. So what is the 
answer? Amazingly--instead of offering proposals to reform the system 
and ease the burden on our citizens--some are suggesting creative ways 
to impose new taxes on Americans and even further complicate our Tax 
Code.
  According to this morning's Wall Street Journal, the Obama 
administration and its allies have floated the idea of imposing value 
added tax--a sales tax imposed on each stage of production, on each 
firm's value added with the actual cost ultimately hidden from the end 
user with the final bill being paid by the consumer at the cash 
register. This type of tax has been widely imposed throughout Europe. 
This morning, in an editorial titled ``Europe's VAT Lessons,'' the Wall 
Street Journal stated:

       As Americans rush to complete their annual tax returns 
     today, there is still some consolation in knowing that it 
     could be worse: Like Europeans, we could pay both income 
     taxes and a value-added tax, or VAT. And maybe we soon will. 
     Paul Volcker, Nancy Pelosi, John Podesta and other allies of 
     the Obama Administration have already floated the idea of an 
     American VAT, so we thought you might like to know how it has 
     worked in Europe.
       VATs were sold in Europe as a way to tax consumption, which 
     in principle does less economic harm than taxing income, 
     savings or investment. This sounds good, but in practice the 
     VAT has rarely replaced the income tax, or even resulted in a 
     lower income-tax rate. The top individual income tax rate 
     remains very high in Europe despite the VAT, with an average 
     on the continent of about 46%. . . .
       In the U.S., VAT proponents aren't calling for a repeal of 
     the 16th Amendment that allowed the income tax--and, in fact, 
     they want income tax rates to rise. The White House has 
     promised to let the top individual rate increase in January 
     to 39.6% from 35% as the Bush tax cuts expire, while the 
     dividend rate will go to 39.6% from 15% and the capital gains 
     rate to 20% next year and 23.8% in 2013 under the health 
     bill, from 15% today. Even with these higher rates, or 
     because of them, revenues won't come close to paying for the 
     Obama Administration's new spending--which is why it is also 
     eyeing a VAT.
       Thanks to the recession and the stimulus, U.S. federal debt 
     held by the public has now reached about 63% of GDP and is 
     headed higher, but the OECD forecasts that the 30 wealthiest 
     nations will see debt burdens ``exceed 100% of gross domestic 
     product in 2011.'' Debt levels in France, Germany, Spain and 
     Italy are expected to have increased by 30 percentage points 
     of GDP from 2008 to 2011. Greece has a VAT rate of 21%, but 
     its debt as a share of GDP is 113%.
       The very efficiency of the VAT means that it throws off 
     huge amounts of revenue that politicians eagerly spend. The 
     VAT thus becomes an engine of even greater public spending. 
     In Europe, average government spending was about 30.2% of GDP 
     when VATs began to spread in the late 1960s. Today, those 
     governments are more than 50% larger, with spending of 47.1% 
     of GDP on average. By contrast, U.S. government spending 
     (federal and state) rose to 35.3% from 28.3% as a share of 
     GDP in the same period.
       It is precisely this revenue-generating ability that makes 
     the VAT so appealing to liberal intellectuals and 
     politicians. Even liberals understand that at some point high 
     income tax rates stop yielding much more revenue as the rich 
     change their behavior or exploit loopholes. The middle-class 
     is where the real money is, and the only way to get more of 
     it with the least political pain is through a broad-based 
     consumption tax such as a VAT.
       And one more point: In Europe, this heavier spending and 
     tax burden has also meant lower levels of income growth and 
     job creation. From 1982 to 2007, the U.S. created 45 million 
     new jobs, compared to fewer than 10 million in Europe, and 
     U.S. economic growth was more than one-third faster over the 
     last two decades, according to the Bureau of Labor 
     Statistics.
       In 2008, the average resident of West Virginia, one of the 
     poorest American states, had an income $2,000 a year higher 
     than the average resident of the European Union, according to 
     economist Mark Perry of the University of Michigan, Flint. 
     The price of a much higher tax burden to finance a cradle-to-
     grave entitlement state in Europe has been a lower standard 
     of living. VAT supporters should explain why the same won't 
     be true in America.
       One trait of European VATs is that while their rates often 
     start low, they rarely stay that way. Of the 10 major OECD 
     nations with VATs or national sales taxes, only Canada has 
     lowered its rate. Denmark has gone to 25% from 9%, Germany to 
     19% from 10%, and Italy to 20% from 12%. The nonpartisan Tax 
     Foundation recently calculated that to balance the U.S. 
     federal budget with a VAT would require a rate of at least 
     18%.
       Proponents also argue that a VAT would result in less 
     federal government borrowing. But that, too, has rarely been 
     true in Europe. From the 1980s through 2005, deficits were by 
     and large higher in Europe than in the U.S. By 2005, debt 
     averaged 50% of GDP in Europe, according to OECD data, 
     compared to under 40% in the U.S.

  While there is no official proposal to impose the VAT--I think it is 
necessary for my colleagues to be on record on this onerous new tax. 
Therefore, I am offering this very simple sense of the Senate amendment 
which calls the VAT exactly what it is--a massive tax increase that 
will cripple families on fixed incomes and only further push back 
America's economic recovery.
  Daniel Mitchell, a senior fellow at the Cato Institute recently 
wrote:

       The VAT--on top of all the other taxes Washington imposes--
     is a terrible idea. Imposing it would pretty well finish the 
     transformation of our country into a European-style slow-
     growth nation. The right way to close Uncle Sam's gaping 
     deficits is to reverse the continued explosion of federal 
     spending.
       The real-world evidence shows that VATs are strongly linked 
     with both higher overall tax burdens and more government 
     spending. In 1965, before the VAT swept across Europe, the 
     average tax burden for advanced European economies (the EU-
     15) was 27.7 percent of economic output, versus 24.7 percent 
     of GDP in the United States.
       Taxes on income and profits consumed 8.8 percent of GDP in 
     Europe in 1965--below the US level of 11.9 percent. By 2006, 
     the European burden had climbed to 13.8 percent of GDP, 
     slightly higher than the 13.5 percent US figure. (The same 
     trend holds for corporate-tax data.)
       Today's income-tax system is a nightmarish combination of 
     class warfare and corrupt loopholes. But adding a VAT solves 
     none of those problems, it merely gives politicians more 
     money to spend and a chance to auction off a new set of tax 
     breaks to interest groups. That's good for Washington, but 
     bad for America.

  J.D. Foster, a senior economics fellow with the Heritage Foundation, 
wrote:

       It comes as no surprise that attention is now turning 
     toward the VAT as the liberal solution for unsustainable 
     deficits that threaten the stability and very future of our 
     economy. Having hiked spending dramatically and then doubling 
     down with his Obamacare, the nation now faces unprecedented 
     near-term debts as the clock ticks toward the long-recognized 
     entitlements time bomb. If there's one thing conservatives 
     and liberals agree on completely, it's that deficits of this 
     magnitude cannot persist. Credit markets won't allow it. Some 
     fundamental course correction is certain. The massive amount 
     of revenue a VAT could raise is the only acceptable solution 
     left for most liberals since they steadfastly refuse to 
     reverse course on their recently enacted spending binge.
       Why is the VAT the darling of the left? Because it can 
     raise vast new revenues without the taxpayers being really 
     sure who took their money. Consumers would pay the tax when 
     they purchase goods and services. Buy a car, pay the tax. Buy 
     groceries, pay the tax. Buy chemotherapy drugs, pay the tax. 
     In this way, taxpayers would only be aware of a bit of their 
     tax bite with each purchase. And unless the tax is printed on 
     the receipt and they look for it, consumers would have no 
     idea how much tax they paid on a particular transaction.
       Today's deficits, and tomorrow's, result from too much 
     spending, not too little revenue. Reverse the massive Obama 
     spending surge (and the Bush surge before that) and the 
     deficits would quickly fall to sustainable levels. Instead, 
     Paul Volcker has done the nation a great service in telling 
     us what Obama and his congressional allies are planning. If 
     that is not the case, if the President and the democratic 
     leadership in Congress really are not planning a VAT attack, 
     let them declare their opposition to a VAT plainly. Every 
     current and would-be member of Congress should say where they 
     stand on the VAT. And unless they favor a huge government, 
     much higher taxes, and less transparency from government, 
     they will stand against it.

  I agree with Mr. Foster--every current Member of Congress should say 
where they stand on the VAT. With this amendment I am giving Members of 
the Senate that opportunity.

[[Page 5583]]

  Several of my colleagues have explained that they would support a VAT 
if it was replacing the Federal income tax or the current corporate tax 
structure. I say to those colleagues that I have not seen a shred of 
evidence from the administration or anyone in Congress that the VAT 
would be used as a replacement tax. I am supremely confident that--if 
and when it is offered--the VAT will be an additional tax on the 
American people. And that is the last thing the American people need 
right now. The solution to America's worsening government fiscal 
outlook is not to increase taxes--it is to cut spending. Congress could 
get America's economy back on track by focusing on tax relief and 
simplification, liability reform, regulatory reform, health care 
security, and energy independence--not on imposing a new, massive tax 
increase that will cripple middle- and low-income families and delay 
America's economic recovery.
  The solution to America's worsening government fiscal outlook is not 
to increase taxes, it is to cut spending. Congress could get America's 
economy back on track by focusing on tax relief and simplification, 
liability reform, regulatory reform, health care security and energy 
independence, not on imposing a new massive tax increase that will 
cripple middle- and low-income families and delay America's economic 
recovery.
  I ask for the yeas and nays on the amendment.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The yeas and nays are ordered.
  Mr. McCAIN. I yield the floor.
  The PRESIDING OFFICER. The Senator from Connecticut is recognized.
  Mr. DODD. Mr. President, what is the business before the Senate?
  The PRESIDING OFFICER. The McCain amendment is the pending amendment.
  Mr. DODD. I ask unanimous consent to speak as in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                            Financial Reform

  Mr. DODD. Mr. President, I come to the floor now, and I came to the 
floor yesterday, in response to the campaign by those both outside and, 
apparently, inside this Chamber who are literally trying to kill the 
Wall Street reform legislation, and to tie that reform to that bill to 
bailouts.
  I pointed out in those discussions yesterday that these arguments are 
straight out of Wall Street's playbook, written by political strategist 
Frank Luntz. As we all know, I submitted his political strategy that he 
offered months or weeks before even consideration of the bill, 
outlining politically how to defeat this legislation. So even before 
there was a bill, Mr. Luntz had a strategy on how to kill it. You 
merely have to look at the date of his memo to know what I am talking 
about.
  Yesterday we heard a strategy, basically written by him, to avoid any 
accountability for the mess they have made of our economy. And if it 
seems strange to you, Mr. President, and others, that the minority 
leader is choosing to attack our bill for being too kind to Wall Street 
by reciting talking points written on behalf of Wall Street, well, you 
are not alone, obviously, if that seems strange.
  Even stranger, of course, was the leader's insistence that this 
legislation is too partisan. Perhaps he has not spoken to my colleague 
and friend from Alabama, the former chairman of the Banking Committee, 
Senator Shelby, with whom I have spent months working on building 
consensus, who said himself months ago that we had achieved a consensus 
on as much as 70 percent of the bill that will be presented to this 
body in a matter of days.
  Perhaps the minority leader had not spoken to any of the Republicans 
on the Banking Committee, who joined with Democrats in bipartisan 
working groups that I asked to be formed back months ago, each of which 
of those groups achieved real and meaningful progress that is reflected 
in the bill that will be on the floor in a matter of days; not just 
amendments that will be offered, it is in the text of the bill of those 
working groups, Democrats and Republicans on the Banking Committee.
  Perhaps the Republican leader had forgotten that as far back as 
February of 2009, I insisted that meetings with the Treasury 
Department, as they were still crafting their plan for reforming Wall 
Street, include Republican staff so Republican ideas would be in the 
proposal from the very beginning.
  Well, this morning the McClatchy newspapers looked into the minority 
leader's accusations made in this Chamber yesterday morning, and 
frankly found them lacking. Please indulge me for a moment. I am 
reading from this morning's newspaper. Let me quote, if I can:

       McConnell accused Dodd of drafting partisan legislation, 
     even though the banking committee Chairman has worked roughly 
     half a year with key Senate Republicans and incorporated many 
     of their ideas into his bill. McConnell also said the bill 
     contains controversial bailouts, but it doesn't.

  And this from today's Associated Press report:

       McConnell on Tuesday said his views on the financial 
     regulation package had been most influenced by the comments 
     of community bankers in Kentucky, his home state. Yet such 
     bankers are represented by the industry groups that most 
     favor setting up an advanced prefinanced liquidation fund for 
     large institutions--the Independent Community Bankers 
     Association.

  The very community banks that insisted upon the $50 billion that the 
banks have to put up if they are going to be unwound, rather than 
taxpayers. So the very banks that my friend from Kentucky claims are 
advising him on his views have a different view than he does about the 
bill that is before us.
  The newspaper article goes on. It says:

       . . . McConnell has also complained that the Democratic 
     bill is partisan and the White House intervened to stop 
     Democratic-Republican negotiations . . . But Sen. Christopher 
     Dodd, Connecticut, chairman of the Senate Banking Committee, 
     negotiated for months with leading Republicans and found much 
     common ground, only to see the vote in his committee unfold 
     along party lines.

  Well, there you have it. Black and white. The attacks on the Wall 
Street reform bill are false. This legislation incorporates Republican 
ideas, Democratic ideas, and it definitely includes one idea that we 
all agree on: ending taxpayer bailouts. Just ask Sheila Bair, who is 
the Chairperson of the Federal Deposit Insurance Corporation, the 
organization that comes in and puts an end to failing banks. Ms. Bair 
is also a Republican, former legal adviser to Senator Bob Dole, former 
majority leader, minority leader of the Senate, an appointee of the 
previous administration, the Bush administration.
  Sheila Bair told the American Banker, in an article published this 
morning:

       The status quo is bailouts. That is what we have now. If 
     you do not do anything you are going to keep having bailouts.

  And nothing is what we will have if Members vote against allowing 
this bill even to come up for debate on the floor of the Senate. Sheila 
Baer goes on to say about this bill:

       It makes bailouts--

  This bill that we will have before this body--

       It makes bailouts impossible. And it should. We worked 
     really hard to squeeze bailout language out of this bill. The 
     construct is that you cannot bail out an individual 
     institution. You just cannot do it.

  Mrs. BOXER. Will the Senator yield for a question?
  Mr. DODD. I will be happy to yield to the Senator.
  Mrs. BOXER. First, I want to say thank you so much for taking to the 
floor to explain to the American people the very strange debate we hear 
coming from the Republican leader on this. I was stunned, because I had 
heard that he had met with the Wall Street people and the banks, and 
then he said over and over again the same phrase yesterday, which was 
repeated endlessly, that the bill you and the President and the 
Democrats are working on--trying to get bipartisan support for, for 
which I commend you--he said that bill would mean one thing and one 
thing only--taxpayer bailouts--when we all know the entire purpose is 
to put an end to one dollar of loss of taxpayer bailouts.

[[Page 5584]]

So I have a question to ask. Is it not my friend's goal to get into a 
situation where the banks, the super big banks, the investment houses, 
pay into a fund themselves with their own money, so that if there are 
any problems and they need to be wound down, it does not cost a dollar 
of taxpayer money, that the fund will be paid for by these businesses 
themselves? Am I correct on that?
  Mr. DODD. Let me thank my dear friend and colleague from California. 
She says it so much more directly and clearly than my efforts here to 
explain this. She is absolutely correct. This is the irony of ironies.
  In fact, let me go further. The $50 billion provision in this bill 
was proposed by the Republicans. I did not come up with this idea. This 
was the idea that was brought up by the community bankers and 
Republicans who said that if there is an unwinding of a failed 
institution, the American taxpayer should not have to pay a nickel for 
that; it should be paid for by the institutions that put themselves in 
that position.
  That is what we did. In fact, in the other body, they have a stronger 
provision with even more dollars involved. The irony of ironies, that a 
Republican provision in this bill, designed to insulate the American 
taxpayers from having to pay a nickel to unwind a failed institution, 
they are now calling somehow evidence that this is a bailout.
  The only reason that money can be used is to bail out, rather to 
unwind that institution, if it gets in that situation.
  Mrs. BOXER. Further, my understanding is, if an institution gets in 
trouble, they are going to go down. They are not going to be revived.
  Mr. DODD. Absolutely.
  Mrs. BOXER. I would say to my friend, because he is an expert on 
this--and years ago I was on the Banking Committee, and am no longer 
there--I want to make sure I understand if I am right on this: I think 
the American people have appreciated the FDIC over the years, because 
the FDIC was another way for taxpayers to be kept out of a problem, 
because it is an insurance fund. The banks are taxed and they put the 
money into the fund. And if there is, in fact, a bankruptcy, you are 
covered. Right now I think it is up to $250,000. Am I correct?
  Mr. DODD. Correct.
  Mrs. BOXER. So this whole notion has worked very well. But in 
closing, because I do not want to interrupt the speech of my friend, 
because I think it is important, it seems to me suddenly there has been 
a huge injection of politics into a bill that should have had, as you 
point out, I say to my friend from Connecticut, bipartisan support.
  If, in fact, the Republicans came up with the idea to have a fee on 
these institutions, to protect the taxpayers so that we have no 
bailouts, and now, after meeting with the banks, it feels to me these 
big institutions have turned on their own idea. But they are using the 
language that is the opposite of what they now want to do. Because, as 
I understand it--tell me if I am right--if we keep the status quo and 
do nothing, which is again their idea right now, we are in trouble, 
because we saw what happens when these big institutions get in trouble. 
Main Street starts to hurt. Lending starts to freeze. We have seen 
millions of job losses due to that horrible time we went through.
  I want to commend my friend and urge him, if he has to come here 
every day--and I will be glad to come over here as well--to explain to 
the American people the truth. I am so tired of politics obscuring the 
truth. We need to put an end to it. We are not perfect. The other party 
is not perfect. No one is perfect. We do not have the ideas that are 
going to save and cure every problem. But we know one thing from this 
crisis. We had to turn to taxpayers. What a nightmare. Thank goodness, 
by the way, those funds are being repaid. We are still out some funds, 
but the vast majority of those funds are repaid. But we are not going 
to go through that again. I would never vote, and I say that right 
here, to bail out these big institutions that were gambling. They 
gambled on the future of America. I will not do it. Therefore, let's 
put something into place where they pay into a fund so if there is a 
problem in the future and they are going bust, we will wind them down 
and we will wind them out on their dollar.
  I hope you will keep saying that, because I do not mind getting in a 
debate with the other side. As a matter of fact, I think there are 
great differences between the two parties, which makes our country 
great because we all appeal to different people in the country. It is 
good for the stability of the Nation. But let's not come here with 
false debate. Let's not come here with made-up arguments, because that 
only hurts the debate.
  I wanted to praise my friend. I wanted to spend a couple of minutes 
thanking him for doing this.
  Mr. DODD. I thank my colleague. I note, you only have to ask 
yourself--look, you do not have to have a Ph.D. in banking. Ask 
yourself this question: The idea of requiring these institutions to put 
up money in advance, so that if they fail they end up paying for the 
cost of unwinding----
  Mrs. BOXER. Bingo.
  Mr. DODD. Who would object to that? Who is objecting to this? I 
mentioned earlier, it was not my idea. This was brought to me by the 
Republicans. Sounds to me like the people who have to put up that money 
are probably the ones objecting to it. These are the large institutions 
that do not want to be assessed any cost associated with their 
mismanagement of an operation.
  Mrs. BOXER. You got it.
  Mr. DODD. So it is pretty much as plain as the nose on your face. I 
am even surprised we have to make the case. So I thank my colleague 
from California. I will try to complete these remarks. I know others 
have other matters they want to be heard.
  I thank Sheila Bair from the Federal Deposit Insurance Corporation. 
Many of us know her, having worked with the Republican leadership for 
years as legal counsel, of course; being an appointee of the Bush 
administration. She talked about our bill today, saying this bill has 
been written specifically to end any notion of any kind of a bailout by 
the American taxpayer.

       It makes [bailouts] impossible, and it should. We worked 
     really hard to squeeze bailout language out of this bill.

  And she is right, working together.

       The construct is you can't bail out an individual 
     institution--you just can't do it.

  Our bill stops bailouts by imposing tough new requirements on Wall 
Street firms. Being too big and too interconnected will cost these 
firms dearly. And, should that not be enough, under our legislation 
regulators can use new powers to break up those firms before they can 
take down the economy. It stops bailouts by forcing firms to write 
their own funeral plans and to pay for their own liquidation in advance 
so taxpayers do not have to pay a dime. They shouldn't. If that is not 
enough, our bill stops bailouts by literally eliminating any 
possibility for the government to bail out these firms. These Wall 
Street firms believe that no matter how much we hate bailouts, if they 
are important enough, at the end of the day taxpayers will come riding 
in on a white horse to save them, just as they did under the Bush 
administration.
  This bill kills the white horse. There is no white horse under this 
bill. When we pass it, as I hope we will, large institutions, big banks 
will know if they fail, they fail. Their management gets fired under 
our bill. Their assets will be liquidated under our bill. Their 
creditors lose money under our bill, and taxpayers don't pay for any of 
it under our bill. The bill stops bailouts.
  To insist otherwise indicates that either the minority leader doesn't 
know what is in the bill or he chose to distort what is in the bill. 
Yet I read this morning in the Wall Street Journal that the Republican 
leadership is ``struggling to maintain a unified opposition,'' even 
going so far as to circulate a letter pledging that each Republican 
Senator will vote to filibuster this bill and keep it from even being 
discussed. I hope that is not the case.
  I can't tell my colleagues, in my 30 years here, what a denial that 
is of everything I have stood for and worked for in countless pieces of 
legislation for three decades, to have Members of this

[[Page 5585]]

body, who have spent hours with me crafting the bill I will offer, 
including their ideas, to then vote against even allowing this bill to 
be debated. I just know that cannot happen. I don't want to believe 
that 41 of my colleagues, many of whom have worked with me on this 
bill, are going to sign on to a commitment that they will not allow 
this bill even to be debated unless I agree to their provisions. I have 
never seen anything like that in my 30 years.
  I have worked tirelessly for months to put together a bill that 
reflects various ideas. I know it doesn't satisfy everyone. I have been 
criticized by the left and the right on this bill. I understand that. 
But I have tried to put together a bill that reflected what I thought 
was commonsense, sound, good legislation. I pray the news I am hearing 
about 41 Senators--before most of these people have even read what is 
in the bill--signing on to a political commitment without understanding 
what is at stake is not true. By losing this bill and having the status 
quo remain, bailouts then are in place. Taxpayers are exposed. The 8 
million jobs that have been lost, the 7 million homes, others who have 
suffered as a result of this economic crisis get little or no relief. 
That is a stunning conclusion of the efforts that have gone on. It 
isn't about us. It is about the people out there who deserve far better 
than they are getting.
  Still, even after it has become apparent that the Republican strategy 
is to delay and obstruct, even after it has become clear that the 
minority has very little to offer in this debate except for some false 
talking points read verbatim from the big banks' script, the minority 
leader took the floor again this morning and said:

       Republicans believe the solution is for bipartisan talks to 
     continue.

  They will. As frustrated as I am, my door has never been shut. The 
door is still open to sit and resolve and work together to get to this 
bill. But I will not sit around days on end in the rope-a-dope game of 
never knowing who I am talking with, whether they have any ability to 
bring people to the table, ``just agree with my idea and I am still 
against the bill.'' I have to ask myself, why did I go through this 
process over the last 4 or 5 months, agreeing to much of what they were 
offering, and there is not a single political vote to show for it; in 
fact, a vote against even debating the bill in the end? Why would one 
ever go through what I did to end up at this particular point?
  Apparently, someone finally informed the minority leader that those 
talks had been going on for over a year. So they will continue. But 
then again, he once again made the false statement that the bill would 
``allow taxpayer dollars to bail out Wall Street banks.''
  There they go again, the same old talking point, the mantra repeated. 
If one says it often enough, I guess it becomes true in some people's 
minds.
  I say to my friend, the minority leader, if he wants to continue the 
debate, he could start by ceasing efforts to filibuster this bill 
before it gets to the floor; before, I would suggest, no more than 
probably two or three people have even seen it or have any idea how 
many titles are in it, what it includes, and what we try to achieve. If 
you want to debate, if you have ideas, then bring them to the floor. 
That is why this body exists.
  If the debate is going to consist of Democrats offering ideas to 
tackle these very complex--and it is a complex set of issues--and 
critical challenges on behalf of American families and businesses and 
Republicans reading false talking points from Wall Street's playbook, 
then count me out. I will not engage in that kind of a debate or 
negotiation. I have no interest in that whatsoever.
  We have a job to do. If my friends on the other side of the aisle 
don't feel like doing the work, maybe they should think about the 
millions of unemployed Americans who didn't go to work this morning 
because they lost a job in this economy, created by the mismanagement, 
the failure to step up and take steps to correct these problems over 
the last number of years. Those Americans would love nothing more than 
to put in an honest day's work for a good day's pay. But they can't 
because the same banks sponsoring this parade of bamboozlement on one 
side of the aisle cost our country 8.4 million jobs, 7 million homes, 
lost health care, and destroyed futures and retirement accounts. That 
is all gone.
  What about them in this debate? Are their issues, their views, their 
concerns going to be discussed? No, just shut it down. Don't even 
debate the issue because ``you can't agree with my idea.''
  That is not why this institution exists. It is not about the process. 
It is not about committee assignments. It is not about your idea or 
mine. It is about people beyond the walls of this Chamber who are 
counting on us to get a job done for them. Our failure to step up and 
even debate these issues and consider each other's ideas is a tragedy.
  I know my friends on the other side of the aisle are faced with a 
difficult choice between supporting their party leadership and 
participating in this complicated, difficult debate. I am not naive. I 
know that is a hard place to be. But if we can't act like U.S. Senators 
for the sake of this issue, for the sake of legislation whose success 
or failure has such an enormous impact on the very survival of the 
middle class and the economy as we know it, then why are we even here? 
Why are we even engaged in this, if that is what the choice is?
  It is easy to understand why the big banks don't like this bill. It 
is far harder for me to understand why any of us would be sympathetic 
to those arguments. We don't work for the big banks. We work for the 
American people who sent us here from our respective States. We work 
for families who have paid a steep price for Wall Street's risky 
behavior. We work for the American public that lost those jobs, those 
more than 8 million jobs, and still faces near double-digit 
unemployment. We work for an American public that lost nearly 7 million 
homes to foreclosure, for millions of people who have seen their small 
businesses fail or their retirement accounts evaporate in a matter of 
hours. We work for an American public that is sick and tired of feeling 
like no one is looking out for their interests, like the political 
hacks and lobbyists hold all the cards in these discussions.
  The minority seems intent on proving them right--I hope that is 
wrong, but I am worried they may be right--on proving that there is no 
issue more important than saying no, stopping all discussion, currying 
favor with special interests, and trying to gain petty political 
advantage, strangling this bill with a filibuster or suffocating it 
with false claims that stick our Nation and its taxpayers with bailouts 
forever; that will continue this era of greed and recklessness on Wall 
Street; that will leave us vulnerable once again to another economic 
crisis.
  I have been here a long time. I know this institution is better than 
that. I know there are friends of mine on the other side who care about 
this bill, who want to be a part of the debate, who want to be part of 
the solution and have ideas to bring to the table and recognize no one 
group, no one Senator is going to write this bill exclusively. But I 
can't get there if the attitude is: We won't even let you debate or 
discuss it. That attitude is not what the American people expect of the 
Members of this body.
  On their behalf, who desperately need us to act, I hope we are better 
than that; that in the coming days before this bill reaches the floor, 
we can find that common ground. If not, we need to go forward. But we 
need to have that debate on the floor of the Senate.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant editor of the Daily Digest proceeded to call the roll.
  Mr. CORKER. I ask unanimous consent that the order for the quorum 
call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. CORKER. I came to the floor of the Senate because my friend from 
Connecticut, who is my friend, made numerous comments about the 
process. I hope that possibly he would be willing to enter into a 
colloquy.

[[Page 5586]]

  I will give a preamble, if I may. There is a lot of rhetoric that has 
gone on around this financial reform bill. I appreciate so much the 
chairman of the committee engaging me for 30 days to try to reach a 
bipartisan agreement. We voted a 1,336-page bill out of committee in 21 
minutes with no amendments. We did so with the understanding--at least 
it was my understanding--that the best way to reach a bipartisan deal 
was to vote a bill out of committee--we knew it was going to be a 
party-line vote--to not stiffen opposition by having a bunch of 
amendments debated and maybe get people pulled further apart. Then what 
we would do is try to seek a template for a bipartisan bill before it 
came to the floor.
  Mr. DODD. Will my colleague yield?
  Mr. CORKER. I will.
  Mr. DODD. That was the intention. But there were 401 amendments filed 
by 2 p.m. on Friday, before the announced markup of the bill. Over the 
weekend, staff came to work on amendments.
  I say respectfully, no one from the minority side came in on the 
weekend. But over the weekend, it was suggested to me by the minority--
--
  Mr. CORKER. Not by this Senator.
  Mr. DODD. No, but that they wouldn't offer any amendments. It turned 
out to be a 21-minute markup. I was prepared to stay there all week, as 
my colleagues know, and announced in advance that would be the case.
  So for the purposes of understanding here, again, that was their 
decision. I hope we could get to some agreement farther down the road. 
We agreed to a lot. The bill that was on the table that day for the 
markup was substantially different than the bill I offered as a 
discussion draft in November.
  Mr. CORKER. No question.
  Mr. DODD. So it reflected a lot of ideas and thoughts that have been 
incorporated between that date and the actual markup date. I say that.
  Mr. CORKER. I have repeatedly publicly thanked the good Senator from 
Connecticut for going through that process, and there is no question it 
is a much better bill. As a matter of fact, I think it is a very 
amendable bill.
  Here is what I would say. I think things are being said that--there 
is no question some of the attacks on the order to liquidation have 
been over the top. On the other hand, there is no question that 
Treasury and the FDIC created some loopholes. That is what executive 
branches do because they want the flexibility to do whatever they wish 
to do. I would do the same thing if I were them. But there are some 
things that need to be tightened up, and I think we could do that in 5 
minutes, I really do.
  I talked with the Treasury Secretary yesterday. It is obviously more 
of a committee-committee level deal now, and I understand that. But I 
think we could resolve that. But I think the thing, if I could--I know 
there have been discussions about this letter. The fact is, I think 
what we are trying to do is say let's get this template done over the 
next couple weeks. Let's do not slow it down.
  I know you talked about entering a bill on April 26. I know there 
have been talks about maybe sliding a week because there are some other 
cats and dogs that need to be dealt with. But we can do this. I think 
if everybody would calm down, and if everybody would quit exaggerating 
how bad things are--there has been a lot of cooperation.
  I just met with the ranking member. I left his office. I think there 
is a strong desire to reach a bipartisan agreement. I hope that--I am 
not blaming anybody, but I think the White House is stirring around on 
this. You have all kinds of forces going on. I think the good Senator 
from Connecticut wants a bipartisan bill that will stand the test of 
time. I know I want one. I know the ranking member wants one. I think 
most every Republican wants one. I think if we could quit shooting 
things over the transom and get settled down, I think, without even 
slowing down the introduction of this bill--not slowing it down 1 day; 
if we get serious as adults for the next 10 days or so, a week--I think 
we could finish. And I believe that.
  I would ask--I would ask all my colleagues--and I ask this 
respectfully of my colleague from Connecticut--look, things did not get 
where they needed to be, and I understand what happened, but I still 
relish the fact that we came close. I think we can get back there. I 
do. I do not think anybody is trying to subterfuge this. I do not. I 
met with all my colleagues yesterday on the Republican side. We may 
have a few folks who do not want a bill, but just because they do not 
like laws. I am making that up slightly over the top myself. But I 
think most people want a good bill. And I say to the chairman, I think 
what you did in December demonstrated that you want a good bipartisan 
bill.
  I do not think it is right--I will get into a little bit here--I do 
not think trying to call one Republican Senator to pick him off, two 
Republican Senators to pick them off--I do not think that is a 
bipartisan bill. Let's get back to the table to finish it.
  Mr. DODD. My colleague wanted a colloquy here, and I am glad to be an 
audience for him. But if he wants a colloquy I will stay around.
  Mr. CORKER. I am glad to listen, as I have often.
  Mr. DODD. Let me say, again, I came here--if I have been strong it is 
because I am responding to the minority leader. The minority leader has 
come every morning now saying this bill perpetuates bailouts. I am not 
going to sit here idly and allow those accusations to be spread across 
the country when you and I both know that is not true--when I am told 
this is a partisan bill.
  I have spent too much time here over too many years doing exactly 
what I have done in the 38 months I have been chairman of this 
committee; that is, to develop wherever I can bipartisan solutions to 
this bill. It has motivated me in everything I have done.
  So to all of a sudden, out of the blue, knowing all the efforts I 
have made, along with others, to try and find that common ground--as my 
colleague from Tennessee well knows here--and then to be faced with a 
minority leader who should know better than coming to the floor making 
these silly accusations, false accusations about a process that has 
been anything but partisan, about conclusions in a bill that are 
anything but accurate in terms, in fact, of what is included in the 
legislation.
  I am willing to listen to ideas on how we can make this tighter, if, 
in fact, that is the case, to stop the bailouts that are occurring in 
the country, all of that. But then having a letter being circulated, 
where 41 people, most of whom have no idea what is in this bill but 
just taking a political position because they are being asked to do so, 
without at least having some appreciation for those of us, including 
yourself, who have worked so hard on this to produce as good a bill as 
we can--understanding there are still ideas that many of our colleagues 
want to bring to this debate, and they should have a right to do that--
that having a full-throated debate on the floor of the Senate--I am 
disturbed.
  What does that say to future chairs? Why would you even bother doing 
what I went through if, in fact, at the end of it all the answer is: 
No, I am sorry, we did not get our way, so we are going to stop the 
debate? I find that terribly distressing. As a Member of this body, 
leaving it in a few months--I will not be here any longer next year for 
the debates--I have to say to the younger Members, the newer Members 
coming along: Be careful. If this is the template on how we operate, 
then all of the things I tried to do over the last year on this bill--
from the hearings, involving everyone, going through the discussions, 
recognizing you did not solve every issue--then you have to ask 
yourself the question: Why would you do that if at the end of the 
process you get a letter circulated stopping a motion to proceed on a 
bill of this import after all the effort?
  If this had been a purely partisan--you know, you are not allowed in 
the room. We are just going to keep you outside. We just want to write 
it--then I get that. You would be right, in my view. I would sign the 
letter, in fact, if that were the case. This is not that case, in my 
view. I say that respectfully to my colleague.
  Mr. CORKER. I will respond respectfully that I think the course of 
action

[[Page 5587]]

that is trying to get underway is to finish the bipartisan--let's face 
it. You and I went a long way. Then we stopped. On March 10 it ended. I 
understood that, look, you were losing Democrats on your committee.
  Mr. DODD. And I was not gaining Republicans.
  Mr. CORKER. You had one, and that is all you asked for when you 
started. I do not want to reiterate that. I never said I could speak 
for anybody but myself. And I did not leave the table. I never left the 
table. So the fact is, the bill took a partisan turn on March 10. There 
is no denying that. You would not deny that and look at me with a 
straight face.
  There are some bipartisan solutions in this bill, I grant that, and I 
thank you for those inclusions. But there is still work to be done. And 
I would say to you that what Republicans are trying to do is say, let's 
finish that work before it gets to the floor. You have said this, and I 
do not think I am betraying confidences. I would never do that 
intentionally. This is a complicated piece of legislation.
  What we need to do is get the template--at least bipartisan in the 
beginning. And then you are right, there are issues such as the Volcker 
rule and there are governance issues that are going to be amended back 
and forth. But let's at least get the main parts of the bill right in 
the beginning--close to right--not the way you would want it on your 
own, not the way I would want it on my own. That has not happened on a 
number of the titles, in fairness.
  I would urge everyone--there has been a lot of work done. You have 
done a tremendous amount of work in this committee. Let's finish that 
work over the next 10 days. Let's quit yelling at each other, and let's 
finish the work the American people sent us to do. I am not lecturing. 
I say all this respectfully. Let's finish what we started.
  Mr. DODD. I hope it can be the case.
  I thank my colleague.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant editor of the Daily Digest proceeded to call the roll.
  Mr. KYL. 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. KYL. Mr. President, there is a view that sometime next week--upon 
the disposition of the bill that is currently before us and perhaps 
some other matters--we might take up the issue of so-called financial 
regulatory reform. I wish to speak for a moment to one of the key 
issues I know is of concern to some of my colleagues, and certainly to 
me.
  The American people have a pretty firm view on this whole thing after 
what they have seen with regard to TARP and the other bailouts. They 
are obviously not crazy about what has happened.
  I think most Americans think there should be two basic goals: First, 
to prevent the kind of crisis that occurred from ever happening again; 
and, secondly, to make sure that taxpayers are not on the hook, 
especially if we are talking about the possibility of continued 
bailouts where Federal money would be involved in unwinding big Wall 
Street firms that get into trouble.
  Unfortunately, this bill that came out of the Banking Committee, and 
could be brought to the floor next week--unless it is changed 
significantly--not only does not achieve the first goal, but it also 
carries forward that policy of ``too big to fail'' and taxpayer 
bailouts. That is why in its current form you have a lot of people on 
my side of the aisle saying it has to be changed. Let's get together, 
talk in a bipartisan way, and make sure we can both achieve the goal 
and, secondly, not carry forward current bad policies.
  This bill, at least in my view--and I will explain why--would set the 
conditions for firms to become overleveraged; that is to say, taking on 
too much debt relative to their value, and it would entrench in law 
forever this concept of taxpayer obligation to bail out these firms.
  Well, how would it do this? Primarily, it creates a $50 billion so-
called orderly liquidation fund established through assessments on the 
largest banks. So at least the first part of the fund would be paid by 
banks themselves. But even that, obviously, would not be big enough to 
cover the bailout, for example, of one of our larger banks, let alone 
some of the other kinds of institutions. But by creating this fund, we 
are, in effect, designating those entities as ``too big to fail,'' 
meaning the government will have to then pick up obligations beyond 
what is covered by the $50 billion.
  So after the exhaustion of that fund, and some other steps, taxpayers 
have provided not just an implicit but an explicit guarantee. I have 
read the language in the bill, and it provides the FDIC shall be 
liable, in effect, for amounts that are necessary beyond that. The 
specific language is the FDIC ``will guarantee the obligations of 
banks'' in times of severe economic distress. That is the status quo. 
That is what people object to. Why should we be on the hook for those 
big banks when they fail?
  There are some additional problems. This kind of guarantee increases 
the likelihood that those firms will take risky behavior and then 
become overleveraged, just as what happened with the real estate 
entities, so-called Fannie Mae and Freddie Mac. Because there was an 
implicit guarantee the government would bail them out if they got into 
trouble, they took risks that were beyond what they should have taken, 
and the end result was, because they failed, we were on the hook, and 
for a lot more than would have been the case had they not taken those 
risks.
  In addition to that, because there is an implicit guarantee, they are 
actually shielded from market forces and are given a competitive 
advantage over their competition. Private investors, as we saw in the 
cases of Fannie Mae and Freddie Mac, are more likely to lend to these 
firms and to charge them a lower interest rate because they are pretty 
well guaranteed that if anything bad happens, they will get their money 
back. Meanwhile, other banks, such as Arizona community banks, don't 
have that kind of implicit guarantee. In fact, a lot of those banks are 
on the brink, frankly, of collapsing today. They are charged more money 
in order to borrow money than these very large, too-big-to-fail 
institutions. So this creates an anticompetitive barrier that will, in 
effect, make cartels out of the large institutions that would receive 
this guarantee.
  The consequences would be severe. Peter Wallison is a fellow at the 
American Enterprise Institute and is very knowledgeable about these 
matters. He wrote this last year:

       Financial institutions that are not large enough to be 
     designated significant will gradually lose out in the 
     marketplace to the larger companies that are perceived to 
     have government backing just as Fannie and Freddie were able 
     to drive banks and others from the secondary market for prime 
     middle-class mortgages. A small group of government-backed 
     financial institutions will thus come to dominate all sectors 
     of finance in the U.S.

  Well, that is the formal way of saying what I said before, and that 
is one of the reasons we don't want to have this kind of implicit 
guarantee or, in the case of the legislation, explicit guarantee by the 
taxpayers. You will see the same kinds of distortions as were created 
by Fannie Mae and Freddie Mac in the housing market prior to the 
collapse of the financial sector last year.
  Back in 2003, I was chairman of the Senate Republican policy 
committee, and we began researching and writing about this. We wrote 
two specific papers sounding the alarm about Fannie Mae and Freddie 
Mac. I was concerned back then that this explicit guarantee or backing 
of these institutions permitted them to operate without adequate 
capital and to assume more risk than their competitors and borrow at 
below market rates of interest, and that is exactly what happened. 
Smaller companies got crushed. Fannie and Freddie engaged in 
increasingly risky lending with the backing of the Federal Government. 
On a massive scale, they made mortgages available to people who could 
not afford them, like buying

[[Page 5588]]

those risky mortgages, and that easy credit fueled very rapidly rising 
home prices. As prices rose, obviously, the demand for even larger 
mortgages rose, and Fannie and Freddie looked for ways to make even 
more mortgage credit available, notwithstanding a questionable ability 
to repay. It was a giant accident waiting to happen.
  By 2008, these two GSEs--government-sponsored enterprises--held 
nearly $5 trillion in mortgages and mortgage-backed securities. They 
were overleveraged. They were too big to fail. The resulting collapse 
devastated our economy, and it left taxpayers with a tab of hundreds of 
billions of dollars. In fact, Fannie Mae and Freddie Mac have now 
transferred to you and me $6.3 trillion of their liabilities--just 
those two entities--and we are on the hook for it.
  That is what we have to prevent from happening, but that is exactly 
what this legislation that passed out of the Banking Committee would 
permit. Why would we continue this kind of too-big-to-fail taxpayer 
liability in what we call a reform bill? We ought to stop that, make 
sure it never happens again.
  I also wish to make this point, since there is a new regulator 
contemplated in this legislation. What happened to Fannie and Freddie 
happened despite the fact that they had their own dedicated regulator, 
and that is exactly what is proposed for institutions in this bill. In 
fact, the bill would use the very same regulators who failed to stop 
the financial crisis from happening.
  I thought this was supposed to be reform. This isn't reform. I am 
reminded of a line from literature--I don't think it is from ``A Tale 
of Two Cities,'' but it could be--where the actor says, ``Reform, sir? 
Don't talk of reform. Things are bad enough already.'' That is kind of 
the way I look at this. We have problems, and the kind of reform that 
is being suggested here is not an improvement; it is a continuation of 
the same obligation of taxpayers to bail out those who are deemed too 
big to fail.
  I wish to add that the bill even extends the scope of these potential 
future bailouts beyond banks. It would explicitly give the Federal 
Reserve authority to regulate any large company in America that it 
wanted to. Thus, the Financial Stability Oversight Council, FSOC, would 
have the power to designate nonbank financial institutions as a threat 
to financial stability--the code word for ``too big to fail.'' So a new 
government board based in Washington would decide which institutions 
get special treatment, giving unaccountable bureaucrats tremendous 
authority to pick winners and losers, and these favorite firms, too, 
would have a funding advantage over their competitors.
  In addition to extending this to bigger companies, the legislation 
extends this same definition all the way through our financing sectors 
to smaller companies. For example, one of the auto dealers in your town 
that finances the automobiles you buy, if you have more than four 
payments, they are covered under here. It even would cover a dentist's 
office or an optometrist. If it takes more than four payments to take 
care of what he had to do, he would be covered by this. So this would 
extend to small and large and in all cases puts a government bureaucrat 
in charge of trying to find out why a firm is in trouble and ultimately 
requires, if they are needed, taxpayers to come to the rescue of these 
firms. As I said, we have to avoid making the mistakes of the past. A 
firm's cost of capital should be based on its ability to repay its 
commitments, not on the probability of future government assistance.
  So given recent experience, I would suggest that we need a more 
competitive financial industry with many firms, not just a few large 
firms with implicit government guarantees dominating the market.
  I started my comments by speaking about what the American people 
don't like and what they would like to see. I think they deserve a 
better approach than this legislation that passed out of the Banking 
Committee, one that promotes accountability and responsible oversight. 
This bill, as I said, is a risk the taxpayers don't need and, frankly, 
cannot afford.
  So I urge my Democratic colleagues to reengage with Republicans to 
produce a bipartisan bill that can pass the Senate by a wide margin. 
Let's not have any more health care bills where it is done strictly on 
a partisan, party-line basis, with a consensus lacking, with the 
American people not liking what is being done. We can provide for the 
orderly bankruptcy of these failed institutions without keeping 
taxpayers on the hook for losses.
  By the way, a lot of this reform has to deal with preventing the 
bankruptcy in the first place--in other words, regulating some of these 
new esoteric financial instruments so that there is greater 
transparency in the complicated trading of these financial instruments.
  I think we can work this out and keep politics out of it. Everybody 
understands there are things which need to be done to prevent the kind 
of collapse we had in the past. It is my understanding that the hard-
working members of the Banking Committee on both sides of the aisle had 
been working hard together and had been producing compromises. They 
were characterized to me as, it is not everything I would want, but 
then in a compromise you don't get everything you want. That is the 
spirit in which we can work together to produce a product that I think 
would be acceptable to our constituents, who don't want to be on the 
hook for any more of these bailouts, as well as provide the kind of 
transparency up front and procedures for unwinding businesses on the 
back end when they finally are unable to continue in business, a 
process which would not require the taxpayers to bear ultimate 
responsibility for their losses. If we are able to work together to do 
this, it will be a win-win situation for the American people, and just 
maybe we will demonstrate that Republicans and Democrats can actually 
sit down together, work something out, and pass a bill that is good for 
everybody.
  Mr. President, I yield the floor, and I suggest the absence of a 
quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BURRIS. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Franken). Without objection, it is so 
ordered.

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