[Congressional Record (Bound Edition), Volume 156 (2010), Part 7]
[Senate]
[Pages 10061-10073]
[From the U.S. Government Publishing Office, www.gpo.gov]




          AMERICAN JOBS AND CLOSING TAX LOOPHOLES ACT OF 2010

  Mr. BAUCUS. Madam President, I ask that the Chair lay before the 
Senate a message from the House with respect to H.R. 4213.
  The Acting President pro tempore laid before the Senate the following 
message from the House of Representatives:

       Resolved, That the House agrees to the amendment of the 
     Senate to the bill (H.R. 4213) entitled ``An Act to amend the 
     Internal Revenue Code of 1986 to extend certain expiring 
     provisions, and for other purposes,'' with the House 
     amendment to the Senate amendment.


                Motion to Concur with Amendment No. 4301

                (Purpose: In the nature of a substitute)

  Mr. BAUCUS. Madam President, I move to concur in the House amendment 
to the Senate amendment to the House bill with an amendment which I 
send to the desk.
  The ACTING PRESIDENT pro tempore. The clerk will report the 
amendment.
  The legislative clerk read as follows:

       The Senator from Montana [Mr. Baucus] proposes an amendment 
     numbered 4301 to the House amendment to the Senate amendment 
     to H.R. 4213.

  Mr. BAUCUS. Madam President, I ask unanimous consent that the reading 
of the amendment be waived.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mr. BAUCUS. Madam President, a few moments ago, the Republican leader 
sought once again to throw mud at the new health care law that Congress 
enacted earlier this year. Let me take a moment to set the record 
straight.
  The Republican leader said the premiums would go up for some 
Americans. What the Republican leader did not say is the nonpartisan 
Congressional Budget Office found that health care reform would lower 
premiums for the overwhelming majority of Americans. After taking into 
account the tax credits to help buy insurance, health insurance will 
cost less for 9 out of 10 Americans--no small amount.
  The Republican leader mocked the new payments to seniors the 
President is highlighting today; that is, the $250 for drug benefits. 
The President made the point that that is important for seniors. The 
truth is, seniors will welcome the help they will soon be receiving to 
pay for prescription drugs in their coverage gap, the so-called 
doughnut hole. Starting very soon seniors will receive $250 to help pay 
for their prescriptions. By the time health care reform is fully phased 
in, we will have completely eliminated the doughnut hole. This is 
something seniors care about very much.
  No longer will seniors have to choose between their rent and the 
prescriptions they need. No longer will seniors have to cut their pills 
in half just to get by. No longer will seniors live in unnecessary pain 
just because of drug costs. So the fact is, health care reform will 
help to control the costs in health care. Health care reform will 
reduce costs for the taxpayer over the decades to come. That is not my 
assertion, it is that of the Congressional Budget Office. Health care 
reform will increase access to lifesaving medical treatments for 
millions of Americans who all too often now must do without.
  Madam President, on the matter before us today, 15 million Americans 
have lost their jobs during this great recession. Although the 
unemployment rate came down some last month, it remains near 10 
percent. At the depth of the great recession, during the first months 
of last year, the economy lost an average of 750,000 jobs a month. That 
is practically the population of my State. We have come a long way 
since then. Even if we exclude temporary census jobs, in the first 5 
months of this year the economy has created nearly half a million new 
jobs. But we still have a lot more to do. We have to get more Americans 
back to work.
  We began doing just that with the Recovery Act. We enacted that as 
one of the first things the new Congress did in February of last year. 
According to the nonpartisan Congressional Budget Office, the Recovery 
Act increased by between 1.2 million and 2.8 million the number of 
Americans employed.
  We continued getting more Americans back to work with the Hiring 
Incentives Act that we enacted in March of this year. The HIRE Act 
should help to bolster job creation in coming months.
  We are continuing again today with the American Jobs and Closing Tax 
Loopholes Act. This bill would create jobs by improving our Nation's 
infrastructure. It would reduce the cost to local governments to build 
roads, bridges, and water treatment facilities that would create jobs.
  This bill would also extend provisions that expire at the end of May. 
These provisions would provide important relief for many Americans.
  Americans who are out of work are depending on our job creation 
efforts. This bill extends the needed lifeline of unemployment benefits 
to more than 5 million Americans who would not be able to support 
themselves or their families without this help.
  We are talking about people who have worked, want to work, and will 
work again. These are our neighbors. And they need our help.
  In my home State of Montana, we have seen some promising signs of 
recovery. In Yellowstone County, unemployment is down from 6 percent in 
March to 5.2 pesent in April. That is good news. But there still remain 
people who need our help.

[[Page 10062]]

  Some counties in Montana have unemployment as high as 16.8 percent. 
In Montana, as with the rest of country, we have seen an increase in 
people looking for work.
  Unemployment rates will continue to hover around 10 percent even as 
the economy improves. As the economy adds jobs, many unemployed people 
grow more hopeful and resume their search for work. That is one reason 
why economists call unemployment a lagging economic indicator.
  The bill that we are considering today includes improvements to the 
unemployment insurance program. This bill would eliminate the penalty 
in unemployment insurance for getting part-time or temporary work. 
Under current law, if people who are unemployed take part-time or 
temporary jobs, and then lose that job, they receive lower benefits 
than people who did not take short-term work. This bill corrects that 
inequity.
  This bill also expands the Trade Adjustment Assistance Community 
College and Career Training Program. The bill would broaden the program 
to include workers who are eligible for unemployment insurance. This 
will help more Americans who are looking for work to get the education 
and looking career training that they need.
  If we do not pass this bill, doctors who see Medicare and TRICARE 
patients will take a 21 percent pay cut. More and more physicians are 
threatening to leave the Medicare and TRICARE programs if this happens. 
Seniors and military families could lose access to their doctors.
  We cannot keep postponing this issue every month or two. Seniors 
worry they will lose their doctors. And physicians cannot run a 
business with this much uncertainty.
  We need to pass a long-term reform. I would life to fix the problem 
permanently. But the votes are not there today. We will permanently 
reform Medicare's system to compensate doctors as soon as we can.
  In the meantime, this bill provides security to doctors and the 
patients they see for the next year and a half through 2011. It 
provides a modest payment increase to physicians for the rest of this 
year and next year.
  This multi-year provision would prevent the untenable cut in 
physician payments. And this bill would provide a pathway to a 
permanent change in how doctors are paid.
  The budget rules have to score a permanent reform as a cost. But we 
all know that this is something that we have to do for America's 
seniors, military families, and doctors.
  This bill would also provide tax relief for American families and 
businesses. This bill would help communities that have suffered a 
natural disaster. And this bill includes important tax incentives to 
improve America's energy independence.
  For individuals and families, this bill provides much-needed tax 
relief in a time of economic uncertainty.
  This bill would extend the teacher expense deduction for teachers who 
buy school supplies for their classrooms. And it would extend the 
qualified tuition deduction to help with college costs.
  This bill would extend much-needed relief for communities that have 
suffered from natural disasters.
  And it would extend important business tax provisions to help create 
jobs and make our companies competitive in a global economy.
  The bill would extend the research and development credit to help 
businesses to continue to be on the cutting edge.
  The bill would also extend important energy tax incentives. For 
example, the bill would extend the dollar-per-gallon credit for 
biodiesel and renewable diesel. And the bill would extend the 
manufacturer's credit for the construction of new energy-efficient 
homes.
  In addition to these important provisions that provide direct 
assistance in job creation, the bill includes other proposals that will 
provide relief for businesses and individuals.
  One such provision is pension funding relief.
  With the weak economy, American employers are faced with the need to 
make higher pension contributions. Several factors have combined to 
require these higher contributions.
  There is the funding changes of the Pension Protection Act of 2006.
  There is the slide in the stock market in 2008.
  And then there is the ensuing great recession.
  These requirements for higher contributions are coming upon employers 
just when they are facing lower asset values and lower cash flow. 
Meeting the new funding rules could divert resources that employers 
could use to keep workers on the payroll.
  We addressed this bind temporarily in 2008. But employers are still 
facing the prospect of closing plants and stores. Employers are still 
faced with the possibility of letting workers go in order to make up 
for lost asset values.
  This bill contains additional temporary, targeted, and appropriate 
relief for these employers. And at the same time, the bill still 
maintains the pension security system.
  These tough economic times have hit the States hard, as well. In last 
month's employment report, for example, State and local governments cut 
22,000 jobs.
  So, included in the substitute amendment is a 6-month extension of 
the additional Federal financial assistance for State Medicaid 
programs. This would allow States to plan for their next fiscal year 
with the greater certainty.
  Additional Federal Medicaid match money, known as FMAP, helps the 
economy grow. According to the economist Mark Zandi, this funding has a 
return on investment of about $1.40 for every dollar invested.
  The nation's governors have repeatedly asked for an extension of this 
Federal assistance. And this bill answers their pleas.
  With so many Americans out of work, our country needs Congress to 
enact this legislation.
  This bill continues valuable tax incentives to families and 
businesses that will help them in these difficult economic times. And 
the bill sustains vital safety-net programs that will also help foster 
economic growth.
  This legislation is important to the American people. It would 
prevent millions of Americans from falling through the safety net. It 
would extend vital programs that are set to expire. It would put cash 
in the hands of Americans who would spend it quickly, boosting economic 
demand. And it would extend critical programs and tax incentives that 
create jobs.
  And so, let us help America's businesses to create more jobs. Let us 
join together to work across the aisle on this common-sense 
legislation. Let us enact these tax incentives and safety-net 
provisions into law.
  I yield the floor, and I suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. ALEXANDER. 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.


                           Health Care Reform

  Mr. ALEXANDER. Madam President, I get a fair amount of mail. I 
received the other day a nice envelope from the Department of Health 
and Human Services addressed to Andrew L. Alexander, Jr., in my 
Nashville residence, with a nice brochure here: Medicare and the New 
Health Care Law; What It Means to You.
  I am one of those 40 million Americans who is 65 or older, so I am a 
part of Medicare. I was very interested to read the brochure, because I 
spent a lot of time, as did the Senator from New Hampshire, and the 
Senator from Montana probably spent even more, on the new health care 
law.
  As I read through this brochure, it did not bear very much 
relationship to the way I understood the law I voted on Christmas Eve 
at the end of last year when we passed this health care law.
  This brochure, which has been mailed at taxpayer expense to more than 
40 million Americans, is an attempt by the administration to explain 
that the health care law does what it does not

[[Page 10063]]

do or does not do what it does. Let me be specific about why I say 
that. Throughout the debate, those of us on the Republican side of the 
aisle said the health care law would cut Medicare, raise premiums, 
raise taxes, pass Medicaid costs on to States, and add to our national 
debt. Those on the other side said we were wrong. Since they had the 
votes, they passed the bill. It is now law. But let me take two or 
three examples from the mail I got the other day. The brochure claims, 
in the first paragraph, that the new health care law will result in 
``increased quality health care.'' Well, that would mean, to me, I 
would think, as I read that, that I, an individual on Medicare, or that 
any individual in the United States, would continue to have at least 
the coverage I am having today and hopefully more.
  Yet Medicare's own Chief Actuary noted in an April 22 memorandum that 
without intervening legislation to correct a payment cut in the new 
law, some providers would ``end their participation in the program''--
that is Medicare--with the effect of ``possibly jeopardizing access for 
beneficiaries.''
  It looks to me if you want to be accurate in writing 40 million 
Americans about what is happening with Medicare, you would add that in 
there and say there is another view by the Chief Actuary of Medicare in 
the Obama administration.
  The Chief Actuary also concluded that 15 percent of Part A 
providers--we mean by that hospitals, skilled nursing facilities, 
hospices, home health agencies--may be unable to sustain their 
operation in the next 10 years as a result of drastic Medicare cuts in 
the new law. That does not sound like ``increased quality health care'' 
to me.
  No. 2, the second paragraph of the brochure says: The new health care 
law will keep Medicare strong and solvent.
  Here is the truth, at least as we see it. The $529 billion in cuts to 
Medicare--no one disputes that we have those--are being used to pay for 
a $1 trillion--when fully implemented over 10 years--health care bill, 
not to shore up Medicare.
  According to the same people who put out this brochure, the CMS Chief 
Actuary, you cannot double-count the Medicare cuts as both paying for 
expanding the health care delivery system and increasing the solvency 
of the program. I mean, common sense says if you take $529 billion out 
of Medicare over the first 10 years, or $1 trillion out of Medicare 
over 10 years, when it is fully implemented, and you spend almost all 
of that on something other than Medicare, that is not the way to make 
Medicare more solvent, even if it is a new Medicare Program. Any 
savings from Medicare, we believe, ought to be spent on Medicare, 
rather than running up the fiscal deficit in Medicare.
  No. 3, on the second page, the brochure says if you are in a Medicare 
Advantage plan, you will still receive guaranteed Medicare benefits. 
This is one of the most disingenuous comments in the brochure. If you 
read that and are one of the more than 11 million people on Medicare 
Advantage, you would think: My Medicare Advantage must be OK. The truth 
is, Medicare Advantage plans will have less generous benefit packages, 
according to the CMS, the group that puts this out, according to the 
Chief Actuary. He says it will result in less generous benefit 
packages. The Congressional Budget Office Director Doug Elmendorf 
testified that fully half the benefits currently provided to seniors 
under Medicare Advantage would disappear under the proposal in the 
earlier bills offered by the Senator from Montana, which were virtually 
the same as this bill.
  Here is the difference. They will come back and say: But we said 
``guaranteed benefits.'' They would be right about that. But guaranteed 
Medicare benefits are what everybody has. If one wants Medicare 
Advantage, which they pay a little more for to cover dental, vision, 
and hearing, or other extra benefits, that is why they buy Medicare 
Advantage. The truth is, the Medicare cuts in the health care law will 
limit plan choices and reduce benefits for almost 11 million seniors 
enrolled in Medicare Advantage on those extra benefits. That is 
relatively one-fourth of all seniors in Medicare, and there are 40 
million of us in Medicare. In my State of Tennessee, there are nearly a 
quarter of a million on Medicare Advantage who will lose those 
benefits. So it is not true--or at least it is disingenuous--that 
benefits will not change. Guaranteed benefits won't, but extra benefits 
likely will.
  Finally, it says the new law preserves and strengthens Medicare. That 
is also disingenuous, because the new law does not include paying 
doctors who serve Medicare patients proper compensation. We call this 
the sustainable growth rate, the SGR. Some people call it the doc-fix. 
One would think a comprehensive health care law would include proper 
compensation for doctors who serve Medicare patients, but it does not. 
Why? It would have, according to the President's budget, added $371 
billion to the cost of the bill and made it add to the debt, which we 
said it would.
  So what did we do instead? We simply passed a health care law, the 
majority did, and claimed it doesn't add to the debt, expand the health 
care delivery system--which we all know costs too much already--and 
went on our way. And we still have with us the big cut in payments to 
doctors which will increasingly create, for those on Medicare, a sort 
of health care bridge to nowhere or to the emergency room, as we find 
Americans who are on the big government programs, Medicare and 
Medicaid, unable, in the case of Medicaid or Medicare, to find doctors 
who are willing to serve them at the lower rates and, in the case of 
those who go to Walgreens in Washington State, a drugstore company that 
won't fill present description drugs for Medicaid patients because of 
the low rates.
  I am disappointed that the administration, in its effort to make the 
health care law sound better, would send out what amounts to 
propaganda. There is a Federal law against propaganda. It says annual 
appropriations can't be used for publicity or propaganda purposes 
within the United States. I know a little about that. When I was 
Education Secretary in 1991 and 1992, I sent out what I thought was a 
very carefully written article to teachers about President Bush's, the 
first, education program, and the Democrats in Congress hauled me up 
before the committee and had the General Accounting Office investigate 
me and castigated me for putting out publicity and propaganda in 
violation of the law. Some House Members have written the General 
Accounting Office and said this violates the law. I don't know whether 
it violates the law, but it doesn't tell the truth in the way we 
Medicare beneficiaries deserve to have the truth told to us about what 
the health care law does. I am disappointed in it. I hope the Center 
for Medicare and Medicaid Services will be more accurate in the future 
and present a more balanced characterization of the law. I am sure 
during the rest of this year there will be a great many Americans who 
will take a closer look at the law and agree with Republicans who said 
no to this because it will raise premiums, raise taxes, and it will 
send new costs to States and will cut Medicare.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Montana.
  Mr. BAUCUS. Madam President, it is with interest that I listened to 
my colleague from Tennessee for several reasons. One, he is debating a 
law that has already passed. It is strange to me that he wants to 
relitigate health care reform. But it is not so strange because I know 
that that is the tack the other side is going to be taking for the rest 
of this year. At every opportunity, Senators on the other side of the 
aisle, all of whom voted against health care reform, will sow the seeds 
of doubt in the minds of the American people. They don't come up with 
constructive ideas on how to improve the work of something that has 
already passed into law. Rather, they stand on the law and tear down 
something that has passed, sowing the seeds of doubt with 
misinformation.
  It is unfortunate, because it has caused the American people to 
wonder who they can trust, especially when

[[Page 10064]]

one side only speaks ill of a major program such as health care rather 
than trying to come up with constructive ideas. That is what is 
happening right now. We heard a statement from a Senator who is trying 
to basically score points in the November elections by sowing the seeds 
of doubt and confusion over health care reform.
  The truth is not what the Senator just said. The Senator from 
Tennessee takes issue with efforts of the government to explain the new 
health care law. He is implying that it is disingenuous, that it is not 
fair, that it is one-sided. I remind all my colleagues that when the 
drug benefit came out, proposed by the administration of a different 
political philosophy, they didn't pay for it--all unpaid for, every red 
cent. They put all kinds of literature out, all kinds of brochures to 
tout the drug benefit. There were some who thought it wasn't fair. 
There were some who thought it was biased. I will not litigate that 
issue, but I do know that charge was made many times when the 
administration of a different political persuasion was touting the drug 
benefit legislation that passed not too long ago.
  I have spoken with this administration several times about getting 
the proper information out; that is, not to tilt, gild the lily, bias. 
At hearings I have made that clear to administration officials. I for 
one do not want this administration or any administration to be unfair 
in explaining the program to the American people. I think the brochure 
the Senator talks about is fair and straightforward. I just happened to 
pull up the Web site yesterday and looked at it to see what it said. I 
was impressed. There is a lot of information there I didn't know about. 
It didn't at all come across to me, trying to be objective and fair, as 
one-sided. It was an honest effort to explain to the American people 
what health care reform is.
  The new law takes steps to improve the quality of health care. Let me 
go back to what the Senator said. No. 1, he took issue with the 
paragraph that said the new law increases the quality of health care. 
Of course, the new law increases the quality of health care. The 
Senator from Tennessee is sowing the seeds of doubt as to whether this 
new law actually does increase the quality of health care. Let me 
explain how it does. First, there is delivery system reform. We get rid 
of a lot of the waste in the American health care system. It is paid on 
the basis of quality, not on the basis of quantity and volume. Every 
expert who has looked at the American health care system knows we have 
to move in this direction. This bill does that. It is going to 
reimburse doctors, hospitals, and health care providers more on the 
basis of quality outcomes than on the basis of the number of services 
provided or the quantity of services.
  The doughnut hole will be filled. That will increase the quality of 
health care for seniors. The statement that the Senator refers to from 
the HHS Actuary actually says that health care reform will extend the 
life of the Medicare trust fund for another decade. I think that 
improves the quality of health care. Anyone who objectively has looked 
at the health care reform legislation and attempted to determine one 
issue; that is, the life of the Medicare trust fund, has concluded that 
the passage of health care reform will extend the life of the Medicare 
trust fund for 8 to 10 years. That clearly gives seniors a little peace 
of mind. It is going to be there. It gives peace of mind to people who 
are about to be seniors, that it is going to be there. That is a major 
improvement in quality.
  It is true what the brochure says. It does increase the quality of 
health care. There is no doubt about it. Anyone who thinks otherwise 
should think through the entire legislation and be objective about it.
  No. 2, he refers to the assertion that it keeps Medicare strong and 
solvent and claims that is not true. The Actuary says that health care 
reform will extend the life of the Medicare trust fund for another 
decade. That is 100 percent refuted.
  Third, the Senator from Tennessee quibbles with the assertion that 
Medicare Advantage beneficiaries will continue to receive their 
guaranteed benefits. The Senator at first admits this is true, but the 
larger point is that health care reform reduces overpayment to Medicare 
Advantage plans. And why should other beneficiaries pay extra for the 
overpayments made to some people who are beneficiaries of Medicare 
Advantage plans? I have talked to a lot of executives who work for 
Medicare Advantage plans in the last week or so. They are interested, 
and they like it. They like the change in the law. Why? Because they 
know they are going to be reimbursed now more on the basis of quality.
  Medicare Advantage plans will be paid more if they can show better 
outcomes, higher quality, not just the standard ``you get the same 
rate'' benchmark compared with fee for service and so forth. A CEO of a 
major Medicare Advantage plan said: Senator, we think that is good 
policy. We like that. We are ready. We are anxious. We want to do a 
real good job. We think that is a good change in the law. That is going 
to, frankly, help seniors--higher quality, better benefits under 
Medicare Advantage plans. That will help.
  Essentially, I want to make it clear, the Senator from Tennessee 
complains the health care law did not correct for payment of doctors. 
Here is his opportunity. He could vote for this bill today. If he 
doesn't want doctors to take a 21-percent cut, if he doesn't want that, 
he should vote for this bill. This bill before us today would prevent 
that cut from taking place.
  I very much look forward to seeing the Senator from Tennessee voting 
for this bill so that doctors do not get a cut in their payment. That 
would be the right thing to do, support this bill so doctors don't get 
cut.
  Again, the Senator takes issue with the assertion that health care 
reform would help keep Medicare solvent. The fact is, the nonpartisan 
Medicare Actuary said health care reform will extend the life of the 
Medicare trust fund for a decade longer.
  I return to my first point: The health care reform law has passed. 
The President signed it. My gosh, why don't we work together 
constructively, both sides, with good points, praise, criticism, both 
sides of the aisle, all constructively to help the American people? Why 
are we here? We are here to help the American people. We are not here 
to score political points. We are the hired hands. We are the 
employees. We work for the American people. The American people want 
good health care reform. They want costs lower, and they want higher 
quality care. So let us work together to help the American people get 
that. That is what we should be doing here, not trying to score 
political points and cause disruptions for the American people for the 
upcoming elections in November.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Udall of New Mexico). The Senator from 
Florida is recognized.
  Mr. LeMIEUX. Mr. President, I ask unanimous consent to speak as in 
morning business.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.


                               Venezuela

  Mr. LeMIEUX. Mr. President, I am here again today to talk about my 
concerns that are emerging from the problems we are seeing in 
Venezuela.
  Last May 25--just a couple weeks ago--I wrote a letter to the 
Secretary of State, Secretary Clinton, that was signed by 11 of my 
colleagues and myself. Senator Ensign from Nevada and I wrote this 
letter together, and we were welcome to have 10 other Senators join in 
the letter to Secretary Clinton to speak about our concern--in fact, 
what we would call a gathering storm of concern--about the country of 
Venezuela.
  The letter seeks to have a review by the Secretary of State and the 
Department of State as to whether Venezuela should be added to the list 
of states that we consider state sponsors of terror. The letter goes 
through a number of issues I have spoken about on the floor before 
concerning some very questionable behavior by Hugo Chavez and 
Venezuela.

[[Page 10065]]

  One of the issues it talks about is the support of Venezuela for the 
narcoterrorists in Colombia, the FARC. Evidence has come forward that 
Venezuela's weapons have found their way into the hands of these 
narcoterrorists.
  Another of the things we talk about in the letter is the concern with 
a plot that was revealed by a Spanish judge in March of this past 
year--a plot to assassinate President Uribe in Colombia, where the 
Spanish judge has accused Venezuela of being behind that plot, along 
with a Spanish terrorist group called the ETA.
  The letter also speaks about Hezbollah's activities in Venezuela--
Hezbollah, the Middle Eastern terrorist group, supported by Iran.
  The letter also speaks of the troubling new information that for at 
least 3 years Venezuela and Iran have been putting factories together 
in remote areas of eastern Venezuela, which is the area believed to be 
rich in uranium.
  In December of 2008, Turkish customs authorities caught one of these 
joint companies, literally called VenIran--``Ven'' for Venezuela--a 
``tractor factory,'' attempting to smuggle 22 containers of explosive 
materials labeled as ``tractor parts.''
  Since 2007, we have pointed out, there have been direct flights 
between Caracas, Venezuela, and Tehran, Iran, without proper controls 
or customs verifications.
  We have also pointed out in the letter there are increasing 
paramilitary Iranian forces operating in Venezuela.
  We know from recent reports from the IAEA, the International Atomic 
Energy Agency, that Iran now looks to have the nuclear fuel which will 
give them the capability to build nuclear weapons. We have had open 
testimony in front of the Armed Services Committee that within 3 to 5 
years Iran may have the intercontinental ballistic capability to 
deliver those weapons across the ocean and put the United States in 
jeopardy.
  But Venezuela is a lot closer. There is no need for an ICBM from 
Venezuela. In fact, a flight from Venezuela to Florida is about the 
same length in time as a flight from Florida to Washington, DC.
  So we brought this letter to the attention of Secretary Clinton in 
May. We wrote this letter on May 25, 2010.
  Mr. President, I ask unanimous consent that this letter be printed in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                  U.S. Senate,

                                     Washington, DC, May 25, 2010.
     Hon. Hillary Rodham Clinton,
     Secretary of State, U.S. Department of State, Washington, DC.
       Dear Secretary Clinton: We are deeply concerned about 
     Venezuelan President Hugo Chavez' growing ties with U.S.-
     designated foreign terrorist organizations and state sponsors 
     of terrorism. This letter is to present you with a number of 
     questions that we believe should be thoroughly addressed 
     within the Department of State's 2009 Country Report on 
     Terrorism which was due to Congress on April 30, 2010. We 
     realize that thorough answers to some of these questions may 
     require a classified annex.


                   PRESIDENT CHAVEZ' SUPPORT OF FARC

       The Revolutionary Armed Forces of Colombia (FARC) is South 
     America's oldest and best armed terrorist group. As pointed 
     out in the 2008 Country Report on Terrorism, the FARC is 
     notorious for carrying out a full range of terrorist 
     activities to include kidnappings, murders, mortar attacks, 
     hijackings, and bombings against Colombian political, 
     military, and economic targets.
       On March 1, 2008, a Colombian military strike against a 
     FARC camp in Ecuadorian territory successfully killed senior 
     FARC members, including Luis Edgar Devia Silva (aka Raul 
     Reyes). Silva was a known terrorist responsible for numerous 
     atrocities within Colombia, and his death and the subsequent 
     capture of his computer laptop provided a treasure trove of 
     intelligence. Chavez mourned the loss of Reyes and eulogized 
     this terrorist as a ``good revolutionary'' while amassing 
     troops on the Colombian border in an attempt to intimidate 
     his Latin American neighbor.
       In light of what the U.S. government has discovered from 
     the ``Reyes'' documents and other sources, we ask that the 
     annual terrorism report provide attention to the following 
     questions:
       What does the information found on Reyes' computer reveal 
     with regard to the depth of the relationship and support that 
     the FARC receives from high-ranking officials in the Chavez 
     government? Based on information gleaned from the laptop, 
     what type of surface-to-air missiles or man-portable air 
     defense systems (MANPADs) has Venezuela provided to the FARC 
     or enabled the FARC to obtain, and what threat do those 
     systems pose to Colombia and U.S. counterdrug efforts in the 
     region?
       In September 2008, the U.S. Department of the Treasury's 
     Office of Foreign Assets Control designated two senior 
     Venezuelan Intelligence officials, Hugo Armando Carvajal 
     Barrios and Henry de Jesus Rangel Silva, and one former 
     senior security official, Ramon Rodriguez Chacin, for 
     materially assisting the FARC's illicit activities.
       What types of weapons have these three senior Venezuelan 
     government officials enabled the FARC to acquire? To what 
     extent does the FARC use proceeds from illicit drug 
     trafficking to acquire weapons from the Venezuelan 
     government?
       In late July 2009, the government of Sweden requested an 
     explanation from Venezuela about how the FARC obtained 
     Swedish-made anti-tank rocket launchers that had been sold to 
     Venezuela in the 1980s. Three of the launchers, matched by 
     their serial numbers, were recovered from a captured FARC 
     arms cache in October 2008.
       Do we have the intelligence resources in place to properly 
     monitor the flow of guns and money from Venezuela to the 
     FARC? Are known FARC officials, such as Rodrigo Granda, Marin 
     Arango (aka Ivan Marquez), and Rodrigo London Echeverry (aka 
     Timochenko or Timoleon Jiminez) able to operate and move 
     freely within Venezuela?
       Do you agree with Director of National Intelligence (DNI) 
     Dennis Blair's March 2009 testimony before the Senate Armed 
     Services Committee in which he stated that despite setbacks 
     brought about by the Colombian government's tireless efforts 
     ``the FARC leadership has shown no signs it seeks to end 
     hostilities or participate in serious peace talks'' and 
     further, that the FARC benefits from cross-border sanctuaries 
     in Venezuela?
       It is well known that cocaine trafficking funds FARC 
     operations. The United Nations World Drug Report for 2009 
     revealed that nearly one-third of all cocaine produced in the 
     Andean region passes through Venezuela. To what extent does 
     the Venezuelan government's involvement in the international 
     drug trade allow for millions of dollars to flow into the 
     coffers of narco-terrorists?
       Recently, the Treasury Department, in an unprecedented 
     move, labeled an active foreign military official as an 
     international drug ``kingpin'' for enabling massive shipments 
     of cocaine from Venezuela into West Africa. Americans are now 
     banned from doing business with Ibraima Pap Camara, the Air 
     Force Chief of Staff in Guinea Bissau and the former head of 
     Guinea-Bissau's Navy and Jose Americo Bubo Na Tchuto, and any 
     assets the two might have had in the United States are now 
     frozen.
       To what extent are drugs from Venezuela flowing into West 
     Africa, and what impact does that have on political 
     corruption, drug smuggling, and terrorist operations in the 
     region? Should President Chavez be held accountable under the 
     Kingpin Act for his role in the flow of drugs to the rest of 
     the world?
       How much do terrorist groups such as Al-Qaida in the 
     Islamic Maghreb (AQIM) profit from trafficking drugs that 
     originate in or flow through Venezuela? What specific steps 
     is the United States taking to cooperate effectively with 
     countries in South America, North Africa, and the Sahel to 
     blunt the trafficking of drugs across the Atlantic and into 
     West Africa?


                  HEZBOLLAH'S ACTIVITIES IN VENEZUELA

       Prior to September 11, 2001, no terrorist group had killed 
     more Americans than Lebanon-based Hezbollah. On June 18, 
     2008, the U.S. Treasury Department's Office of Foreign Assets 
     Control announced that it was freezing the U.S. assets of two 
     Venezuelan based supporters of Hezbollah--Ghazi Nasr al Din 
     (a Chavez employed ``diplomat'') and Fawzi Kan'an for 
     providing direct support to Hezbollah. According to the 
     Department of Treasury, these two individuals were involved 
     in the planning of Hezbollah operations, including terrorist 
     attacks and kidnappings.
       What is your assessment of the presence and activities of 
     Hezbollah inside Venezuela? What is your assessment of the 
     purpose and implications of a meeting in Beirut on or about 
     February 1, 2010, between Adel El Zabayar and Imad Saab, 
     deputies of the Venezuelan National Assembly, and Nawaf 
     Musawi, director of international relations of Hezbollah?
       On November 3, 2009, our Israeli allies stopped the cargo 
     ship MV Francop before it could reach its destination in 
     Syria, which is a state sponsor of terrorism. The Francop was 
     loaded with 36 shipping containers holding 500 tons of 
     Katyusha rockets, mortars, grenades, and a half-million 
     rounds of small-arms ammunition suspected to be bound for 
     Hezbollah.
       Is there information confirming that the Francop had 
     stopped in the Venezuelan port of Guanta before sailing for 
     Syria and at the same time that Venezuelan Foreign Minister 
     Nicolas Maduro was in Damascus visiting with Syrian President 
     Bashar Al-Assad? Are there any indications of a substantial 
     Iranian security presence in Guanta?

[[Page 10066]]




        PRESIDENT CHAVEZ SUPPORT FOR STATE SPONSORS OF TERRORISM

       In addition to his documented support for Hezbollah and the 
     FARC, President Chavez has closely aligned himself with Cuba 
     and Iran, both of which are already on the State Sponsors of 
     Terrorism List.
       Venezuela's financial support for state sponsors of 
     terrorism is evident by Chavez's extensive support of the 
     Castro regime in Cuba, which is calculated to amount to $1 
     billion a year. To what extent does Venezuelan assistance to 
     the Cuban regime facilitate the regime's ongoing repression 
     of the pro-democracy movement and forestall a transition to 
     democracy in Cuba? How deeply are Cuban advisors involved in 
     the intelligence and security apparatus of the Venezuelan 
     government?
       What is your assessment of the role of long-term Castro 
     confidant Ramiro Valdez as a special advisor to the 
     government of Venezuela and the impact it will have on pro-
     democracy leaders and movements in Venezuela? What role, if 
     any, did Valdez play in the recent purge of over 100 
     Venezuelan military officers?
       With respect to Iran, President Chavez has repeatedly 
     expressed support for that country's covert nuclear program 
     and announced in September 2009 a plan for the construction 
     of a ``nuclear village'' in Venezuela with Iranian 
     assistance.
       In your judgment, to what extent is Venezuela supporting 
     Iran's covert nuclear enrichment program development? What is 
     the current state of Venezuela's nuclear program, and to what 
     extent is Iran providing nuclear knowhow to Venezuela? Under 
     the present conditions, does Venezuelan-Iranian nuclear 
     cooperation violate the Nuclear Non-Proliferation Treaty and 
     United Nations International Atomic Energy Agency protocols?
       We have seen reports of suspicious Venezuelan-Iranian 
     companies sprouting in remote areas of Venezuela, including 
     the VenIran ``tractor factory.'' In December 2008, Turkish 
     customs inspectors intercepted 22 shipping containers bound 
     for VenIran that were labeled ``tractor parts'' but instead 
     contained an ``explosives lab'' and chemicals that could be 
     used to manufacture explosives. What is your assessment of 
     the activities carried out by VenIran? Is it possible that 
     its facilities are a front for illicit, possibly even 
     nuclear, technology-related activities?
       Congress is close to authorizing a comprehensive set of 
     sanctions aimed at restricting Iranian access to refined 
     fuels in a bid to stop Iran from acquiring nuclear weapons. 
     At the same time, Iran has a growing financial presence in 
     Venezuela, and President Chavez has pledged to provide Iran 
     with 20,000 barrels of gasoline per day.
       To what extent are Venezuela's financial institutions 
     assisting the Iranian nuclear enrichment program? Are you 
     concerned about the activities of the Venezuelan Banco 
     Internacional de Desarrollo and the Banco Binacional Irani-
     Venezolano? To what extent could Venezuela's financial 
     institutions and energy resources help Iran undermine 
     bilateral or international sanctions designed to stop its 
     covert nuclear program?
       The 2008 Country Report on Terrorism confirmed that Iran 
     and Venezuela continued weekly flights connecting Tehran, 
     Syria, and Caracas and that passengers on these flights were 
     only subject to ``cursory immigration and customs controls.'' 
     What is the U.S. government's understanding of the number of 
     passengers and nature of their travel as well as the type of 
     cargo transported on these flights? Is the Administration 
     concerned that these flights are being used for nefarious 
     purposes?
       On April 21, the Secretary of Defense issued a report 
     regarding the current and future military strategy of Iran. 
     The report states that Iran's Islamic Revolutionary Guard 
     Corps-Qods Force maintains world-wide operational 
     capabilities and that ``recent years have witnessed an 
     increased presence in Latin America, particularly 
     Venezuela.''
       What threat does the Islamic Revolutionary Guard Corps-Qods 
     Force presence in Venezuela pose to the United States and our 
     interests in Latin America? What if any measures is the 
     Administration taking to verify the extent of terrorism 
     activities in Venezuelan territory? How is the Administration 
     ensuring that all appropriate branches of the U.S. government 
     are aware of these key findings?


  IMPLICATIONS OF ADDING VENEZUELA TO THE STATE SPONSORS OF TERRORISM 
                                  LIST

       The State Department currently designates four nations--
     Syria, Cuba, Sudan, and Iran--as state sponsors of terrorism. 
     These countries provide ideological support and material 
     assistance to terrorist groups. Once you consider the 
     evidence behind Venezuela's substantial ties with U.S.-
     designated terrorist organizations and state sponsors of 
     terrorism, we would like to know the strategic implications 
     of designating Venezuela a state sponsor of terrorism. We 
     would also like to know the implications for the integrity of 
     this list if Venezuela continues to evade designation.
       Looking into the future--and short of designating Venezuela 
     a `State Sponsor of Terrorism'--what other concrete measures 
     are available to curb President Chavez' threatening ties with 
     terrorist groups and state sponsors of terrorism? Under what 
     conditions would the Administration apply such measures? Does 
     the U.S. government have a contingency plan to respond to a 
     sudden and prolonged unavailability of Venezuelan oil exports 
     to the United States?
       Given that Chavez is expected to receive a $20 billion loan 
     from the Chinese Government and his government has just 
     signed yet another multi-billion dollar arms deal with Russia 
     for weapons that far exceed any rational analysis of 
     Venezuela's national defense requirements--it is clear that 
     this is the time to revisit our polices within the region. We 
     encourage you to work with all appropriate federal agencies 
     in obtaining thorough answers to these questions. We look 
     forward to further discussions about what steps the 
     Administration plans to take in order to address these 
     disturbing developments within our hemisphere.
           Sincerely,
         John Ensign,
         George S. LeMieux,
         James M. Inhofe,
         Jon Kyl,
         John McCain,
         James E. Risch,
         Roger F. Wicker,
         Sam Brownback,
         Jim Bunning,
         Scott Brown,
         Robert F. Bennett,
         John Cornyn.

  Mr. LeMIEUX. We hope to receive a response from the Department of 
State. I know firsthand that Secretary Clinton is focused on Latin 
America. I have spoken to her on several occasions. I know she knows we 
need to do a better job promoting democracy in Latin America. She 
shares that concern. We have had those conversations.
  For too long, Latin America has been neglected by the United States 
in our diplomatic relations. For a variety of reasons, some of them 
with good merit, we have been focusing to the east. But we cannot 
neglect our friends in Central and South America. We cannot neglect our 
friends in Colombia, for example, or in Panama. That is why I have come 
to the floor on several occasions and called for the ratification of 
the free-trade agreements between our country and those countries that 
only makes sense. It not only makes sense for jobs and commerce, but it 
also makes sense in terms of our good relations with our friends in the 
region. No better friend do we have than in Colombia, right next door 
to this very concerning state of Venezuela.
  The reason I come to the floor specifically today is that when we 
sent this letter on May 25, we expected to receive a response. Yet just 
last Friday, Assistant Secretary Arturo Valenzuela, Assistant Secretary 
of State for Western Hemisphere Affairs, was asked about this letter 
because there was an upcoming trip by the Secretary of State to South 
America.
  Secretary Valenzuela was asked why Secretary Clinton was not going to 
Venezuela, and he explained. Then the question of this letter came up, 
and his response was:

       Oh, I don't--because I was traveling, I don't know anything 
     about that letter, so I'd have to find out.

  Now, I know they get a lot of letters over at the Department of 
State, but this letter is signed by 12 Senators. It has been widely 
covered in the media. It was relevant enough that someone would ask the 
question at a press conference. Yet Mr. Valenzuela, through some 
oversight, was unaware of the letter.
  I look forward to getting a response from Secretary Clinton and 
Assistant Secretary Valenzuela to this letter. There is a gathering 
storm in Venezuela. As much as we have to look across the ocean to our 
fears about Iran, their development of nuclear weapons and what they 
are going to do with those nuclear weapons, there is a concern to our 
south, very close to our shores in Venezuela, and a dangerous 
combination which is occurring between Iran and Venezuela, Ahmadinejad 
and Hugo Chavez.
  If we do not stay focused on it, mark my words, 3, 5 years from now 
we are going to be seeing all the same developments in Venezuela we 
have seen in Iran. We are going to see them starting to develop a 
nuclear presence for ``peaceful'' purposes. They are going to be 
playing from the same playbook Ahmadinejad has played from in Iran.
  We have to take aggressive measures against Iran. I have called, as 
many

[[Page 10067]]

Senators have, for this administration to get to work in a more 
expeditious way to impose those sanctions--meaningful, hard sanctions 
on Iran to stop their nuclear program. We are reading in the newspaper 
today about Iran--all the circuitous efforts it takes to reflag ships, 
rename ships so they can get weapons back into Iran and avoid our 
sanctions. We have to crack down on that. That is the diplomatic and 
foreign affairs problem of today. But the diplomatic and foreign 
affairs problem of tomorrow is Venezuela, and steps should be taken 
right now to work ahead of that problem so that 3 to 5 years from now 
we are not having all the same troubles with Venezuela that we are now 
having with Iran. Yet they are far closer to the United States than 
Iran is.
  So we sent this letter, and we look forward to the response. There 
are a lot of ramifications of declaring a country a state sponsor of 
terror. I am not asking that be done today. But I am asking it be 
seriously evaluated. That is why Senator Ensign and myself, along with 
10 other of our colleagues, sent this letter, and we would like to hear 
a response. We would like it to be taken seriously. We would like this 
administration to focus on Venezuela before it is a problem that gets 
ahead of us, before it is a problem we do not have enough time to 
address in a proactive and thoughtful manner.
  Little problems become big problems. This problem is already beyond 
being little. Let's get on top of it. Let's evaluate it. We hope we get 
a response to this letter as soon as possible, from the Secretary of 
State and the Assistant Secretary of State for Western Hemisphere 
Affairs.
  With that, Mr. President, I yield the floor.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DORGAN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                          Gulf Coast Oilspill

  Mr. DORGAN. Mr. President, I wish to say a few words about the 
oilspill in the gulf and what has or has not been happening recently. I 
don't think there is an American citizen who can really avoid seeing on 
television or hearing on the radio or reading in the newspapers about 
the devastating consequences of the oilspill in the Gulf of Mexico.
  The fact is, we have drilled for oil and have been producing oil in 
the gulf for a long time, dating back to the 1940s. I believe something 
like 50,000 wells have been dug offshore. So it is not a surprise that 
there has been oil development offshore in this country, and we have 
achieved drilling a fair amount of oil for the needs of this country. 
But it is also the case that deep well drilling--in this case, a well 
that is drilled into the ocean floor a full mile below the surface of 
the water and then down another 30,000 feet below that--is a very 
different situation.
  It is also now clear that this company, the company that was engaged 
in drilling this well, did not have the wherewithal, the technical 
capability to decide: If something disastrous happens, we should be 
able to shut down the gusher of oil. I would have thought and would 
have expected that the company would have covered the worst possible 
circumstances. What if the worst thing happens? Do we have the 
capability to address it? The answer at this point is no.
  This is the 50th day in which oil has been gushing out into the Gulf 
of Mexico from this oil rig blowup. It is pretty clear to everybody 
that, after trying a series of different things, the BP Corporation 
does not know how to address this gusher of oil into the gulf.
  I was reading this morning another news story about this.
  I confess to my colleagues that I don't live on the gulf. I am not 
from one of those States. They would, perhaps, know much more about it 
than I would. But most of us in this country are learning from the 
investigations that are being done, and we are learning more and more 
about not only what has happened, but what the consequences are.
  The story this morning: ``Rate of Oil Leak, Still Not Clear . . . '' 
So 50 days later, we don't understand how much is coming out of the 
faucet, how much is spilling from this gusher into the Gulf of Mexico.
  It is difficult or almost impossible to measure what has been the 
effect in recent days of some amount of containment that has been 
successful. We know they are not containing all of the oil, but they 
are gathering some of the oil. The question is, What amount? What 
percentage of the oil that is gushing into the gulf is being contained?
  One of the things that bothered me a fair amount is I am quoting now 
from a New York Times piece:

       On Sunday, engineers halted their efforts to close all four 
     vents on the capping device, because even with one vent 
     closed, the amount of oil being captured was approaching 
     15,000 barrels a day, the processing capacity of the 
     collection ship on the surface.

  If you are going to be able to collect more oil, why would you not 
have enough ships on the surface to be able to allow you to close more 
of those vents and to capture more oil and have the requisite number of 
ships on the surface to deal with it? I don't understand that at all. 
But it seems to me that every time we read something new about this, it 
is that somebody didn't plan properly to try to address this issue.
  The story goes on to say:

       Some scientists involved in the Flow Rate Technical Group 
     say they would like to produce a better estimate, but they 
     are frustrated by what they view as stonewalling on BP's 
     part, including tardiness in producing high-resolution video 
     that could be subjected to computer analysis, as well as the 
     company's reluctance to produce a direct measurement of the 
     flow rate.

  Continuing to quote:

       They said the installation of the new device and the rising 
     flow of oil to the surface had only reinforced their 
     conviction they did not have enough information.

  A Dr. Leifer said:

       It's apparent that BP is playing games with us, presumably 
     under the advice of their legal team. It's six weeks that 
     it's been dumping into the gulf, and still no measurements.

  Again, that is a direct quote from Dr. Leifer in this article.
  All of us understand that the consequences of this are devastating. 
We stand here and debate and talk and we go to hearings, yet there are 
people at the end of a dock in some small town who look out, and all of 
those fishing boats are idle, sitting at the dock, because it has 
destroyed the fishing in that area. The shrimpers who would normally be 
out dealing with the shrimp beds, their boats are idle, their nets are 
idle. Those are people who are losing money every day, the people who 
can't make a monthly payment on their boat that is sitting on the dock 
because they can't go out because their fishing industry is gone. Those 
people have to make payments at the end of the month. The person with 
the cafe or the restaurant on the dock that has very few people 
visiting these days is losing money hand over fist. You could go on and 
on about the consequences of what this has meant to the gulf--to the 
families, to small businesses, to the fishing industry, the shrimpers, 
and so on.
  So it seems to me it is time now, after 50 days, to ask a couple of 
other questions, and I am going to make a suggestion. I asked at a 
hearing recently whether the BP commitment, which says: We will pay or 
reimburse for all ``legitimate'' costs--I asked the Justice Department 
in a hearing: Is this pledge by BP a binding commitment? Does it bind 
anybody? The answer by the Justice department representative is that, 
no, it is not binding. It is a pledge.
  I think that is certainly better than not having a pledge--to have a 
company whose rig has caused this gusher of oil, this unbelievable 
spill into the Gulf of Mexico--if that company makes a pledge, it is 
better than having a company walk away. On the other hand, a pledge 
without a binding commitment doesn't mean very much.
  What I suggest at this point is that we, after 50 days, decide to go 
beyond

[[Page 10068]]

that pledge. I have seen people interviewed who have said: we have 
submitted to BP what is happening to our small business, our families, 
and our boats, and haven't gotten a response, or we got turned down, or 
this or that. It seems that we ought to understand the consequences of 
this, and the depth of the costs is going to require something very 
different.
  What I propose is the following: I think on this 50th day of the 
spill, what I believe should happen is that the Justice Department 
should go to BP and say: Let us formalize an agreement in which you put 
the first $10 billion from BP into a gulf coast recovery program. That 
gulf coast recovery fund would be available and would be run by two 
interests. One would be a special master who would represent the public 
interest, and the second would be a counselor who would represent BP's 
interest, and they would jointly manage the $10 billion gulf coast 
recovery funds--and it may need much more than that. At least the first 
step is that you have $10 billion in a fund, and you have some public 
interest that is now involved in making judgments. Look, BP has its own 
interests at heart. I don't doubt that it wants this gusher stopped. I 
understand that. I don't doubt at all that BP wants to minimize the 
damage. I am not suggesting otherwise.
  I am suggesting this: When presented with a range of alternatives, or 
of opportunities, or of actions, that a company will have to act in its 
best interest. That is the requirement for its shareholders. That may 
well not be in tandem or may not travel parallel with what is in the 
public's interest. That is why I think that it is now time to say to BP 
that you have made a pledge; is the pledge binding? Does it have real 
money behind it?
  We read and see that they have spent $1.5 billion at this point. This 
is a company that made $150 billion in net profit in 10 years. That is 
$15 billion a year. Again, what I suggest is a $10 billion payment into 
a gulf coast recovery fund, which the company would have a part in the 
management of, and a special master representing the public interest 
would have the management of, and that we proceed from there and 
determine how much more is required.
  Perhaps if the $10 billion is not all required, the company gets 
reimbursed. My own expectation is that the cost of this spill will far 
exceed the $10 billion when it is all done. This is going to last for 
years. We know that. This is not something that will be resolved in the 
next 6 months. I am talking now about the costs. Let us hope that 
finally, at long last, this spill, this gusher, gets shut down. But 
when that happens, there is so much more to do to try to understand 
what this means to the families who made their living on that coast. 
What does it mean to them? How do we go forward and recover? With what? 
That is why I think this gulf coast recovery fund, with BP's money and 
a special master involved in at least bringing the public interest into 
the discussion about what kind of outlays from that fund are made and 
to whom and for what purposes, is critical.
  I am going to write to the Justice Department today suggesting that 
this is an approach that should be taken. Look, if BP is approached and 
BP says, you know what, we don't intend to put money into a fund, that 
tells us a little something, doesn't it? Is the money going to be 
there, or isn't it? That is a partial answer to that. If the company 
says we don't intend to put money into a gulf coast recovery fund--if 
that is the case, then we have legislation on the floor with which we 
could address that issue. There are ways to address this with fees and 
other applications to the company that caused this damage. Better, it 
seems to me, to take the company at its word when it pledges that it 
will reimburse legitimate costs; but also say to them, as a result of 
that pledge, let's now make it binding and let's begin to put together 
this gulf coast recovery fund that represents a binding commitment from 
the company.
  If the company ultimately doesn't pay these costs, we know what would 
happen. It will go on the backs of the American taxpayer. That is not a 
fair way to resolve this, and it is not acceptable. It is a very large 
company. It has made a substantial amount of money. It made $6 billion, 
as reported, in the first quarter of this year alone. Surely a $10 
billion initial commitment into a gulf coast recovery fund is not too 
much to ask, to begin the construction of a fund that would merge both 
the public interest, which is important, with the private interest of 
BP, to make sure the funding is not only made available but that it is 
used in a way that addresses the significant costs that have been 
visited upon the people who live and work in that region.
  I know there are many ideas that are being kicked around in the 
Congress and elsewhere to try to address a wide range of issues. Many 
of them have great merit. It seems to me that we need to do something 
for the family this morning who is wondering whether it is going to 
survive, whether its business can survive, whether it can make its boat 
payment on the fishing boat at the end of the month when there are no 
fish to catch. When the restaurant pulls the shades because it has no 
customers and it is right near the dock--all these folks, and so many 
others, who have lost their jobs and who confront this questions of: 
What about us? What are we going to do? Will there be recovery for us, 
for my family, and for our small town?
  I think the best way for us to address this is to say let's make sure 
the pledge made by BP becomes a binding one. I think that can be done 
without legislation. It can be done by this administration and the 
Justice Department reaching out and signing an agreement creating such 
a fund, creating a special master with BP, having BP deposit the money 
so it could begin a robust, significant, and real recovery fund. If 
this company says that is not their intent, that they don't intend to 
do that, or they are not interested in doing that, then it seems to me 
a binding requirement is one we should take up here on the floor of the 
Senate, and very quickly. There are plenty of ways--and I will not go 
into them now--for us to address the question of whether the company 
that caused this spill, this gusher of oil, which is certainly the most 
significant disaster in the gulf in the last century and perhaps more--
if the company that caused that--whose rig caused that, says we don't 
intend to be a part of something like this, then there are approaches 
we can use here in the Senate to make that company responsible for it 
in a binding way.
  Mr. President, with that, 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. SESSIONS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                Amendment No. 4303 to Amendment No. 4301

       (Purpose: To establish 3 year discretionary spending caps)

  Mr. SESSIONS. Mr. President, I call up the amendment that is at the 
desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Alabama [Mr. Sessions], for himself and 
     Mrs. McCaskill, proposes an amendment numbered 4303 to 
     amendment 4301.

  Mr. SESSIONS. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mr. SESSIONS. Mr. President, Senator McCaskill and I are again 
offering this amendment that would place a cap on discretionary 
spending in which we participate in every day but that tends to violate 
the budget.
  Our budget is a critically important component of our financial 
management. I have been a member of the Budget Committee for a number 
of years, and it is very frustrating to see how it has gotten around 
the budget. The legislation that is before us is just another example 
of violating the budget in ways that are not responsible. For

[[Page 10069]]

example, the unemployment compensation and the payments to physicians 
are not emergencies. They are just not. Any responsible household, any 
responsible city, county, or State government knows that. When those 
leaders deal with financial crises, they have to figure out how to 
handle them.
  What we are doing with this legislation before us is borrowing money 
to pay a fundamental obligation of the United States of America, which 
is to pay doctors an adequate wage for doing Medicare work. They are 
already paid less for Medicare than private insurance pays them for 
doing the very same procedures, but we have another shortfall here. If 
Congress does not pass legislation, physicians will take a 21-percent 
cut in the amount of money they are paid. That cannot work because our 
physicians are already, in many cases, losing money on Medicare 
treatment of our seniors. They cannot take a 21-percent cut. They will 
quit doing the work. This is not a matter of debate. It will collapse 
the Medicare system. We need to do this, but that is the kind of 
expenditure that is fundamental. It is part of the obligation we have 
had for many years to pay physicians to do Medicare work. They do not 
do it for nothing. It ought not to be paid for by borrowing the money 
on top of all the debt we are now running up in this country.
  Our national debt just hit $13 trillion. We will, in 5 years--now 4--
double the national debt, and in 10 years we will triple the national 
debt. Why? Because we are taking items that are baseline requirements 
of this government and miraculously converting them to emergencies and 
then breaking the budget. If anybody objects, such as Senator Bunning 
did on behalf of his 40-some-odd grandchildren, he is attacked as being 
against physicians or against the unemployed. Senator Coburn has raised 
these issues. I support both of them. They are both right.
  If the American people understood how irresponsibly we are managing 
their money, they would be even more upset with us than they already 
are. The American people are right to be upset with us. We are 
converting fundamental governmental obligations to emergency spending. 
Why? Because we do not have to pay for it; we can just borrow it. That 
is not right.
  Senator McCaskill, my Democratic colleague, is concerned about these 
issues. We have worked together to offer this amendment that would make 
it harder to violate the budget caps, to make it more difficult and to 
help us to be more responsible in our spending. Quite a number of my 
Democratic colleagues joined with us in this amendment and voted for 
it. Fifty-nine Senators voted for it on one of our previous votes. We 
were one short of what is necessary to make it law--just one vote 
short.
  We are offering this amendment again. We have taken quite a number of 
steps to make this legislation palatable and to respond to concerns 
that some have raised, such as, would it impact the military? No. Would 
it impact legitimate emergency spending? No.
  We have done some things that some may believe weaken the amendment a 
bit, but it still adds some real strength to it and real value. This 
kind of budget cap legislation is what allowed us to balance the budget 
in the late 1990s. I know President Clinton has touted that he balanced 
the budget. If I recall, Congress--which appropriates every dollar that 
is spent--shut the government down at one point to try to contain 
President Clinton's proposed spending, and succeeded in doing so. That 
eventually led to a balanced budget. The legislation that was in effect 
at that time, which was very similar to this proposal, expired, and 
this is one reason spending has surged.
  I thank the Chair for the opportunity to offer this amendment. We 
will talk on it again later. I hope that we can enact these provisions 
into law and that we will get that one extra vote necessary to make a 
real bipartisan statement. We had bipartisan support for this amendment 
last time, and it would make a real bipartisan statement to the whole 
financial world that we are beginning to take seriously our 
responsibility to reduce this surging deficit. Only then will we begin 
to see the kind of stability in our economic markets that we must have.
  I thank the Chair, and I yield the floor.
  The PRESIDING OFFICER. The Senator from Iowa is recognized.
  Mr. GRASSLEY. Mr. President, today, our body starts debate on 
expiring tax and health provisions. Around this Capitol building, the 
nickname of these items is called extenders. I wish to make a couple of 
points on the process before I get into the substance of the 
substitute. My first point will reflect on how much the Democratic 
leadership has avoided a simpler, clearer, bipartisan approach. My 
second point will consider all of the other time-sensitive, unfinished 
tax legislation that appears to be abandoned with only a few weeks left 
in this session.
  My first point deals with a conscious decision to use a partisan 
process for bipartisan issues. What I find surprising is that we are 
taking up a package that, like the HIRE Act jobs bill of a few weeks 
ago, absolutely belongs to the bicameral House and Senate Democratic 
leadership. It was negotiated between House and Senate Democratic 
leaders, with some input from their tax-writing committees and staff. 
These discussions occurred entirely behind closed doors. As far as I 
know, it was a Democrats-only discussion. It is not a conference 
agreement, where things are worked out in a sophisticated conference 
committee made up of people from the House and Senate.
  Then, in addition, at the very last minute, the compromise took on 
the properties of an amoeba. In that amoeba fashion, the House Rules 
Committee split the bill into two pieces, one dealing with the so-
called Medicare doctor fix and the rest of the bill dealing with the 
balance of that package. Then, under the magic of the House Rules 
Committee, this amoeba-like bill was reconstituted into one legislative 
product, and that is the underlying bill Leader Reid has brought before 
the Senate this very day.
  I am relieved to see that it appears the Senate will process 
extenders in a way that is different from the way the HIRE Act jobs 
bill was handled. It looks as though we Senators will have a chance to 
represent our constituents and shape this bill, because Leader Reid has 
not filled the amendment tree or filed cloture at the start of debate. 
That is a real relief around this body, where amendment trees have been 
filled and cloture has been filed.
  Back home, folks wonder why it is taking Congress so long to deal 
with these routine extenders. As an example: As I left church Sunday in 
Cedar Falls, IA, a person who has investment in a biodiesel plant wants 
to know when we are going to pass the biodiesel tax credit bill. Most 
of the tax provisions expired almost a half a year ago, on December 31, 
2009. Folks are angry that Congress seems to be dithering, among other 
things, on the 71 tax provisions. In my State, it is a biodiesel tax 
credit that always comes up, but people are wondering about the 
dithering generally. And, of course, we even have physicians across the 
country being frustrated that this Congress has allowed a 21-percent 
cut in payments to go into effect again this year. Payment cuts of this 
magnitude severely impact physicians and health care providers and 
practitioners throughout the country, and they significantly threaten 
beneficiary access to care.
  Medicare beneficiaries' access to physicians and other needed medical 
care has been jeopardized this year as never before because Senate 
Democratic leadership has once again failed to pass an essential 
physician update in a timely manner. We could have wrapped up this 
time-sensitive legislative business 4 months ago. We could have taken 
up a bipartisan package that I put together with my friend, Finance 
Committee Chairman Baucus of Montana. To be sure, some of the structure 
in this package reflects the agreement that my friend and I reached. 
But this package, in terms of the impact on the deficit, is likely 
several times the size of the package we agreed upon. Virtually all of 
the additional cost is due to proposals I would not have agreed to in 
representing my Republican Conference.

[[Page 10070]]

  I was under the impression that the Senate Democratic leadership was 
genuine in its desire to work on a bipartisan basis, but clearly I was 
mistaken. Although the Senate Democratic leadership was highly involved 
in the development of a bipartisan bill, they arbitrarily decided to 
replace it with a bill that skews toward their liberal wing. That is 
why we are where we are this very day. There is a liberal agenda that 
exalts open-ended deficit hiking, spending, and tax increases, and 
doing it above everything else. Angry vocal members with that view seem 
to have dominated the decisionmaking of the Democratic leadership in 
resolving routine items.
  The actions in the House a couple of weeks ago go on to further prove 
my point. The Senate Republican leaders backed the Baucus-Grassley 
compromise of last February. To them, it seemed to be a balanced 
package. It was largely offset, it was leaner than most Democrats 
wanted, but it was thicker than most Republicans wanted. Republicans 
preferred a fully offset package using spending cuts; Democrats 
resisted most spending cut offsets and wanted many multiples of the 
level of spending with which Republicans were comfortable. So it is 
ideal, because this is the way it works most of the time between 
Senator Baucus and me.
  The Baucus-Grassley compromise was a genuine middle ground. But for 
the liberal core of the Democratic caucus, it was their way or the 
highway. Leader Reid responded to that pressure and scuttled the 
Baucus-Grassley compromise. Ironically, almost 4 months later, it looks 
as though the Democratic caucus is moving closer to the structure of 
the Baucus-Grassley compromise of last February.
  The Senate Republican Conference, seeing the alarming growth in 
deficits and debt in the intervening 4 months, will press hard for a 
fully offset package. For those in my conference, several fiscal 
events--and these all occurring in the intervening 4 months since the 
Baucus-Grassley bill was scuttled--have been compelling on my side of 
the aisle viewing this legislation a little bit differently.
  The first event is the second opinions we are receiving on the fiscal 
impact of the health care bill. The Congressional Budget Office has 
revised the official spending upward.
  Mr. President, I ask unanimous consent to have printed in the Record 
a copy of the CBO's May 11 letter to Congressman Jerry Lewis. The 
letter is accompanied by two tables that identify explicit 
authorizations of discretionary funding. These tables are available 
along with the full text of the letter on the CBO's website at 
www.cbo.gov.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                    U.S. Congress,


                                  Congressional Budget Office,

                                     Washington, DC, May 11, 2010.
     Hon. Jerry Lewis,
     Ranking Member, Committee on Appropriations, House of 
         Representatives, Washington, DC.
       Dear Congressman: As you requested, the Congressional 
     Budget Office is providing additional information about the 
     potential effects of H.R. 3590, the Patient Protection and 
     Affordable Care Act (PPACA, Public Law 111-148), on 
     discretionary spending. The following analysis updates and 
     expands upon the analysis of potential discretionary spending 
     under PPACA that CBO provided on March 13, 2010. In 
     particular, it provides an update of the earlier tally of 
     specified authorization amounts, as well as a list of 
     programs or activities for which no specific funding levels 
     are identified in the legislation but for which the act 
     authorizes the appropriation of ``such sums as may be 
     necessary.''
       Potential discretionary costs under PPACA arise from the 
     effects of the legislation on a variety of federal programs 
     and agencies. The law establishes a number of new programs 
     and activities, as well as authorizing new funding for 
     existing programs. By their nature, however, all such 
     potential effects on discretionary spending are subject to 
     future appropriation actions, which could result in greater 
     or smaller costs than the sums authorized by the legislation. 
     Moreover, in many cases, the law authorizes future 
     appropriations but does not specify a particular amount.
       CBO does not have a comprehensive estimate of all of the 
     potential discretionary costs associated with PPACA, but we 
     can provide information on the major components of such 
     costs. Those discretionary costs fall into three general 
     categories:
       The costs that will be incurred by federal agencies to 
     implement the new policies established by PPACA, such as 
     administrative expenses for the Department of Health and 
     Human Services (HHS) and the Internal Revenue Service for 
     carrying out key requirements of the legislation.
       Explicit authorizations for a variety of grant and other 
     program spending for which specified funding levels for one 
     or more years are provided in the act. (Such cases include 
     provisions where a specified funding level is authorized for 
     an initial year along with the authorization of such sums as 
     may be necessary for continued funding in subsequent years.)
       Explicit authorizations for a variety of grant and other 
     program spending for which no specific funding levels are 
     identified in the legislation. That type of provision 
     generally includes legislative language that authorizes the 
     appropriation of ``such sums as may be necessary,'' often for 
     a particular period of time.
       CBO estimates that total authorized costs in the first two 
     categories probably exceed $115 billion over the 2010-2019 
     period, as detailed below. We do not have an estimate of the 
     potential costs of authorizations in the third category.
       Implementation Costs for Federal Agencies--The 
     administrative and other costs for federal agencies to 
     implement the act's provisions will be funded through the 
     appropriations process; sufficient discretionary funding will 
     be essential to implement this legislation in the time frame 
     called for. Major costs for such implementation activities 
     will include:
       Costs to the Internal Revenue Service (IRS) of implementing 
     the eligibility determination, documentation, and 
     verification processes for premium and cost-sharing credits. 
     CBO expects that those costs will probably total between $5 
     billion and $10 billion over 10 years.
       Costs to HHS, especially the Centers for Medicare and 
     Medicaid Services, and the Office of Personnel Management for 
     implementing the changes in Medicare, Medicaid, and the 
     Children's Health Insurance Program, as well as certain 
     reforms to the private insurance market. CBO expects that 
     those costs will probably total at least $5 billion to $10 
     billion over 10 years.
       Explicit Authorizations of Discretionary Funding--Explicit 
     authorizations are identified in Tables 1 and 2. Table 1 
     presents a list of items for which PPACA specifies the 
     authorized amount of funding for at least one year. It also 
     includes items for which initial specified funding levels 
     existed under prior law but for which PPACA extends the 
     authority for continued spending. The specified and estimated 
     amounts shown in Table 1 total about $105 billion over the 
     2010-2019 period.
       Table 1 differs from CBO's table of specified 
     authorizations provided on March 13, 2010, in the following 
     ways:
       Certain provisions that extend (existing) authorizations 
     with a specified level have been added. (In the previous 
     version of that table, only new authorizations were 
     included.) Also, provisions that provide mandatory grants for 
     2010 but authorize future spending of such sums as necessary 
     (subject to appropriation) have been included. Those 
     provisions are noted in the updated table.
       Table 1 includes an estimate of the cost of section 10221 
     of PPACA, which incorporates the provisions of S. 1790, the 
     Indian Health Care Improvement Reauthorization and Extension 
     Act by reference. (CBO had not completed an estimate of the 
     Indian health provisions for the March 13 version of the 
     authorization table.) Those provisions authorize the 
     appropriation of such sums as are necessary for the Indian 
     Health Service (IHS) for carrying out responsibilities 
     broadly similar to those in law prior to enactment of PPACA. 
     As a result, the amounts included in Table 1 reflect recent 
     appropriations for those IHS programs, with adjustments for 
     anticipated inflation in later years.
       Table 1 also includes a few corrections to the table 
     provided on March 13. For example, section 5207, which 
     authorizes funding for the National Health Service Corps, was 
     inadvertently left off the March 13 table but is included in 
     Table 1.
       Table 2 presents a list of new activities for which PPACA 
     includes only a broad authorization for the appropriation of 
     ``such sums as may be necessary.'' For those activities, the 
     lack of guidance in the legislation about how new activities 
     should be conducted means that, in many cases, CBO does not 
     have a sufficient basis for estimating what the ``necessary'' 
     amounts might be over the 2010-2020 period.
       Although Tables 1 and 2 provide more information about the 
     discretionary costs associated with PPACA, they do not 
     represent all of the potential budgetary implications of 
     changes to existing discretionary programs--including both 
     potential increases and decreases relative to recent 
     appropriations. Some of those changes could affect spending 
     under existing authorizations or may lead the Congress to 
     consider making changes--up or down--in the funding for 
     existing programs. Moreover, some of the potential new costs 
     for individual provisions of the legislation may be covered 
     by the broad

[[Page 10071]]

     estimate of $5 billion to $10 billion for administrative 
     costs to HHS.
       I hope you find this information useful. If you have any 
     questions about this updated analysis of PPACA's implications 
     for future discretionary appropriations, please contact me or 
     CBO staff. The primary staff contacts for this analysis are 
     Jean Hearne and Julie Lee.
           Sincerely,
                                             Douglas W. Elmendorf,
                                                         Director.

  Mr. GRASSLEY. That letter documents CBO's projections that health 
reform will result in at least $115 billion in additional spending 
beyond what was previously included in the total of last March.
  In addition, Douglas Elmendorf, Director of the Congressional Budget 
Office, recently indicated that the landmark health care reform bill 
would not accomplish its primary fiscal objective of reducing Federal 
health expenditures.
  Dr. Elmendorf made this point in a presentation to the Institute of 
Medicine on May 26, of this year. The presentation is titled ``Health 
Costs and the Federal Budget'' and is available on the CBO website as 
well.
  The second event is the record buildup of public debt. Last week, the 
Federal public debt passed $13 trillion. On that monstrous number, $1 
trillion was added in the last year all by itself.
  The third event is the continuous mounting of the cost of the 
stimulus bill. Recent Congressional Budget Office scoring shows that 
policy, instead of being roughly $800 billion, is now exceeding $1 
trillion.
  The fourth event is the fiscal troubles in the country of Greece. Too 
much spending and public debt has put Greek public finance in a state 
of distress.
  The fifth event is the troubling developments in States with large 
open-ended social spending programs and already very high income taxes. 
The people who send us here are also reading these reports and they are 
rightfully worried about these fiscal troubles. They are sending one 
message to Washington, and it is as clear as any bell. They are saying: 
Reverse course on deficits and debt. They say we in Congress ought to 
restrain ourselves and our policies; pull back on extra spending. 
Republicans heard that message a while ago, and it looks to me as 
though Democrats are hearing the same thing.
  To sum up at this point, on the first point I have been speaking 
about--on process--the Democratic leadership, by avoiding a genuine 
bipartisan compromise, is continuing to take a very long path to 
resolving this overdue unfinished business. The bipartisan path to 
succeed was set forth almost 4 months ago--early February--and that was 
the Baucus-Grassley compromise.
  Unfortunately, the tax offsets--largely noncontroversial--were lifted 
from that compromise and used for something totally unrelated, but to 
cover the bloated spending in the health care bill. To retain the 
spirit of that compromise, those offsets would need to be replaced by 
restraints on spending. Republicans, in our alternative, will show the 
way to achieve those savings.
  As has been the case for the last year and a half, those who pay 
income tax and those who receive government checks aren't treated 
similarly.
  Even with those revisions, keep in mind on net, the taxpayer is 
paying at least $40 billion more in this bill. Spending constituents 
receive almost $100 billion in new spending.
  My second process point goes to time-sensitive legislative business 
that is yet unfinished in terms of revenue and taxpayers affected. The 
other unfinished tax legislative business dwarfs the measures in this 
bill now before the Senate.
  There are three major policy areas that need to be addressed. I do 
not know when they are going to be addressed. These three issues are 
the death tax, the current alternative minimum tax fix--that is an 
annual process we go through--and, three, the bipartisan 2001 and 2003 
tax relief plans. So I want to go into these in some detail.
  I have a chart that shows the status of these three policy issues. 
Let's start with the death tax, or the estate tax, whatever you want to 
call it. Since the first of the year there has been no death tax. If 
you died, up to this point, presumably, your estate is going to be tax 
free. At the end of this year, the death tax then reappears, and not in 
a very friendly way.
  After failing to act for almost 3 years in the majority, the House 
Democratic leadership put a death tax reform measure before the House 
last year at the same time it should have been discussed in the Senate. 
But the Senate has not acted on the House bill.
  I might suggest to you that we had to act on that health care bill 
because it takes effect in 2014, but tax extenders and the estate tax 
that had to be settled in December were not even discussed.
  In Iowa I can tell you that confusion and the anxiety over the 
uncertain state of the death tax comes up in my town meetings all the 
time. I would be surprised if other Senators are not hearing the same 
thing. I got a letter signed by 750 lawyers and accountants in my State 
saying: How do we advise our clients? What is the estate tax going to 
be for the future?
  It is not a case of just what the tax law is, it is the case of 
millions of people wanting to plan estates and cannot do it. I refer 
again to my friend, Chairman Baucus, who was working on a compromise 
proposal with Senators Lincoln, Kyl, and myself.
  Unfortunately, the liberal core of the Senate Democratic caucus seems 
to prefer no action at all. My friend, the junior Senator from Vermont, 
has been transparent about his desire to leave the law as it is; in 
other words, next year only have a million-dollar exemption.
  Others feel just as strongly, but perhaps are not as transparent as 
the junior Senator from Vermont. In any event, the effect of failing to 
reform current law will be to raise the number of people hit by the 
death tax by a factor of 10 times. What I am saying is, stalling out a 
bipartisan reform, which seems to be the liberal core's objective, will 
likely mean 10 times as many family farmers and small businesses will 
be hit with the death tax. A reform like the one envisioned by Senators 
Lincoln and Kyl will mean only the richest 10 percent of dead peoples' 
estate will face the death tax.
  Now I would like to turn to a second major area of unfinished 
business; that is, the alternative minimum tax fix. This is one of 
those yearly or biannual things the Congress goes through so that 
middle-class Americans will not pay a tax that was meant just for the 
very wealthy. So we are talking about this year's tax fix already.
  The law says 30 million Americans, or maybe more accurately 24 
million Americans, ought to be paying this income tax right now. The 
trouble is they do not file until next year, so it gives us a chance to 
do something about it. But for those filing quarterly, if they are not 
taking that into consideration they are violating the law.
  In the next week, on June 15, the second installment of this year's 
estimated income tax is due. Last year, 24 million middle-income 
families were spared from the unfair hit of the alternative minimum 
tax. The fix meant $2,300 per family. This year those figures are going 
to go up.
  If the law is not changed, all those families will have to pay at 
least $2,300 more per family. In my State of Iowa, it means at least 
124,000 middle-income families will be paying additional income tax 
that was only meant for the very wealthy.
  No bill has been marked up or passed in the House that deals with 
this problem. Under current law, some of these millions of families 
should be paying estimated tax next week, June 15.
  Finally, let's take a look at the third major area of unfinished tax 
business. Here we have a chart, and I am referring to the widely 
applicable rate cuts in family tax relief from the 2001 and 2003 
bipartisan tax relief plans.
  Virtually every American who pays income tax, and millions more who 
do not under current law, will have a higher tax bill if we do not 
extend the 2001 and 2003 bipartisan tax relief bills. For years I have 
referred to the sunset of these plans as a tax wall. Middle-income 
families will run right into a very firm wall of tax increases.

[[Page 10072]]

  For a family of four with an income of $50,000, that tax wall is 
$2,300. For a single mom with two kids earning $30,000, that tax wall 
is $1,100. No bill has been marked up or passed in the House that deals 
with this problem.
  You may hear some on the other side say: Too bad about the sunset. 
They argue that the bipartisan group wrote the tax relief plans with a 
sunset. The sunset, therefore, is the responsibility of the bipartisan 
authors of these plans.
  If that argument is advanced by members of the current majority, 
keeping in mind they have had control of Congress for 3\1/2\ years, I 
wait for that as an opportunity to quickly respond. My response will be 
to provide a citation of all of the filibusters led by the Democratic 
leadership on Republican attempts to make all three of these areas of 
bipartisan tax relief permanent law.
  The bill before us has very timely and important measures. In nearly 
all instances, the expiring tax provisions are treated the same way as 
they were treated under the Baucus-Grassley agreement of almost 4 
months ago, going back to early February.
  I thank my friend, the chairman of the committee, Senator Baucus, and 
the Democratic leadership for holding on to those pieces of the Baucus-
Grassley agreement. Especially important is an extension of the 
biodiesel tax credit because we have thousands of workers--and I have 
seen the figure of 23,000--who have been idled throughout 44 States of 
the United States as they have shut down the plants.
  So if you really want a jobs bill, reinstate the biodiesel tax credit 
and you will put thousands of workers in Iowa back to work, and about 
23,000 nationally.
  Likewise, Iowa companies, such as Rockwell Collins in Cedar Rapids, 
IA, have taken charges to earnings as the research and development 
credit has lapsed. Unfortunately, there are some notable deviations 
from the Baucus-Grassley agreement of last February. Two pieces of the 
Midwestern disaster relief package were dropped from the Baucus-
Grassley agreement in the Senate bill. The alternative fuels credit was 
altered to remove coal-to-liquids and other promising cutting edge 
technologies.
  The bill before us actually also leaves out some very important 
provisions of rural health care. These rural health care provisions 
where included in the Baucus-Grassley agreement of last February but 
have since been dropped by the Democratic leadership.
  Here again we will have a Republican alternative that will show the 
way on including these important items and having them offset; in other 
words, they will be paid for. These important rural health care 
provisions would keep ambulances running in rural areas and improve 
Medicare payments for both urban and rural hospitals so they are able 
to keep their doors open.
  There is also an important provision left off the bill that ensures 
that physicians in rural areas are paid fairly relative to urban 
States.
  Is that such a hard thing to figure, that if you are under Medicare, 
a national program, you ought to be treated the same in rural areas as 
urban America?
  The bill before us also fails to protect beneficiaries from having 
their physical and occupational therapy cut off. It also fails to 
extend the add-on payment for Medicare mental health services furnished 
by psychologists and mental health counselors.
  This add-on has been critical in improving access to mental health 
care services for Medicare beneficiaries and even military personnel 
suffering from stress and other mental health issues. Again, the 
Republican alternative will afford these protections and offset the 
costs; in other words, it will be paid for.
  The bill before us also fails to extend the Q-I program, which 
provides assistance to low-income beneficiaries. The Q-I program covers 
the Part B premium and out-of-pocket costs for seniors. Without it, 
many low-income seniors will be forced to decide between getting needed 
medical care and basic necessities such as food.
  The bill before us misses the opportunity to fix the incredibly 
short-sighted policy in the health reform bill that created a Medicaid 
payment cliff for primary care providers.
  Have we not learned anything from our Medicare provider payment 
problems? The Republican alternative converts the 2-years of additional 
payments to Medicare providers to a grant program to get States to 
increase payments to providers. The same dollars, but we do not end up 
having a cliff where there will have to be a lot of money made up at 
some future time.
  On the offsets side, as I indicated above, revenue raisers that were 
noncontroversial were lifted, and these were, in a sense, transferred 
for yet more spending in that bloated health care reform bill that 
passed in March.
  This meant the bicameral Democratic leadership had to yet scrape 
deeper to this offset barrel. They pulled out a House-passed change on 
carried interest. They raided the international tax policy area. They 
moved revenue-raising ideas out of that area and used them to offset 
proposals like yet another expansion of the Build America Bonds. That 
is a program I have questioned in the past.
  This transaction cannot bode well for efforts to reform our outdated 
and uncompetitive international tax titles.
  It follows the destruction of the bipartisan tax policy reform of the 
worldwide interest allocation rules. The losers are U.S.-based 
companies and their workers. The net tax cost of doing business 
globally will rise for American-based firms. We already have a 
noncompetitive corporate tax system. Why would we want to make it more 
uncompetitive? Why would we want to transfer more jobs overseas? This 
won't rise for competing firms based in other countries. So Japan, the 
UK, Germany--name any country--those competing firms will have a leg up 
because of the tax policy in this bill.
  Some characterized these generic tax increases as ending a tax 
incentive for shipping jobs overseas. As I have indicated, the opposite 
will occur. The embedded higher taxes burden only U.S.-based companies. 
In a globally competitive environment, with much of the growth in sales 
overseas, the impact of those taxes will have to be absorbed here in 
the United States. The after-tax rate of return on those U.S.-based 
business activities will decline. The costs will have to be cut 
elsewhere to pull the rate of return back up to a competitive level 
because, in this global economy, we have to compete. U.S.-based labor 
and other expenses will, as we might not be surprised, be cut.
  As with the health care bill, the American people are sending a 
message to those of us representing them in the Congress. The message 
is this: Finish these time-sensitive matters and do it in a fiscally 
responsible manner. Of course, that is a message that has been ignored 
for several months.
  Now we get to these tax extenders. They have been attacked as fat-cat 
tax breaks one week. Then a week later the same critics have labeled 
them as job incentives. They have been hijacked and manipulated for 
partisan purposes. That is why, 4 months after scuttling a bipartisan 
compromise on bipartisan policy, the Senate finds itself struggling to 
complete this bill. It could have been done so easily in February. This 
is somehow routine, unfinished business the American people rightly 
expect us to complete.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Maryland is recognized.
  Mr. CARDIN. Mr. President, I take this time to talk about amendment 
No. 4304, which I hope I will be able to get cleared by setting aside 
the pending amendment in order to offer it.
  At this time, let me bring to the attention of my colleagues what the 
amendment would do. This amendment would affect the Federal employees' 
health benefit plans by allowing the administrator to change the 
current rules to enroll children up to the age of 26. Currently, the 
restriction for Federal employees is that they can only enroll 
unmarried children to age 22.
  There are 8 million Federal employees and retirees covered under the 
Federal Employees Health Benefits Plan. As I am sure everyone is aware, 
under

[[Page 10073]]

the law recently passed and signed by President Obama, we have now 
extended coverage for children up to the age of 26. However, that 
becomes effective under the law for plans entered into after September 
23, 2010. For most plans, the requirement to include children being 
able to enroll up to age 26 would begin on January 1 of next year when 
the plan year begins.
  Private insurance companies have responded. They understand that this 
is not really a cost issue and that it makes sense to allow the 
children of the plan holders up to the age of 26 to be enrolled 
immediately. Most of the private insurance companies have responded by 
opening enrollment now.
  OPM Director John Berry would like to do the same. He has stated he 
would like to begin expanding coverage for enrollee adult children now, 
rather than wait until January to offer this cost-saving benefit. The 
problem is, current law prevents him from doing that because of the 
definition of a dependent child being an unmarried child, age 22.
  The purpose of this amendment is to give OPM the authority to start 
to enroll now children who have not reached their 26th birthday. This 
is particularly important knowing we are in the graduation season. Many 
of us are very proud to attend our children's graduations. Many of 
these children would like to remain on their parents' policy now that 
they are no longer eligible for insurance at college. Unfortunately, 
without this change, they will have to wait until January of next year, 
which will cause a lapse in coverage.
  The scoring of this is insignificant. We are not talking about a 
significant amount of additional cost. In fact, we believe it is really 
a cost-savings issue.
  This amendment was offered as a bill and enjoys bipartisan support. 
Senators Collins, Lieberman, Akaka, Rockefeller, Mikulski, Bingaman, 
Johnson, Kaufman, Kerry, Landrieu, Stabenow, Warner, Dodd, Dorgan, 
Levin, Cantwell, Casey, and Hagan have joined in cosponsoring this 
legislation. It has the support of the National Active and Retired 
Federal Employees Association, the National Federation of Federal 
Employees, the American Federation of Government Employees, the 
National Treasury Employees Union, and the list goes on.
  This amendment makes abundant sense. Our clear intent is to allow 
those who are under Federal employees' health benefit plans to take 
advantage of enrolling their children now. This amendment basically 
clarifies that law so that OPM can move forward to enroll children up 
to the age of 26 immediately and not wait until January of next year, 
causing a lapse in coverage. It is a bipartisan amendment, 
insignificant cost. I hope it will be cleared so I may offer it, and 
hopefully we can act on it without too much time.
  I yield the floor.

                          ____________________