[Pages S53-S92]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

HOPE FOR CHILDREN ACT

The PRESIDING OFFICER. Under the previous order, the hour of 10 a.m.
having arrived, the Senate will now resume consideration of H.R. 622,
which the clerk will report.
The legislative clerk read as follows:

A bill (H.R. 622) to amend the Internal Revenue Code of
1986 to expand the adoption credit, and for other purposes.

Pending:

Daschle/Baucus amendment No. 2698, in the nature of a
substitute.

The PRESIDING OFFICER. The majority leader.

Amendment No. 2698

Mr. DASCHLE. Mr. President, I appreciate the opportunity that we now
have to revisit the question of economic stimulus. This was a
contentious debate before we ended the First Session of the 107th
Congress last December. Over the course of the last several weeks, of
course, we have made an effort to try to find what I call ``common
ground'' in an effort to expedite the consideration of economic
stimulus and to move this process forward.
I don't have a calendar in the Chamber at this point, but I remind my
colleagues that we have very little time between now and the Founders'
Day recess to do all of the work that Republicans and Democrats have
indicated is important to both our agendas. Both caucuses have
indicated a strong desire to deal with economic stimulus, a strong
desire to deal with election reform, a strong desire to finish the farm
bill, and, certainly, a strong desire to deal with energy. My hope is
we could deal with all of those pieces of legislation prior to the
Founders' Day recess. In order to do that, we have to maximize the use
of every day.
We have 2 days this week. We have only 2 days next week because of
the Republican retreat. Then we have 2 weeks following that to complete
our work on all of the bills I have just mentioned.
In an effort to move the process along, I will propound a unanimous
consent request within the hour to see if we might find an agreement on
procedure on the economic stimulus bill. I would propose, as I
suggested to Senator Lott yesterday, four amendments on a side. I am
not wedded to that. If people have a desire to offer more amendments
than that, we could do that. But we have to get this ball started.
I am concerned, frankly, about reports I have received overnight that
there are some on the Republican side who want to slow walk this bill,
who don't want to bring it to closure, who, for whatever reason, have
decided now that we are on this bill that they don't want to have a
vote on final passage until perhaps 2 weeks from now. Keep in mind, we
are not in session next Wednesday. Some have suggested that we should
not have a vote on this bill until after the State of the Union
Message--that is Tuesday night--which means we then wouldn't be able to
complete our work until the following week.
I know of all the cries and anger and the anguish expressed by some
for the fact that we were not able to complete our work on the economic
stimulus bill last December. How ironic it would be that some of those
who have criticized the inability to come to some conclusion would now
be responsible for delaying it even further.
I hope that is not the case. I hope we can get an agreement that will
allow us to reach some procedural conclusion so we can complete the
substantive work on this bill prior to the end of the week.
Let me briefly lay out exactly what it is we are suggesting. Two
circles on this chart depict virtually all of the proposals that have
been made by either Republican or Democratic Senators, and oftentimes
Members of the House, with regard to economic stimulus. Democrats have
proposed increasing unemployment benefits, adding unemployment
compensation coverage for part-time workers and recent hires, and
providing affordable group health coverage for the unemployed. The job
creation tax credit for businesses was also something that we felt
would go a long way to addressing the need to stimulate the economy
from the business side.
We also supported extending the unemployment benefits for 13 weeks,
tax rebates for those who didn't get them the last time, the bonus
depreciation that would accelerate the depreciation on investments in
business, and then the fiscal relief for States.
States are very concerned that bonus depreciation, in particular, is
going to cost them about $5 billion. They are also concerned that the
Medicaid costs are going up dramatically. So the fiscal relief for
States is something that has been the subject of a number of very
urgent letters to us from Republican and Democratic Governors alike.
Our Republican colleagues suggested accelerating rate reductions, the
repeal of the corporate AMT--the alternative, and health coverage for
unemployed workers through individual insurance markets. They also
suggested extending unemployment benefits. They suggested the tax
rebates. They proposed bonus depreciation and fiscal relief for States.
Several weeks ago we began considering, well, how can we move this
bill forward? The suggestion was, let's just take the common elements
in the two circles, the overlap you see here on this chart, and
consider that as sort of the base proposal that might be used as a way
to move the bill forward, while not denying Senators the right, of
course, to offer other ideas, other suggestions, if the requisite 60
votes on points of order can be acquired.
So that is really what is before the Senate right now. We have taken
a House vehicle, the adoption tax credit, and we are amending the
adoption tax credit procedurally with this proposal as a way in which
to allow Senators to begin the debate on economic recovery.
The CBO has provided a real service to us over the last couple of
weeks, and I don't know if all of our colleagues had the opportunity to
see it. If they have not, I urge them to take a look at it. But the CBO
made an evaluation of the stimulative impact of all of the proposals I
have just listed here in these circles. The stimulative impact,
obviously, is a very significant factor, I believe, on what it is we
decide we want to offer for economic stimulus. The payroll tax holiday
offered by Senator Domenici is one of the provisions that had the
biggest bang for the buck, according to the CBO. Of course, we
suggested that that might be a component, but because there isn't
agreement on it, unfortunately, it certainly doesn't fit into this
common ground proposal at this point. I would have supported it. I
still do. But that has a large bang for the buck. Additional tax
rebates have a medium bang for the buck according to the CBO.
We are proposing in this common ground proposal the tax rebate for
those who didn't get any help the first time. Temporary investment
incentives, such as the bonus depreciation --again, that is a medium
bang for the buck--better than some, not as good as others. That is
also in the common ground proposal. So you have two of the items in the
common ground proposal, according to the CBO, that have a medium bang
for the buck, medium stimulative value.
Look at what the CBO said about accelerated rate cuts. They said it
had a small bang for the buck, and a corporate AMT repeal falls into
the small category, very little stimulative value.
Now, this isn't a Democrat position, this isn't an analysis made by
one of my staff; this is the Congressional Budget Office which has
provided the analysis. So, again, if we want to do what we say we are
doing here--provide

[[Page S54]]

some common ground on stimulative proposals that have the most effect--
according to the CBO, some of the proposals in here, such as tax
rebates, bonus depreciation, go a long way.
Let me address the unemployment benefits as well because that, too,
is something I think we ought to say something about. The CBO didn't
address that question, but the CRS did. The Congressional Research
Service said:

Extending unemployment compensation is, in fact, likely to
be a more successful policy for stimulating aggregate demand
than many other tax/transfer changes. Individuals who are
unemployed and who are not or will not be receiving
unemployment benefits are much more likely to spend
additional incomes than, say, higher income individuals who
receive tax cuts.

That is in a memo provided by CRS to Senator Baucus last fall.
Mr. President, I simply say again, if we are serious about moving
this forward, let's take those proposals that analysts and economists
have said have stimulative value. If we are serious about finding
compromise, what could possibly be wrong with taking the proposals that
both sides had in their initial proposal as a way with which to at
least get to conference? This is a ticket to conference. Then we can
have another debate about what ought to be in the bill. That is what we
are doing here. I just hope our colleagues will recognize that and will
recognize how limited a timeframe we have to address this issue and
move this legislation forward.
So I am asking my colleagues on the other side, let's come to some
agreement on amendments procedurally, let's come to some agreement on
amendments substantively, but let's come together. Time is wasting. I
don't want to see this bill slow-walked, or see this legislation
languish on the floor for days, when we can do this and move on to
other things that need to be done sometime very soon.
I thank the Chair and my colleagues. I yield the floor.
The PRESIDING OFFICER. The Senator from Iowa is recognized.
Mr. GRASSLEY. Mr. President, our status is, am I right, that we are
on the Finance Committee bill, the tax bill before us?
The PRESIDING OFFICER. The Daschle amendment No. 2698 is pending.
Mr. GRASSLEY. Mr. President, I think my colleague from South Dakota,
the distinguished Democrat leader, has made it very clear where we are
compared to where we were before Christmas. Let me repeat that we had
been working on an economic stimulus package in various ways for
several weeks, most of it not here on the floor of the Senate but in
small groups, and different groups, and bipartisan groups, and partisan
groups, to come together to see what we could get to get through the
Senate--a stimulus package--and the need for it was directly related to
the downturn in the economy that came mostly as a result of September
11 terrorist attacks. And then what finally happened was just before we
adjourned. A White House-centrist package that was put together by
mostly Republican and Democrat centrists, working with the White House,
was a bill that passed the House of Representatives before the bill
came here to the Senate. Then in the closing days of the Senate, prior
to adjournment for the holidays, the bill did not come up on the floor
of the Senate.
So we are back here now, afterwards, to a point where we are dealing
with something that is still very important to help dislocated workers
and to help bring the economy back from the recession caused by
September 11, the war on terrorism, and the attacks against America.
I emphasize again that where we ended up before Christmas was the
House of Representatives passing a bill that had been worked out by, I
think for the most part--and I hope I am not unfair to the House of
Representatives on this--by a group of centrists in the Senate, made up
of both Republicans and Democrats, who came up with a plan that had
White House support. The President said he would sign it. You never
know for sure until you take a vote, but it looked as if this White
House-centrist package would have had in the low fifties--but a
majority of the Senate--to pass the Senate, if it had been able to be
brought up.
We were not allowed to bring it up and discuss it. That is a
decision, under our Constitution, that the majority leader can make. I
may find fault with the decision; I do not find fault with his right to
do that.
Now on the second day we are back in session in the new year, this
bill has been brought up. The sad commentary is we are 1 more month
into the recession, 1 more month of 800,000 people unemployed because
of the September 11 terrorist attacks, and a lot of people who used to
have health insurance do not have health insurance and dislocated
workers are not being given the help the bipartisan White House-
centrist stimulus plan would have given them. Also, we do not have
those tax incentives that will stimulate the economy.
As the distinguished majority leader just said, there are certain tax
rebate plans the CBO said would be of help in stimulating the economy.
There are certain accelerated depreciations that were in the bipartisan
package that would help the economy. So, effectively, we have lost 30
days, and people who needed help are not getting the help.
I am glad to be back here, though, and I am glad the majority leader
has taken the initiative of bringing this issue up. Hopefully we can
get an agreement to pass a bill and get it to the President.
I need to reiterate that we had a bill worked out by a group of
Democrats and Republicans in the middle of the political spectrum in
the Senate. That is why we call them centrists. They worked out a bill
with the White House. The White House said the President would sign the
bill. The bill received a favorable vote in the House of
Representatives, and here we are.
I would like to get back to where we left off before the holidays, so
I am going to spend my time this morning before other speakers come to
the Chamber to speak on this very important issue of why the bipartisan
White House-centrist stimulus package ought to still be the package
before the Senate, even more so than the amendment about which the
distinguished majority leader just spoke and why it should pass the
Senate, although I sensed in the majority leader's statements that he
is willing to look at things beyond his proposal--at least I hope I
interpreted that right--so that we can get something to the President.
I hope somehow our debate can persuade him to come back to what we
have: a bipartisan White House-centrist stimulus plan that was before
the Senate because we know that it has passed the House, and all it has
to do is pass the Senate and the President will sign it and these
800,000 unemployed workers who do not have health insurance, if they
have exhausted their first 26 weeks of unemployment, will still have
unemployment compensation.
I am going to start with some discussion of the tremendous commitment
to displaced workers that the White House-centrist stimulus plan has in
it. The plan's unemployment insurance proposal represents what I
consider a very unprecedented commitment to dislocated American workers
and, in the end, probably may be something, if one looks at long-term
solutions to the problems of uninsured, to help uninsured people as
well.
I start with the fact that it provides an additional 13 weeks of
unemployment benefits to eligible workers. Remember that about 10
percent of the unemployed people use up to 26 weeks. Maybe that is even
higher than 10 percent now because of the recession. There is always a
need for some more unemployment compensation for some people. We do not
always respond to that with an additional 13 weeks. We are doing it
because there was a calamity on September 11 which has speeded up the
unemployment index as a result by 800,000.

We have an estimated 3 million unemployed workers who would qualify
for benefits averaging $230 a week. These benefits would be 100-percent
federally funded.
The bipartisan White House-centrist plan would also transfer an
additional $9 billion to State unemployment trust funds. This transfer
would provide the States with the flexibility to pay administrative
costs, provide additional benefits, and avoid raising unemployment
taxes during the current recession.
Consider the bipartisan White House-centrist commitment to providing

[[Page S55]]

health care for dislocated workers. This commitment goes further and
wider than any other proposal, and it gets more help to more people
more quickly than any other proposal.
It commits over $19 billion, out of the total package of about $100
billion, to health insurance assistance. This is over six times as much
money for temporary health insurance assistance as provided under the
original stimulus proposals.
The bipartisan White House-centrist plan takes a three-pronged
approach to get health insurance to people in need.
First, the plan provides a refundable, advanceable tax credit to all
displaced workers eligible for unemployment insurance, not just those
eligible for COBRA. The value of the credit is 60 percent of the
premium. The credit has no cap and is available to individuals for a
total of 12 months for the next 2 years, including 2001 to 2003.
The individuals can stay in their employer COBRA coverage, or they
can choose policies in the individual market that may better fit their
family's needs. This only makes sense because we should not lock people
into one straitjacket of health insurance which under some proposals
would be just the COBRA approach because sometimes these policies are
too expensive for people to keep. I say that even with the 60-percent
subsidy that we would provide.
The bipartisan White House-centrist proposal also includes a major
new insurance reform to protect people who have had employer-sponsored
coverage and go out into the private market for the first time after
being laid off. The bipartisan White House-centrist proposal makes
COBRA protection available to people who have only had 12 months of
employer-sponsored coverage rather than 18 months under current law. By
doing this, we greatly expand the group of displaced workers who cannot
be turned down for coverage or excluded because of a preexisting
condition.
The new 12-month standard is especially important to people with
chronic conditions who have difficulty getting affordable insurance.
The second prong of the White House-centrist bipartisan proposal is
$4 billion in enhanced national emergency grants for States which can
be used to help all workers--not just those eligible for a tax credit--
pay for health insurance because they have become unemployed.
The third prong of the proposal includes $4.3 billion for a one-time
temporary State health care assistance payment to States to help
bolster those States' Medicaid Programs. We are seeing almost all 50
States in trouble with their Medicaid Program because of the recession.
As we know, the Medicaid Program is an important safety net program for
low-income workers and families of disabled workers.
I yield the floor now to other colleagues, but I suggest that we have
a lot in this bipartisan White House-centrist proposal that can
immediately, when the President signs the bill, help the 800,000
workers who are unemployed because of the September 11 terrorist
attacks on America.
We ought to get the show on the road. It should have been done before
Christmas. It is not too late to do it right now. I hope people would
study this proposal that has been developed by a group of people in the
center of the Senate, both Democrats and Republicans, and move this
bill along. We have 50 votes for it, and if people will study, I think
we will even get a much higher percentage.
I yield the floor.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. Mr. President, in politics, like everything else, common
sense dictates what is sensible and reasonable and really what people
should do, and common sense in this debate indicates the two sides,
Democrats and Republicans, should separate what they do not agree on
and move forward on what they agree.
Senator Daschle has offered a very reasonable approach to stimulating
the economy. He has said the Democrats have certain things they want
that the Republicans will not support. The Republicans have legislation
they want to initiate that we will not support. There are things we
both agree on, Democrats and Republicans. There has never been any
question about the fact there are certain things we agree on.
Senator Daschle outlined four things we agree on. As an example,
extending unemployment benefits. Everyone agrees we should do something
to help the unemployed. If we want to stimulate an economy, give money
to people who have no money and they will go out and spend it on
things, and that is stimulative.
Now we are in a situation where we are being told: Of course, we
agree on those things, but we do not want to go forward with it. And I
say, why?
With all due respect to the Republican leadership and the people on
the Republican side, maybe there is a game being played called a
``blame game.'' In yesterday's Daily Monitor, which comes out actually
in the evening, the publication reports they had a conversation with
Senator Lott.
A paragraph out of the Daily Monitor reads:

Lott predicted many amendments would be offered. Asked
whether that would mean debate would likely last through
next Tuesday, the day of President Bush's State of the
Union Address, Lott said it might, paused, then winked.

Those people were saying there was a lot of laughter after his wink.

Bush is expected to propose his own stimulus plan in the
speech.

That is what this is all about. This is what it has been about for a
long time. We are trying to come forward with a stimulus package that
helps the American people.
Some of their proposals have merit, some of our proposals have merit,
but not enough to get 60 votes. So why do we not do those things we
agree on? The answer is not blowing in the wind. The answer is the
minority does not want a stimulus package to pass prior to the State of
the Union Message next Tuesday. It is as simple as that.
So no matter how much good faith Senator Daschle might show, no
matter how much common sense Senator Daschle may pronounce, the fact is
it appears they are not going to let us do anything until after next
Tuesday, which is too bad.
I attended a meeting at the White House yesterday with the President,
Senator Daschle, and the Republican leadership. Statements were made,
and there was a lot of feel-good stuff about ``we need to work
together,'' and we do. But winks and nods are not the way to pass
legislation. The way to pass legislation is to agree on things we agree
on and move forward with that.
As far as the things we do not agree on, Senator Daschle has
suggested yesterday and on several occasions, let us come with the
package he has suggested and have each side offer amendments, two
amendments, three amendments, four amendments. We could complete those
by week's end. Certainly we can do it by the State of the Union date.
I assume we could go one step further. It was even suggested we put
time limits on each of those amendments, an hour or 2 hours on each
amendment. But, no, we waited. The Republicans held a conference
yesterday evening starting at 5:30 and it went for a couple of hours to
determine whether they should proceed on the suggestion of Senator
Daschle that we go forward with what both parties agree on.
Now maybe there should be more stimulus to this economy than that,
but at least it would be something to start with. Think of the
unemployed as an example. Think also of the small businesspeople who
could really use a depreciation allowance that was bigger and broader
than the one now. That is one of the things everyone agrees on, but yet
they are waiting in the wings.
What about States who are desperate for Medicare help, why are we not
doing something there? Everybody says we should do it. Well, I am sorry
to say it is because of the wink. We are going to stall things until
Tuesday night, and then the President can come and speak on national
television and say, why can Congress not get together and give us a
stimulus package?
I say to the American people, I say to the people in my State of
Nevada, we could have a stimulus package in the next day or two if we
go forward on this proposal to agree on what is agreed upon by
everyone. There is no dispute. No one is coming and saying we do not
agree on those four things that Senator Daschle wants. Everybody agrees
on those. What they are unwilling to do is to take away the fact

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that President Bush has already written his speech and he has a
paragraph or two long paragraphs, about the country being in an
economic strait and we need a stimulus package, and why will Congress
not work with him to get a stimulus package.

I could help write that speech because that is what it is going to be
about. I do not think I need to help write the speech because it has
already been written and they do not want to change any words of that
speech. They want to proceed and try to come up with a political
advantage in saying the Democrats, led by Senator Daschle, will not
allow them to go forward on a stimulus package. I am saying that is
untrue. It is unfair. It is unrealistic.
Common sense dictates we should go forward with a program that
everyone agrees we should go forward with, costing about $70 billion.
It would be $70 billion worth of stimulus that would be reciprocated
numerous times and help the economy.
The PRESIDING OFFICER. The Senator from Arizona.
Mr. KYL. Mr. President, I will take a few minutes to explain what I
think is really going on. There is an old saying that if you let me
define the terms of the debate, I will win the debate every time. That,
I think, is what the majority leader and the assistant majority leader
are trying to do today. They are suggesting, with a straight face, that
the proposal is agreed to by both sides, so why should we not proceed
with it and who would want to amend it?
Well, it is not agreed to by both sides. Let us get back to the
definition. Something that is called an agreement, that both sides have
agreed to the provisions of, would seemingly be something that could
pass very quickly, and that would not be amended.
So why are those of us on this side of the aisle saying, ``Wait a
minute, you are trying to hijack the President's stimulus package, redo
it the way you want it, and still characterize it as something that we
agree with?'' We do not agree with it.
What happened is after September 11, whether the economy was
beginning to improve by then or not, it was clear the events of
September 11 were driving our economy down, especially in the travel
and tourism area but all throughout the economy. Large and small
businesses both were beginning to suffer. People stopped traveling.
They did not invest as much. Businesses were not investing as much. The
President very quickly called for a proposal that would stimulate the
economy and protect and create new jobs.
That was the essence of his proposal, to protect jobs and to create
new jobs. In fact, he was able to put together a program and propose it
on October 4 and 5, about 3 weeks after the September 11 event, and he
called upon Congress to join him in this effort.
Some of us on this side of the aisle were urging the President to
propose certain things we thought would be very effective in
stimulating the economy, and the President said no. He said that while
he agreed with us that cutting the capital gains tax and making the tax
cuts permanent and doing things of that sort would really help to
stimulate the economy and protect jobs, he was not going to propose
that in his package because now that we are in a time of war, he
believed that he had to act in a bipartisan way to promote unity among
our leaders in Washington, and to get both Democrats and Republicans to
quickly agree on a package we can pass in Congress and he could sign
into law. That is what is needed for the American people. He said, I am
going to propose a package that includes a few of the things that
Republicans think are good ideas to stimulate the economy and a few of
the things our friends on the Democratic side believe should be in such
a package, and I will present that in a bipartisan way.

He did that on October 4 and 5. There were ideas that represented the
main themes of both political parties. Republicans had primarily asked
for a repeal of the corporate alternative minimum tax, acceleration of
all marginal income tax reductions, and accelerated enhanced
depreciation. Those were the kinds of things that Alan Greenspan and
others who came before our Finance Committee said would help stimulate
the economy and get over what he defined as an ``investment
recession.'' In other words, businesses were not doing enough to make
capital expenditures. These kinds of provisions would help provide the
incentive for those capital expenditures.
Democrats had called for other things: Payments to nontaxpayers who
were not part of the rebate program from the original tax cuts of 2001,
an extension of unemployment insurance, and grants to States for health
benefits for displaced workers.
The President said: I will take those three components that our
Democratic friends supported, I will take the three components that
some Democrats and Republicans support, and I will put them together in
a bipartisan bill in the hope we can quickly, in a unified, bipartisan
way, enact this package for the benefit of all Americans.
By the way, the House quickly passed a version of what the President
proposed, but not exactly what he proposed. The majority leader in the
Senate said no.
Let me fast forward, before going through the rest of the history,
what the majority leader and the assistant majority leader have talked
about this morning, something they call a lowest common denominator
package, something to which both sides agree. They have defined it that
way. What they have done is take the things from the President's
original proposal that they wanted and said: We agree to those, so that
is our package. By the way, we will take one of the things the
President wanted and stick it in there. That means we have a
bipartisan, lowest common denominator package. Why can't we just pass
this little bill? At least we both agree on it.
As the assistant majority leader said: Maybe there should be more
stimulus in the bill. Indeed, there should be more stimulus in the
bill. There is only one item in the bill that provides any kind of
stimulus to the economy, only one item, the accelerated depreciation--
which we still don't know the details of--that provides investment
incentive to protect and create new jobs. It is clearly not a stimulus
package.
However, by defining what we have agreed upon as what you have agreed
upon, they have tried to hijack the President's proposal and
recharacterize it as something it is not. It is not something we have
agreed upon. The President would never have proposed just the items in
this bill and said, that is good enough for me, it is a balanced
package.
It is designed to provide benefits to people who are unemployed. That
does not stimulate the economy. But the President believed that was
important to do. At the same time, it included limits that would
actually provide more incentive for investment--that critical element
of capital that is needed to spur the economy and protect and create
jobs.

The Democratic leader has said: Fine, I will take one part--the part
I like--say we have not agreed on the rest, and define that as a bill
upon which we have all agreed. It reminds me of the old saying: What is
mine is mine, and what is yours is up for grabs.
They basically pocketed what the President was proposing as a
compromise, a bipartisan proposal, taken the part they liked, rejected
what they did not like, and then said: Why not bring that to the floor
and have a vote on it? After all, it was part of what the President
proposed. Exactly. It was ``part'' of what the President proposed, but
not, importantly, the part that would stimulate the economy.
I am all for helping those who are unemployed. The President made a
big point of wanting to help those who are unemployed and therefore to
extend the unemployment benefits. However, I think we all agree, people
would rather have a paycheck than an unemployment check. This bill does
virtually nothing to stimulate the economy, to protect jobs, and to
create new jobs. It would be a sham.
When the minority leader yesterday said, you bet it will take beyond
next Tuesday to get this right, all he was doing was stating a fact
that, without amendments to this bill which provide real stimulus, of
course we could not, with a straight face, vote on this bill and call
it a stimulus package. Of course, the President is right next Tuesday
to urge us to do what he asked us to do in early October, throughout
the month of October, throughout the

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month of November, and then December, until we finally went home on
December 22 without having acted on a stimulus package.
The economy is still not doing very well. People are still out of
work. What the President is going to be asking is to please get on with
the job of enacting a bill and to not redefine this by simply taking
what you like out of his proposal and recharacterizing that as a lowest
common denominator agreement upon which we both agreed.
I see the distinguished majority leader is here. Before I conclude my
remarks, let me make this statement. I think the proposal he has made
here treats the President in a very unfair way. I know the President
was trying to reach out to the other side, to include things the other
side wanted, and that he wanted, in an effort to be bipartisan, in an
effort to try to get this done quickly, so we wouldn't be into next
year, the year 2002, when we finally passed a stimulus package. I do
know for a fact, he left things out I would have liked to have seen in
there. I don't think the distinguished majority leader probably would
have liked them very much. The President knew that. He didn't want to
have a highly partisan bill. He didn't want to have a particularly
controversial bill. That is why he proposed a balanced package.
I think it takes unfair advantage of the President, in his offer to
be bipartisan and to try to get this done quickly, to just take the
part you like and say, that is the part we agree with, we reject almost
all the rest of it, but why not pass that?
Let me go back a little bit in time to review what happened. After
the President made his proposal on October 4 and 5, the House passed a
bill. The Finance Committee, on which I sit, began to work on the bill.
By the way, remember, the Finance Committee enacted a bipartisan tax
cut proposal earlier in the year, so it is a committee that has in the
past and even began last year working together in a bipartisan fashion
to get things done. I thought I could do that with the stimulus
package, taking the President's proposal, perhaps modifying it, but
trying our best to come up with something that would be passed in a
bipartisan and quick fashion. It turned out that the Finance Committee
was not going to write the bill. It would be written in a partisan
fashion by just one party, not both. When the package finally came
before the committee, I thought it was interesting, I never could
figure out who claimed parentage of it.

Several leaders on the Democratic side said actually they didn't
write it, and with good reason: It was not something of which to be
proud. It had $54 billion in new spending; only $21 billion could be
characterized remotely as stimulative measures. Out of a total of $117
billion in the bill, it had $5 billion in extra agricultural spending,
provisions added in the dead of night to bring Democrats on board--and
also, in my personal view, as a means of getting some of the special
interests on board on the bill.
For example, the Commodity Purchase Program, and expenditures for
things such as soybeans, pumpkins, snap beans, rum, tuna--all kinds of
things--special tax credits for Amtrak, almost all of which have
virtually nothing to do with getting the economy going again as a
result of the September 11 events, but all of which were designed to
bring more people on to support the bill.
Needless to say, that bill could never pass. It was voted out of
committee on a strictly party line vote and obviously did not pass
before the end of the session. The President, in an effort to try to
move this thing along, kept encouraging us to develop a bill that could
pass. The House passed another bill which I thought was a much better
bill than the first bill they passed and much more along the lines that
some of our colleagues on the Democratic side were proposing. Still,
that bill did not come before the Chamber.
Finally, in desperation, in mid-December, a group of Democrats and
Republicans in the Senate--the so-called centrist group--got together
and developed a proposal that they thought would at least be an
approach to stimulus as well as taking care of unemployed workers and
be representative of the compromise that might bring about the
President's agreement, and which they could then propose to the Senate
and get it passed.
They took it down to the White House and met with the President. He
said: OK, you have a deal. It isn't what I originally proposed, but it
is a great effort at compromise, and I will agree to it, and I will
agree to sign it; it is passed.
The President urged those of us on the Republican side of the aisle
in the Senate to lay aside the other things we wanted to try to
accomplish in this bill in an effort to get this finished before we
went home for Christmas--to agree to the centrist coalition approach
the Senator from Iowa, Mr. Grassley, described, part of which was in
his remarks earlier.

I also confess that I wasn't enamored by some of the provisions of
the bill. I thought it did far too little to stimulate the economy. But
in an effort to reach bipartisan compromise and get this done before
the end of the year, as far as I know, virtually all of my colleagues
on the Republican side of the Senate agreed to support that centrist,
bipartisan approach which the President said he would sign.
Still, the majority leader said no. Instead of taking that proposal
up, we took up the railroad retirement bill, a big agricultural
spending bill, and some other items before we went home for Christmas
and the New Year's recess. We didn't do a stimulus package.
Now, we come back in January after the recess when a lot of criticism
has been heaped upon those who prevented us from getting a stimulus
package voted on, passed, and sent to the President. The American
people are not happy with the status quo. I think they understand with
the President that we should have done something a long time ago but
that it still is not too late to try to help our economy. People
continue to be laid off around the country. We have to help them, not
only by temporarily extending their unemployment benefits but, as I
said before, to get them a paycheck and not just unemployment checks.
That means providing the capital for investment that will create the
jobs that will put them back to work and get the economy moving again.
That is what the President proposed today. It is what the second
House proposal did. It is what, at least to some extent, the centrist
coalition proposal would do, and it is necessary that we get on with
that job.
What is before us today is not that kind of proposal. What is before
us today is not a compromise. What is before us today is not something
that has been ``agreed to'' by both sides. It has been characterized by
our colleagues on the other side of the aisle as moving forward on what
we agreed on. That is a mischaracterization. As I said before, it is
taking some pieces of the bipartisan proposal the President suggested,
pocketing those, and saying: Well, we both agreed on that. We are going
to reject the rest of what you proposed, Mr. President, but since you
proposed this as part of your package, we will characterize that as
what we agreed on, and that is what we will vote on here.
That is incorrect, and, as I said before, I think it is taking
advantage of the President's good faith efforts to try to move
something forward with which both sides could identify and which would
have gotten the economy moving back in October of last year.
That is why on this side we have said we are happy to now have this
stimulus bill on the floor. We can finally begin debating what is
necessary to get this economy moving again, take care of the people who
are unemployed today, and make sure we can get them back to work
tomorrow. That is the key. But in order to do that, we are going to
have to put something in this bill that actually provides stimulus and
will help to actually put more capital investment into the system so
jobs can be created and people can go back to work.
We can't simply accept what has been put on the floor here, which, as
I said before, has essentially no stimulus effect in it. That is why we
are not going to agree to a process which would terminate our ability
to offer amendments which we see as necessary to try to get this bill
back to a more balanced kind of a bill and to try to provide something
that will actually stimulate the economy.

I will have more to say about this. I see some of my colleagues on
the other

[[Page S58]]

side. I am, frankly, curious to see what their approach to this is,
given the fact it should be very clear by now that they can no longer
characterize this as a bill comprised of things we agreed upon, because
we don't agree to them.
Three of the four items were in the President's package. In one form
or another, they were in packages we were willing to support as long as
they were accompanied by other provisions, but not standing alone.
Standing alone, there will be virtually nothing to stimulate the
economy. And I don't think we can with a straight face, therefore, say
this is a job creation, stimulus package. With the amendments we could
propose, we could get them. If our colleagues on the other side will be
open minded about some of those amendments, I think we can get there.
As a matter of fact, we have a couple of amendments ready to go. We
will, I think, have majority support on the other side of the aisle. I
regret that probably it is going to take 60 votes to pass any amendment
because of the rules of the Senate. I am not objecting to the rules. I
understand those rules. But because any amendment is probably going to
take 60 votes, it will be very hard for any amendment to pass. As a
result, we will probably be stuck with the bill that has already been
laid down.
But I think it will be interesting to see whether a majority of our
colleagues will actually agree to certain proposals such as that
offered by the centrist coalition. That should suggest there is a
bipartisan way to proceed here.
I just hope my colleagues on the other side of the aisle will agree
that in that circumstance, if at least a majority of the Senate is
willing to vote on a compromise package that will have a stimulative
effect, we have an obligation to get this done for the sake of the
American people sooner rather than later and that maybe we could work
together and accomplish this result without too many more days having
elapsed.
I will have a little more to say about this in the future. I hope
very much that we can over the next few days get to a point where we
can pass a bill, go to conference with the House of Representatives,
and quickly present the President with a bill that will get people back
to work in this country and get our great economic engine moving
forward full steam ahead.
The PRESIDING OFFICER. The Senator from Minnesota.
Mr. WELLSTONE. Mr. President, I ask unanimous consent that I be able
to follow the majority leader.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. REID. Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. DASCHLE. Mr. President, I ask unanimous consent the order for the
quorum call be rescinded.
The PRESIDING OFFICER (Mr. Reed). Without objection, it is so
ordered.
The majority leader is recognized.
Mr. DASCHLE. Mr. President, about an hour ago I noted that we have a
lot of work to do in a very short period of time. We have talked
jointly--Republicans and Democrats--about the need to do not only
economic stimulus but the farm bill, the energy bill, and the election
reform bill. We have 2 days this week. We have only 2 days next week.
And then we have 2 weeks before the Founders' Day recess.
I do not know how we can accommodate all of those unless we can move
this legislation forward. We had lengthy debates about the economic
stimulus bill for weeks in the remaining period prior to the end of the
last session.
I suggested to Senator Lott yesterday that perhaps one way we could
expedite the consideration of this bill, without any time limits, is
simply to get a limit on amendments. I have been told there are some on
the Republican side who would rather not complete work on this bill
perhaps not only not this week or next week but until the week after. I
hope that is not the case.
There is much to be done. As I said, I think there is mutual
advantage to getting it done. So I indicated about an hour ago that I
would propose a unanimous consent request that would simply recognize
the facts I have just stated. I am not wedded to the particular
amendment limit I have suggested in this unanimous consent request. I
am going to be proposing we limit amendments on either side to four
each. That would accommodate Senators on either side who may wish to
add to this common ground package I have suggested. They can offer a
substitute. They can do any one of a number of things. If four does not
work, I am happy to entertain an alternative number. But we have to
start with something. So that is my intention.

Unanimous Consent Request

Mr. President, I now ask unanimous consent that there be four first-
degree amendments in order for each leader or their designees to the
pending matter; that if the Senate passes H.R. 622, as amended, then
the Senate immediately turn to the consideration of H.R. 3529, the
House stimulus bill; that all after the enacting clause be stricken and
the text of H.R. 622, as passed, be substituted in lieu thereof; the
bill be read a third time and passed; the Senate insist on its
amendment, request a conference with the House, and the Chair be
authorized to appoint conferees.
The PRESIDING OFFICER. Is there objection?
Mr. KYL. Mr. President, I object and just note that I do so on behalf
of the minority leader as well as myself. I note there is no intention
to delay. If we could pass the bipartisan Centrist Coalition amendment
and not have a point of order raised on that, we could have this done
by this afternoon. So the object is not to delay. The object is to try
to make sure we have a good bill.
The PRESIDING OFFICER. Objection is heard.
Under the previous order, the Senator from Minnesota is recognized.
Mr. NICKLES. Will the Senator from Minnesota yield just for a couple
of minutes?
Mr. WELLSTONE. I will be pleased to yield. I will follow the Senator.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. I tell my good friend and colleague, the majority
leader, his request was to take up the bill he introduced and have a
few amendments on it, and objection was heard on that--I think for good
reason. But I will tell my friend and colleague, if the majority leader
is willing to take up the House-passed tax bill, I will work with him
to come up with a limited number of amendments and see if we can't get
that passed in the next couple of days.
So if he will modify his request, and instead of using the bill he
introduced, to make that the House-passed tax bill, I will work with
him to come up with an agreement to limit the amendments and try to get
it passed in a very expedited fashion.
I yield the floor. I just wanted to let my colleague know that.
The PRESIDING OFFICER. The Senator from Minnesota is recognized.
Mr. WELLSTONE. If the majority leader wants to respond, I will
withhold for the majority leader.
Mr. DASCHLE. I thank the Senator from Minnesota.
I will be brief. Let me just say, the whole purpose in this exercise
is to find common ground. If this isn't the common ground, I am willing
to entertain any amendment that might be viewed as better common
ground. But we know that whatever common ground proposal we find has to
attain at least a 60-vote threshold.
We know the House-passed bill will not reach a 60-vote threshold. We
know the Democratic proposal will not reach a 60-vote threshold. So
simply to take up a bill that we know will fail does not get us any
further along.
The whole idea, as I said at the beginning, is to seek some
compromise that would allow us a 60-vote threshold. So we are still
waiting. We are still searching. We are still hoping we can offer
amendments in the effort to accommodate that goal--a 60-vote threshold.
So I appreciate the kind offer of the Senator from Oklahoma, but I
think he knows, as I do, that isn't going to get us where we need to go
if we are going to complete our work on this bill.
Mr. DORGAN. Will the Senator from South Dakota, the majority leader,
yield?
The PRESIDING OFFICER. The Senator from Minnesota controls the time.
Mr. DORGAN. I ask if I might inquire of the majority leader.

[[Page S59]]

Mr. WELLSTONE. Please.
Mr. DORGAN. I just listened to a rather lengthy discussion by the
Senator from Arizona about where we are and how we got here. He
characterized the position of the majority leader as having been
unwilling to compromise on virtually anything at any time for any
period of time. That, it seems to me, is at odds with what has happened
in the last couple months in relation to economic recovery or the
stimulus package.
I wonder if the Senator from South Dakota could respond to those
rather lengthy comments about his so-called failure to compromise on
these provision.
My observation, I would say, has been that the majority leader has
been willing to compromise on virtually all of these provisions in
order to try to reach an agreement. But despite those compromises,
there has not been any budging on the other side.
Could the Senator from South Dakota, the majority leader, respond to
the assertions we have just heard from the Senator from Arizona?
Mr. DASCHLE. Unfortunately, I was not in the Chamber when the Senator
from Arizona made his remarks, so it would be difficult for me to
comment specifically. But if that is the tenor of the comment made by
the Senator, let me simply refer him to my opening remarks today which
I made about an hour ago.
I had a chart that showed, in a circle, the proposals made by the
Republicans and, in a circle, the proposals made by the Democrats.
There is an overlap of those two circles.
The list of items in that overlapped part of the two circles is what
we have before us. They are not word for word identically proposed.
They are different. The concepts are different.
I appreciate the senior Senator from Minnesota helping me with my
visual aids, handing me this chart. On this chart is shown the common
middle area which comprises several issues that are common to both
Republican and Democratic proposals.
We both have proposed unemployment benefits. We both have proposed
tax rebates. We both have proposed bonus depreciation. We both have
proposed fiscal relief for States.
Mr. NICKLES. Will the Senator yield?
Mr. DASCHLE. As I said, they are not identical, but the components
are found in both bills. If that isn't the definition of
``compromise,'' I honestly do not know what is.
All I am suggesting is, we take that as the base vehicle and use it
as the subject for whatever amendments Senators wish to offer. So that
is really the issue.
The Senator from Minnesota has been very kind with his time. I
appreciate him yielding to me.
The PRESIDING OFFICER. The Senator from Minnesota.
Mr. WELLSTONE. Mr. President, I just will build on what I think the
majority leader was saying. I will be very honest. I was listening to
him propound this unanimous consent request, and I was thinking: We are
talking about four provisions. I don't know how any Senator can
disagree with any of them: The tax rebates, the business relief--we can
go over all of them--the State stimulus which is critically important
for Medicaid, and the extension of 13 weeks of unemployment benefits.
Then I think the request was saying there would be two--how many
amendments on each side?--four amendments all together.
Mr. DASCHLE. No. No. If the Senator will yield, let me make sure
everyone understands the proposal. The proposal was that either caucus
have a minimum of four amendments to offer in addition. So there would
be amendments to the package proposed as the common ground vehicle.
Mr. WELLSTONE. So what I was thinking about was: Look, I can think of
a number of amendments I would want to do alone, which would extend
unemployment benefits beyond 13 weeks, which would bump up the
benefits, which would increase the eligibility. What about health care
assistance? I am thinking that might not be enough.
But then I was thinking: Look, here is what we agree on; and then
Senators from both sides of the aisle can bring other amendments to the
floor. And I am sure the distinguished Senators from Oklahoma or
Wyoming have other ideas. So do several other Senators. And then we
just move forward. We have amendments. We vote on them.
We are all accountable for our votes. But we do the work of democracy
as opposed to one big, gigantic stall, which is what we are actually
experiencing right now. That is what this is about.
I simply want to say that, to me--I keep struggling to do this. I
keep struggling to connect all this sort of strategy and tactics with
people's lives back home. Sometimes it is hard to do it. We get here
and get so caught up in how we are going to get it done.
The majority leader is trying to move this forward now. But I will
tell you, there are so many people who are flat on their backs through
no fault of their own. They are running out--if they have not already--
of unemployment insurance. They do not have any health care coverage.
The States are in a world of trouble right now in terms of their own
budgets and Medicaid costs. We could pass this. And maybe there will be
some amendments that will be introduced on both sides that will improve
upon this. Political truth is elusive.
My guess is the definition of ``improvement'' of several of my
colleagues from the other side might not be my definition. I will have
amendments. I will want to make sure that families can afford to
purchase health insurance for themselves and their loved ones. I will
want to make sure that part-time workers and working poor are eligible
for unemployment insurance and that they get better benefits. And
colleagues from the other side will have other amendments.
Let's be very clear about this. This is one big, gigantic stall. The
whole idea is, let's just put it off. Let's not move forward. It is
just one big coordinated political strategy. Maybe it is a great
political strategy. But from the point of view of people back home, it
is not.
I heard my colleague from Arizona--and this is the last thing I will
say about the past; then I will look forward from today on--about how
we didn't do the work before the break and how the Democrats didn't do
this and didn't do that and there was no ``stimulus plan.'' If my
memory serves me correctly--again, the Senator from Arizona might not
agree--indeed, we had an economic recovery plan. There were 53 votes or
maybe 54 votes, and it was blocked on a procedural point. Some would
view it as filibuster. We didn't get 60 votes. We had a plan. There
were some Republicans who supported it. It was terribly important, and
it was blocked.
Now my colleagues are just dying to bring over the House measure. I
can't remember whether it has the big Enron bailout money in it now or
not. Frankly, the House of Representatives tried so hard to reach back
to the mid-1980s and get as many billion-dollar or half-a-billion-
dollar breaks to this large company or that large company or this
family with an income over $500,000 or this family with an income of $1
million, I can't even remember all they were trying to do.
With all due respect, ``Robin Hood in reverse'' tax cuts with 50
percent plus of the benefits going to the top 1 percent, not even
scheduled to take effect for a couple of years, much less giving $1
billion here and $1 billion there to a different multinational
corporation, Enron at one point in time included--that may be too
embarrassing to do any longer--I don't think it has a heck of a lot to
do with economic recovery.
Economic recovery is the here and now. Economic recovery is how you
help people who are flat on their backs. Economic recovery is how you
help people consume. Economic recovery is Keynesian economics. Economic
recovery is how you have a stimulus that really jump starts the economy
now. Economic recovery is strategic investment in the economy to get
the economy going, not ``Robin Hood in reverse'' tax cuts, not $1
billion here or a half a billion there for this big company and that
big multinational corporation, not even scheduled to take effect right
now, having nothing to do with getting the economy going right now.
But I will tell you what it does do. We will see a lot of this over
the next couple of weeks. What it does do is assure a huge, ideological
victory for Senators who believe that when it comes to the most
pressing issues of people's lives, there is not much the

[[Page S60]]

Government can or should do which, by the way, is a great philosophy
when you own your own large corporation. It doesn't work for the vast
majority of families and working people in our States.

If we go forward with what my colleagues are talking about--and I
certainly would love for us to go forward; I would like for this
unanimous consent request to be accepted--we will start with what
Senator Daschle has offered. I don't think very many Senators are
opposed to any of these provisions. The Senator from Oklahoma is. In
which case, we will have debate. Then we will have an up-or-down vote.
Then there will be other amendments. And all of that will work out.
But the other part of this is, with all due respect, I think what is
happening here right now is, it is about more than economic recovery.
That is part of it. This is a big, gigantic stall. My colleagues from
the other side of the aisle don't want to move forward on this economic
recovery package. We could move forward. We have a minimum of four
amendments on each side. We debate them, and we vote on them. And
people back home hold us accountable. In addition, what we can agree
on, we agree on, which will provide at least some help for people and
maybe even some help for the economy.
I am not sure actually whether or not we have anywhere near enough of
an economic recovery package here, but I sure would like to start with
what we agree on. I would sure not like to see this stalled out.
The other agenda I want to speak on for a minute or two is this
gigantic stall today in the context of trying to add on to the tax cuts
which are going to bleed this economy. The truth is, all this
discussion, CBO analysis about deficits and where we are going, not
only raises questions about the surplus, but you are going to see it in
the President's budget plan. You will see a budget plan that basically
is going to say, forget the commitment to fully funding IDEA, kids with
special needs, and helping out schools and education in our States.
That is all I am hearing about back in Minnesota. When I go to the
school board meetings, 1,000 people show up at a time. The surpluses
are gone. Teachers are being eliminated. Class sizes are going up.
Afterschool programs are being eliminated, huge fees for co-curricular
activities, be it music or athletics, on and on. And people are saying
to me: Paul, thanks. The Senate did a pretty good job on this, a real
good job, bipartisan, voted for full funding for kids with special
needs. It would have been $2 billion more for our State over the next
10 years. It would have made a difference. It would have been $45
million this year.
It was blocked by House Republican leaders, blocked by the
administration. I do no damage to the truth. That is what happened. Do
you think now we are going to get more of a commitment? Are we going to
get anywhere near full funding? Are we going to get anywhere near the
resources from the Federal Government back to our school districts,
including what we promised? No.
And now my colleagues want to add even more ``Robin Hood in reverse''
tax cuts, going to the top 1 percent big multinational companies. That
means we have no resources. That is what it is all about. If you don't
think we should be doing much by way of education and you don't think
we should live up to our promise of prescription drug benefits for the
elderly, building on to Medicare, and if you don't think we should do
anything about the crisis in affordable housing, I argue to the Chair,
who does so much work in education, that affordable housing is becoming
the second most important educational program in the country. When 8-
year-olds are moving two and three times a year because their families
can't afford housing, it is real hard for them to do well in school.

I could go on and on because, frankly, it is going to all go on and
on. You are going to see it when it comes to the commitment to
transportation infrastructure. Veterans are going to ask, what happened
to them; how come people are not saying this to them any longer, above
and beyond the Fourth of July parades? Across the board, that is what
we are going to see.
We are heading for a huge debate where the differences make a
difference. That is fine with me. It doesn't need to be done. The
Senator from Oklahoma came by. We shook hands, had a good time. I like
to mix it up with people. It is my nature to like people. But we will
just have the differences.
The Senator from Texas is out here. He knows what that is about. That
is fine. It will be an intellectually honest debate about the role of
government, about pressing issues in people's lives, about priorities,
about where we make our investments, about how we raise money, about
who we support, about how we invest in the economy, about what we do
for our children, about whether or not we protect the environment. All
of these issues can be debated and should be.
What I am little bit skeptical about now is just a big stall. This
isn't like a big debate. This is a big stall. That is what my
colleagues on the other side of the aisle are about right now.
I yield the floor.
The PRESIDING OFFICER. The Senator from North Dakota is recognized.
Mr. DORGAN. Mr. President, I listened with interest today to my
colleague from Arizona, and now my colleague from Minnesota, on this
subject of economic recovery. This is a critically important subject.
This is not the normal run-of-the-mill policy that we debate here in
the Senate. Our economy is in some trouble, and I am not sure any of us
quite understand how much trouble. It is a new economy. We don't have
models by which we can judge what happened in the past and therefore
project what might happen in the future. This is a new global economy
that operates and behaves in ways that are different than perhaps
represent our conventional understanding.
I know my friend from Minnesota mentioned that our colleague from
Texas, who is in the Chamber, came from a background of teaching
economics, I believe, in college. I, too, briefly taught economics in
college. I like to say that I have gone on, nonetheless, to overcome
that experience and lead a reasonably productive life.
The field of economics is not much more than psychology pumped up
with a little helium. We have all kinds of economists in this country
who will give us their best guess of what has happened and what will
happen. But nobody really knows.
We have heard suggestions from respected economists in America, Nobel
Prize winners no less, that we have an economy that is in a recession;
that we have rather substantial overcapacity in this economy, and the
most effective way to jumpstart this economy is to do the kinds of
things that represent a boost in consumption. This morning, one of my
colleagues talked about increasing business investments. Perhaps there
is a need for some of that. But most economist will tell you that
during a time of recession, when you have overcapacity, the quickest
way to jumpstart an economy is to boost consumption.

What menu of plans has been introduced that would do that? One of my
concerns is that there is almost no room to be critical of a plan these
days because if you are critical, somehow you are taking on the
President in an unfair way.
I gave the response to the President's radio address a couple weeks
ago, and I received a letter from a guy who said he was listening and
almost drove off the road when he heard me. It was a shrill, partisan
letter. Some of us receive those periodically. My response to the radio
address--about the first one-third of it was about what a outstanding
job this President has done prosecuting the war against terrorism. I
complimented him and Secretary Powell and Secretary Rumsfeld and
others. I talked at great length about that.
Then I said, on the subject of economic recovery, that we have
differences. I talked about those differences. I debated the
differences in policy. Norman Vincent Peale once said: Most people
would rather be ruined by praise than saved by criticism.
There is nothing, in my judgment, that injures this country by having
a full-scale debate break out on something that represents important
public policy.
Let me talk a bit about some of the ideas that have been brought
forward on the subject of economic recovery. In my judgment, the
goofiest idea, if I can

[[Page S61]]

use that term, came from the House Ways and Means Committee. We just
had a colleague suggest that we start with that bill here on the floor
of the Senate. The proposition is that we go back to 1988 and provide
tax rebates to large corporations for the alternative minimum taxes
they paid over the last 14 years. Somehow that is represented to be a
piece of economic recovery policy.
That is not going to promote economic recovery. It doesn't have the
foggiest thing to do with economic recovery. It has everything to do
with writing a very big check to some of the biggest corporations in
this country. They paid tax under what is called a ``minimum tax''
because in the 1980s we decided we didn't want to have companies making
billions of dollars in net profit and paying zero in taxes. We thought
there ought to be some minimum at least. That was the proposition.
But, of course, the House Ways and Means Committee, on which I used
to serve, wrote a bill that said, by the way, let's provide rebate
checks to all those companies that had to pay minimum taxes dating back
to 1988, such as IBM. We will give them a $1.4 billion check. Ford
Motor Company--give them a billion-dollar check.
Does anybody think that will promote economic recovery in this
country, when we are in a recession and have overcapacity in the
economy. No, that is just a giveaway. I will not apologize to anybody
for having passion about public policy and saying, when somebody
recommends doing something that will increase the deficit, that augurs
against the interests of the average American citizen and will do
nothing to help the economic recovery but will enrich those who don't
deserve that by giving them rebates for taxes they should have paid--
minimum taxes, not regular taxes. Nobody deserves an apology from those
of us who say that makes no sense; that won't help this country.
So we have a debate about those kinds of policies. I use that just as
one example. My colleague, the majority leader, said let's take those
areas of intersection between what the President and others have
proposed, and where there is common ground, let's offer that, have
amendments to it, and pass it.
One area is extended unemployment benefits to those who have lost
their jobs. Two months in a row, we have had news that 400,000 American
people have lost their jobs. So 400,000 additional Americans came home
from work one night and had to tell their families that they got a
notice that they had lost their jobs.
Do you know who most of them are? Most of them are families who know
about second shifts, second jobs, secondhand, and second mortgages.
These are the families at the bottom of the economic ladder, and they
know about these things. They are the first to lose jobs in a
recession.
Now, we asked 11 of the leading economists in this country what we
could do to give this economy a boost, what would really promote
economic recovery. Virtually every single one of them said this: If you
extend unemployment benefits to those who have lost their jobs during
an economic downturn, that money is immediately spent by those who
receive it because they need it. They need a helping hand during tough
times. When they are down and out, they need a hand. They will spend
that money immediately. That is exactly the kind of help that
stimulates the economy. That is what we have done in every economic
downturn in the last 25 years.
So that is a provision the majority leader brings to the floor today
that says: Look, the President says he supports that; we support that.
Let's take that provision and pass that provision. Three additional
provisions represent the same approach--common provisions agreed to by
virtually everyone. He says let's move that which we can move, allow
people to offer amendments to it, but let's not drag our feet any
longer on these issues. Let's have some movement and action to try to
give the economy a lift, with policies that we know and which
economists tell us will help this economy recover.
We talked a great deal in this Chamber about policies in kind of an
antiseptic way. There is not much about real people and the effect of
policies on real people. Just take one of those 400,000 people who, in
October, had to tell their family they had lost their job, or one of
those 400,000 people, in November, who had to tell their family: I have
lost my job, but it wasn't my fault. This economy is in a recession.
It was in a recession prior to September 11, and then those two
airplanes that ran into that World Trade Center and murdered thousands
of innocent Americans. That act of terror and mass murder cut a hole in
this country's belly and created additional victims. They are people
who lost their jobs because this economy continued to slow down even
more following those terrorist attacks. So those people came home at
night to say to their families: I have lost my job, my ability to make
a living.
It is said that the unemployment rate is 5.8 percent. For someone who
goes home having to tell their family they have lost their ability to
make a living, their unemployment statistic is 100 percent. They have
lost their job. That is pretty tragic for families to have to explain
to others that they no longer have a paycheck coming in. In most case,
these are hard-working Americans. They are at the bottom of the
economic ladder, scratching and clawing and trying very hard to move up
and do well for their families.
In a recession, in an economy that turns sour, it almost always
injures them first.
That is why this provision at the very least ought to be embraced by
everyone immediately.
Mr. President, I will make one additional comment. If politics was
hot air, there would be enough to lift this building. I understand all
that. But, frankly, on both sides of the aisle, we have men and women
of good faith who really want to do the right thing. Let's try to find
a key today to unlock this and find a way for Democrats and
Republicans, conservatives, liberals, and moderates to understand that
we all live in the same country. We all live on this same spaceship
Earth. We are all Americans, and we want what is best for our country.
It is not disloyal to break out in open debate about one policy or
another, but at the end of the day, we must compromise. We must find a
way to reach common agreement in ways that will help the American
economy. I hope that is the case.
Let me finish as I started. I think this President deserves the
praise of the American people and this Congress for many things in
recent months. I think the leaders of this Congress--my colleagues,
Senator Daschle and Senator Lott--deserve praise in many ways for a lot
of the things they have done to bring us together to deal with the
threat to our country. I want to provide the same kind of praise to all
of us for coming together--the President, yes, Senator Lott and Senator
Daschle--to reach agreement now on an economic recovery package.
What the majority leader has proposed makes good sense to me. He said
we have all kinds of plans out there. Let's take that area where those
plans intersect and we have reasonably common agreement. Let us move
those and then come back and see if we can reach agreement on others,
or take those areas of common agreement, offer some amendments to them,
and see where the votes are and then move forward.
What the majority leader has proposed makes good sense. I hope others
will embrace it today.
In the end, I am not interested in what is good for the Republican or
the Democratic Party or the President or Congress. There is not a
Republican or a Democratic way to go broke. There is not a Republican
or Democratic way to lose your job. It is not a partisan thing to have
to tell your family that you lost your job yesterday.
This is not about politics. It is about whether we are going to do
the right thing for the American people. Yes, for businesses, many of
which are struggling, and especially for families, many of whom have
received the news of a job being lost in an economy that has turned
sour.
What can we do to help this economy? A lot of the problems of this
country we have talked about in recent days will be solved by a growing
economy that provides opportunity and hope once again to families, to
workers, and to businesses.

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It is interesting, there is one story going around about a
corporation that failed in this country. That is a tragedy as well. But
it is always the case when we see these situations, somehow those at
the top end up doing real well and those at the bottom end up losing
their shirts.
In many cases, that is what happens in a recession as well. I hope we
can understand that as we grapple with the questions of how do we pass
legislation that gives this country's economy a chance to survive and
how do we give American families and businesses some hope that tomorrow
will be a better day, that they understand the American economy will
offer opportunities for them again in the future.

Mr. President, I yield the floor.
The PRESIDING OFFICER. The Senator from Texas.
Mr. GRAMM. Mr. President, I want to begin by talking about the
history of how we came to where we are today. Then I want to talk about
where we go from here.
When it became clear that the country was in a recession--in fact,
before many people in Congress recognized that we faced an emergency
situation--the President started to talk about a stimulus package. The
President met with Democrats and Republicans.
I remember a day I went down to visit with the President as he was
soliciting advice as to what should be in a stimulus package. My advice
was that there are two things we could do that would dramatically help
the economy and that during the recession not only would not cost us
money, but incredibly would probably put money in the Treasury. Those
two proposals--not surprisingly, given that I made them--were to cut
the capital gains tax rate and to make the tax cut permanent.
From the time of John Kennedy, in each and every case where we have
reduced the capital gains tax rate, we have encouraged people to more
efficiently manage assets, we have encouraged investment, and people
have actually paid higher taxes--at least in the short run and often in
the long run--as a result of those changes.
It seemed to me then and it seems to me now that cutting the capital
gains tax rate would be the cleanest, most efficient, least expensive
way of stimulating the economy. In fact, for the remainder of this
recession that action would almost certainly put money in the Treasury,
not take it out.
In terms of making the tax cut permanent, what could be more
destabilizing than having a Tax Code that is going to expire in 10
years? We tell people about how we are cutting their tax rates, we are
eliminating the marriage penalty, we lowered the 15 percent rate, we
will repeal the death tax, and yet everybody who has read the fine
print knows in 10 years, because of a budget technicality, the old Tax
Code comes back and a massive increase in taxes occurs in 1 day.

In fact, there is the absurdity that if you die today, you face one
set of taxes on your small business or your family farm that you built
up; if you die 9 years from now, you face no death taxes; and if you
die 10 years from now, the Government takes 55 cents out of every
dollar you have earned in your lifetime and takes it away from your
family, often forcing people to sell their small business or sell their
family farm.
What do you think people think about the prospects that if you die in
9 years, you pay no death tax, but if you die in 10, the Government
takes 55 cents out of every dollar you earn? I, quite frankly, am
concerned as to what is going to happen in that ninth year, with the
kind of perverse incentives we have created.
I proposed to the President that we make this tax cut permanent.
Supposedly, we intended it to be permanent and I thought the stability
that would come from having that certainty would help the economy.
The President's response was that we had to come up with a package
that was going to be bipartisan and that he did not believe those
policies would be accepted by our Democratic colleagues and that they
would become a lightning rod in the debate. Obviously, I did not agree
with that, but the President came up with a proposal where over half
the proposal came not from recommendations that Republicans made but
from recommendations that Democrats made.
The President, however anybody wants to criticize him, basically sat
down thinking that after September 11, something had really changed. I
remember a colleague of mine sitting in my office saying: After the
11th, things have changed forever. I suggested that forever is a very
long time. By January, the things that had changed in Congress about
cooperation had pretty much changed back, unfortunately. But the
President--and I say this as a great compliment to him--when he wrote
his initial stimulus package, tried to take Democratic ideas and
Republican ideas and come up with a bipartisan compromise that he
thought might be adopted on a bipartisan basis.
So the debate started, and the House passed a bill. They passed it on
a partisan basis. We had a debate in the Senate, but nobody could get
to the 60 votes necessary to pass a bill, and we had an impasse.
Then a series of our more moderate Members--I was not a member of
this group--got together, Democrats and Republicans, and came up with a
bipartisan proposal. That bipartisan proposal basically picked and
chose among various stimulus proposals that had been made. Based on the
fact we clearly had a majority of Members of the Senate who were for
this bipartisan proposal that emanated from the Senate, the House of
Representatives passed that bipartisan proposal in the waning hours of
the last session. That proposal then came to the Senate. However,
Senator Daschle decided to not allow it to be considered, even though
clearly a majority of Members of the Senate--Democrats and
Republicans--were for that bill.
That is the way the last session ended. We are now in the new
session. Senator Daschle approached our leadership and said: I am
willing to bring up a stimulus package. But he was not willing to bring
up the stimulus package the President proposed. He was not willing to
bring up the stimulus package the bipartisan coalition proposed. What
he wanted to do, in essence, was to take the provisions from the
President's proposal that he agreed with, all of them in one form or
another things the majority of Democrats were for, and he wanted to
bring that up.
Now we are perfectly supportive of bringing that bill up. The
majority leader ultimately can bring up any bill he wants to bring up,
but our basic position is simple and straightforward, and I think
anybody who is trying to be objective about this will see it makes
sense. If we bring up the bipartisan bill that was put together by
moderate Republicans and moderate Democrats, I think within that
context we could have an agreement limiting the number of amendments we
would debate. Senator Daschle and others would have an opportunity to
offer a substitute or other amendments. Those of us who might want to
strengthen the package from an economic stimulus point of view would
have an opportunity to offer a couple of amendments, and that would be
it. That would have been a reasonable and acceptable proposal.
The proposal the majority leader made, however, was to bring up a
totally new bill, one-quarter of which--giving money to the States--was
never in any of these other proposals I have seen. The President did
not propose that. The House did not adopt that. Where that came from, I
do not know.
The point is: We have a bill before the Senate, and my suggestion is
we let the Senate work its will; that we have a series of amendments, a
Democrat amendment, a Republican amendment; that we debate these
issues. There clearly will be an amendment to expand the accelerated
depreciation part of this bill. We have a bill before us that provides
accelerated depreciation for about 9 months. We had a proposal
initially for 3 years. There will almost certainly be an amendment on
that and it ought to be voted on. We have had a lot of debate about
overturning the tax cut, not letting it go into effect. Clearly, I
think we can provide some certainty to investors and to consumers by
having the Senate go on record that we are not going to overturn the
tax cut.
I personally believe we will benefit the economy if we have the
Senate make the repeal of the death tax permanent. I would like to have
a vote on it. I am sure there will be many amendments, or some
amendments, on the Democrat side, but it seems to me that

[[Page S63]]

if one wants to make up their own proposal--and when they are the
majority leader, they have the right to do that--they have to recognize
other people may not support it and they will want an opportunity to
present their ideas. That is how the Senate rules work.

If we had gone to something that had been agreed to by the majority
of our Members to begin with, I think we might have limited amendments,
but now I think what we need to do is to simply start the process of
offering amendments. I do not know how long this is going to take. I do
not think, quite frankly, it is going to take a terribly long time. I
think there are issues that need to be voted on.
Finally, let me say we have a deficit. We have a deficit primarily
because we have a recession. The second largest cause of the deficit
has been the explosion in spending, most of which occurred in the last
3 months of the Clinton administration. An increase of over $120
billion in spending above the level we set out in the bipartisan
balanced budget agreement occurred in a 3-month period, with a
Republican Congress. I am not only pointing at Bill Clinton. A
Republican Congress and Bill Clinton had a spending orgy, the likes of
which I have not seen in almost a quarter of a century in the Senate.
The third thing is we have adopted a tax cut of $38 billion.
Altogether, we have had over a $300 billion decline in the surplus.
Some of our colleagues say the problem is the tax cut. But, that is
only about one-tenth the size of the collapse of the surplus.
I know there are people on the Democrat side of the aisle who would
like to raise taxes and to eliminate that tax cut. We certainly will
have an opportunity to vote on that. But the bottom line is, we need a
stimulus package. We are in a recession, and every penny we use to
stimulate the economy we are going to have to borrow. That is a dollar
we are going to be taking away from somebody who might have used it in
another way. So if we are going to have a stimulus package, I think it
is very important it be a package that stimulates the economy.
I find it incredible--some people might find it unbelievable, and in
some ways it is both--that if we look at the Daschle proposal that is
now before us, if someone paid income taxes last year as an individual,
they will get no benefit from this stimulus package. We give big tax
cuts to people who do not pay taxes. We have massive increases in
spending, but if someone paid taxes last year; if they are working and
saving and investing; if they are anybody who is currently making the
American economy go and paying taxes in the process, this bill does not
deem them worthy of having a stimulus provision that would encourage
them to work more or save more or invest more.
I do not know how the economy is stimulated without providing
incentives for people who are engaged in productive activities. I do
not understand that. I know the proposal that was in the bipartisan
package and that was in the Bush proposal that would accelerate the tax
cut that is coming for individuals who make more than $28,000 a year--
that there was opposition to it. I do not understand, if the objective
is to get people to work and save and invest, why no incentives are
provided for people who are working and saving and investing.
So some will remember that when this bill was presented yesterday,
these two intersecting circles--the Republican proposal and the
Democrat proposal--were presented, and where the union of those two
circles was, was supposedly what Senator Daschle was proposing. Well,
it turns out a quarter of it I have never heard of before; and that is,
we have a bigger deficit than all the States combined, but now we are
going to run a bigger deficit to give them money.
I don't understand it. What it really looks like to me, looking at
this so-called stimulus package, is spending. You look at the words
``spending'' and ``stimulus,'' and the only similarity is they both
start with an ``S.''
Here is my point and I will conclude: We can stand and talk about
provisions that were in old bills that nobody has debated in months. I
could rant and rave about stimulating the bison industry. That was a
provision dealt with and laughed out of the of the Democratic version
of the bill. I could taunt my Democratic colleagues with it forever,
but what good would it do in this debate? None. Bringing up retroactive
provisions in the original House bill that have never been considered
by the Senate, that no Republican Senator has endorsed, that are not in
the bipartisan consensus bill, I don't think is very productive,
either.
The path we have chosen, quite frankly, I think is the hard path. If
we had brought up the bipartisan bill, we might have adopted it; it
might have gone to the President and been signed. Instead, we brought
up a bill nobody has ever seen. It will be amended, probably at great
length. Then if it is adopted, it will go to conference, where there
might be more mischief and the potential of not getting a bill. If
there is an easy way and a hard way, we have decided, it seems to me,
to do it the hard way.
I think it is important to start the amendment process. I urge my
colleagues on both sides of the aisle, we have a vehicle before the
Senate. Whether Members are for or against it, everybody claims--with
the exception of two or three Members of the Senate--that they want a
stimulus bill. We have a proposal before the Senate. If we do not like
it--and I don't like it --we should offer amendments to it. I believe
we will be ready, hopefully this afternoon, to begin that amendment
process. It may be, as we start debating amendments, as we start voting
on them, that we could yet form a consensus and adopt this bill. That
would be very beneficial if that were the case. I hope it will be the
case.
I yield the floor.
The PRESIDING OFFICER. The Senator from Louisiana.
Mr. BREAUX. I thank the Chair for recognizing me for a moment or two.
I will use a few minutes to talk about where we are on the question of
economic stimulus. It is appropriate to say where we are is where we
have been. The phrase ``been there, done that'' comes to mind, and I
think it is very appropriate. When we left for the holidays, the recess
that we enjoyed back home with our families, we left the Senate in a
situation where neither side had a sufficient number of votes to move
on something that was significantly important to the American people.
It is clear we as a nation are in difficult economic times. I imagine
people back home wonder whether Congress is going to do anything about
it. I wonder whether sometimes we have the capacity to do anything
about it because of the situation we find ourselves in.
It is interesting and important to point out that neither side has
the ability to do whatever they want. We as Democrats do not control
the White House. We as Democrats do not control the House of
Representatives. We as Democrats do not have the 60 votes in this body
in order to accomplish things that we might like to do if the other
side insists on filibustering that effort.
On the other side of the coin, it is also important to note that the
Republicans do not have the ability either to do whatever they want in
these areas. They, too, do not have 60 votes to push through what they
think is an appropriate remedy to the economic conditions we find
ourselves in.
It is, therefore, obvious, in order to get anything done we will have
to reach some type of a middle ground or an agreement that takes the
best of both parties and puts them together in a package that might do
something on a positive note for the American people who are suffering
a great deal because of the downturn in the economy.
It is true that the two parties have fundamentally different
approaches on how to assess this. I have tried to compare it to the
question of people who make widgets and people who buy widgets. It
seems appropriate to point out that the other side tends to say if we
are going to get this economy going, we will have to help the people
who make the widgets. We will have to help the businesses that produce
the products because they are not producing at full capacity. We will
have to help the companies that make the widgets. We have to help them
with bonus depreciation, and we have to help them with net operating
loss carrybacks. Those are some of the ideas we have talked about. We
will help them with alternative minimum tax and remove that burden so
that these companies can make more widgets.

[[Page S64]]

On the other hand, on my side of the aisle, we tend to concentrate on
those who buy the widgets and say it doesn't matter how many companies
make how many widgets. If you don't have individuals able to buy the
widgets, they are not going to be able to sell the widgets. Therefore,
it is important for economic recovery to do something for those
actually trying to buy the products who find themselves in an economic
situation of not being able to do so.
We said, all right, we have a lot of people unemployed and we have to
help them with unemployment insurance, to give them a longer period to
try to find a job. We will help those people who are without health
insurance because they cannot be productive citizens if they do not
have health insurance for their children and families. We want to do
that. We also want to help the most unfortunate among us by making sure
we give them some benefits because they did not receive those benefits
during the last tax cut. We do that by providing $14 billion worth of
rebates in terms of direct grants to those individuals.

That is where we were when we left. That was the Democratic position
and that was the Republican position. Neither side had 60 votes. We
come back after the recess and we are right back where we were: Been
there, done that. We can continue to do that and face each other off
and blame the Republicans for failure because they don't agree with us
and listen to our Republican colleagues blame us for failure because we
don't agree with them. They think they are right and we think we are
right. But outside the beltway and outside Washington I imagine there
are an awful lot of people who are scratching their heads and saying:
Look, these are grownups that we send to Washington and the job that we
send them to do is to make government work for those who are not in
government. Unfortunately, what they see is that in too many cases, we
cannot simply compromise to the point of agreeing and getting something
done.
Last year, Democrats filibustered the economic stimulus bill.
Republicans filibustered the farm bill. Neither side was able to
accomplish anything in these two important areas. We can continue to do
that. We can continue to take the position that we want to help the
people that buy the widgets, and we are not going to move. And our
Republican colleagues can say, we will continue to try to help the
widget manufacturers, and we will not compromise. We can continue to
make the arguments and continue to blame each other for failure. But
the end result is the people that need the help do not get the help
they need.
I commend very strongly the majority leader, Senator Daschle, who has
said, I will not continue in that vein. I want to break this logjam. I
want to end this gridlock. What I am willing to do is to give up some
things that those who want to take care of the widget buyers are really
interested in, like health insurance for unemployed people--a very big
issue and one to which I think there is an answer. I am willing to step
aside and give that up in order to get this process moving. But the
other side will have to also give a little in order to get a package
that can pass this body.
Senator Daschle has said: Enough of business as usual. Let's make the
first important step toward getting something done that can, in fact,
help the people we intend to help. He has suggested that we have
extended unemployment insurance. That is important. We don't know how
long people are going to be unemployed. It is obvious Congress will
have to address this. He does it in his proposal. And I add, the other
side has agreed on that. He says we will give some additional help to
people who did not get much help the last time, and has proposed $14
billion in rebate checks.
The other side has said they could support that. They said that
before we left for the recess. Some people say you are trying to help
people who do not pay taxes. Those people may not pay income taxes, but
they certainly pay payroll taxes. I am not sure if one tax is less
painful than the other. If you are paying taxes, you are paying taxes.
Therefore, we ought to help those people who are paying taxes. The
rebate proposal is a common idea to which both sides have essentially
agreed.
We said we are going to help States. The Senator from Texas was
pointing out that Texas is in bad shape, as well as some of the other
States. But States have different problems and additional problems. We
can, in fact, operate at a manageable deficit on the Federal level,
which I do not have problems with. We are in a position to help States.
The concept was to say, all right, we are going help States with
Medicaid by giving them a little bit more of a Federal share to help
pay for the health care of indigent people who need the greatest amount
of health care of all.
I think the proposal says we are going to give a 1.5-percent increase
in the amount of Federal money paid for the purpose of helping
Medicare. That would allow States to do a better job in helping people
who are sick and poor, and also perhaps give them some additional money
from the Federal share which they could use for other priorities within
the State. That is something that has been sort of a common idea that
both sides have said in the past they could support.
Another thing in the Daschle proposal is something to help the widget
manufacturers.
I had dinner last night with a group of high-tech chief executive
officers, who are some of the best and brightest in the country. Every
one of them said: If you could do something on bonus depreciation to
help us buy new equipment this year to help us expand or grow our
businesses, that would be very important. These are the top people in
their industries. Telecommunications and computer manufacturing are
American companies. They said that bonus depreciation would be very
important for them.
I think the House said they are going to do a bonus depreciation bill
for 3 years. The Senate said 1 year. Is there not a number in between 1
and 3 on which we could probably agree? Of course, I think that is an
important ingredient.
Some of my colleagues on this side said if you add it up--it is like
the score for a football game. If you have three things the Democrats
like and only one thing the Republicans like, that is not really fair.
The bonus depreciation is part of the $69 billion. The 1-year package
is about $42 billion.
One item that Republicans like--I like it, too--was the most
expensive by far of the four. It is $42 billion for bonus depreciation
with a 40-percent accelerated bonus depreciation for 6 months and 20
percent for the second 6 months. It averages out to 30 percent.
There is some flexibility. I think the majority leader indicated this
is something which is a good concept for the widget manufacturers and
for business and people who produce products in this country.
As has been referred to, we have a centrist plan. I plead guilty to
being a part of that effort and will continue to do so because I think
it brings together centrists in both parties to try to break the
logjams in which we find ourselves far too often.
We had a plan that addressed health care needs. It is not in here. I
wish it were. I think we suggested it in terms of a tax credit for
unemployed people without health care insurance. It is an incredibly
positive thing that Democrats should embrace and run with. It is
something that will eventually happen at some point. Some said: Your
plan only said the Federal Government was going to pay for 60 percent
of the cost of premiums for unemployed workers' health insurance. That
means the poor worker would have to pay 40 percent of the cost of his
premium, and they probably can't afford that.

Let us think of what the current situation is. Right now, unemployed
people who lost their jobs can continue their health insurance, but it
is at their own expense--100 percent. You have to pay 100 percent of
the cost of the premium. For the very first time, we were saying the
Government should pay 60 percent of the cost of that premium. That is
100 percent more than they pay now.
I think it is a movement in the right direction. I think it has
merit. I think it should apply to people who do not have a job and
can't afford health insurance, whether or not they are a so-called
COBRA-covered person who had health insurance at their previous job.
It is another subject, but I think we ought to have mandatory health
insurance in this country. It is the best way

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to help solve the problem. That is something about which we as
centrists felt very strongly. That is not in here. But am I going to
say, because it is not in here, I will not support this package? Of
course, not.
Let me move towards concluding my remarks by saying what Senator
Daschle has done is create a strategy and a process that will allow us
to get to the next step. We can continue to stop everything we do and
continue to not let anything else come up the rest of the year until we
craft a package in the Senate to which 100 percent of the people can
agree. If we take that approach, we will not get anything done, not
only on the stimulus package, but we don't do anything else in the
year. We don't do an agriculture bill or anything else important, such
as an energy bill, or any other high-priority item. It is absolutely
critical that leaders are able to say we are going to make some moves
here. We want to make this Senate function as it should.
I think what Senator Daschle said was, I am going to offer a
streamlined package. We give up a lot of things that we would like to
see in it. The other side will have to give up a lot of things they
would like to have in this bill. But let us at least get this package
through the Senate, take the common ideas and pass it, and do it today,
tomorrow, but do it, and quickly, in order for us to get to a
conference with our colleagues in the other body. That will be a very
difficult conference because their bill is far different from ours. It
is far different in emphasis. It is far different in costs. It is far
different in whom it attempts to help and how it attempts to help them.
But we have to get to conference if we have any hope of reaching a
conference agreement. This strategy allows us to do that.
I would say to the conferees that it doesn't do them any good if we
get to that point and bring it back to the House or the Senate with
things in it that are not going to be adopted. I will take half an
apple rather than no apple at all. I think if you can't get everything
you want, you get as much as you can in an agreement and then save the
rest for a later date. But last year we got nothing. The people who
were unemployed last year still do not have health insurance. They
still have not received any rebate help or assistance from the Federal
Government. They still have not received any health insurance or
extended unemployment insurance benefits. What they got was an
argument. As I said before, you can't take an argument to the grocery
store and buy food. They do not accept that. You can't walk into a
store and say: I need to buy groceries for my family this week, and, by
the way, I will pay for it with the promise that Congress will do
something to help me in the future. It doesn't work that way. We
actually have to get something done. Arguments don't buy food. Blame
does not buy groceries.

It is incumbent upon us to try to reach an agreement with which we
can get to conference and let the conference work its will. I urge all
of those who say we have to have it just like I like it or we are not
going to have it at all--that approach on both sides of the aisle does
not help the people we were elected to help. I think they are sort of
getting wise to the ways of Washington. I want to change their
thinking. I want to give them the encouragement to say Congress can at
times work out difficult problems with positive solutions, with both
parties reaching out to each other, recognizing that we have to give a
little in order to get a lot.
Senator Daschle's proposal in fact does that. It is a good proposal.
It is not the final proposal. It is not the final answer to this
difficult problem of economic stimulus. But at least let us move one
step down the line in order to try to reach an agreement that can
actually be something everybody can be proud of, and, even more
importantly, get the job done for those who need the help.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER (Mrs. Carnahan). The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. SCHUMER. Madam President, I ask unanimous consent the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. SCHUMER. Madam President, I see my friend from Oklahoma, the
minority whip, is in the Chamber. I will try to be no more than maybe 6
or 7 minutes. Would that be OK, because a Democrat spoke last?
I thank my friend from Oklahoma.
Madam President, I would like to address two issues. The first is
this stimulus package of the majority leader, Senator Daschle.
Let me just say, in a town that is wracked by partisanship, and where
the differences often seem insurmountable, only one person has cut
through that to try to come up with a compromise that is not going to
make either side or any Senator 100-percent happy but is the basis for
moving forward and getting a stimulus package. That person is Majority
Leader Daschle.
I cannot heap enough praise on the majority leader for this effort.
We know our economy is squishy. Every one of us goes back to our
community and we hear of layoffs, of consumer uncertainty. We hear
people are afraid the next 6 months will be considerably worse than the
present, and they are looking to Washington for leadership, not only
for a stimulus package in terms of the number of dollars that it will
put into the hands of people and businesses, but also for a sign that
we can work together to give them a sign of confidence, a sign the
stewardship of the economy is in good hands and partisan differences
are outweighed by what is good for the Nation.
I have to say, the only effort that has had some traction, the only
effort that has made some sense in this regard is the effort of the
majority leader. I am sort of confounded by the many attacks upon him.
This is a man whom we all know well. These editorials and things like
that do not comport with the real Tom Daschle who is somebody who
always goes out of his way and takes that extra step for a compromise.
I do not like every piece of the package he has put forward. I wish
there were other pieces that could be in there--I will talk about one
in a minute--but I certainly think both sides of the aisle should be on
their feet applauding the effort, the effort to break the logjam and
get us moving.
Let anyone who starts saying that Tom Daschle is ``Mr. Partisan'' or
``Mr. Obstructionist'' look at the actions that have occurred in this
Chamber today and look for the one Senator, of the 100, who has stepped
forward and said: Here is a basis for compromise. I am not just saying
it has to be my way. I am not just saying why I don't like what the
other side or another Senator does, but rather here is a place where we
can meet pretty much in the middle of the road.
I think I speak on behalf of many of my fellow Senators and many
millions of Americans in thanking Majority Leader Daschle for trying to
bring us together, for trying to create compromise that can move us
forward, for trying to give us that basic centerpiece we can then use
as a way to get a stimulus package done and add other pieces that are
necessary.
I mention to my colleagues one piece that I believe is necessary to
add. I know we have been apart for a little more than a month. Every
one of us went back to our State and back to our family. I, for one,
was glad to be home every night with my girls. I was glad to be in my
State seeing everybody and touching base with them. But as you may
remember when we left--I believe it was December 20--we were very close
to passing a bipartisan House-Senate compromise to help Lower Manhattan
with certain kinds of tax breaks that would encourage businesses to go
down there, that would encourage businesses to stay there. It was
worked on by Senator Baucus and Senator Grassley. It was worked on by
Congressman Thomas and Congressman Rangel. We were almost there. But at
the last minute, because we were doing things in the final moments,
people said they needed a little more time to study it.

First, let me discuss the need. It is urgent. Even though we lost
close to 30 million square feet in downtown Manhattan, we have many
businesses that left and are unwilling to come back yet. Businesses--
large and small--were scratching their heads and saying: Does downtown
Manhattan have a future?
Our Governor and our new mayor are rapidly putting together plans to
try to

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figure out how to rebuild downtown Manhattan. But the question on
everybody's lips is: Will the kind of very necessary tax breaks to
bring businesses back to downtown Manhattan--given the fear factor and
given everything else that has occurred--be forthcoming from
Washington?
This is not a partisan issue. We have had support from both sides of
the aisle. This is not even a bicameral dispute. The House has passed a
bill already. I certainly give the White House credit for being
amenable to a compromise.
All I can speak to is the necessity. The attack on the Twin Towers on
September 11, of course, is still with us. It was not an attack on
downtown Manhattan or even New York State. It was an attack on all of
America.
It would be an admission of defeat--we have had such success
overseas--if downtown Manhattan does not rise up, rebuild itself, and
be revitalized. What could be a stronger message to the terrorists of
the world, to the anti-Americans of the world, to those who hate us for
our very freedom, than if downtown Manhattan rises anew like a phoenix?
I can tell my colleagues without these tax breaks it is going to be
hard to do.
I have spoken to Senator Clinton. We will be working very hard to get
these breaks passed, hopefully, as part of the stimulus package; and if
there is no stimulus package, then in some other way. I hope all of my
colleagues will be supportive. We need the help.
All of America has admired the bravery of the victims' families, many
of whom the President graciously invited to the White House yesterday--
the firefighters, police officers, and rescue workers, and just average
New Yorkers who rose to the occasion. We now need to back up our
admiration with real help. The future of downtown and Lower Manhattan
depends on what we do in this body in the next month, the House having
already acted.

I urge my colleagues, if they have any questions about the compromise
proposal that has been put together, if they have any changes they seek
to make, if they have any objections to any of the small parts of it,
please let us know ahead of time. At the end of December 21, when we
were very close to passage, many of my colleagues came to me and said:
Look, I am very sympathetic. I just want a little time to study it.
Well, now we are in studying time. But soon it will be time to act.
Again, I plead and beg with my colleagues to make sure that we don't
hold up this package so necessary for downtown Manhattan's survival, so
necessary to send a concrete message that we are not going to let the
terrorists destroy any part of our country.
I yield the floor.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Madam President, I appreciate the comments of my
colleague from New York. He mentioned his desire to bring up the New
York City package. I requested earlier that we take up the House-passed
tax bill that has a New York package in it. We are having a debate
right now as to what should be the underlying bill.
So people understand, I suggested that we take up the House-passed
bill. That would be the logical thing to do. If we are going to pass a
stimulus package, the House has already passed it. I told the majority
leader I would work with him to come up with a finite list of
amendments, a mutually agreed-upon list of amendments or number of
amendments, and work to pass it. He wasn't agreeable to that yet. Maybe
a little later he will be. Instead, he wanted to come up with a list of
amendments he thought were mutually agreeable.
I don't think there is a consensus on a list of amendments. I will
just go over a couple of them.
The underlying bill I wanted to take up had New York in it. I will
tell my colleague from New York, this amendment does not have New York
in it. That doesn't mean I agree with everything that is in the House
bill; I don't. So if we start with that as the package, I will probably
try to make some changes and some deletions to the House bill.
I look at the package the majority leader wants to bring up, and I
say: Wait a minute, where is the beef? Where is the stimulation? There
is no assistance for New York. I am looking at the bill that was just
introduced yesterday. I am almost amazed. I heard one of my colleagues
say Republicans are filibustering this bill. We are not filibustering
this bill. We didn't object to bringing it up.
A bill we have never seen before is now pending on the floor of the
Senate. We could have asked for it to be read. We could have asked for
a vote on the motion to proceed. We didn't do any of that. We wanted to
take up and pass a stimulus package. But we would also like to know
what is in it. And just for elementary purposes, we would like to have
it stimulate the economy. We would like to have it create jobs.

I looked at the package the majority leader introduced. It fails in
that regard.
I will go through the various elements in this package for my
colleagues.
Mr. SCHUMER. Will the Senator yield?
Mr. NICKLES. I am happy to yield.
Mr. SCHUMER. I thank the Senator. I don't want to get into any
disputation about the underlying package. The Senator was very helpful
to us in the final moments of the session last time about getting a New
York package. I thank him for that and hope we can work together in
whatever comes out to get a New York package done early this year.
Mr. NICKLES. I appreciate my colleague from New York. I will tell him
I read with interest today an article from the Washington Post that
said that not only did we pass the legislation that my colleague and
friend from New York alluded to to provide tax relief for the victims
of the New York and Virginia disaster but also the Oklahoma City
disaster, so they wouldn't have to pay taxes in the year 2001 or in the
year 2000 for this recent 9-11 tragedy, but also in Oklahoma it is for
1994 and 1995.
The Washington Post said we also passed the $5 billion package of
benefits. That wasn't accurate.
Mr. SCHUMER. If my colleague will yield, if it were only so.
Mr. NICKLES. I understand.
Looking at the package that the majority leader has introduced, there
is only one thing that anybody could remotely say is really
stimulative. There are four elements to the majority leader's package,
one of which deals with accelerated depreciation. Then there are three
others that would fall into spending categories.
Some people say it is rebates of tax cuts, $14 billion; people who
didn't get anything from the tax cuts. They didn't get anything because
they didn't pay taxes. Anybody who paid Federal income taxes got a tax
cut of $300 for individuals, $600 for a couple. We have already done
that. What we didn't do is give tax cuts for people who didn't pay
taxes. That is the proposal pending.
Some people say everybody has agreed with that. I don't agree with
it. I don't think it is good policy for us to go out and borrow $14
billion to have to pay over $1 billion a year in interest basically to
hand out money and call it a tax cut when they didn't pay taxes. I find
that objectionable. Maybe I am unique in that way. Maybe the majority
will pass it. That may well be. It did pass the House of
Representatives. I don't think it is good policy. I think it does spend
$14 billion. It does add that much to the deficit, to the amount of
national debt.
We don't have a surplus anymore. Some people say it made sense last
year when we were distributing the surplus. But to me, it doesn't make
sense today. I don't think that should be in the package. So not
everybody agrees with everything in the majority leader's package.
It has the extension of unemployment compensation. That will increase
spending and will not stimulate the economy. It also gives the States
$4 or $5 billion. I am sure they would be very appreciative of that.
States are going through some difficult times; so is the Federal
Government. I don't know if this is the right time for us to be
implementing a new revenue sharing approach.

The House has done it. Now it is being proposed by some on this side.
Maybe the votes are there. We may find out. I am not particularly
excited about it. I am not sure it is the right thing to do. Some
people would easily say we are taking money out of the Social Security
trust fund and giving it

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to the States. I am not sure that makes good sense to do that either.
If we look at those three proposals, extending unemployment
compensation, that costs money, it is a spending program; $14 billion
in checks to people who didn't get checks last time, but they didn't
pay taxes last time, so basically a spending program for $14 billion to
low-income people for last year; and then a new program to give the
States some money, maybe calling it Medicaid, maybe calling it revenue
sharing, basically contributing, I believe, under Senator Daschle's
proposal, about $5.5 billion. The House passed $4 billion. Those are
the three spending proposals, and then the accelerated depreciation.
Accelerated depreciation is the only thing that anybody could say
legitimately is going to give incentive to create jobs. Looking at this
proposal, I have heard people say the House-passed bill had 30 percent
depreciation for 3 years, 30-percent accelerated depreciation. That
means if you have 100-percent depreciation for the life of the asset,
and you have to depreciate it over X number of years, let's say 10
years, you can put a greater percentage of that in the first year and
expense it. That will encourage investment. The House did that with 30
percent for 3 years. So any investment made in the next 3 years could
qualify.
Senator Daschle's proposal says it is 30 percent for 1 year. I just
looked at the language and it says: Special allowance for certain
property acquired after September 10, 2001, and before September 11,
2002.
January has already gone. You are talking about, if we enacted this
tomorrow, maybe 7 months. But by the time people understand it and by
the time it passes the conference, by the time it gets out, you are
looking at a provision that is probably less than 6 months. In other
words, hurry up and purchase your equipment or whatever you are going
to do in the next few months.
That might be good for disposable items, but for anybody who is going
to purchase something that needs to be manufactured, it is not enough
time to do any good.
The proposal Senator Daschle has introduced has a worthless
stimulative impact. It will not create jobs. It fails the test, and I
don't think we should pass it. Why don't we take the bill the House
passed and have some amendments to it?
I count votes around here. At one time, that bill had well over 50
votes. It may not have had 60, but it had over 50. It had a lot of
provisions that some of us didn't like in there, but it had a majority
of votes, I believe. Senator Daschle doesn't want to take up that bill.
As a matter of fact, he wants to take up a different House bill, strike
the language--take out House bill 622; insert his bill in it, amend it
for a little while, and then, when we are finished, take up the House-
passed bill, strike that language, and put this bill in.
I suggest, why don't we take up the House-passed stimulus bill and
amend it? We can go through the regular order and have amendments. I
will help him get a limitation on amendments. Or we don't have to have
that; we can just take it up, debate it, amend it, and pass it. That
would be the regular order. I don't want anybody to say the Republicans
are filibustering. I am ready to amend Senator Daschle's proposal. But
I think we ought to take up the House-passed bill. Then I will work
with him to come up with language. But to say we have a consensus bill
and call it stimulus--when three or four elements of the bill are
spending provisions, and the one thing that might be considered
stimulative--accelerated depreciation--doesn't last long enough.
Senator Breaux suggested a compromise of 2 years. That would be a lot
better than the 6 months I have seen for the accelerated depreciation.
4 or 5 months have already gone by since September 11. There is not
much time left. There is not much stimulus to this bill.
The other side wants to act as if they tried to bring up a stimulus
bill and get it done, but because they could not get a unanimous
consent agreement to pass it in 2 days, they will pull it down and say:
We tried; it was their fault.
There is no stimulative impact to that bill whatsoever. The Democrats
held up the package for the last couple of months. President Bush asked
for it in early October, but we didn't get it done, even though we
tried to get it up in November and December. And there was some
criticism--I think rightfully--delivered toward the Democrats for not
letting that happen.
I heard Senator Grassley say let's take up the bipartisan bill--
Democrats and Republicans supporting the bill--on which the
administration worked. That bill is H.R. 3529. Let's take that up,
amend it, and pass it, and see if we can't do some good.
Tax legislation happens to be important. Then I look at Senator
Daschle's accelerated depreciation, and I want to see the good in this
bill, I want to see something that will create jobs and provide
economic relief. I don't think this will create very many jobs. I am
disappointed in it. We can do better. We must do better.
Some people say let's just pass something and send it over in the
House and maybe we will fix it in conference. I would like to do better
than that in the Senate. We should do better. We should be embarrassed
if we can't do any better than that. We should not call this a stimulus
package. You can call it a spending package, aid for States or for
unemployment extension; you can call it expanded welfare payments for
people who didn't pay taxes--we are going to give $14 billion out--or
if you cram through a purchase in the next 6 months, we might give you
a little better deal. You can't call this a stimulus package.
It is political cover for the Democrats to claim they tried to do
something and didn't get it done. It is unfortunate to try to blame the
other side. I would like to see us take up a package that would,
hopefully, be agreed to by Democrats and Republicans, work on it, amend
it, improve it, pass it, send it to conference, and see if we can't get
a bill out of conference in the next couple of weeks to create jobs.

If we are not going to create jobs, let's not do it. We don't need
more excuses to spend money. We are spending a lot of money. The
President is coming up with a budget proposal that has more money for
national security, defense, and homeland defense. We spent a lot of
money last year. We don't need excuses to spend more money and use the
guise of a stimulus bill with the title of a stimulus bill.
This bill that Senator Daschle introduced, in my opinion, fails the
test. It has the title: ``To provide incentives for economic recovery,
and for other purposes.'' The other purposes are ``let's spend more
money,'' because it does very little, if anything, toward helping
stimulate an economic recovery.
I really hope we will work together and try to come up with a
package. I don't want to stall anything. I am happy to begin
considering amendments if that is Senator Daschle's request. We can
have amendments on the floor. I see Senator Grassley is on the floor,
the ranking member of the Finance Committee. We can start considering a
lot of amendments today. I know Senator Wellstone mentioned he has
some, and I have some. They probably won't be the same but let's
consider them. Let's get to work on a true economic stimulus plan.
I yield the floor.
The PRESIDING OFFICER. The Senator from Rhode Island is recognized.
Mr. REED. Madam President, I thank the Senator from Iowa for his
graciousness.
This morning and this afternoon, we have engaged in a discussion with
respect to the stimulus package. Senator Daschle, the majority leader,
has fought for a sensible position which represents, really, as he says
so well, the common ground that exists between both parties.
Recognizing that we need 60 votes to move to passage of a legislative
initiative, his approach has the most merit and the most probability of
passing. So I encourage my colleagues to support the proposal of
Senator Daschle.
In a sense, what he has done is combine the common elements of both
Republican and Democrat proposals to find the provisions that will
garner the necessary 60 votes to go forward so we can provide real
relief in a timely fashion to millions of Americans who are facing
difficult economic times.
At the core of his proposal is extending unemployment benefits for an
additional 13 weeks. Routinely, during previous recessions, we have
done so. This is a recognition that there are literally millions of
people who have been

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thrown out of work because of economic circumstances as well as the
areas of New York City and around the Pentagon, in some cases, because
of the attacks of September 11 and the recession that began in March
2001.
The reality is that there are millions of Americans who need
assistance. The unemployment rate is growing. More important than that,
perhaps, for our consideration is that the number of people who have
been unemployed for a long period of time is growing. In the robust
economy of the nineties, when people lost jobs, they quickly found
other jobs. Today, they find themselves, if not permanently, then in
many respects for a much longer period of time, without access to work.
They need these benefits.
Extending unemployment compensation also stimulates the economy.
Typically, someone who is relying upon unemployment benefits will take
those checks and immediately pay their bills, go to the store, provide
food for their children, pay their rent, immediately infusing those
dollars into the economy, increasing the consumer spending, the lack of
which is one of the causes of the recession we face. So it is a
proposal that is commendable on two major points: It helps hard-working
Americans and will get our economy moving.
Similarly, the Daschle approach talks about tax rebates for those
people who did not enjoy the previous tax rebates enacted last spring.
These are individuals who may not pay income taxes, but they pay a
great deal of their hard-earned wages in payroll taxes. For those
individuals, they deserve the kind of rebate that others received.
There has been an insinuation in some of the discussions on the floor
today that these people do not contribute to our economy, that somehow
they are not part of the great economic enterprise in our country, I
must disagree very strongly with that proposition. These are the men
and women who get up each day, go to very difficult jobs in hotels,
driving trucks, small businesses, running them and sometimes working in
them. These people deserve the same kind of benefits others receive.
In addition, a rebate for these individuals also achieves a second
important goal. Typically, money received by wage earners will go right
back into the economy because in a household living on minimum wage or
near minimum wage, struggling to raise children, struggling to get by,
there is always the opportunity to spend a little bit more on the
children, to spend a little bit more to defray the cost of life.
Again, Senator Daschle's proposal has touched upon a topic that is
very important to both sides, and that is bonus depreciation for
business: Give business incentives to make sure they go back into the
capital markets, to go ahead and buy capital equipment, to make
investments which we hope will be both productive and also get the
economy moving.
One of the key differences between the Daschle proposal and other
proposals is that Senator Daschle recognizes that in order to be
effective as a stimulus, it has to be timely, it has to be limited to
this year, not 2 and 3 years from now when this recession, we hope--
indeed, we believe--will be something in the past. If we want to be
effective, if we want to stimulate the economy, then we have to focus
and target this bonus depreciation for business.
The final element in this package is fiscal relief for the States. We
have to recognize that the States are under extraordinary pressure
because of this recession. Their tax revenues have fallen, but their
commitments to human services and to a host of other programs will not
abate. They must have the resources to provide for medical assistance
for working Americans. They must have the resources for the child
protection system, which the States run. They must have the resources
for education, which the States primarily run.
Those obligations will not be held in abeyance during this recession.
We have the opportunity, if we support this initiative, to provide
resources to the States, and if we do not provide those resources, many
States--most States--will be required constitutionally to balance their
budget by raising taxes or slashing their social services budgets,
which will only worsen the impact of the recession on some of our most
vulnerable citizens.
One of the ironies of our debate today is that while many of my
colleagues are talking about accelerating tax cuts, if we do not
provide assistance to States, we may very well see the States raising
taxes which will be a further check on our recovery.
Senator Daschle's legislation makes eminently good sense on economic
grounds, and it is the only proposal which has received the support of
a sufficient number of Senators so that it can be enacted into law, or
at the very least passed by this body and sent to conference with the
other Chamber.
The resistance to moving forward quickly on this package, is truly
something to behold even in light of Senator Daschle's offer to allow
for amendments from both sides of the aisle. But frankly, this is the
core of the economic initiatives that we agree upon and which will
provide real relief, first, to struggling Americans and, second,
overall to an economy that is in recession.

Madam President, I have the responsibility of serving as the vice
chairperson of the Joint Economic Committee. Our staff has been doing
an outstanding job trying to pull together the economic analysis that
should provide us at least a roadmap, if you will, for any economic
stimulus legislative. Let me summarize the consensus view of our
current economic situation.
First, despite some encouraging signals about the economy, it remains
weak. Just ask anyone who reads the newspapers and they can tell you
that. When Ford Motor Company lays off thousands of people, when a
major retail chain, Kmart, goes into bankruptcy reorganization--
interestingly enough, I was talking to someone who is connected to one
of our larger toy manufacturers in the United States, who told me there
are only four major distribution channels for toys in the United
States, the four major department store chains, and one of them, 25
percent of the retail market, is in bankruptcy reorganization. So we
have a very weak economy.
There are many conditions in place already for a recovery, and most
forecasters believe that within 3 to 6 months, there will be an
economic recovery. But most also believe this recovery will be rather
anemic, rather weak; it will not be the kind of robust growth that we
saw in the nineties.
Indeed, all of these forecasts are based on some significant
uncertainties. Two significant uncertainties are the condition of
foreign economies such as the economic meltdown in Argentina. The
question is: Will it be contained to Argentina? Will it spread to other
parts of South America? Will other countries find themselves in
economic distress?
Generally speaking, this recession is not unique to the United
States. It is a worldwide phenomenon. Those economies will affect
whether we come out of this in a robust fashion and when we will come
out of this recession.
There is something else, too, that is an uncertainty: consumer
spending. Will it bounce back to the levels that have sustained this
economy over the last several years, or will people for many reasons,
because of concern about their safety, because of a sense in this
moment of national danger? Will those psychological factors and
sociological factors undermine a robust response by our consumer
sector? It may be that the patterns of past economic recoveries are not
applicable today.
Even though forecasters are projecting recovery, there is much
uncertainty. Even when the recovery comes, one of the great tasks will
still be undone, and that is to provide support and help for those who
are out of work today, who deserve the opportunity to support their
families while they wait for this economy to recover.
One of the interesting facts about economic trends is that even when
the economy begins to respond, when gross domestic product becomes
positive again and starts growing, usually unemployment continues to
increase for many months after that. In the nineties, when the recovery
took hold unemployment continued to increase for about 15 months.
For most Americans, the economy is measured by one simple fact: Do I
have a job? And, collectively, what is the unemployment rate for this
country?

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We can foresee even with a modest rebound this year or next year the
single factor that confronts most families, their economic index--do I
have a job?--is still going to be questionable. So we have to act.
Again, Senator Daschle's proposal, at its core, at the heart of it,
has a very simple, time-tested provision: extending unemployment
benefits. At a minimum, we should be able to agree to do that this
week.
I mentioned there were some encouraging signals about the economy,
and it is fair and, I think, appropriate to mention those.
First, we have seen an increase in the average weekly hours worked in
manufacturing. Up until recently, those hours were declining, signaling
a weakness in our manufacturing sector, which because of the relatively
high pay of that type of work is a pillar of our economy. And we are
beginning to see that initial claims for unemployment are not
increasing with the same level each and every week.
We have seen some increases in new orders for capital equipment,
particularly information technology. Again, a great deal of the boom
over the last decade was fueled by increased investment in information
technology, computers and routers and service and a host of other
equipment. That appears to be coming back.
Once again, it is very fragile. If we listen to the commentators on
the business channels, one week Intel will do well because they are
shipping a lot of chips, and the next week their projections are down
and their stock goes up and down. So we are certainly not out of the
woods, but there is some encouragement.
There also seems to be increased optimism among the purchasing
managers in the country. Those business men and women who are in charge
and want to go ahead and order equipment, seem to be much more
optimistic. So there is encouraging news.
All of this is good news, but as I said before, our economy is still
weak and a well-tailored, well-timed, and well-targeted stimulus
package would still be a boost to our economy.
The economy is weak in many different ways. The unemployment rate
rose to 5.8 percent in December. That is 8.3 million people; not
statistics, people, 8.3 million people who were told they did not have
a job, who had to go home in the evening and tell their spouse they did
not have a job, who had to look at their children knowing they did not
have a job. They deserve our assistance now, not our rhetoric.
As I indicated before, within those statistics one of the most
alarming trends is the increase in long-term unemployment. Nearly 1 in
every 7 of those who are unemployed, 1.2 million people, had been
jobless for more than 26 weeks, exhausting their benefits or on the
verge of exhausting their benefits. So not only do they not have a job,
they do not have an unemployment check either, unless we act.
We were looking very closely last December at the holiday sales. They
seemed to be better than expected, but I might point out still much
weaker than a year earlier.
So we are in a position economically where there are mixed signals,
weakness but some encouraging signs. There are also some structural
issues that will, I hope, bode well for the future.
First, inflation has been relatively stable. That has been a
situation that has allowed the Federal Reserve to employ a very
aggressive monetary policy of lowering interest rates to try to
stimulate this economy. That is a good thing for us and a good thing
for our economy.
Short-term interest rates are as low now as they have been since the
1960s. Although long-term rates have not fallen as much as we would
like, they are lower than a year ago. Business inventories are low as
well, which is a sign that we are beginning to work through the buildup
in inventory which was hampering further production. There are no
obvious supply bottlenecks, but the reality is monetary policy alone
may not drive us out of this recession quickly enough or robustly
enough.
It is interesting to note the remarks of Chairman Greenspan over the
last several weeks have been cautious about the timing and the scale of
our economic recovery. His recent caution is in marked contrast to his
and others past comments. So I think we are beginning to recognize our
action would be very helpful to our economy.
I urge, as I have repeatedly, that we act and we act on those
sensible proposals offered by Senator Daschle.

As I said, most economists predict a recovery will begin late in the
spring. Even if that recovery begins, we still need to assist those
Americans who are unemployed today and who will continue to be
unemployed. As I mentioned, in the early 1990s, at the end of the last
recession, unemployment increased for 15 months after the recession was
officially over. It is also typical that those long-term unemployed are
the last to find reemployment. So they are in a very precarious
position--without benefits, without the prospect of a job, usually the
first to be fired and the last to be rehired. We can help them. We must
help them. I hope we do help them this week as we consider quickly this
legislation before us.
By extending unemployment insurance benefits, we can assist them and
we can do it in a way which will not be detrimental to our looming
deficit problem because unemployment insurance is a countercyclical
program. As the economy recovers, as employment grows, people do not
receive unemployment benefits. Today they need them. Hopefully, with a
robust economy in 6 months or 9 months or 1 year, those expenses will
no longer be borne by the Federal Government. These individuals will be
back in the workforce.
I urge, once again, we move very quickly on the proposals that have
been suggested by Senator Daschle. All of them have been vetted by
economists from a range of opinions. They have been determined to not
only help individual Americans but also to have a positive stimulative
effect and to help our overall economy by putting money into the
economy and by allowing States to forego income or sales tax increases
at the State level. All of this makes a great deal of sense and it
should be done.
One other point I will conclude with, and we have all been reflecting
on the drama in Texas and other places of Enron. One of the most
disturbing aspects of that situation is that the retirement security of
the employees was ignored by the leadership of that company in many
different ways. All of us, every single Member of this Senate, will
rightly, I think, very sincerely, criticize what has taken place. But
today, we are already encroaching on the Social Security trust fund.
That is what it means when we start saying we have a deficit because we
are no longer accumulating a surplus. We are now working our way
through Social Security funds, funds that have been pledged for over 60
years to those Americans who have reached retirement age. So when I
hear discussions about accelerating tax breaks, and when we have people
coming out and saying simply, as a matter of faith not economics, we
have to lower taxes, I wonder whether a year from now, 2 years from
now, 3 years from now, people will look at us as those employees down
in Houston look at the Enron leadership and say: You took our
retirement. You spent it. You gave it away on bonuses to executives.
You just dissipated it, not to help the economy but to help yourself.
So as a cautionary point at this juncture, as we consider a whole
range of proposals, I would like to leave at least that thought in the
minds of my colleagues.
I yield the floor.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. GRASSLEY. Madam President, I gave some opening remarks a little
earlier on this legislation, but I will reiterate a few points I made
from that first statement. The most important thing to remember, as we
are trying to reach an agreement on a stimulus package, is there has
been a lot of work put into this over the last several weeks--not since
the holidays but before the holidays--and we have had partisan
approaches by both Republicans and Democrats. We have had bipartisan
approaches. We have had cooperation between some Members of Congress
and the White House, and we have a bipartisan White House-centrist
package that has passed the House that the President said he would
sign, and one that had a majority vote, if we had taken a vote in the
Senate before the holidays, that could have been to the President by
now. It would have been to the President, signed into law, and

[[Page S70]]

helping 800,000 people unemployed since the September 11 terrorist
attacks on America.

This White House-centrist bipartisan package is a solid economic
stimulus plan. Most important, it has a compassionate approach to put
displaced workers first, and even more so than the amendment offered by
Senator Daschle because he does--as I would agree to do--put in 13
weeks of additional unemployment compensation. However, his consensus
package does nothing for those unemployed workers now who had health
insurance previously. They have to pay the health insurance called
COBRA out of their own pocket. The proposal I call the White House-
centrist bipartisan package has a 60-percent tax credit for that.
It is important to have a bipartisan plan. This White House-centrist
package is a plan that can pass the Senate. Most important, this plan,
if passed, will be signed by the President because he has said so. I
was in on that bipartisan meeting the President had with House leaders,
with Democrats from the Senate, and with Republican moderates. He said
he would sign it.
If we pursue the majority leader's plan, workers and businesses will
face more delays because that plan will have to be conferenced with the
House. That is going to take days probably. It could even take some
weeks. The further we get along, the more there tends to be a recovery,
the less economic good that stimulus package will do. It will be a
delayed effort to help those 800,000 people who are unemployed and
those people who do not have health insurance. If we use the bipartisan
White House-centrist package, we will be able to get that passed right
away.
How long would it take to get it through conference? Just remember
how long it took to agree that we ought to have the quasi-conference
procedure that we operated a couple weeks before the holidays. Remember
how long it took to reach the substantive agreement we have, the
bipartisan White House-centrist package. All this history--and we ought
to learn from history--ought to dictate the time to act is now, not a
month from now.
We had Chairman Greenspan advising the President, advising Congress
in early October, that was a time to pass the stimulus package--not
only pass it now as a stimulus, but we need to do it for the workers.
That is what we need to do for small business, as well.
The bottom line is, if we pass the White House-centrist bipartisan
bill, unemployment checks can go out to those people who have exhausted
their 26 weeks. Businesses will invest in new plant equipment with a
30-percent, 2-year accelerated depreciation. Unemployed workers will
get help for their health insurance so they can continue to have
coverage for their families, as they did before they were laid off.
Taxpayers will get a payroll tax rebate. Taxpayers will get a little
extra income tax relief to spend. New York City, hurt by September 11
terrorist attacks and needing help, will receive aid to rebuild. This
could occur tomorrow if we get a chance to vote upon the bill that
passed the House of Representatives before the holidays, the very same
bill the President said he would sign.
We are talking about moving ahead on a stimulus package. Now, instead
of talking about the bipartisan White House-centrist package, we are
talking about the new, scaled-back stimulus plan offered within the
last 24 hours by our distinguished majority leader. This isn't the
first time there has been a stimulus plan offered by the other side.
This is the third variation on a stimulus plan offered by the
distinguished Senator who is our majority leader.
As most Members know, the Democrats initially passed the stimulus
plan out of the Finance Committee, not in the spirit of how the Finance
Committee usually works in a bipartisan fashion, but in a wholly
partisan mode. It happens that with all the work put into that
committee hearing, that plan was never sent to the floor for a vote.
The distinguished majority leader almost immediately radically modified
the Senate Finance Committee partisan stimulus proposal--again, acting
in a partisan way. And nothing gets done in the Senate if it is done by
one party. That is why it is so important to remind people of the White
House-centrist bipartisan stimulus package that the President said he
would pass.
Surprisingly, that revised proposal that the Senate majority leader
put on our table immediately after the partisan bill came out of
committee looks a great deal like the White House-centrist bipartisan
stimulus package I have been referring to that we ought to pass and
send to the White House. A substitute back in November, put on the
table by Senator Daschle, adopted measures initially promoted by many
Republicans. Unfortunately, in December, the majority leader blocked a
vote on the White House-centrist plan in large part, I believe, out of
fear it would pass. And it would have.
Now comes yet another variation of that theme. The majority leader
has delivered yet another economic stimulus package--basically the
skeletal remains of previous stimulus proposals.
I will talk about some of the differences between the White House-
centrist bipartisan package and the partisan Democrat skeleton stimulus
plan. I will explain, then, why I believe the bipartisan White House-
centrist package is better for America and, most importantly, for those
dislocated workers, and particularly for the dislocated workers who do
not have health insurance. I will look at what it does for displaced
workers.
This is the White House-centrist package. Our unemployment insurance
proposal represents an unprecedented commitment to American workers. We
provide up to 13 weeks of additional unemployment benefit to eligible
workers who exhaust their regular benefits between March 15, 2001, and
December 31, 2002. We have an estimated 3 million unemployed workers
qualifying for an average of $230 a week. These benefits would be 100-
percent federally funded at a cost of about $10 billion. Our proposal
transfers an additional $9 billion to State unemployed trust funds.
Such a transfer would provide the States with flexibility to pay
administrative costs, provide additional benefits, and avoid raising
unemployment taxes which would be a bad thing for them to be forced to
do during the current recession. We never want to raise taxes during a
recession.
The United States enjoyed a growing economy and declining
unemployment for much of the previous decade. But the economic slowdown
that officially became a recession started in March 2001. We all know
that was exacerbated by the terrorist attacks on September 11. That
meant more substantial layoffs. I said this recession started in March
2001. Economists officially labeled it a recession. But remember that a
long time before that--almost a year, March 2000--we started a downturn
in manufacturing. That manufacturing index, going back to the last year
of the Clinton administration, has still been going down 19 months in a
row. Even though the official recession started in March 2001, those in
manufacturing had been in recession for a whole year before that.
We have seen the unemployment rate for all segments of the economy
rise from 4 percent in November 2000 to 5.7 in November 2001. By
historical standards, you could say the current unemployment rate is
still substantially below the level at which Congress deemed it
necessary to enact extended unemployment benefits based upon what
Congress has done for the few times in the past. Over the past 50
years, the Federal Government provided temporary extended unemployment
benefits only six other times. The average unemployment rate during
those times was far higher than it is right now at 7.3 percent as an
average for those six times.
Based upon historical record, the President did not go as far with
his suggestion for helping unemployed people as the bipartisan centrist
stimulus package does. The President originally suggested that extended
unemployment benefits--meaning the additional 13 weeks--should be
limited to those few States that have a disaster declaration in effect
as a result of September 11 and which have a threshold of the 30-
percent increase in their unemployment rate.
A number of our colleagues on both sides of the aisle insisted we
provide immediate assistance, not just to a few States as the President
suggested but to every State, regardless of their unemployment rate. We
have agreed to do exactly that in our bipartisan centrist stimulus
package. The President has agreed to sign it even though it didn't
start out at that point.

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We have some, unfortunately, on the other side of the aisle who
continue to insist that what we are doing is not enough. They insist
that we should go further by requiring every State to provide specific
benefits and establish specific eligibility criteria as a condition of
receiving their additional Federal assistance of 13 weeks. In other
words, what they are suggesting is that we violate the agreement we had
between the States and Federal Government, for the most part letting
States decide who should and under what circumstances they qualify for
unemployment assistance.
We could not agree to the demands on the other side to change this
longstanding relationship between the Federal Government and the State
governments on the policy of unemployment compensation. We have always
left those decisions about benefit levels and eligibility criteria to
the States.
The changes sought by those on the other side of the aisle destroy
this historic relationship and undermine the flexibility needed by
States to respond to their unique circumstances while ignoring a fact
about America--that we are geographically vast; our population is very
heterogeneous. Consequently, you can't pour one mold in Washington, DC,
that fits the needs of New Mexico the same as New York City, or Iowa
the same as Sacramento, CA. Leave us leave it to the legislatures of
California, Iowa, New Mexico, and New York to decide what the policy
should be for their States as those people closer to the grassroots see
their needs. To me, that is just a commonsense approach to governing.
It might not be a commonsense approach in England where the country is
small, but it is obviously the sort of thing we need to do in our
federal form of government.

I would now like to touch on the White House-centrist bipartisan plan
commitment to providing health care for dislocated workers because the
plan that the distinguished Senator majority leader has put on the
table does not deal with this at all.
If there is one thing I could point out from his remarks this
morning, it is that he tried to make the point that his package has
only things in it to which both sides agreed. I think he is misreading
the Republican side of the aisle. There is a great deal of commitment
on the part of Republicans--the vast majority of our caucus--to meet
the health care needs of people who are dislocated workers because of
September 11. Quite frankly, it would do this for the first time in the
history of our public policy.
They have been saying since October that Republicans don't care about
helping workers with health insurance. I quote Senator Daschle himself
last December saying that his Republican colleagues ``so far have
refused to come to the table and negotiate seriously.''
There is nothing further from the truth. Since October, when
President Bush first called on Congress to pass the stimulus package, I
have worked closely and seriously with both Democrats and Republicans
to come up with a meaningful, bipartisan approach to helping people
impacted by the events of September 11. Compared to where we started on
the issue of health care for the dislocated workers, Republicans have
come a very long way to a position with which a majority of our caucus
agrees. I do the history on this just to prove the point.
This debate began, let us say, back in October--too long ago, I am
sorry to say, and embarrassed to say. We should have passed this bill
when the recession first hit its lowest point. Our proposal at that
time relied on a national emergency grant program to deliver health
benefits to workers at a cost of just $3 billion. We look back now, and
we say that just doesn't do it. Over time, the number grew. I said
publicly that we could double or even triple that number.
I also invited Democrats to modify the grant criteria to make the
program more responsive to the needs of workers without health
insurance. I even offered some Democrats the opportunity to write the
criteria, if we could agree on doing it through national emergency
grant programs. The reason for that is you can deliver the help to
those who do not have health insurance within 30 days after the
President would sign the bill. But the Members of the other party
refused. And that did not stop us from staying at the negotiating
table, regardless of what the distinguished majority leader says about
our refusal to negotiate.

(Mr. JOHNSON assumed the chair.)
Mr. GRASSLEY. Additionally, we proposed giving workers a refundable,
advanceable tax credit towards the purchase of health insurance equal
to 50 percent of the policy's cost. So we moved away from a national
emergency grant program to one that is probably more dynamic, with more
flexibility for the workers--a tax credit for those who are unemployed
to continue the insurance they had where they previously worked and
were laid off; and even go beyond that, for people to have health
insurance even if they did not have health insurance at their previous
job before they were laid off.
Democrats objected, claiming that the credit was too small and that
sicker people would have trouble buying policies in the individual
market. So there was one gripe after another, but we tried to satisfy
those gripes to reach a consensus agreement which ended up being the
bipartisan centrist-White House program.
Our new proposal then was endorsed by the White House even though the
President had suggested another approach. It was endorsed by the White
House, the House of Representatives, and by the bipartisan centrist
group of this body. That program takes a three-pronged approach to
getting health insurance assistance to those dislocated workers who
used to have health insurance where they first worked. Now they are
unemployed. Now they do not have health insurance. Now they would have
health insurance under the White House-centrist bipartisan package, but
they would not have it under the Daschle amendment before the Senate.
Our proposal goes further and wider than any proposal on the table to
date and gets more help to more people more quickly than any other
proposal to date. What is more, it represents a giant leap in spending
on health care. It includes over six times as much money for temporary
health insurance assistance as our original Republican, and admittedly
partisan, proposal.
The House-passed stimulus bill--what the President said he would
sign, and the centrist group in the Senate backs--would spend
approximately $19 billion on temporary health insurance in the year
2002. And it does it the right way, by using existing programs, along
with new ones, designed to get people the help they need quickly.
Now I take a minute to describe our three-pronged approach.
First, the White House-centrist bipartisan proposal provides a
refundable, advanceable tax credit to all displaced workers eligible
for unemployment insurance, not just those eligible for COBRA. The
value of the credit is 60 percent of the premium, instead of the 50
percent in our original proposal. The credit has no cap and is
available to individuals for 12 months between the years 2001 and 2003.
Individuals can stay in their employer COBRA coverage or they can
choose policies in the individual markets that may better fit their
families' needs. This only makes sense because locking people into
COBRA, as the Democratic leadership insisted prior to Christmas--and it
is not even in their proposal now--forces people to stay with policies
that may be too expensive for them to keep, even with a 60-percent
subsidy.
Our goal was to give dislocated workers access to all health
insurance choices available to them in the private marketplace. We have
done that in a responsible way that uses the dynamics of the
marketplace rather than the straitjacket of a Government program to
deliver the help.

This bipartisan White House-centrist proposal includes major new
insurance reforms to protect people who have had employer-sponsored
coverage and go out into the private market for the first time after
being laid off. It makes the COBRA protections available to people who
have had only 12 months of employer-sponsored coverage, rather than 18
months as under current law. By doing this, we greatly expand the group
of displaced workers who cannot be turned down for coverage or excluded
from any insurance because of preexisting conditions.
The new 12-month standard is especially important for people with
chronic conditions who have difficulty obtaining affordable coverage.
It is a

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major step, and I am surprised that the Democratic leadership does not
want to take us up on these sweeping new reforms.
I turn now to the mechanics of the tax credit proposal. It is much
easier to implement than the direct subsidy approach that the
Democratic leadership has had in some of their proposals. But there is
nothing on health insurance in the Democratic amendment before us. They
just forget about the needs of the dislocated workers who used to have
health insurance who do not have it now because they are unemployed.
While the Democrat proposal requires employers to shoulder the
burdens, our proposal relies on existing State unemployment insurance
systems. So under this bill, workers will be able to access the credit
and begin applying it to their health insurance premiums in a timely
way. Let me explain the workings of it.
Newly dislocated workers will receive certificates from their State
unemployment offices, or ``one stop'' centers, when they apply for
unemployment insurance. You can take care of both needs at one time--
unemployment insurance and continue your health insurance from the
previous employer. Or if you did not have it there, you can get a
certificate to go out and get it for the first time.
So you take those certificates and submit them, along with their
contribution to the premium, to their employer or insurer, and move on
with insurance. Afterwards, insurers then would submit the certificates
to the Treasury Department for reimbursement.
This approach works because it relies on existing systems to deliver
new benefits and, as a result, delivers those benefits in a fast and
reliable way.
I ask my colleagues, why would anyone insist on a mechanism that just
will not deliver the goods to the people who need them? In other words,
people who became unemployed yesterday have lost their health
insurance, they cannot afford to keep their COBRA up, or maybe they are
unemployed from a place that did not even have health insurance and
then have to institute some system where they have to wait a long time
to get the help. I do not understand the wait.
The second prong of this proposal is $4 billion in enhanced national
emergency grants for the States, which can be used to help all
workers--not just those eligible for the tax credit--to pay for health
insurance. States have flexibility under our approach and can use these
grants to enroll their workers in high-risk pools or other State-run
plans, or even enroll them in Medicaid if the State decides.
To address concerns raised by Democratic colleagues, our enhanced
national emergency grant program requires all States to spend at least
30 percent of their grant money on temporary health insurance
assistance. In addition, we have included protections for the States--a
minimum grant of at least $5 million for any State that meets the grant
criteria.
Finally, the third prong of the proposal responds to Democratic
requests by including $4.3 billion for a one-time temporary State
health care assistance payment to the States to help bolster their
Medicaid Programs.
Just this Monday, I had a State senator from Davenport, IA, speak to
me at one of my town meetings about the needs of the States for
additional Medicaid funds. I said to her that Governor Vilsack and
Republican leaders and Democratic leaders had a conference call with me
on that very subject before Christmas. I said we have this $4.3 billion
in this White House-centrist bipartisan package that the President will
sign, that has passed the House of Representatives.
What you need to do is get Governor Vilsack, I said to our State
Senator, who I said I would help, get him to call Senator Daschle and
ask this bill to come up, and you will have Iowa's share of this $4.3
billion.
As we know, the Medicaid program is an important safety net for low-
income children and families and disabled individuals. Medicaid is a
joint Federal and State program that accounts for a large part of State
budgets. So in this time of budget constraints due to recession, States
are struggling to make ends meet. Iowa is one of those. In fact, I
think I read in the newspapers that there are 40 States that have very
serious budget problems, and Medicaid is probably the biggest one of
those budget problems in almost all of those States.
So as a result of the unique and extraordinary economic situation we
now face, we need to help those States rather than having those States
scale back Medicaid services, including my own State of Iowa. I think
we are going to be scaled back by $18 million. This provision provides
a one-time emergency cash injection that will help States avoid
Medicaid cutbacks.
This feature was not part of our original plan. I just say that. You
might ask: Senator Grassley, why didn't you have it in your original
plan? Well, the process of legislation is evolution of a bill. There
are very few bills in Congress that are introduced and passed as they
are originally introduced. I would not pretend to believe that every
bill I introduce is a perfect piece of legislation. This process of
negotiation on these, listening both on the Republican side and the
Democratic side, is one of improving a piece of legislation, and even
after that is done, with new ideas in it, you have to recognize that
many of our colleagues have concerns about even this provision. In
fact, I share their reservations, and that is why I am emphasizing that
this is not simply a garden variety increase in Medicaid funding; this
is to meet the temporary emergency payments that result from a downturn
in the economy because of the terrorist attacks of September 11 that
have not only affected the Federal budget situation but most of our
States.
This Nation is calling for a bipartisan compromise. In that spirit,
we have agreed to add this proposal on Medicaid to our bill.
We made tremendous steps towards the Democratic position in order to
find bipartisan compromise on health care, a compromise on health care
that is not even in the Democratic proposal that is before the Senate.
I said that what we have included in here our Republicans would vote
for, I think, maybe except for two Republicans. And then we have enough
Democrats that make up a majority to get this bill passed. But those
steps have not been reciprocated by the Democratic leadership.
Displaced workers then deserve to be treated with respect by this
body, and I believe those workers have earned a vote on this bill. In
other words, the House has passed this bipartisan White House-centrist
package. The President has said he would sign it. So if we have a
majority vote here, we could pass this, and it would be out of the way.
We would be stimulating the economy, and we would be helping dislocated
workers.
It is necessary for me now to discuss the individual income tax
reductions in the White House-centrist plan and also compare this to
the skeletal plan put forth by our distinguished majority leader.
The original House stimulus bill would have accelerated the reduction
of the 27 percent rate to 25 percent. That otherwise would not be
scheduled to go into effect until the year 2007. The White House-
centrist package has adopted this approach.

Here is another thing on the charts that the majority leader used in
his speech this morning. He referred to ``rates reduction''--plural,
``rates.'' We have one rate reduction, the 25 percent bracket, or let's
say the 27 percent down to 25. We don't change other rates. We do have
other tax provisions, the tax rebate for low-income people.
So we have the White House-centrist bipartisan package helping these
middle class taxpayers. The skeletal Democrat plan doesn't do this. It
does not provide one red cent of tax relief for people who are working
for a living, not even one cent of tax relief for working Americans. So
let's take a look at who will benefit from our planned rate reduction.
I have some charts I will be referring to. The reduction of the 27
percent rate will benefit singles with taxable income of at least
$27,000. I want people to think about this, a single person with income
as little as $27,000. Somebody is going to be saying before the day is
out that these people are not overtaxed. I would like to have you ask
people making $27,000 if they couldn't use a reduction of their income
tax from 27 percent down to 25 percent. They would probably laugh at us
for suggesting that that is not enough.

[[Page S73]]

We are talking about heads of households that would have income as
little as $36,250 and married couples with taxable income as low as
$45,000. These are not wealthy individuals. These are middle class
working Americans. I have the chart I referred to that Members can see.
I want them to see what the median income for a four-person family for
every State in the Nation.
Median income is the amount of income right in the middle, with half
the incomes above and the other half below. Our chart shows that the
average median income for a four-person family in the United States, as
we can see, is $62,098. A family of four now, that is the average.
Remember, half are below and half are above. A reduction of the 27
percent rate to 25 will benefit married couples with taxable income
over $45,000. So it will benefit working people who are well below the
national median income level.
This chart also shows those States that have family median income
that is higher than the national average. And so we can look at where
these people live: Connecticut, New Jersey, Delaware, Michigan, Rhode
Island, California, Washington State. These are the States where a
family of four will benefit the most from our proposed tax cuts.
The more surprising figures are shown in the next chart. We can see
the States with median income below the national average. So you recall
that I said that reducing the 27 percent rate to 25 percent will
benefit married couples with taxable incomes over $45,000. Look at the
median income distribution of this chart. You can see from this chart
that there is not one State on the list that has a median family income
of less than $45,000.
So you can see that our proposal will benefit everyone, not just the
elite few, not just from a few selected States. But the distinguished
majority leader's Democratic skeletal plan provides no relief for these
States. The Treasury Department has estimated that the White House-
centrist bipartisan plan's acceleration of the 27 percent rate will
yield $17.9 billion of tax relief in the year 2002 for over 36 million
taxpayers. That is one-third of all income tax payers. Small business
owners and entrepreneurs account for 10 million or 30 percent of those
benefiting from this rate reduction.
When you refuse to accelerate the rate cuts, you harm farmers and
small businesspersons the most. That is because most small
businessowners and farmers operate their businesses as sole
proprietors, sub-S corporations, partnerships. The income in these
types of entities is reported directly in individual tax returns.
Therefore, a rate reduction for individuals reduces taxes for farmers
and small businesses. That is why the rate reduction under the
bipartisan White House-centrist plan is so important. In 2002 alone, it
injects $17.9 billion of stimulus into our ailing economy, and it helps
small businesses that create the new jobs.
So what would a small business do with these tax savings? Well,
considering that most of the recent job growth has come from small
businesses, I believe they would feel safe hiring more people and
making more business investment. We know that 80 percent of the 11.1
million new jobs created between 1994 and 1998 were from businesses
with less than 20 employees. Eighty percent of American businesses have
fewer than 20 employees. That is why I refer to this as the 80-80 rule
for supporting tax reductions.
In addition, lowering taxes now would increase business cashflow
during the current economic slowdown. The higher cashflow would
increase demand for investment and labor. Don't just take my word for
it because we have the National Bureau of Economic Research. They
produced, in October 2000, a publication called ``Personal Income Taxes
and the Growth of Small Firms.'' As you know, the National Bureau of
Economic Research is a well-regarded, nonpartisan organization. It is
the organization that determines when official recessions begin and
when they end. They said this one began in March 2001. If we trust them
to make that determination, I hope we trust the conclusions reached in
their report.
Their report on individual taxes and small business growth reaches
the unambiguous conclusion that when a sole proprietor's marginal tax
rate goes up, the rate of growth of his or her business enterprise goes
down. Simply stated, high personal income tax rates discourage the
growth of small business and right now, in a recession, that is the
last thing we need.
That is why it is important to do rate reductions and do them the
right way and fully accelerate the 27-percent rate reduction. We are
simply accelerating a decision the Senate made last summer. We should
not, as has been suggested by some in the Democratic leadership, repeal
rate reduction or, to state it correctly, we should not increase taxes.
Again, that is the last thing you should do in a recession.
We know tax cuts are stimulative. When working Americans have more of
their own income, they are more financially secure and comfortable with
spending.
Let me say who really loses when this body fails to act. It is our
displaced workers, it is our fellow Americans who still have a job, it
is the security of our job base, and it is the soundness of the
Nation's economy.
The Senate Democrat leadership will not allow an up-or-down vote on
our bipartisan White House-centrist stimulus package. At least that was
the way it was before our holiday break. The reason why I don't think
they allowed it to be done is because it would pass. We have a majority
of Senators--obviously, a bipartisan majority. Obviously, this proposal
comes from the center of the Senate, from conservative Democrats and
moderate Republicans. So what. That is how you get things done in the
Senate.
I might not agree with everything in the package. I might be
considered more conservative than those who put it together, but it is
a good package. More importantly, it meets the needs of our country
post-September 11. It meets the needs of those dislocated workers,
those people who don't have health insurance.
So now where are we? We are at a point where the distinguished
majority leader has offered the skeletal remains of that package. But I
don't think there is a majority of Senators supporting that move. When
you get it all said and done, it doesn't help those people who don't
have health insurance.
I urge Senators to think twice before supporting something less than
the full stimulus package that was written by Democrats and Republicans
in the center of the Senate and that was so done in a way that
satisfies the White House for signature. We need to enact a plan that
will stimulate the current economy and serve as insurance against a
second downturn in the next few years.
For those in this body, both Republican and Democrat, there are a few
who say we will be better off if we don't pass the stimulus package, or
that we are recovering and we might not need it. I say to them,
remember that most recessions have a double downturn. They have it when
the original recession kicks in, and then they have an upturn, and then
they have a down tick. A down tick probably is not a negative growth
situation, but it is still a downturn. This stimulus package will be
insurance against having a steady rise in the economy over the next few
years, with no down tick, as is traditional for some recoveries. We
need to enact a plan that will stimulate the current economy and give
us that insurance.
The White House-centrist bipartisan package does that. I hope the
Senate hears the pleas of the American people and will support a
comprehensive stimulus package--one that aids displaced workers, tends
to their health care needs, and gives a real turbocharge to our
economy, and to do that into a full recovery, a recovery without a down
tick, so those who need a job can get it and those who have a job can
keep it and relieve a lot of anxiety--particularly anxiety over not
having health insurance, which unemployed people have.
Mr. President, I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. CARPER. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. CARPER. Mr. President, I am not interested in casting aspersions
today at the work of our Republican friends with respect to the
economic

[[Page S74]]

recovery package. I think, for the most part, they have entered into
this in good faith. Senator Grassley of Iowa has worked hard, as has
Senator Baucus of Montana, to try to craft a consensus package that we
can all agree to--or at least 60 of us can--which would have a
beneficial effect. I wanted to speak briefly and reflect back for a
moment on the principles that we adopted on a bipartisan basis last
fall as we approached the creation of an economic recovery package.
There are really three principles that come to mind. One is that
whatever we came up with should be temporary in nature; second, there
should truly be stimulative of our economy; three, it should not
exacerbate long term the budget deficit of our Nation.

I can stand here along with any of our colleagues, certainly the
Presiding Officer, and think of any number of items I would like to
include in a stimulus package that are not included in the four-part
proposal put forth by the majority leader.
He has suggested a 13-week extension in unemployment insurance
benefits; a tax rebate for those who did not receive a tax rebate
previously and who are very likely to spend that money sooner rather
than later; bonus depreciation incentive for businesses to renew
capital investment, which has been lacking for the last year or more
now; and fiscal relief for States with respect to their health care
costs.
My State of Delaware and other States are having a very difficult
time as the rolls of the unemployed rise, as the numbers of people who
are eligible for Medicaid rise, and States need help with that.
As I look through that list of four proposals Senator Daschle has put
forward, I see in those proposals ideas that are essentially temporary,
that are stimulative, and do not exacerbate our fiscal situation long
term.
If we are going to do something in this regard--we have been dancing
this dance for a long time--we need to get on with it. I applaud our
leader for bringing it up early on, but if we do not do something soon,
it is really too late.
When we were in economic recovery and expansion during the 1990s, a
lot of people thought it was going to last forever. We know it did not.
Similarly, people think that when we are in a recession it will last
forever, too, and we know from history that recessions do not last
forever either. The history of recessions since World War II is that
they are generally a year and a half long; most are 12 months in
duration. We have been in this one for almost 12 months.
I think one of the reasons the landing has been as soft as it has
been--and I know it has not been for everyone--one of the reasons this
recession is not as deep as it otherwise might have been is because of
some of the most aggressive monetary policy by the Federal Reserve I
have witnessed in my lifetime, maybe the most aggressive policy which
is now being felt in our economy.
Second, we have seen prices drop precipitously from a year ago. It is
not just the price of gasoline we put in our cars, trucks, and vans,
but it is the price of the heating oil we are using to heat our homes
this winter. Even natural gas prices are down dramatically. We feel
good about those things psychologically, but also they have a material
effect on our economic well-being and our pocketbooks.
A third piece that is kicking in to help lessen the severity of the
recession is the amount of spending we are doing. We are spending a lot
of money, and we are spending it, for the most part, on the right
things--the war in Afghanistan, the war against terrorism around the
world, trying to help the folks of New York recover and rebuild, trying
to make sure the airline industry does not end up in a real depression
with massive layoffs and closings.
Those three things taken together--aggressive monetary policy by the
Fed, much lower energy prices, and the deficit spending we are already
doing--combine to help, if not lift, the economy to at least reduce the
depth to which it is dropping.
I am personally bullish about the economy. I think there is a pretty
good chance come spring we will be coming out of this recession. Some
have said it will be a jobless recovery and maybe mirror what we had in
1990, 1991, and 1992. My sense is we will probably be coming out of it
sooner rather than later.
The Federal Reserve will meet next week. They will debate whether or
not to lower interest rates again by maybe another quarter of a
percent. I have no crystal ball. I am not sure what they are going to
do. They can do that or make no change at all.
The time will come when the concerns of the recession will give way
to inflationary concerns. If we wait too long for this stimulus
package, we are going to put ourselves in the position of instead of
being in concert with the Federal Reserve's monetary policy where we
pass a package that supports what the Federal Reserve does, we are
going to be offering a package that will stimulate the economy which is
already on the rebound and the Federal Reserve's concerns will move to
not so much how do we get the economy moving, but how do we dampen down
inflationary expectations.
I said to our leader any number of times: No bill is better than a
bad bill with respect to economic recovery. What he has proposed is not
a bad bill. I believe it is quite a good proposal. As I said earlier, I
can certainly offer changes that I would like to see adopted that might
make it better. Frankly, so could our Republican friends as well.
This bare-bones approach works for me, but more important, I believe
it will work for our country. It will provide the insurance policy
along with the Federal Reserve monetary policy, along with the energy
price drops, along with the spending we are already doing to make sure
when we do get into this spring that the economic recovery we are
hoping for will actually materialize.
We have been joined in the Chamber by Senator Baucus of Montana,
chairman of the Finance Committee. I spoke of him when he was not in
the Chamber. I now thank him in person. No one has put more time,
energy, and effort into trying to develop a package with respect to the
economic recovery of our country than Senator Baucus. I wanted to
express my thanks to him for the great work he has done.
My hope is we can move from this proposal today and actually adopt
it, but if we cannot and if we do not, I want him to know he has my
respect and certainly my thanks. I yield the floor.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, what is the present parliamentary
situation?
The PRESIDING OFFICER. The pending question is Daschle amendment No.
2698.
Mr. BAUCUS. I thank the Chair, and I thank my good friend from
Delaware, Mr. Carper, who is a great addition to this body, to the
country, and certainly does great service for his State of Delaware.
The Senator is a good man.
Mr. President, like a lot of others, I have read the David McCullough
biography of President John Adams. I commend it to anybody listening
who has not read it. It is a wonderful story of a colossus of a man,
John Adams. It is so inspirational, especially reading about that era
in our country where men and women were very concerned about their
futures, most of them having left England, oppressed by Great Britain,
and how they reacted to it, with the variety of people in the colonies
at that time with different backgrounds and certainly not having
present-day communications. Nothing traveled faster than the speed of a
horse. It gave people time to reflect.
John Adams read thousands of books. He read all the political
philosophers of the time in original Greek, in original Latin, as did a
lot of our Founding Fathers and women, too. Abigail Adams clearly was a
great force in helping our country come together.
John Adams, as a major force for what was right for America, helped
persuade the delegates assembled at the Continental Congress trying to
decide the future of our country to break away and declare
independence. He is the main reason for the words in the Declaration of
Independence. Thomas Jefferson wrote them, of course, but it was John
Adams who was the primary mover in helping to persuade men and women in
difficult times to come together and do what was right and break away
from Great Britain.
Then came the Revolutionary War. We were so ill prepared. Mr.
President,

[[Page S75]]

35,000 British troops landed on Staten Island.
We had such a difficult time putting troops together, and it was John
Adams, as the head of the War Board, who foresaw far ahead of anybody
else how difficult the Revolutionary War would be and began putting
together the armaments in order to make that happen and how to prevail
and how to deal with the Brits.
I only mention this because as we are debating an economic stimulus
bill, an economic recovery bill, in many respects what we are doing is
so far removed from those great Americans who met in Philadelphia,
later met in Washington, DC, in subsequent years, in helping develop
and frame our country. This is a sterile debate compared with the
debates they had. It is a very important debate, but it is a sterile
debate. It is very important clearly because our economy is not out of
a recession.
Most businesses that study these matters for their livelihood believe
we are not out of the woods. The manufacturing sector is in very
difficult straits. There is some data that indicates maybe we are near
the end of the so-called recession, but it is my belief, in talking to
people around the country, business men and women, that we are not.
That is clearly the case with respect to at least a couple of million
people who, in addition, have lost their jobs compared with previous
years and deserve an extension of unemployment compensation benefits.
We do need to come together in the way our forefathers did back then.
I do not want to be too dramatic or too simplistic about it, but when
we look back and think of what our Founding Fathers and mothers did and
how they came together in very difficult times, it is very inspiring. I
urge us to tap into that, to remember what they did and to utilize and
act in the same vein and try to do what is right for America.
I think if we are all honest with ourselves we know what is right is
to forget this partisan bickering back and forth. Forget the labeling.
Forget the criticism. Forget trying to take credit. Just kind of do
something which seems right, and right to me is some modest tax
stimulus to help business and extending the unemployment compensation
benefits to help people who have lost their jobs.
Different Senators are going to have different ideas, but in the main
I think we can do something pretty modest but on target and very
quickly. I am quite confident the President wants the same thing and is
trying to achieve the same goals. I urge all of us on both ends of
Pennsylvania Avenue to in a larger sense be inspired by our Founding
Fathers and think of the difficulties they had in working together, and
they worked together.
The Thirteen Colonies actually voted unanimously for independence.
One State abstained, but 12 Colonies all voted unanimously. It was very
difficult. Think of the southern Colonies, the northern Colonies, much
different backgrounds, but they came together. They knew what was right
for America. On a much lower plane, if they could do what is right for
America back in 1776, clearly in the year 2002 we could pass a modest
economic stimulus package that makes sense for America. In that vein, I
urge all of my colleagues to work together.

Amendment No. 2701 to Amendment No. 2698

Mr. BAUCUS. Mr. President, I rise today to offer an amendment to
include extension of expired agricultural disaster assistance programs
to the economic recovery bill. My amendment, cosponsored by Senator
Enzi, provides $1.8 billion for the Crop Disaster Program for losses
incurred in calendar year 2001. Further, it provides $500 million for
the Livestock Assistance Program, $12 million of which will be directed
to the American Indian Livestock Feed Program.
Extension of these agricultural disaster relief programs is
necessary. Why do I say so? It is because of an unprecedented streak of
poor weather and economic conditions continue to hamper the economic
prospects for farmers and ranchers throughout our country.
Farmers in parts of the South and northern-tier States have been
particularly hard hit. Although some sectors and some regions have
begun to recover, farmers' overall earnings from their farming
operations, not including government payments, are down sharply from
the levels in the mid-1990s.
The current difficulties could not come at a worse time.
While struggling to survive three disastrous years, farmers are now
faced with sharply escalating operating costs due to higher energy and
fertilizer prices, and basically higher operating costs.
According to the most recent projections provided by the U.S.
Department of Agriculture, total farm expenses were estimated to rise
another $4.2 billion in 2001. This latest rise came on the heels of a
nearly $10 billion increase in total farm expenses in the preceding
year, 2000.
Caught between severe and erratic weather conditions and rising
operating costs, American agricultural producers have experienced a
severe economic squeeze.
The data kept by USDA's Economic Research Service demonstrate that
net farm business income was at a decade-low in 1999 and 2000. Thanks
to a limited recovery in some sectors, USDA projects that farm business
income will rise slightly in 2001.
Still, unless government assistance is continued, net farm income in
2001 is actually projected to be lower than farm income in those bad
years of 1999 and 2000. Even in sectors in which economic conditions
have been improving, such as livestock, poor grazing conditions have
pushed many ranchers to feed heifers for slaughter rather than using
them to rebuild their herds.
Not surprisingly, 3 years of economic hardship have taken a toll on
the farm economy. ERS statistics show farm debt rising in the last 3
years at such a rapid rate, more than in the 1980s. In other words,
farmers are borrowing to continue their operations. This increased debt
load adds further to farmers' operating costs.
In my home State of Montana, it is anticipated that 40 percent of
producers seeking operating loans this year will be denied if we fail
to provide this assistance in this amendment.
Thus, if government efforts to support farm income are now
curtailed--with weather problems continuing, costs rising, and no time
to recover from the contraction in farm operating income since 1998--
the economic impact on rural America could be devastating.
In a real sense, the economic problems that have afflicted the rest
of the economy in recent months have been plaguing the farm economy for
several years.
A downturn in farm income does not just impact farmers; it wreaks
havoc in the rural communities that depend upon them. Farmers in
economic distress are not able to make their usual purchases of seed
and fertilizer, not to mention food and clothing.
This makes the agricultural sector--which is directly and indirectly
responsible for nearly one-fifth of U.S. gross domestic product--among
the most vulnerable sectors of the U.S. economy.
To ensure that the stimulus plan also provides benefits to
agriculture-dependent economies in the South Midwest, and northern-tier
States, my amendment extends the disaster relief programs that have
been critical to shoring up farm income over the last 3 years.
This will allow farmers--and the rural economies that depend upon
them--to share the economic support provided to the rest of the economy
in the stimulus plan and make real progress in recovering from the
multiyear downturn they are now struggling through.
Simply put, many rural economies did not fully participate in the
growth in the 1990s. According to data from the U.S. Bureau of Economic
Analysis, growth in many rural States, including Montana, Iowa,
Oklahoma, North Dakota, Wyoming, Louisiana, and Mississippi has lagged
behind--in some cases, far behind--the national average.
In the same vein, according to the Bureau of Labor Statistics, over
the last decade, job growth in rural areas has lagged far behind that
in urban areas.
Further, rural areas appear to have entered the current recession in
late 2000, almost a year and a half ago. Rural America seems to be the
first to suffer a recession and the last to recover. For this reason
and so many more, this stimulus bill should include agricultural
disaster assistance.

[[Page S76]]

I note that this amendment does not include a commodity purchase
section that was the subject of much criticism from the other side of
the aisle.
Some may recall that this provision was attacked for extending
benefits to buffalo ranchers and asparagus farmers--among others. I
believe those attacks were unfair and misdirected. I still support
provisions for specialty crop producers. However, in order to minimize
controversy and move this amendment forward, I have dropped this
provision from my amendment.

Finally, I have letters of support for this amendment from the
following organizations: The National Association of Feed Growers,
Montana Stockbrokers, National Farmers Union, signed by 26 State
presidents, the National Cotton Council, the National Cattlemen's Beef
Association, and others. I also have a joint letter from the Montana
Grain Growers Association and the Montana Farm Bureau Federation
describing the desperate need for this agricultural disaster
assistance.
All I hear when I am home is the need for this legislation. We are in
dire straits. We have not participated in the national growth of the
1990s. We are hurting. It is not just my State but in many other parts
of rural America. We need this.
I urge all colleagues to support this amendment and ensure this
economic stimulus program truly helps all Americans. That includes
farmers, ranchers, and those living in rural communities.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I missed part of his statement. This is
an amendment to the Daschle amendment?
Mr. BAUCUS. Yes.
Mr. NICKLES. It costs how much?
Mr. BAUCUS. About $2.3 billion.
Mr. NICKLES. To be expended this year; and it is for what?
Mr. BAUCUS. Disaster assistance.
Mr. NICKLES. We are not doing the farm bill.
Mr. BAUCUS. Right.
Mr. NICKLES. The Senator does not want to wait another week or two?
Mr. BAUCUS. Mr. President, the farmers cannot wait. We don't know the
prospect of the farm bill either. Income is going down the tubes;
farmers are going down the tubes. That is why we are acting now.
Mr. NICKLES. Mr. President, I missed part of my colleague's comment.
I heard he would have an amendment to add an agriculture section to the
so-called stimulus bill. I don't think that underlying bill qualifies
as a stimulus bill. I don't see anything in the underlying bill that
creates jobs. Now we are talking about an additional 2-point-some
billion dollars to be added to agriculture payments. I don't think the
amendment should be on this bill.
I want to read the amendment. I know many sections of our country in
rural areas are hurting in agriculture. We will be debating the
agriculture bill, the farm bill, probably in the next couple of weeks,
and I think that would be a more appropriate vehicle. I will read my
colleague's amendment. I have great respect for him. My initial
reaction is it does not belong on this bill. I hope it will not be
added to this bill. We will no doubt vote in the not-too-distant
future.
I know there are colleagues on this side, and I assume we will
alternate amendments. Senator Smith has an amendment on accelerated
depreciation. It is my hope to bring that amendment up as well.
Mr. BAUCUS. I call up my amendment.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Montana [Mr. Baucus] proposes an amendment
numbered 2701 to amendment No. 2698.

Mr. BAUCUS. I ask unanimous consent the reading of the amendment be
dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To provide emergency agriculture assistance)

At the end add the following:

TITLE ____--EMERGENCY AGRICULTURE ASSISTANCE

Subtitle A--Income Loss Assistance

SEC. ____01. INCOME LOSS ASSISTANCE.

(a) In General.--The Secretary of Agriculture (referred to
in this title as the ``Secretary'') shall use $1,800,000,000
of funds of the Commodity Credit Corporation to make
emergency financial assistance available to producers on a
farm that have incurred qualifying income losses in calendar
year 2001.
(b) Administration.--The Secretary shall make assistance
available under this section in the same manner as provided
under section 815 of the Agriculture, Rural Development, Food
and Drug Administration, and Related Agencies Appropriations
Act, 2001 (Public Law 105-277; 114 Stat. 1549A-55), including
using the same loss thresholds for the quantity and economic
losses as were used in administering that section.
(c) Use of Funds for Cash Payments.--The Secretary may use
funds made available under this section to make, in a manner
consistent with this section, cash payments not for crop
disasters, but for income loss to carry out the purposes of
this section.

SEC. ____02. LIVESTOCK ASSISTANCE PROGRAM.

(a) In General.--The Secretary shall use $500,000,000 of
the funds of the Commodity Credit Corporation to make and
administer payments for livestock losses to producers for
2001 losses in a county that has received an emergency
designation by the President or the Secretary after January
1, 2001, of which $12,000,000 shall be made available for the
American Indian livestock program under section 806 of the
Agriculture, Rural Development, Food and Drug Administration,
and Related Agencies Appropriations Act, 2001 (Public Law
105-277; 114 Stat. 1549A-51).
(b) Administration.--The Secretary shall make assistance
available under this section in the same manner as provided
under section 806 of the Agriculture, Rural Development, Food
and Drug Administration, and Related Agencies Appropriations
Act, 2001 (Public Law 105-277; 114 Stat. 1549A-51).

Subtitle B--Administration

SEC. ____11. COMMODITY CREDIT CORPORATION.

The Secretary shall use the funds, facilities, and
authorities of the Commodity Credit Corporation to carry out
this title.

SEC. ____12. ADMINISTRATIVE EXPENSES.

(a) In General.--In addition to funds otherwise available,
not later than 30 days after the date of enactment of this
Act, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall transfer to
the Secretary of Agriculture to pay the salaries and expenses
of the Department of Agriculture in carrying out this title
$50,000,000, to remain available until expended.
(b) Receipt and Acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to carry out
this section the funds transferred under subsection (a),
without further appropriation.

SEC. ____13. REGULATIONS.

(a) In General.--The Secretary may promulgate such
regulations as are necessary to implement this title.
(b) Procedure.--The promulgation of the regulations and
administration of this subtitle shall be made without regard
to--
(1) the notice and comment provisions of section 553 of
title 5, United States Code;
(2) the Statement of Policy of the Secretary of Agriculture
effective July 24, 1971 (36 Fed. Reg. 13804), relating to
notices of proposed rulemaking and public participation in
rulemaking; and
(3) chapter 35 of title 44, United States Code (commonly
known as the ``Paperwork Reduction Act'').
(c) Congressional Review of Agency Rulemaking.--In carrying
out this section, the Secretary shall use the authority
provided under section 808 of title 5, United States Code.

SEC. 14. EMERGENCY DESIGNATION.

The entire amount made available by each of Subtitle A and
Subtitle B--
(1) shall be available only to the extent that the
President submits to Congress an official budget request for
the amount that includes designation of the entire amount of
the request as an emergency requirement for the purposes of
the Balanced Budget and Emergency Deficit Control Act of 1985
(2 U.S.C. 900 et seq.); and
(2) is designated by Congress as an emergency requirement
under section 251(b)(2)(A) of the Balanced Budget and
Emergency Deficit Control Act of 1985 (2 U.S.C.
901(b)(2)(A)).

The PRESIDING OFFICER. The Senator from Illinois.
Mr. DURBIN. Mr. President, I rise in support of the Daschle-Baucus
amendment which is being considered now. What we have is an
opportunity--and I hope a bipartisan opportunity--to do something about
the economy.
Senator Daschle has taken those elements of the Republican economic
stimulus plan and the Democratic economic stimulus plan that we agree
on and brought those to the floor, saying, use this as a starting
point, as a bipartisan effort.
There are other ideas. Some on the Democratic side have concepts, and
I am sure those on the Republican side do as well. What Senator Daschle
is trying to do is to break the logjam, cut through the rhetoric, and
do something.
I am discouraged that when Senator Daschle tried to do that this
morning in the Senate Chamber, some Members

[[Page S77]]

on the other side of the aisle objected. I hope this is not an
indication that we are in another logjam, at an impasse and unable to
break through.
Clearly, we have a good-faith effort to find a bipartisan economic
stimulus package. This package contains elements with which I think
Democrats and Republicans should agree. I don't believe there is any
debate over the fact of 5.8-percent unemployment in this country and 8
million people out of work, and there are a lot of people facing hard
times. This recession has made it difficult for them and their
families. I read about it at home in the newspapers and hear it from
people I talk to who call the office. A lot of families face a
difficult circumstance and are trying to get by.
What we are trying to do with the economic stimulus bill is extend
unemployment benefits for those who have been unemployed so they can
keep their families together.
If the problem in America today is the fact we have overcapacity of
goods and services and not enough demand and we want to help the
economy move forward so more people make purchases, we want to give the
resources to those who will spend them. The first to spend these
resources are those out of work. Every dollar given to that unemployed
worker for his or her family will be turned into a purchase, an
important purchase for that family for clothing, food, to pay the
utility bill in the cold winter months, shelter, maybe even medical
costs. I hope there is no argument about that. I hope we can concede
this is something to which both sides should agree.
There is another element in this bill of equally importance relating
to the Medicaid system. Medicaid, of course, is health insurance for
the disadvantaged people in America and those on disability. What we
have found in my State of Illinois and across the Nation is that a lot
of hospitals are facing closure today. States are seeing shrinking
revenue and cannot match the Federal dollars that might come in from
Medicaid and are cutting back for Medicaid reimbursement. That means
small hospitals, rural hospitals, inner-city hospitals, hospitals with
a disproportionate share of elderly patients, and patients with
disabilities are the ones that are facing closure. The Daschle-Baucus
bill addresses that.
I ask the Senator from Montana if he would like to comment. When he
speaks of rural areas, the hospital Medicaid reimbursement in his State
probably is similar to my own; inadequate to meet the current need.
This amendment, the Daschle-Baucus amendment before the Senate now,
provides, if I am not mistaken, additional Medicaid assistance to these
hospitals in this difficult time. I would not be surprised if in
Montana, as in Illinois, you had rural hospitals that were on the edge
of closure. With this dramatic change in lifestyle, the quality of life
in smalltown Montana or smalltown Illinois is going to change
dramatically if the travel time to a hospital goes from 25 minutes to
an hour and a half for the elderly person struggling to press on and
live or for the woman delivering a baby. This makes all the difference
in the world.
I ask my colleague from Montana if he would comment on the Medicaid
aspect of this economic stimulus bill before the Senate.
Mr. BAUCUS. I thank my good friend from Illinois. The Senator is
absolutely correct. Unfortunately, we are in a recession, and the data
we have is based upon times when the economy was in better shape, a
couple of years ago. As a consequence, the formula for distributing
Medicaid payments from Uncle Sam to the States is based upon old data,
and now the hospitals are hurting, more people have less income, they
cross the Medicaid poverty index, they get lower payments--just the
opposite of what they should receive. As a consequence, what the leader
suggested is essentially about a $5 billion reimbursement to the States
that have lost revenue as a consequence of the downturn. Revenue, in
some respects, they will get. But with the tax provision passed and the
lagging economic data, these States are losing significant revenues in
the provisional help.

Mr. DURBIN. I thank the chairman. I can't believe the circumstance is
any different in Oklahoma. I have to believe the hospitals in rural
Oklahoma and Illinois are facing the same problems. That is why this
amendment offered by Senators Daschle and Baucus as an effort to try to
help those hospitals really shouldn't have much debate. I, frankly,
think if we don't face this head on, we are going to face head on a
serious medical crisis in this country. We are going to see a lot of
hospital closures. We are going to see a lot of health care providers
that can't continue to make provisions for those who are in nursing
homes and hospitals. If we don't do something with this bill's
recommendations, if we get up in the politics of the moment, if we find
ourselves time and time objecting to bringing this economic stimulus to
the floor, it is going to be at the expense of the basic health care of
small towns in America--in the Midwest, Far West, and all over the
United States.
When you take a look at these two basic provisions for giving a
helping hand to unemployed workers who are trying to keep their
families together, and giving a helping hand to health care providers
that are particularly hard pressed because of this economy, this
section seems to be an excellent starting point in our debate about
moving this economy forward.
There may be other amendments offered on the other side. Senator
Daschle says we are open to that suggestion. Let us have amendments
offered on both sides and bring this bill to conference.
The President told us to get moving. Senator Daschle offered this
amendment just for that purpose. The question is now whether the
Republicans in the Senate will join us in a bipartisan effort to do
something. I can tell you right off the bat there will be Republican
amendments that they might offer which I can't support.
I just left a hearing on Enron, which is the topic de jour on Capitol
Hill. We went through what happened in that corporation. It had a
situation basically where the Enron ship started to sink. The corporate
officials and officers grabbed the lifeboats and left the pensioners
and investors and employees to drown. That is exactly what happened. As
a result of that, there is little sympathy on Capitol Hill for Enron.
Yet one of the Republican economic stimulus plans was to give--get
this-- $260 million in tax breaks to that bankrupt corporation. I am
not going to stand for that. I will vote against that every day of the
week. Try to explain to people back home why you want to give a tax
break to a bankrupt corporation where the officers and officials
basically fleeced investors across America, including the President's
mother-in-law.
Do we want to give a tax break to that operation or a $1 billion tax
break to IBM? Those are issues we can debate at length and get to a
vote on. I think there ought to be votes taken with time limits for
debate and get to the bottom of it. It depends on the bipartisan will
of this body. The Senate is constructed so one Senator can stand up and
object and that is basically the end of the story. That is what
happened this morning.
I hope my friends on the Republican side of the aisle will take
another look. I hope they will understand there are unemployed families
in every State. They are not just Democrats. They are Republicans and
Independents, too. They have people who want a basic helping hand.

What we are suggesting to help is no radical idea. President Bush's
father did that. When he faced a recession during his Presidency, he
extended unemployment benefits. This isn't some Socialist scheme we are
coming up with, I say to my colleagues on the Republican side. This was
considered a good, sound, economic decision by the President's father's
administration.
This morning we pick up the newspaper and find the political climate
and scenery has changed quite a bit in America. For a long time, we
labored under the deficits with a lot of red ink. It meant that the
national debt kept going up and up. So we had to collect taxes from
businesses and individuals across America just to pay the interest on
the national debt. This was not tax money collected for education or
for the defense of our Nation or for health care. No. It was money
collected to pay interest on the national debt largely held by foreign
investors.
We have turned that corner. In the last 6 years of the Clinton
administration, we started generating surpluses.

[[Page S78]]

We started funding for retirement in America. We could say to our kids
that they were going to see in their lifetime the publicly held
national debt come to an end. That would basically have changed in our
lifetime. The money collected was going to be spent to make America a
better place rather than paying interest on old debt. That was the
trend line.
The fiscal discipline we are facing today and the Congressional
Budget Office report says the party is over. The surplus is gone. We
are back into deficits.
For some reasons, it is very easy to explain. I voted to fight this
war. I voted to give the President the money he needed for our troops.
I would do it again tomorrow. Did it add to the deficit? Yes. I do not
think there is a person in America--certainly not the parents and
families of those who are serving our country--who would have us
shortchange the men and women in uniform. That is absolutely the right
thing to do. We are going to continue to do it, but it means more and
more deficit spending so we can wage this war successfully and bring
our troops home safely. So be it.
Also, the fact is it has taken a toll on our surpluses as well. There
were some projections that by now we would have rosy scenarios and all
sorts of good times ahead of us. It hasn't happened. We are still in a
recession. The recession takes money out of the Government coffers and
adds to the deficit.
We also passed a tax bill last year--a tax cut bill. Many of us
cautioned, saying: Go slow. Don't try to guess what the economy is
going to look like 5 or 10 years from now. I may be wrong. It didn't
even take a year. In 8 months, those rosy projections about surpluses
have evaporated with the recession and with the war. It is over. That
is why, with the suggestions of greater and greater tax cuts in the
future, a lot of us fought the battle to finally end the deficits and
move toward a surplus in our Federal budget. We don't want to return to
those bad old days.
For goodness' sake, for our children, let us retire this national
debt and get back to fiscal discipline and a sound approach. We cannot
give all the tax cuts that we all would like to give.
This is an election year. Every candidate wants to stand in front of
a crowd and say: I voted to cut your taxes. People just cheer and big,
broad smiles cross their faces. Folks are coming to understand that
there is a price to pay for it. The $300 or $600 rebate checks they got
last year added to the deficit. Money is now being taken out of the
Social Security trust fund and Medicare trust fund to pay for it. It is
a price that we will pay.

My colleague from Michigan, Senator Stabenow, said yesterday that
this is an analogy between what happened at Enron and what is happening
here in this debate. At Enron, the top officials cashed in their stock
before it became worthless while the little guys who had their
401(k)s--investors and employees--didn't get a chance to cash in their
stock and were left holding the bag. Everything disappeared. Financial
security was gone. The same debate is going on here now.
There are those who want to give tax cuts to the wealthiest people in
America at the expense of the retirement of the workers of America--the
Social Security trust fund. That doesn't make sense. Let us not do an
Enron on America. Let us make sure that we have a sound policy that
really is good for this economy, and every part of it--small
businesses, family farmers, and workers alike.
That is why the Daschle-Baucus proposal before us is a good one. It
is one that starts us toward a path of doing something sensible to help
the economy but not something that will hurt us in the long term.
I urge my colleagues, particularly on the Republican side who
objected to this economic stimulus package this morning, to please
reconsider. Let us bring this to the floor. If you have some good
ideas, let us have a debate and vote--and a limit on the time we put
into that debate so we know it is going to end and hopefully end up
with a bipartisan bill to send to the conference. And maybe with the
work on the House and Senate sides we can have a bill for the President
by the beginning of next week. That is important. I think Senator
Daschle has stepped forward with a positive, sensible, and fiscally
conservative approach on this which is good for America and which is
good for our economy.
I yield the floor.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I have just a couple of comments. My
colleague and friend from Illinois said something about this bill
before us is promoting tax credits. The House Bill 3529 that this
Senator tried to bring up and that passed the House just recently
reformed corporate AMT, and didn't have anything that was going to be
of benefit to Enron. I want to make sure that is understood.
Mr. DURBIN. Will the Senator yield for a question?
Mr. NICKLES. I am happy to yield.
Mr. DURBIN. The economic stimulus package passed by the House, the
Republican-sponsored package, the first package contained many billions
of dollars in tax relief for corporations such as IBM and Enron. Is
that not correct?
Mr. NICKLES. To correct my colleague, the bill we are trying to bring
up is H.R. 3529, and it contains reformed corporate AMT. The bill the
Senator is referring to did pass the House earlier. It is not what this
Senator is trying to bring up? The House, as I am sure my colleague
also knows, passed the subsequent measure. That is the measure that has
bipartisan support. That is the measure the President supports. That is
the measure we are trying to pass. That is the measure that Senator
Daschle wants to pass and then strike the language on the House-passed
bill and insert it in.
I suggest we take up H.R. 3529 and amend it. Again, we just want to
make sure. H.R. 3529 is the bill we are trying to bring up, and Senator
Daschle is trying to bring up his four-point bill. I have some
reservations about that bill. My colleague from Illinois, I know, said
a couple things he likes about it. There are a couple things I do not
like about it.

I am suggesting we take up the House-passed bill, what Senator
Daschle is planning on eventually striking, and amending it with
whatever we come up with.
I suggest we take up the House-passed bill which does not include any
provisions that would benefit Enron, which I think may have been
implied earlier.
Mr. DURBIN. Will the Senator yield for one more brief question?
Mr. NICKLES. I am happy to yield.
Mr. DURBIN. Is it not correct, then, your bill would have abolished
the alternative minimum tax, a tax paid by corporations that otherwise
have no Federal tax liability prospectively in the future?
Mr. NICKLES. That is correct. The House-passed bill, H.R. 3529
effectively reformed AMT prospectively. That is correct. It has had no
benefit for Enron, no cash benefits for IBM. So I want to make that
clear.
Also, just for the record, I just had a chance to read the amendment
offered by my friend, Senator Baucus. It has $2.3 billion in emergency
agricultural assistance, $1.8 billion for the Commodity Credit
Corporation, and an additional $500 million for the Commodity Credit
Corporation that is designated as livestock. And $12 million is for the
American Indian Livestock Program, which I did not even know we had.
Anyway, there is a $500 million program for that. I think my colleague
from Wyoming wants to speak on it.
I want to have printed in the Record the emergency spending for
agriculture that we have done in the last 10, 11 years.
It has exploded, absolutely exploded. For the years 1990 through
1995, the average was less than $1 billion a year. For the last 2
years, agricultural emergency spending was right at $15 billion and
over $11 billion. I think it has been done kind of haphazardly, and
maybe done right before the end of the year, where agriculture has been
in a tough situation, and we just threw out a lot of money. I am afraid
that is what we would be doing if we added another $2.3 billion.
What about reforming the crop insurance program? We did that a couple
years ago. I remember being in this Chamber and everybody saying: Wait
a minute, let's fix the crop insurance program so we do not have to
come up--every time there is a drought or a flood--with a new Federal
emergency

[[Page S79]]

program and write big checks. We are going to fix the insurance
program. And we spent some money to fix it. And we have subsidized that
program enormously.
What are we doing now? This is adding more money to agricultural
emergency assistance. I know we have farmers hurting in my State, just
as there are in Montana, and I am sure in many other parts of the
country. We are having a drought that is very significant in my State,
as I am sure in many of the plains States as well.
But I am looking at the total cost of this program. I will read
through these last several years. In 1995, the total agricultural
emergency assistance was $600 million; the next year it was $140
million; the next year it was $400 million; the next year, 1998, it was
$160 million; and then in 1999 it jumps all the way up to $6.62
billion--not $6.62 million--$6.62 billion. Then the next year it
doubles again to $14.99 billion; and last year, 2001, to over $11
billion.
Yet people are saying: Let's add some more billions on top of that.

Then we are going to be dealing with an agriculture bill in the next
couple weeks, and people are going to say: Let's spend an extra $75
billion on top of that. Some of us will have an amendment saying: Let's
look at who is getting what. There is a front-page article in the
Washington Post today that talks about one farmer getting $38 million
in the last 5 years. Then it basically says there are thousands of
farmers who are making enormous amounts--hundreds of thousands of
dollars--not $50,000, not $80,000, not $100,000. There are thousands of
farmers who are getting hundreds of thousands of dollars.
I think for the top thousand or more in Arkansas, the average payment
was almost $500,000. I have some of those in my State. I think that is
outlandish. And they can get it from all kinds of ways, including
emergency assistance, including supplemental farm bills. We used to
have limitations. We need limitations.
When we get to the farm bill, again, I hope we will put limitations
on the payments. In the Harkin-Daschle bill, if I remember, farmers
would be able to receive almost $500,000. And I read in the paper today
people are able to get millions through multiple entities. We need to
tighten that up. I know Senator Grassley has an amendment. Others on
the Democratic side hopefully will support it. I have one that will
limit payments to $150,000. I am sure some people will say the sky is
going to fall because we limit farmers and entities to $150,000.
Regardless, I think we should do it.
I think we should be debating the farm bill and agricultural
assistance on the farm bill, not on the stimulus package.
Mr. President, I ask unanimous consent to have printed in the Record
the chart from which I was reading.
There being no objection, the material was ordered to be printed in
the Record, as follows:

Emergency Spending for Agriculture: A Brief History of Congressional
Action, FY 1989-2001

summary

From FY1989 through FY2001, twenty-one appropriations,
authorization, or farm disaster acts have added $43.8 billion
in emergency funding for U.S. Department of Agriculture
(USDA) programs. Nearly $32.8 billion, or about 75 percent of
the total amount, was for FY1999-FY2001 alone.
Since FY1989, the vast majority of the total emergency
funding has been paid directly to farmers, primarily through
two mechanisms: ``market loss payments'' ($21.4 billion, all
since FY1999) to compensate for low farm commodity prices,
and disaster payments ($15.8 billion) paid to any producer
who experienced a major crop loss caused by a natural
disaster. The remaining $6.6 billion has funded a wide array
of other USDA programs, including other forms of farm
disaster assistance, speciality crop assistance, farm loans,
overseas food aid, food and nutrition programs, and rural
development assistance.
Total annual funding additions in the 21 acts providing
emergency assistance to USDA programs since FY1989 are as
follows:
FY1989: $3.39 billion;
FY1990: $1.48 billion;
FY1991: $0;
FY1992: $1.0 billion;
FY1993: $1.3 billion;
FY1994: $2.57 billion;
FY1995: $0.6 billion;
FY1996: $0.14 billion;
FY1997: $0.4 billion;
FY1998: $0.16 billion;
FY1999: $6.62 billion;
FY2000: $14.99 billion;
FY2001: $11.17 billion.
Grand Total (FY1989-2001): $43.82 billion.

Mr. NICKLES. Mr. President, I know my colleague from Wyoming, who has
an interest in this area, is waiting to speak, as well as others.
I yield the floor.
The PRESIDING OFFICER. The Senator from Wyoming.
Mr. ENZI. Mr. President, I appreciate the Senator from Montana,
Senator Baucus, offering this amendment. I particularly appreciate it
because it gives me an opportunity to recognize that this amendment
will allocate $500 million in emergency spending for the Livestock
Assistance Program.
There was a lot of mention in this Chamber about things we have done
in an emergency way for agriculture. The program that we have left out
has been livestock assistance. The ranching folks of this country have
been the ones who for years have said they really don't want the
Federal Government helping them out. With the exception of the drought
programs, that has been true.
One of the difficulties is that they are not in line all the time for
this money. Consequently, when they need it, we do not always insert
it. The Livestock Assistance Program is an ad hoc program that is
administered by the United States Department of Agriculture--USDA--
through the Farm Service Agency.
It is available to livestock producers in counties that have been
declared disaster areas by the President or the Secretary of
Agriculture. It provides financial relief to livestock producers who
are experiencing livestock production loss due to drought and other
disasters.
Livestock producers in my State of Wyoming have been hard hit by
drought. And the drought outlook for this year isn't optimistic. In
fact, right now we are having the driest winter that any of them can
remember.
I was in a store and ran into an old friend of mine and asked him how
things were going; and you could see the drought was at the top of his
mind because that is what he brought up immediately. He did not say
whether he was feeling well or his family was well. The drought was
causing the problem. And it was a different problem. Usually at this
time of year there is enough moisture in the ground and enough cold air
in Wyoming that the ground freezes. It is pretty solid.
When the ranchers go out to feed--and you have to feed when the
ground is frozen solid--they usually can go to the spot where the
cattle are and lay down the feed. This year, they have to go to a
different place every day and move the herd because of the destruction
they do to the land in raising the dust and covering the feed that has
been put down because of how dry the ground is. It would not even
freeze hard. So the outlook for next year is worse than last year. And
the year before that was a bad year.
There are some problems with the Livestock Assistance Program in
getting any kind of continuing help. It actually anticipates you are
only going to have a problem 1 year. We are about to go into our third
year, and, of course, nobody got any payments for the second year
because that never got put in anywhere last year, even though we were
promised that somewhere this program, that has existed and needs to
exist, would exist. It has not existed.
You may not know that in the primary case of drought, producers
usually suffer the loss of grazing sources. The Livestock Assistance
Program commonly provides the means to buy supplemental feed for their
livestock.
Although Congress has made a full commitment to this program when it
authorized it several years ago, the program was not funded in fiscal
year 2002 in either the emergency agricultural supplemental or the
agricultural appropriations fiscal year 2002 bill.
I believe this program funding is critical to the continuing
viability of ranches in Wyoming and the West. This amendment would
provide short-term immediate economic stimulus to Wyoming's
agricultural population. The program is appropriate for the economic
stimulus package because it directly stimulates the agricultural
sector. This money will be spent immediately in rural areas, and it
will be spent to pay debt and to purchase winter feed for livestock--
primarily the latter.

[[Page S80]]

The U.S. Drought Monitor, presented by the United States Department
of Agriculture, the National Drought Mitigation Center, and the Climate
Prediction Center show that the entire Northwestern U.S. is
experiencing extreme and severe drought. This is the second year of
continuous drought for Wyoming's producers. In these conditions, the
State's natural resources have been unable to recover. In order to
conserve those resources, State and Federal Government have evicted
ranchers from State and Federal leased land. Producers have been forced
to find alternative grazing arrangements where pasture land is limited
or sell off their herds.
Many producers grazed hay fields last summer and fall that had been
slotted to provide winter feed. Virtually every indicator--
precipitation, snow pack, reservoir levels--shows that the drought may
get worse.
In fiscal year 2001, that is the year before last, the Livestock
Assistance Program was funded at approximately $430 million. In
Wyoming, 933 producers received $7,752,029. That is an average of
$8,000 per producer. You can see where that would just buy feed to get
them by through the drought.
Nationally, it provided assistance to about 186,000 producers at 88
percent of their grazing loss--that depends on how many people put in
for this limited number of dollars--but at 88 percent of their grazing
loss for the drought. And this year, again, the need is similar. We are
looking at perhaps another year of it yet. Providing the program with
$500 million for drought experienced in 2001 would ensure that
producers receive assistance for 100 percent of the anticipated grazing
losses due to the drought.
Wyoming producers would receive approximately $9 million. Again that
is about $9,000 per producer. The USDA has indicated that this level of
funding would be sufficient for this year. Half of Wyoming's counties
have been declared drought disaster areas for the second continuous
year. The Secretary of Agriculture has already officially declared many
counties as disaster areas in the livestock producing States of
Montana, Idaho, Washington, Colorado, Nebraska, Kansas, Oklahoma,
Missouri, Iowa, Texas, Kentucky, and, of course, Wyoming.
I ask my colleagues to take a long, hard look at the merits of this
amendment. This amendment would provide the livestock producers with
what everybody has been saying would be provided; that is, the
opportunity to continue their operations and to stay in business for 1
more year.
I ask my colleagues to support this bill and to pray for rain and
snow in the West.
I yield the floor.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, I rise to make some points in response to
the Senator from Oklahoma. He makes some good points, but I think they
should be addressed.
One is, what about livestock; what about crop insurance. Why don't we
have a crop insurance program that works, that takes care of disasters,
farmers who suffer disasters? Why do we have to come along every once
in a while with a disaster assistance bill?
If I might suspend, I see my friend from Nevada in the Chamber. He
may have a request.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. Mr. President, through the Chair to the chairman of the
Finance Committee, I express my appreciation for his courtesy.
We have now been here all day working on this bill. The first
amendment offered is the amendment offered by the Senator from Montana,
chairman of the committee, which has wide support. It is a bipartisan
measure. Its sponsorship is bipartisan.
I ask if we could have a vote on this matter at 3:30. That would be
45 minutes to continue the debate. The vote would be on or in relation
to this amendment. I ask unanimous consent that that be the case.
The PRESIDING OFFICER. Is there objection?
Mr. McCONNELL. Mr. President, reserving the right to object, the
manager of this bill on our side is off the floor for a moment. Until
he arrives and is consulted, I object.
The PRESIDING OFFICER. Objection is heard.
Mr. REID. Mr. President, I understand the Senator from Kentucky
having to object. I would hope that the floor staff would alert Senator
Grassley to my request. If that time is not sufficient and there are
other people who want to speak on it, we have absolutely no problem
with that. I do think we should have a vote as quickly as possible.
I will renew that request at a subsequent time after the message is
related to Senator Grassley and also to the minority leader.
I ask unanimous consent to be listed as a cosponsor of this
amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Montana.
Mr. BAUCUS. Mr. President, just some basic points to clear the air
and to get the facts straight.
It has been suggested that we have crop insurance and why isn't crop
insurance sufficient to compensate farmers and ranchers through
disaster. The argument is made that we have a crop insurance program.
Why do we need disaster assistance? The answer is quite simple.
First of all, the crop insurance program does not cover livestock. So
that point is irrelevant. Second, with respect to crops, program crops,
there are a couple of points. No. 1, very few farmers buy Federal crop
insurance. Why? Because it is so expensive and the coverage is so poor.
Even with reform of the crop insurance program, it is not good enough
for farmers and ranchers to participate in it. It just is not available
as a practical matter.
In addition to that, it is unavailable today for crop losses in 2001.
If you had a loss on your crop in 2001, you cannot go now to buy
Federal crop insurance in 2002 which will cover losses in 2001. It is
too late. Even if you were to buy Federal crop insurance in 2002, you
would not want to, a lot of farmers do not want to because, as I said,
it is so expensive and the coverage is so poor.
The last disaster bill passed here covered losses basically because
prices were so low. The disaster assistance bill before the Senate now
covers natural disaster losses--drought, floods--and also quality crop
losses; that is, insect, disease, or for whatever reason the quality of
the crop is so poor that the farmer takes a large cut.
This is not a new program. This amendment only provides dollars for
existing disaster relief programs. For crops, it is a 35-percent loss,
and for livestock, under the livestock emergency feed program, it is a
40-percent loss in grazing over 3 months; for quality loss, as I
recall, it is about a 25-percent loss. It is existing programs.
In many States across our country, we find counties that have already
been declared disaster counties for purposes of this amendment.
For example, I will read some of the States. In Iowa: $17 million
would be available for crop disaster, $3.1 million for livestock. In
Oklahoma--my good friend from Oklahoma, Senator Nickles, would be
interested in this--it is about $50 million in disaster assistance to
farmers in Oklahoma for crops, and about $40 million for livestock
disaster assistance; Texas, $436 million for crops, $92 million for
livestock. The list goes on: Wyoming--Senator Enzi, of course, is
cosponsoring this amendment--Tennessee, a significant amount;
Mississippi, a cotton State, $70 million for cotton producers as a
consequence of disaster to the cotton industry in that State; Montana,
of course, and I might also add that there are many others. At the
appropriate point, I will indicate all of the States that qualify.

I might also address a point made by the Senator from Oklahoma that
all these big farm bill payments--he read in the paper a lot of farmers
get very high payments under the farm program. That is comparing apples
with oranges or watermelons with peanuts or whatever products you want
to take. We are not talking about the farm bill, Mr. President. This
debate is about emergency agricultural disaster assistance, which is
entirely separate from the farm bill.
It is true that some farmers, under the current farm program, get
high payments. It is also true that there are very significant
limitations on which farmers or ranchers can get disaster assistance--
very significant limitations. A farmer or rancher cannot get disaster
payments over $80,000. We hear

[[Page S81]]

about farmers who get large payments under the farm program. Much of
that is justified because they are large farms. But that is irrelevant
to this point. This point is, what do farmers receive and what should
they receive under disaster assistance?
There is an $80,000 limitation. A farmer or rancher cannot receive
more than that in disaster payments. But $80,000 is not a lot of money.
That is gross payment. Think of all of the costs that farmer or that
rancher has to incur. That is not $80,000 in his pocket, that is
$80,000 to cover expenses and losses. Mr. President, I guarantee you it
would not even come close to making a farmer whole.
There is another limitation, where no payments can go to any farmer
or rancher whose gross income is $2.5 million. That may sound like a
lot of money, but not if it is gross. Anybody who knows anything about
farming or ranching knows that what farmers and ranchers receive as
their net profit, in most cases, is zero. In many cases, it is less
than zero, or maybe a little bit more than zero. The net return on
farmland in America is a pittance. But farmers and ranchers endure that
low rate of return because it is a way of life.
Mr. REID. Will the Senator yield for a question?
Mr. BAUCUS. Yes.
Mr. REID. I can remember many years ago in the farm industry when the
cost of pieces of equipment was almost nothing. Now one of those trucks
can cost a million dollars. Would the Senator indicate how much farm
equipment costs, generally speaking? We see the little John Deere
tractor you used to be able to buy at Sears Roebuck. Now these pieces
of equipment cost hundreds of thousands of dollars per farm; is that
correct?
Mr. BAUCUS. That is correct. The Senator makes an excellent point.
Farm machinery costs have skyrocketed. It is obscene how much tractors
cost. A combine is over $100,000. I know; I was raised on a ranch. I am
astounded at how much farm equipment costs today. It is just
ridiculous. On top of that, it cannot be used, in most cases, year
round. It is not like a factory where you get to use the equipment all
the time and have 60, 70, 80, 90 percent capacity. Most farm equipment
is only used for a short time. You can only harvest cotton a certain
time of the year or bail hay or combine grain. It is a very short
season. It is not year round. So it is a very expensive piece of
equipment that does not get a great rate of return because it cannot be
fully utilized, to say nothing of all the other increased costs that
are greater for farmers or ranchers; namely, fuel, fertilizer, and
other things; all of that has gone through the roof, including freight
rates.

I am from a State which is a captive shipper State. There is
virtually no rail competition in my State. Shippers in my State ask
grain farmers to pay twice as much to ship a bushel of wheat than do
farmers in other parts of the country who ship that wheat the same
distance. Why? Because there is competition in the other States. There
is none, for all intents and purposes, in Montana. There are other
cases around of captive shippers. It is not of sufficient competition
to get trucker or rail rates low enough.
However you slice it, this is a sector of the economy that is in deep
trouble. For a specific, unique reason--weather-related, cost-related--
if we are going to pass an economic stimulus bill, as we should,
because our country still needs a stimulus that is fair, direct, short
term, a shot in the arm, agriculture should be included.
Agriculture, directly and indirectly, is one-fifth of America's gross
domestic product. I will bet a lot of people living in cities do not
know or appreciate that. But agricultural production, directly and
indirectly--that is, suppliers and expenditures farmers make on not
only equipment but farm products and also farm services, and they also
buy clothes and pay the bills and so forth--it amounts to one-fifth of
America's gross domestic product. If we are going to pass a stimulus
bill, certainly a good portion of it, a significant portion, or a small
portion should include agricultural disaster assistance.
I will yield the floor. I see my very good friend, my colleague from
our State, on the floor. I am honored that he is here to speak on the
amendment. I know a lot of farmers and ranchers in the country are
pleased to see Senator Burns supporting this effort.
Mr. BURNS. I thank my colleague from Montana. I thank him for
presenting a bare-bones amendment covering the emergency agricultural
situation we have in our State. He is exactly right. There are a lot of
folks who do not realize how big agriculture is in our overall economy.
You know, it is not surprising because each and every one of us in
this country goes about our way feeding and clothing ourselves.
Everyone plays a part. It may not be in the area of production, but it
could be in the area of transportation, or processing, advertising,
presenting, or the marketing of food products. I don't think there is a
country like ours in the world that has the advantage of eating fresh
fruits and vegetables all through the year, even though you may live in
the northeastern part of the country where it is snowing and blowing.
So it is a marvelous system, a system that is held high as an example
around the world.
When this subject was first offered last fall, it was pretty well
loaded up. I think we tried to boil the fat out of it and offer some
assistance to some people who have been impacted. We are going into our
fourth year of drought. There are many in this Chamber and many people
across the country who have seen that wonderful river called the
Yellowstone River, which flows through the park to Williston, ND. Below
an area called Yankee Jim Canyon to the mouth of the Big Horn River,
you can wade across the Yellowstone River and never get your knees wet,
which gives you some indication of the impact this drought has had on
my State--now going into its fourth year.
It is hard to imagine you would have less than a bushel an acre in
combining and fewer prospects of any kind of income. For the marginal
producers, those days are gone. There is a ritual that goes on in our
State.
Every year about this time is when you and your wife gather up your
books and make the annual trek to see your banker and arrange for
operating loans for another year. Those banks that do a lot of business
with owners of farms and ranches are telling me that even some
professionals are marginal because of no crops, none at all.
I ask unanimous consent that I be made a cosponsor of this amendment.
I thank my friend from Montana for offering it.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BURNS. Mr. President, I am still a little concerned about on what
bill this amendment is being offered. I want this to pass, and I would
hate to see it passed in the Senate and we get a good warm and fuzzy
feeling inside and then we lose it in conference or we lose the
stimulus altogether. I do not know what is ahead. I do not see that in
my crystal ball. I see a very hazy picture. This amendment needs to be
adopted because this is not only happening in the State of Montana, it
is happening in other States as well.
Keep in mind that the American people have agreed they still want
this insurance policy of our ability to feed and clothe this Nation and
not become dependent on other sources for our subsistence.
I heartily urge my colleagues to support this amendment. I thank the
Chair, and I thank my friend from Montana. I yield the floor.
The PRESIDING OFFICER. The Senator from New Hampshire.
Mr. REID. Mr. President, will my friend yield for a unanimous consent
request?
Mr. GREGG. Certainly.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. Mr. President, I have been told that Senator Grassley has
not been contacted. I will wait until he has been contacted.
The PRESIDING OFFICER. The Senator from New Hampshire.
Mr. GREGG. Mr. President, I rise to speak about the stimulus bill and
address one of the issues I hope we will be able to address as we move
forward on this bill. I recognize the parties are trying to reach an
agreement on a package which is acceptable to both sides and which is
bipartisan.
In that effort, the majority leader has put forward a bill.
Unfortunately, a large section of this bill, 25 to 30 percent, is new
language which has not

[[Page S82]]

been agreed to by both sides, and there are serious reservations on our
side about it.
There are initiatives within the bill which are agreed to, however,
such as extending the unemployment compensation. In addition, there are
other ideas that were agreed to, we believe, that could be added to
this bill. That has been highlighted by many of the speakers.
I note one idea that I think we should consider because it is
bipartisan--and there does seem to be some general agreement for it,
and it is a win-win issue for us from the standpoint of public policy--
and that is the need to reduce the capital gains rate.
We are talking about economic stimulus. We are talking about creating
jobs. We are talking about increasing productivity so our economy
starts to move a little more aggressively. Probably nothing can be more
of a positive factor for that than to make capital more readily
available for people to invest and, as a result of investing, create
jobs. The result of an expansion of capital activity is the creation of
jobs.
One of the most effective ways to create more capital in the
marketplace and make more resources available is to make the cost of
capital less, and that is what a cut in the capital gains tax
accomplishes.

A cut in the capital gains tax was proposed when we addressed the tax
bill last year. At that time when I made that proposal, it failed on a
very close vote, 47 to 51, with two people not voting. Interestingly
enough, it was a bipartisan vote in favor of cutting the capital gains
rate.
Why was that? Because the amendment I proposed at that time had a
sunset to it. It was a 2-year proposal which reduced the rate from 20
percent to 15 percent, but only for 2 years so it would not have a
negative long-term impact on the budget. In fact, by sunsetting it
after the 2-year period, we will actually have a positive cashflow
situation.
Why is that? If we generate the capital gains activity from assets
which are locked up, which are not being used--for example, if somebody
has owned stock for 10 years, 5 years, or even 2 years but they are not
going to sell that stock because they think the capital gains tax on it
will be too high, if we can do something which causes that person to
sell that stock, then we create a taxable event.
We have proved throughout history in our country that every time we
cut the capital gains rate, it generates a lot of economic activity. A
lot of people sell assets, which are capital assets, in order to take
advantage of that lower rate, assets which they would not have
otherwise sold.
What happens as a result is that we create more taxable events. And
what happens as a result of that is the Treasury gets more money. So in
any reasonable scoring of the capital gains issue, a capital gains tax
cut actually generates more money to the Federal Government in the way
of revenues than if we do not do anything in the early years. In the
outyears, we lose money.
If we sunset a capital gains tax cut after 2 years, the practical
effect is that we get the good side. We get the new revenues, added
revenue activity without the outyear activity of reduced revenues. As a
practical matter, a capital gains tax cut which has a 2-year sunset
attached to it, as did my amendment when I offered it last year, is
basically a window of opportunity for people to free up assets which
are presently locked down, take the money from those assets, pay taxes,
and, as a result, add more money to the Treasury and then take that
money and reinvest it in something which will arguably be a more
efficient use of those dollars.
By doing that, it creates more capital in the marketplace which in
turn creates more economic activity which in turn creates more jobs.
The practical effect of a capital gains tax cut which has a sunset
attached to it is that it is a win-win event for us from the standpoint
of public policy in that, one, it generates more revenues during a time
when we are heading toward a deficit and those revenues will assist us
in alleviating that deficit and, two, it generates more economic
activity, more efficient use of capital and, as a result, it generates
more jobs.
As we move down the road of debating this issue of economic stimulus
and we are looking for bipartisan concepts which makes sense, I suggest
we take a hard look at the capital gains tax cut which I proposed
during the prior process.
During that process, as I said, the amendment was offered. It failed
on a narrow vote. I think some people voted against it because they
were committed to this package or that package, not because they did
not think capital gains reduction, especially when it was sunsetted,
was a bad idea. I note that the people who voted for it--it was a
significant bipartisan vote in the context of tax matters.

As a practical matter, as we move down this path to a stimulus
package, I hope we revisit this issue of cutting the capital gains tax
rate for 2 years from 20 to 15 percent and, as a result, generate more
revenues for the Treasury, create more economic activity, create more
efficient use of capital, and in the end the biggest plus will be that
we will be creating more jobs.
Mr. President, I yield the floor.
The PRESIDING OFFICER (Mr. Nelson of Florida). The Senator from
Minnesota.
Mr. DAYTON. Mr. President, I rise today to speak in support of
Senator Baucus's amendment to provide disaster assistance to farmers. I
begin by thanking my very distinguished colleague from Montana who has
consistently championed the need to help farmers throughout the country
who have crop losses due to natural disasters. I thank the Senator for
his leadership and strongly support this amendment that will provide
disaster assistance to farmers who need it and will be further
devastated without it.
American agriculture has been in a recession for the last several
years; or even for some farmers, a depression. Last August, the
Minnesota Farm Service Agency calculated that Minnesota farmers had
suffered $500 million in crop losses in the first half of 2001. Then in
November of last year, the U.S. Department of Agriculture announced the
largest monthly drop in commodity prices in USDA's 91 years of
recording that statistic. In a single month, overall commodity prices
plummeted nearly 10 percent nationwide. With prices that low, farmers
have no ability to withstand additional losses that a disaster creates.
At that time last November, the Senate Agriculture Committee was
completing its markup of legislation that would provide desperately-
needed assistance to farmers and producers. Amazingly, we spent most of
December sitting through a filibuster of the farm bill. That filibuster
was harmful to all farmers--it was catastrophic to those who need
disaster aid and whose farms may not survive without it. Senator
Baucus' amendment will provide this vital assistance before is too
late. I urge my colleagues to support this amendment.
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. BAUCUS. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, I have a letter addressed to me, signed by
James Echols, who is chairman of the National Cotton Council. I will
not read the entire letter, but I will read the operable paragraph.
Essentially, the letter urges the passage of the pending amendment and
it includes this statement:

Cotton producers have suffered late season losses from
flood damage in the Mid-south and dry growing conditions
followed by excessive moisture during harvest in West Texas.
In most cases crop insurance coverage was inadequate or
nonapplicable as damage occurred to seed cotton stored in
modules stored in the fields while waiting to be ginned.
Further we understand crop insurance policies have a
provision which deny coverage for losses due to unnamed
storms such as the one that occurred in the Mid-south last
fall. Producers of other commodities have suffered similar
losses and also need assistance.

I ask unanimous consent that this letter from the National Cotton
Council be printed in the Record.
There being no objection, the letter was ordered to be printed in the
Record, as follows:

[[Page S83]]

National Cotton Council

of America,

Washington, DC, January 24, 2002.
Hon. Senator Max Baucus,
Chairman, Committee on Finance, Senate Hart Building,
Washington, DC.
Dear Mr. Chairman: The National Cotton Council appreciates
your continued support for inclusion of funding in the
economic stimulus package to provide assistance for weather
related crop losses. Weather related losses in many parts of
the Cotton Belt have made a dire economic situation much
worse.
Cotton producers have suffered late season losses from
flood damage in the Mid-south and dry growing conditions
followed by excessive moisture during harvest in West Texas.
In most cases crop insurance coverage was inadequate or non-
applicable as damage occurred to seed cotton stored in
modules stored in the fields while waiting to be ginned.
Further we understand crop insurance policies have a
provision which deny coverage for losses due to unnamed
storms such as the one that occurred in the Mid-south last
fall. Producers of other commodities have suffered similar
losses and also need assistance.
We realize the daunting task facing Congress in building a
consensus for an economic stimulus package. However, we urge
the Senate to include assistance for weather related crop
losses.
Thank you for your favorable consideration of our request.
Sincerely,
James E. Echols,
Chairman.

Mr. BAUCUS. Mr. President, I also ask unanimous consent that Senator
Landrieu of Louisiana be added as a cosponsor of this amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BAUCUS. Mr. President, seeing no speakers at this point, I hope
my co-manager, my good friend from Iowa, Senator Grassley, will come
fairly quickly so we can get an agreement on further time remaining for
debate on this amendment. When that occurs, then we will get closer to
a vote.
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.
Mr. DORGAN. I ask to be added as a cosponsor of the amendment offered
by the Senator from Montana, Mr. Baucus. I know he has offered this
amendment previously on a different vehicle. This amendment is
critically important to farm States, to farmers, and Main Street
businesses that are trying to do business in a pretty tough economy.
This is an awfully good amendment, as has been stated by a number of
colleagues on both sides of the aisle. I hope we get a strong
bipartisan vote for it. I commend Senator Baucus for this amendment. It
is a great idea. It is important. I ask unanimous consent to have my
name added as a cosponsor.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DORGAN. I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. REID. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. REID. Mr. President, while we are waiting to hear from the
minority as to whether or not we can agree on a certain time for a vote
on this very important amendment, I would like to indicate how I
personally feel.
We need an economic stimulus program. We need it now. With America in
the midst of a recession, there is no time for delay. Our Nation cannot
afford to have Congress play games for political purposes. We do not
need to, and should not, wait until the President addresses the Nation
in the State of the Union Address on Tuesday. We should take action
before then. Now is a time to move forward and, in so doing, help our
Nation's economy move forward.
My concern, of course, is that we have a situation where, as reported
yesterday in the press, there are some who do not want to move forward.
I have the greatest respect for the minority leader. I have worked with
him now for many years. When asked yesterday, would debate likely last
through next Tuesday, meaning the State of the Union Address, Senator
Lott said: It might--pause--and then winked to the press. Meaning, of
course, with the wink and the nod, that the answer to the question
was--yes, this would be stalled until the State of the Union.

There are a lot of important things we can do to help the country,
not the least of which is this amendment of which I am a cosponsor,
offered by the chairman of the Finance Committee and also the Senator
from Wyoming. We need to move forward on this legislation.
We have an economic stimulus plan that helps accomplish that. It is
not perfect, but it is one whose component parts will get more than 60
votes. It is part of a bipartisan agreement. It is a good plan made up
of solutions Democrats and Republicans alike would support. This plan
would have immediate impact and help those most in need.
What do we propose? First, extending unemployment benefits for an
additional 13 weeks for all workers who have exhausted their
unemployment insurance benefits after September 11. Talk about
stimulus. Try giving money to people who have nothing. They will spend
it. That will help the economy. They will be buying groceries, they
will be buying small appliances--tires for their car maybe. Assisting
working families in this way is not only the compassionate thing to do
but also an effective way to jump-start the economy.
Second, providing a tax rebate to everyone who did not get one last
year. The part of the President's tax cut that was the most popular and
the most successful was the tax rebate. That was our idea. We talked
about the tax rebate. We talked about the tax rebate idea, and the
President took that. Fine, all ideas from wherever they come, if they
are good, should be used. The tax rebate idea was our idea. We believe
those people who did not get one should get one this year. We have
already taken steps to help some of our ailing businesses, such as
airlines, which in the process helps other industries and corporations.
What about consumers? This tax rebate will increase consumer
spending. As consumers are more active and are able to purchase more,
businesses will respond by increasing investment and production.
Third, increasing the bonus depreciation deduction available to
businesses for certain capital costs. This will encourage businesses to
invest more now, and that will spur economic growth. Talk about a shot
in the arm. If this depreciation allowance is not good for this year,
when are they going to do it? They are going to do it this year.
Fourth, providing fiscal relief for States by temporarily increasing
the Federal Medicaid matching rates. Most States, as a result of the
financial strain on the budget, have imposed significant cuts on
Medicare eligibility, or if they have not, they are in the process of
doing that. Why? Because they are running out of money. So we must
protect Medicaid programs from budget cuts to improve health care for
Nevadans, and all Americans, and ease the burden on States.
Our plan, then, attends to critical needs and offers immediate help.
Some amendments or alternatives supported by both parties have merit,
but not the votes needed to pass. But we have a process here. The
majority leader came today and said: You have four, we have four. We
will even agree to time limits on those. They simply refused to do
that.
We have propounded an agreement to say let's have a vote at 3:30.
That was 45 minutes ago. We are willing to resume that and have a vote
in a half hour. Vote on this amendment offered by the chairman of the
Finance Committee and Senator Enzi. This is an important amendment
dealing with a large segment of our society. It would stimulate the
economy.

But neither the plan embraced by the House Republicans nor the plan
supported by Senate Democrats on the Finance Committee would receive 60
votes in the Senate. It is a fact of life. We have had people today on
the floor, from the minority, saying: It has a majority. Why don't they
let it come forward? It has a majority.
We are in the Senate. We did not set the rules yesterday. They were
in the process of developing starting 200 years ago. Some object to
requiring 60 votes

[[Page S84]]

for approval of an economic stimulus bill or an amendment. That is the
way it is.
If they want to use that logic, I think it is something we should
maybe strongly consider accepting. If that were the case, we could go
back and look at campaign finance reform, which passed the Senate by 59
to 41, a majority vote. We would already have campaign finance reform.
Many of the questions involved in the Enron investigation would no
longer be an issue because campaign finance reform would have already
been passed.
Or the Social Security lockbox, which passed 53 to 47. It is a
majority plus 2. If that were the case, using their logic, all of these
votes we have had over the years--I will just limit it to the last
couple of years where we have gotten more than 51 votes--those things
would be law.
In the Senate, because of the rules we have, you need 60 votes. That
is the way it is. I accept that. But for people to come here and say:
We have the majority, why won't they let us do it?--they should be very
careful with that logic because I just picked two examples. There are
scores of them, in addition to campaign finance reform and Social
Security lockbox. And the Social Security lockbox vote is becoming more
important each day because we are now spending Social Security
surpluses.
The American public should understand. The Social Security surpluses
are being spent this year. For the last 4 years we have not been
spending them, but now we are.
This stimulus plan now before the Senate offered by the majority
leader was created from a consensus. I would like to have added more
stuff to this. I think we need something in a stimulus package to help
tourism. The State of the Presiding Officer, Florida, relies heavily on
tourism. Tourism has been hurt very badly in the State of Florida and
other places in the United States. I think any stimulus package should
have a provision to deal with tourism.
I personally believe, if we want to really stimulate the economy, we
should do something to develop the infrastructure of this country.
Let's build some roads--highway construction. For every $1 billion we
spend on highway construction, we get 42,000 jobs. Not 4,200--42,000
jobs--and all of the 42,000 people working in those construction jobs
pay taxes, buy cars, refrigerators, and all kinds of other things. But
at this stage I cannot get 60 votes for my tourism stimulus. I know it
would stimulate the economy. So does the Presiding Officer.
The National Conference of Mayors has its winter meeting taking place
in Washington, DC, today. The mayors support my stimulus package as it
relates to infrastructure 100 percent. They have passed resolutions.
But in the Senate, I can get 51 votes but I can't get 60, and therefore
it is not going to happen right now. I will keep working on it.
So it is very unfortunate that the minority is now saying the House
bill has more than 50 votes over here, why won't you just let us bring
it up and pass it on that basis? Because we live in the mature world of
the Senate. That is how things work here.
As I have said, Senator Daschle's plan is not perfect but it is the
best he could do. It is what we agree on. That is the consensus
package. I think we should pass it quickly, and I wish we could do
that. I hope we can do it before Tuesday. But with winks and nods, it
appears we will not be able to do that.
Mr. President, there is nobody in the minority on the floor so I do
not want to offer my unanimous consent request, but I am going to offer
it in the next few minutes. I ask everyone to be alerted to that.
I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. BAUCUS. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BAUCUS. Mr. President, while we are waiting for an agreement--I
hope that comes very soon--on the time to vote on the pending
amendment, I would like to introduce into the Record letters of support
for the amendment.
The first is from the National Cattlemen's Beef Association, a letter
to myself signed by Lynn Cornwell, president of the NCBA; next, a news
release from the National Association of Wheat Growers expressing
support in favor of the pending disaster relief amendment; next, a
letter from the National Farmers Union in support of this amendment
signed by 26 different State farmers unions; letters to me from the
Montana Stockgrowers Association, the Montana Farmers Union, and the
Montana Grain Growers Association, all in support of the amendment.
I ask unanimous consent they be printed in the Record.
There being no objection, the letters were ordered to be printed in
the Record, as follows:

National Cattlemen's

Beef Association,

Washington, DC, January 24, 2002.
Hon. Max Baucus,
Chairman, Senate Finance Committee, Hart Office Building,
Washington, DC.
Chairman Baucus: The National Cattlemen's Beef Association
(NCBA) appreciates the hard work and effort that has gone
into the Economic Stimulus package to date. Livestock
Assistance Programs included in the Committee passed package
will prove to be a vital economic stimulus in many areas of
the country impacted by severe and lingering drought. NCBA
supports your efforts to include Livestock Assistance Program
funding, at the appropriate levels, in the Stimulus package
currently moving in the United States Senate.
NCBA believes that Livestock Assistance can prove to be a
vital stimulant to the local economies in the areas affected.
We hope that during the upcoming debate on the Economic
Stimulus package that you will continue your support of this
very important program.
The program funds will be used immediately to help
producers offset the increased cost of feed and forage
acquisition due to Mother Nature. NCBA continues to work with
USDA, land-grant universities, extension service personnel,
local and state governments, and state cattle associations to
address the best use of funds that will be available.
Thank you for the opportunity to share these requests with
you. Please contact NCBA staff at 202-347-0228 if you have
any questions or concerns with these or any other issues.
Sincerely,
Lynn Cornwell,
President.
____

The National Association

of Wheat Growers,

Washington, DC, November 12, 2001.

NAWG Supports Disaster Spending Proposed by Senate Finance Committee

Washington, D.C.--The National Association of Wheat Growers
(NAWG) expressed support today for including agricultural
disaster spending in the stimulus package being considered in
the Senate. Several wheat producing states have experienced
crop disasters in 2001, and NAWG views this mechanism as an
appropriate way to provide much-needed assistance.
``Many of our nation's wheat producers had severe crop
disasters that not even crop insurance will completely
mitigate,'' said NAWG President Dusty Tallman. ``In this
period of poor economic conditions, these farmers are unable
to bear the burden of crop failure.''
Proceeds from the disaster assistance will largely go to
repay loans and expenses against the drought-stricken 2001
crop.
``Rural America is in as much need of economic stimulus as
anywhere else,'' said Tallman, ``and in this way we can
provide support to hard-hit farmers and the communities where
they live.''
NAWG is a nonprofit organization representing U.S. wheat
growers who, by combining their strengths, voices, and ideas
are working to ensure a better wheat industry for today and
tomorrow.
____

National Farmers Union

Washington, DC, November 28, 2001.
Member,
U.S. Senate, Washington, DC.
Dear Senator: On behalf of the 300,000 family farmer and
rancher members of the National Farmers Union (NFU), the
undersigned NFU Board of Directors urges your support of
provisions in the Economic Recovery and Assistance for
American Workers Act providing disaster assistance for family
farmers and ranchers.
Farmers across the nation have suffered substantial
economic losses from adverse weather and disease during the
2001 crop year. The needs are immediate. We encourage you to
support the production and quality loss assistance program in
Finance Committee Chairman Baucus' economic recovery package
passed out of the Senate Finance Committee which includes
$1.8 billion in emergency assistance for crop producers and
$500 million for livestock producers.
From Montana to Louisiana, Texas to the Northeast, and
California to Missouri, farmers and ranchers have experienced
adverse weather conditions, disease, insect infestations, and
sudden weather phenomena. These disasters resulted in massive
crop production

[[Page S85]]

and quality loss and losses impacting livestock producers.
These losses are negatively impacting the livelihoods of
family farmers, ranchers and their rural communities in all
regions of the country.
As you seek ways to strengthen the U.S. economy through an
economic stimulus package, it is critical that agriculture,
which represents nearly twenty percent of all U.S. economic
activity and whose foundation is this Nation's farmers and
ranchers, receives priority consideration. We again urge you
to support production loss assistance in the economic
stimulus bill and we look forward to working with you on this
important issue.
Sincerely,
Leland Swenson, President, National Farmers Union; Vicki
Trytten, President, Alaska Farmers Union; Joaquin
Contente, President, California Farmers Union; Larry
Quandt, President, Illinois Farmers Union; Gary Hoskey,
President, Missouri Farmers Union; Carl McIlvain,
President, Michigan Farmers Union; Russ Kremer,
President, Missouri Farmers Union; John Hansen,
President, Nebraska Farmers Union.
Robert Clunk, President, Ohio Farmers Union; Dan Joyce,
President, Oregon Farmers Union; John Stencel,
President, Rocky Mountain Farmers Union; Wes Sims,
President, Texas Farmers Union; Jim Davis, President,
Washington Farmers Union; Alan Bergman, Vice President,
National Farmers Union; Jim Miller, President, Arkansas
Farmers Union; Gary Turner, President, Idaho Farmers
Union.
Larry Coomer, President, Indiana Farmers Union; Donn
Teske, President, Kansas Farmers Union; Dave
Frederickson, President, Minnesota Farmers Union; Del
Styren, President, Montana Farmers Union; Robert
Carlson, President, North Dakota Farmers Union; Ray
Wulf, President, Oklahoma Farmers Union; Larry Breech,
President, Pennsylvania Farmers Union; Dennis Wiese,
President, South Dakota Farmers Union; Arthur Douglas,
President, Utah Farmers Union; Bill Brey, President,
Wisconsin Farmers Union.
____

Montana Stockgrowers Association,

Helena, MT, November 14, 2001.
Re: Economic Recovery and Assistance for American Workers Act
of 2001.

Senator Max Baucus,
Hart Senate Office Building,
Washington, DC.
Dear Senator Baucus: On behalf of the members of the
Montana Stockgrowers Association, I am writing this letter to
express our support and appreciation for your efforts to pass
an economic stimulus package, the Economic Recovery and
Assistance for American Workers Act of 2001. The tragic
events of September 11th have obviously added to the economic
woes of this country and efforts such as yours are absolutely
necessary to allow us to endure and recover.
In particular, we are asking that you continue your
steadfast support for the reestablishment of the Livestock
Assistance Program. As you are well aware, Montana livestock
producers continue to struggle with the impacts of successive
years of drought and this assistance may prove invaluable to
our producers.
Again, thank you for your efforts in this important area.
If you or your staff have any questions, please feel free to
contact me.
Sincerely,
Steven L. Pilcher,
Executive Vice President.
____

Montana Farmers Union,

Great Falls, MT, November 29, 2001.

Farmers Union Seeks Agricultural Disaster Assistance in Senate Economic
Stimulus Package

Great Falls (November 29, 2001).--In a letter to U.S.
senators this week, the National Farmers Union (NFU) Board of
Directors urged inclusion of production loss assistance in
the economic stimulus package soon to be debated on the U.S.
Senate Floor.
``Farmers Union supports the efforts of Senate Finance
Committee Chair Max Baucus (D-Mont.) for including assistance
for farmers and ranchers suffering production loss due to
natural disasters in his economic stimulus package,'' said
NFU President Leland Swenson. ``Agricultural producers
nationwide are suffering from depressed commodity prices;
however, the situation is particularly grim in states that
have also faced floods, drought, tornadoes and other natural
disasters.''
``Montana producers just harvested their smallest winter
wheat crop in 60 years, the spring wheat crop was the
smallest in more than a decade, and lack of forage has forced
many ranchers to sell or reduce their herds,'' said Montana
Farmers Union President Del Styren, who sits on the NFU
Board. ``The agricultural assistance included in Senator
Baucus' economic stimulus package is crucial to these
producers who not only need to generate the optimism--and
capital--to plan for another year, but also need to reassure
their lenders,'' he said.
Baucus' economic stimulus package extends the fiscal 2001
emergency agricultural assistance for another year to
compensate farmers and ranchers for income losses resulting
from damaging weather conditions. It provides $1.8 billion
for crop disaster assistance and $500 million for livestock
disaster assistance.
``From Montana to Louisiana, Texas to the Northeast, and
California to Missouri, farmers and ranchers have experienced
prolonged adverse weather conditions, disease, insect
infestation and severe weather events,'' Swenson said.
``These disasters are resulting in massive production loss
and sustained quality loss in harvested crops and livestock
grazing.''
The letter to the senators was signed Wednesday, November
28, 2001, by the 26-member NFU board, which was in
Washington, D.C. for its quarterly meeting and to make
personal visits with senators about the farm bill, which will
be debated soon by the Senate.
____

Montana Grain Growers Association, Montana Farm Bureau
Federation, Montana Farmers Union,
November 9, 2001.

Needed Ag Disaster Assistance Included in Economic Stimulus Package

Montana farm groups applauded the inclusion of agricultural
disaster assistance in the economic stimulus package approved
Thursday by the Senate Finance Committee. The package,
introduced by Chairman Max Baucus, is expected to go to the
full Senate next week.
Nearly 2,000 square miles of central Montana hardly saw a
combine this season. According to state statistics, winter
wheat production was down 50 percent statewide, and 75
percent in the golden triangle--the heart of wheat production
in Montana. Crop insurance loss ratios are expected to top
500 percent, unmatched previously in Montana.
``I wish I could say the drought in Montana has eased,''
stated Dale Schuler, president of the Montana Grain Growers
Association. ``But it has not, and the cumulative effects
over four years puts too many Montana farm operations close
to the edge. Our Congressional delegation has viewed
firsthand the drought situation and has responded. This
legislation introduced by Senator Baucus moves us one step
closer''.
Jake Cummins, Executive Vice President of the Montana Farm
Bureau Federation, added, ``there will be a battle ahead to
keep ag disaster assistance in place as the bill moves to the
floor of the Senate. But support for agriculture is crucial
to stimulating our economy and providing a strong base for
one of the most fundamental industries in America. In this
time of uncertainty, we can't cede our production agriculture
to other countries''.
Diana Adamson, Vice-President of the Montana Farmers Union,
echoed the comments. ``This prolonged drought is starting to
impact all segments of Montana's economy. It's not just a
farm problem, but all of the businesses in rural communities,
and even the larger town, are affected. I hate to see what
happens if this does not come through''.

Mr. BAUCUS. Mr. President, there are a number of States that have a
good number of counties which have been designated as having disasters.
In Michigan, for example, there are 82 counties that are eligible for
these emergency loans due to losses by drought.
In Texas, 58 counties received emergency designations. To quote a
press release from Secretary Veneman, ``Texas has experienced a variety
of weather-related disasters this year, including drought, excessive
rain, tornadoes, hail and flooding.'' These counties were in addition
to the 23 counties designated for emergency earlier in the month of
December 2001.
In Idaho, 28 counties were designated; in Maine, 16 counties; in
Tennessee, 16 counties were designated; in New York, 33 counties,
because of drought, hail, and excessive rain; Nebraska, 36 counties due
to draught and severe heat; Pennsylvania, 3 counties were named on
January 8th of this year, but 58 counties in Pennsylvania were
designated December 14 because of drought; in Ohio, 36 counties
designated for disaster qualification due to losses caused by excessive
rain and flooding. That designation was on November 8 of last year. In
Oklahoma, in October of last year, the entire State was designated due
to losses caused by excessive heat and drought. Secretary Veneman
stated at that point:

Oklahoma has experienced severe drought conditions this
year. Our farmers and ranchers need this assistance to
recover from these natural disaster losses.

That is Secretary Veneman commenting on the problems in Oklahoma.
Mr. President, there are more I could cite, but I think that is
enough at this point. I see other Senators standing in the Chamber. I
assume they want to address the Senate. I am not positive. But I yield
the floor.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. TORRICELLI. Mr. President, since last January, economic growth
has slowed in our country and nearly 2 million Americans have lost
their jobs.

[[Page S86]]

Behind them are children whose tuition is in danger and families who
are in trouble with mortgage payments or rents that are due. There is
an enormous loss of family security. The tragedy of terrorist attacks
in September only exacerbated the already slowing economy.
As Americans continue to suffer the effects of this economic decline,
Congress simply needs to implement a plan to deal with their pain and
to help the recovery. That opportunity was lost in the closing weeks of
last year. It cannot be lost again.
The Democratic leadership has brought to the Senate floor a modest
proposal to stimulate economic growth and national recovery. It
contains four principal provisions that both parties included in their
economic recovery plans last year. One would assume, therefore, since
they are four common elements previously proposed by both parties, they
should be acceptable now.
The four elements combined provide effective short-term stimulus to
bring the most economic activity with the least damage to the Nation's
fiscal health. They provide broad-based, rather than industry-specific,
stimulus, and they are directed to individuals who are most likely to
need and spend the tax reductions rather than people generally. These
more targeted, more thoughtful approaches minimize loss in revenue,
preserve the balance of the Federal budget, and give more relief.
The four provisions are:
First, the extension of unemployment benefits. In December, the
unemployment rate reached 5.8 percent. It was the fifth consecutive
month with a rise in unemployment. At least 1.1 million jobs were lost
in the last 4 months of 2001 alone.
In times of economic recession, people turn to unemployment insurance
first. It is not only a proper thing to help families in their pain, it
is itself an economic stabilizer. As people become unemployed, they
naturally spend less money. If they have no unemployment insurance,
they spend no money and the economic contagion and unemployment spread.
We are at that point.
This legislation provides 13 additional weeks of unemployment
insurance. In the last recession, in 1992, 56 percent of those
collecting unemployment insurance benefits had their benefits expired.
They were without resources. That extends and deepens a recession.
These extra weeks are necessary for the families. They are also
necessary for the country. We now know from our research that every $1
invested in unemployment insurance generates $2.15 in gross domestic
product. Unemployment insurance in the last recession mitigated 15
percent of the economic decline. It is the right thing to do, it is the
fair thing to do for people, and it is good economics. That is the
first provision.
Second, tax rebates. Putting money directly in the pockets of people
who are struggling helps families make ends meet, but it also increases
demand. This is the single best way to generate new economic activity.
The Democratic proposal before the Senate will provide a second round
of tax rebates to those Americans who did not benefit fully from the
tax cuts of last summer. There are 130 million taxpayers in America,
yet only 82 million received a full rebate last summer, and 34 million
Americans got no tax cut at all.

This plan provides $300 per individual, $500 per head of household,
and $600 per couple for taxpayers. People would receive a rebate. But
they are also the people--lower income people--who are more likely to
spend the money.
I voted for last year's tax cut. But even I will concede,
overwhelmingly, the money that went out in rebates did not go into
consumer spending. It went to middle-income people. It went to higher
income people. This rebate, we know from our research, will go to
people who will spend it and spend it immediately, thereby helping
their neighbors, helping businesses, helping the country recover.
Third, fiscal relief for the States. I know something about this
issue because my State of New Jersey now, per capita, as a percentage
of State spending, has the largest deficit in the United States. It is
fully 12 percent of the State budget.
Approximately 30 States in the Union are now in the midst of a
recession. In addition to their falling revenues and budget shortfalls,
29 States face a $600 million cut in Federal Medicaid payments this
year. It could not come at a worse time. As a result, many States are
considering reductions in their Medicaid Programs to deal with the
budget shortfalls. This could result in substantial numbers of low-
income people losing health insurance.
My State of New Jersey has been forced to suspend further enrollments
in its expansion of Medicaid to childless adults with incomes below the
poverty line because of budget constraints. At the same time, the
growing ranks of the unemployed have generated an increased demand for
Medicaid coverage.
This proposal will help States meet the increase in Medicaid costs by
temporarily increasing the Federal Medicaid matching rate. Without it,
the health care crisis becomes worse, State budget impacts worsen, they
cut vital services, or they raise taxes, or they do both. Either way, a
difficult recession becomes deeper and more painful.
Fourth and finally, the bill provides a tax depreciation deduction,
for a limited time, to encourage businesses to invest in new plants and
equipment. It increases the depreciation deduction for the cost of any
capital asset purchased before the end of the year. The bonus
depreciation of 30 percent of the cost of the asset is in addition to
the normal first-year depreciation.
I know something about this provision in New Jersey, as well, because
while there has been an overall drop in capital spending, most of it
has been in new equipment. The largest drop in equipment has been in
telecommunications, impacting Verizon, Lucent, AT&T the very pillars of
the economy of my State.
This is the best way, through this advanced depreciation, to make it
affordable for companies to buy the productive, efficient equipment
they need to be more competitive. And doing it now assures continued
employment and helps to end the recession.
This is not only a balanced plan, it is a fair plan. I regret it is
so modest in scope. The Nation actually requires more. But our first
responsibility is to achieve something, not simply to stake out
positions of partisan advantage. This both has merit and should be
achievable. I urge my colleagues to adopt it. The American people will
work their way out of this recession, but this Congress has an
obligation to make it easier, to give them the tools.
There is work to be done in this country defending the Nation from
enemies from abroad--winning the war, protecting our security here at
home--but also there are the age-old problems: Educating children,
giving them equal opportunity, modernizing our infrastructure, dealing
with a health care crisis that goes generation to generation. In a
recession, these things become difficult to impossible. In a growing
economy, they can be both likely and achievable.

This may not end the recession immediately, but it eases the pain. It
shortens the time. It is a good and fair plan. I urge my colleagues to
adopt it.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER (Mrs. Clinton). The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. NELSON of Florida. Madam President, I ask unanimous consent that
the order for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Florida is recognized.
(The remarks of Mr. Nelson of Florida pertaining to the submission of
S. Res. 201 are located in today's Record under ``Submission of
Concurrent and Senate Resolutions.'')
The PRESIDING OFFICER. The Senator from Oregon.
Mr. SMITH of Oregon. Madam President, I thank the Chair for the time.
I am going to withhold offering an amendment. I understand the leaders
are working out an agreement between mine and Senator Baucus's
amendment. With respect to their efforts, I will not offer this
amendment now, but I would like to talk about it.
The Presiding Officer and I were privileged to be in a hearing this
morning with Chairman Greenspan and heard his very insightful views on
the economy and what we can do. I noted in his testimony this
paragraph:

[[Page S87]]

The retrenchment in capital spending over the past year was
central to the sharp slowing we experienced in overall
activity. The steep rise in high-tech spending that occurred
in the early post Y2K months was clearly not sustainable. The
demand for many of the newer technologies was growing
rapidly, but capacity was expanding even faster, exerting
severe pressure on prices and profits. New orders for
equipment and software hesitated in the middle of 2000 and
then fell sharply as firms reevaluated their capital
investment programs. Uncertainty about economic prospects
boosted risk premiums significantly, and this rise in turn
propelled, required or hurdled rates of return to markedly
elevated levels.
In most cases, businesses required that new investments pay
off much more rapidly than they had previously.

That is the sentence that I think is so significant:

In most cases, businesses required that new investments pay
off much more rapidly than they had previously.

If that is, as the chairman indicated, central to the sharp slowing
in our economy, then it seems to me if we are going to do a stimulus
package, we ought to do something that is meaningful, something that
has economic heft to it, enough weight to actually stimulate our
economy. I have said for a long time that I support the ideas on health
care, the ideas on extending unemployment benefits. In fact, I am
cosponsor of one of them. I think getting cash into the hands of
consumers, as Senator Torricelli just indicated, is very important to
the demand side of getting our economy moving.
I think it is important that we also look at the supply side. If we
want employers to employ people again in large numbers, then we ought
to do something to help with the retooling of industry, getting enough
of a stimulus so that business and planners can make a difference in
ordering and redoing their plants and reemploying their people. I don't
question the sincerity of some of the proposals, but as I evaluate
them, compared to the amendment I will offer, I think they lack the
weight that our economy needs at this critical hour.
In fact, I think it is important to note that while Chairman
Greenspan is not in a position to endorse anybody's particular idea or
amendment, he and former Secretary Rubin have both uniformly stated
their support for stimulus ideas with respect to depreciation,
accelerated depreciation, or a bonus depreciation, however you want to
term it--that these things would increase cash flow, add to asset
values, and would have an immediate stimulating effect on our economy.
What I am going to be proposing is that we have a 30-percent
depreciation bonus that lasts for 3 years. One of the competing
proposals is that it be for 1 year. This is better than the 10 percent,
1-year proposal that was earlier offered. However, it still falls very
short because if you figure that it only lasts for 1 year, much of this
year is already gone. What can a business reasonably prepare for, plan
for, employ for, if they have only a few months left in the year,
literally, between now and September, when it would end, to take
advantage of it? They may get a few copiers and a few new rugs for the
front office, but this is not what our country needs if we are serious
about reemploying people.
So my proposal, conversely, will give companies the time to do major
projects which would generate thousands of jobs. It will allow us to
build heavy equipment, modernize a lumber mill, repair a rail bed,
revamp a management information system for a factory, or even construct
an airplane. We say a lot about airplanes right now. I know Boeing is
suffering greatly, and an accelerated depreciation program that will
last for 9 months will not be very helpful to them at all. Certainly,
the high-tech community, whether you are talking about the Silicon
Forest in Oregon or the actual forest in Oregon, needs something with
enough teeth in it, enough time to it that will allow them to make the
plans and the investments that are necessary.
Then I think about the farm community. It may not be until 2002 that
farmers see much improvement in their economy, and I hope it is sooner.
But if it is not, I would like to have this in place when their
cashflows improve and they can replace old, unreliable, or dilapidated
equipment and get the advantage of this bonus depreciation.

Madam President, I appreciate this time. I will come back later to
talk again about it and specifically offer this amendment when we work
out an agreement between ours and Senator Baucus's.
I truly hope this meaningful depreciation amendment can be adopted by
over 60 of our colleagues. I think it is critical that we do that
because I think we need to marry the best ideas of the Democratic Party
and the best ideas of the Republican Party. We need to work on the
supply side and the demand side. There is a human side and there is a
business side. There is a very nice marriage to be had in a stimulus
package that will truly leave our country better because it has the
economic weight that is required for this critical hour.
So in doing that, we will sooner throw off the shackles of recession
and leave our country the better for it.
Madam President, I yield my time and simply say I will return as soon
as our leaders have worked out the agreement and specifically offer the
amendment, hoping it can be voted on tonight or tomorrow.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. Madam President, we are very close to being able to offer a
unanimous consent agreement and we will call for a vote immediately and
then go thereafter to the amendment.
I ask unanimous consent that at 4:20 p.m. today, the Senate vote on
or in relation to the Baucus amendment, the pending amendment; that no
other amendments be in order prior to that vote; that upon the
disposition of that amendment, Senator Gordon Smith be recognized to
offer an amendment regarding depreciation.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
Mr. REID. Madam President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. REID. I ask unanimous consent that the order for the quorum call
be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered. The
Senator from Oklahoma.
Mr. NICKLES. Madam President, pursuant to section 205(b) of H. Con.
Res. 290, the concurrent resolution on the budget for fiscal year 2001,
I raise a point of order against the emergency designation, as defined
in section 205(d) of that resolution, which is contained in the pending
amendment No. 2701.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, I move to waive section 205 of H. Con.
Res. 290, the concurrent resolution on the budget for fiscal year 2001,
for purposes of the pending amendment, and I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There appears to be a sufficient second.
The question is on agreeing to the motion. The clerk will call the
roll.
The assistant legislative clerk called the roll.
Mr. REID. I announce that the Senator from Hawaii (Mr. Akaka), the
Senator from Delaware (Mr. Biden), the Senator from Connecticut (Mr.
Dodd), the Senator from California (Mrs. Feinstein), and the Senator
from Georgia (Mr. Miller) are necessarily absent.
I further announce that, if present and voting, the Senator from
California (Mrs. Feinstein) would vote ``aye.''
Mr. NICKLES. I announce that the Senator from New Mexico (Mr.
Domenici), the Senator from Oklahoma (Mr. Inhofe), the Senator from
Arizona (Mr. McCain), the Senator from Alaska (Mr. Murkowski), and the
Senator from Alabama (Mr. Shelby) are necessarily absent.
I further announce that if present and voting the Senator from
Oklahoma (Mr. Inhofe) would vote ``aye.''
The PRESIDING OFFICER (Mr. Durbin). Are there any other Senators in
the Chamber desiring to vote?
The yeas and nays resulted--yeas 57, nays 33, as follows:

[Rollcall Vote No. 2 Leg.]

YEAS--57

Allard
Baucus
Bayh
Bennett
Bingaman
Bond
Boxer
Breaux
Burns
Campbell
Cantwell
Carnahan
Carper
Cleland
Clinton

[[Page S88]]

Cochran
Conrad
Corzine
Craig
Crapo
Daschle
Dayton
Dorgan
Durbin
Edwards
Enzi
Graham
Harkin
Hatch
Hollings
Hutchinson
Hutchison
Inouye
Jeffords
Johnson
Kennedy
Kerry
Kohl
Landrieu
Leahy
Levin
Lieberman
Lincoln
Mikulski
Murray
Nelson (NE)
Reed
Reid
Rockefeller
Sarbanes
Schumer
Smith (OR)
Stabenow
Thomas
Torricelli
Wellstone
Wyden

NAYS--33

Allen
Brownback
Bunning
Byrd
Chafee
Collins
DeWine
Ensign
Feingold
Fitzgerald
Frist
Gramm
Grassley
Gregg
Hagel
Helms
Kyl
Lott
Lugar
McConnell
Nelson (FL)
Nickles
Roberts
Santorum
Sessions
Smith (NH)
Snowe
Specter
Stevens
Thompson
Thurmond
Voinovich
Warner

NOT VOTING--10

Akaka
Biden
Dodd
Domenici
Feinstein
Inhofe
McCain
Miller
Murkowski
Shelby
The PRESIDING OFFICER. On this vote, the yeas are 57, the nays are
33.
Three-fifths of the Senators duly chosen and sworn not having voted
in the affirmative, the motion is rejected. The point of order is
sustained. The emergency designation is stricken.
The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I make a point of order under section 302
of the Budget Act against the pending amendment, No. 2701, for
exceeding the spending allocation of the Senate Finance Committee.
Several Senators addressed the Chair.
Mr. REID. Mr. President, may we have order in the Senate.
The PRESIDING OFFICER. The Senate will please be in order. Members
will please take their conversations off the floor.
Pending before the Senate is the point of order raised by the Senator
from Oklahoma. Does the Senator from Nevada seek recognition?
Mr. REID. Mr. President, what is the issue before the Senate at this
time?
The PRESIDING OFFICER. A point of order has been made by the Senator
from Oklahoma that the Chair is prepared to rule on, unless there is
some intervention.
The amendment of the Senator from Montana would increase the amount
by which the Finance Committee exceeds its allocation under section
302(a) of the Budget Act in violation of section 302(f) of that same
act. The point of order is sustained.
The amendment falls.
The Senator from Nevada.
Mr. REID. I know the Senator from Oregon is going to be recognized. I
would just say to my friend, the manager of this bill and the chairman
of the Finance Committee, I hope he will offer this amendment again
before we get off this stimulus package. This was an extremely good
vote. There were a number of people missing, and I have no doubt in my
mind if this amendment, of which I am a cosponsor along with a number
of others, were offered again, it would be agreed to.
I think this is extremely important, and I hope the Senator from
Montana will offer this amendment at the earliest possible date. I
think it is too bad that we had some people not here today because I
think there is obviously overwhelming support for this amendment.
The PRESIDING OFFICER. The Senator from Oregon.

Amendment No. 2705

Mr. SMITH of Oregon. Mr. President, I have an amendment which I send
to the desk and ask for its immediate consideration.
The PRESIDING OFFICER. The clerk will report the amendment.
The bill clerk read as follows:

The Senator from Oregon [Mr. Smith], for himself, Mr.
Allen, Mr. Craig, and Mr. Burns, proposes an amendment
numbered 2705.

Mr. SMITH of Oregon. Mr. President, I ask unanimous consent the
reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To amend the Internal Revenue Code of 1986 to provide for a
special depreciation allowance for certain property acquired after
September 10, 2001, and before September 11, 2004)

At the end of the bill, add the following:

SEC. ____. SPECIAL DEPRECIATION ALLOWANCE FOR CERTAIN
PROPERTY ACQUIRED AFTER SEPTEMBER 10, 2001, AND
BEFORE SEPTEMBER 11, 2004.

(a) In General.--Section 168 of the Internal Revenue Code
of 1986 (relating to accelerated cost recovery system) is
amended by adding at the end the following new subsection:
``(k) Special Allowance for Certain Property Acquired After
September 10, 2001, and Before September 11, 2004.--
``(1) Additional allowance.--In the case of any qualified
property--
``(A) the depreciation deduction provided by section 167(a)
for the taxable year in which such property is placed in
service shall include an allowance equal to 30 percent of the
adjusted basis of the qualified property, and
``(B) the adjusted basis of the qualified property shall be
reduced by the amount of such deduction before computing the
amount otherwise allowable as a depreciation deduction under
this chapter for such taxable year and any subsequent taxable
year.
``(2) Qualified property.--For purposes of this
subsection--
``(A) In general.--The term `qualified property' means
property--
``(i)(I) to which this section applies which has a recovery
period of 20 years or less or which is water utility
property, or
``(II) which is computer software (as defined in section
167(f)(1)(B)) for which a deduction is allowable under
section 167(a) without regard to this subsection,
``(ii) the original use of which commences with the
taxpayer after September 10, 2001,
``(iii) which is--

``(I) acquired by the taxpayer after September 10, 2001,
and before September 11, 2004, but only if no written binding
contract for the acquisition was in effect before September
11, 2001, or
``(II) acquired by the taxpayer pursuant to a written
binding contract which was entered into after September 10,
2001, and before September 11, 2004, and

``(iv) which is placed in service by the taxpayer before
January 1, 2005, or, in the case of property described in
subparagraph (B), before January 1, 2006.
``(B) Certain property having longer production periods
treated as qualified property.--
``(i) In general.--The term `qualified property' includes
property--

``(I) which meets the requirements of clauses (i), (ii),
and (iii) of subparagraph (A),
``(II) which has a recovery period of at least 10 years or
is transportation property, and
``(III) which is subject to section 263A by reason of
clause (ii) or (iii) of subsection (f)(1)(B) thereof.

``(ii) Only pre-september 11, 2004, basis eligible for
additional allowance.--In the case of property which is
qualified property solely by reason of clause (i), paragraph
(1) shall apply only to the extent of the adjusted basis
thereof attributable to manufacture, construction, or
production before September 11, 2004.
``(iii) Transportation property.--For purposes of this
subparagraph, the term `transportation property' means
tangible personal property used in the trade or business of
transporting persons or property.
``(C) Exceptions.--
``(i) Alternative depreciation property.--The term
`qualified property' shall not include any property to which
the alternative depreciation system under subsection (g)
applies, determined--

``(I) without regard to paragraph (7) of subsection (g)
(relating to election to have system apply), and
``(II) after application of section 280F(b) (relating to
listed property with limited business use).

``(ii) Election out.--If a taxpayer makes an election under
this clause with respect to any class of property for any
taxable year, this subsection shall not apply to all property
in such class placed in service during such taxable year.
``(iii) Qualified leasehold improvement property.--The term
`qualified property' shall not include any qualified
leasehold improvement property (as defined in section
168(e)(6)).
``(D) Special rules.--
``(i) Self-constructed property.--In the case of a taxpayer
manufacturing, constructing, or producing property for the
taxpayer's own use, the requirements of clause (iii) of
subparagraph (A) shall be treated as met if the taxpayer
begins manufacturing, constructing, or producing the
property after September 10, 2001, and before September
11, 2004.
``(ii) Sale-leasebacks.--For purposes of subparagraph
(A)(ii), if property--

``(I) is originally placed in service after September 10,
2001, by a person, and
``(II) sold and leased back by such person within 3 months
after the date such property was originally placed in
service,

such property shall be treated as originally placed in
service not earlier than the date on which such property is
used under the leaseback referred to in subclause (II).
``(E) Coordination with section 280f.--For purposes of
section 280F--
``(i) Automobiles.--In the case of a passenger automobile
(as defined in section 280F(d)(5)) which is qualified
property, the Secretary shall increase the limitation under
section 280F(a)(1)(A)(i) by $4,600.
``(ii) Listed property.--The deduction allowable under
paragraph (1) shall be taken into account in computing any
recapture amount under section 280F(b)(2).''

[[Page S89]]

(b) Allowance Against Alternative Minimum Tax.--
(1) In general.--Section 56(a)(1)(A) of the Internal
Revenue Code of 1986 (relating to depreciation adjustment for
alternative minimum tax) is amended by adding at the end the
following new clause:
``(iii) Additional allowance for certain property acquired
after september 10, 2001, and before september 11, 2004.--The
deduction under section 168(k) shall be allowed.''
(2) Conforming amendment.--Clause (i) of section
56(a)(1)(A) of the Internal Revenue Code of 1986 is amended
by striking ``clause (ii)'' both places it appears and
inserting ``clauses (ii) and (iii)''.
(c) Effective Date.--The amendments made by this section
shall apply to property placed in service after September 10,
2001, in taxable years ending after such date.

Mr. SMITH of Oregon. Mr. President, this amendment is really very
simple. It does address in a meaningful way the stimulus side of our
effort. I think we are all deeply concerned when we go home and we meet
the unemployed who need extensions on unemployment benefits and health
care insurance benefits from COBRA.
I would like to help. What they really need long term is a job. What
we need to do is remember there is a supply side to this economic
equation as well. We have to do something meaningful in order to help
businesses retool, reinvest, restart, and reemploy the citizens of this
country.
There is a proposal--I believe well-intentioned--that is improving on
the other side. Originally, it was a 10-percent depreciation bonus over
1 year's time. Now it is up to 30 percent over 1 year's time with
eligibility.
I believe 30 percent is the right number for this bonus depreciation,
but as a person of business prior to politics I can tell you it takes
more than what is remaining in the year of eligibility. We have already
used up 4 months. By the time the President might see this, there may
be 5 months used up. Seven months to make a business plan in capital
equipment in order to restart plants is simply inadequate to be
meaningful to have the economic test that our country requires.
My amendment will actually help stimulate the economy. We have heard
this from experts such as Alan Greenspan, such as Secretary Rubin of
the Clinton administration, and others who have said this is one
meaningful thing you can do that will actually help stimulate the
economy in the short run and reemploy people quickly.
I urge my colleagues to vote for this amendment. It is critical.
Whether you are talking about the silicon forest of the high-tech
industry in Oregon or the timber industry of the forests in Oregon,
they need this bill. They need it desperately if we are serious about
restarting plants and reemploying our people.
I hope tomorrow morning when we vote on this there will be 60
colleagues and more who will understand that while we are going to do
much on the demand side to help with unemployment benefits and to help
with health care benefits, we are also going to do something to help on
the supply side and actually help to stimulate jobs and reemployment.
I encourage all of my colleagues to vote for this amendment.
Mr. NICKLES. Will the Senator yield?
Mr. SMITH of Oregon. I would be happy to yield.
Mr. NICKLES. The Senator's amendment deals with the accelerated
depreciation. The essence of the Senator's amendment is there would be
accelerated depreciation of 30 percent for 3 years in contrast to
Senator Daschle's amendment, which is 30 percent for a timeframe
between September of 2001 and 2002. Senator Daschle's amendment has 30
percent basically from February--basically 8 months.
Mr. SMITH of Oregon. The Senator is correct. My point is simply that
is not enough time to do much more than buy a few typewriters or rugs
for the front office. You can't make a serious business plan in that
amount of time and represent to the American people that we are
actually helping to reemploy people. We need to rebuild some railroad
beds. We need to retool some plants. We need to allow businesses the
time necessary to do the engineering, to do the environmental studies,
and to make the plans that can take advantage of it. And they will do
it if they are given time sufficient to get the job done.
Mr. NICKLES. Will the Senator include me as a cosponsor of the
amendment?
Mr. President, I ask unanimous consent to be made a cosponsor.
The PRESIDING OFFICER (Mr. Cleland). Without objection, it is so
ordered.
Mr. SMITH of Oregon. Mr. President, I yield the floor.
The PRESIDING OFFICER (Mr. Harkin). The Senator from Virginia.
Mr. ALLEN. Mr. President, I rise in support of the amendment to
increase the 30-percent bonus depreciation from 1 year to 3 years.
The underlying proposal, while improvement over the previous one,
which was only 10 percent, is still too short. It is not enough time to
help revive the high-tech economy, and, indeed, our general economy to
help create more jobs.
If the underlying proposal were implemented, the bonus depreciation
would only last until September of 2002, which is merely 8 months away.
The amendment of the Senator from Oregon was passed by the House of
Representatives and was supported by the Bush administration. The
argument that the Senator from Oregon has made makes a great deal of
sense. It will boost investment. It will boost growth in the high-tech
sector in particular.
Why does that matter? I was just meeting with high-tech folks from
Redmond, WA, Silicon Valley in California, and here in Virginia.
Whether in Oregon, or anywhere else, this proposal makes good sense.
Senator Smith's amendment takes aim at the core problem of our
slumping economy which is seeing a huge drop in investment, in
equipment, and in machinery. Over 3 years, a 30-percent bonus
depreciation would get the investment engine going and running strong
again. It would lower the cost of new capital spending. It would
provide a stimulus for a broad array of industries, including
telecommunications, technology and others, including transportation.
The current depreciation schedule clearly has not kept up with our
economy. It is especially harmful in this economic slowdown.

Senator Smith introduced this proposal on behalf of the Senate
Republican High Tech Task Force late last year. Indeed, looking at the
concept of the enhanced expensing as proposed by Senator Smith for
bonus depreciation, it would be highly beneficial to the high-tech
community, the sector of our economy that has driven productivity
growth and created millions of jobs during the last decade.
The information technology industry makes up only 8.2 percent of the
U.S. economy. Yet it has accounted for almost 30 percent of the real
gross domestic growth from 1994 to 2000. Much of this growth resulted
from the increase in investment in hardware, software, networking, and
communications systems.
As the economic slowdown has persisted, decreasing IT investments
have substantially weakened our American economic growth. During these
uncertain economic times, as Senator Smith stated, businesses have
decreased motivation. They do not want to take those risks in buying
new equipment and new systems because they are worried about what the
economy may do. The result, obviously, has an adverse impact on job
opportunities for those who fabricate the chips, for those who assemble
the computers, and for those who work on the programs and all the
innovations and adaptations that improve our lives--whether it is in
education or communication services and manufacturing.
This amendment has a robust expensing provision. I think it can turn
around our bleak economic scenario. The enhanced expensing provision in
this amendment, of which I am proud to be a cosponsor with Senator
Smith, has broad support.
As I noted previously, the House passed it. This has the support of
leading high-tech trade associations, including AeA, CapNet, EIA, BSA,
the Information Technology Association of America, the Information
Technology Industry Council, and TechNet.
We need to get into some details of the economy because that bolsters
the argument about why we need to pass this amendment.
Diminishing IT investments impact our economy. By the fourth quarter
of

[[Page S90]]

2000, conditions were changing dramatically from what they were in the
previous 6 years. Gross domestic product growth plunged. It was
precipitated in part by an 8.4-percent drop in investment for all
equipment and software, and a 9.5-percent decline in investments in
computers and peripheral equipment in the first half of the year 2001.
To put this in perspective, 2001 was the first time since 1974 that
business investments in IT declined over a 12-month period. In the
first quarter of 2001, the trend acted as a drag on our economy
subtracting an estimated 4.41 percentage points from overall growth.
In the second quarter of 2001, the impact was even more dramatic with
diminishing investments in technology equipment and software
subtracting over 1.52 percentage points from U.S. economic growth.
Some of the decline in IT investments may be attributed to the
lingering effects of Y2K, which caused many firms to accelerate their
IT spending to ensure they could maintain current operations during the
century date change in the year 2000.
Other factors included diminishing revenues to commit to business
expansion and upgrades, and the tendency to conserve capital during
times of economic uncertainty and concerns arising from the terrorist
attacks of September 11. All of these factors contribute to the
decision to hold onto technology assets longer than normal in part to
maximize tax deductions under the current five-year depreciation
rules. So you might as well use it for the whole 5 years. That ought to
be changed also. That is not the purpose of this amendment, but it
points out the value of this amendment. If you have a long 5-year
depreciation, such as if you upgraded for Y2K, and you have economic
uncertainty, you see the exacerbated negative impact on our whole
economy and jobs and spending.

We need to have that stimulus. This is what this is. Of all the
things that are in this underlying bill, this idea meets the concept
and the definition of economic stimulus more than anything else that
has been presented so far. There may be others coming up, but this is
the best so far.
An economic stimulus ought to be a change in our tax or regulatory
policies that induces or spurs spending or economic decisionmaking that
would not otherwise occur but for that change in the tax laws. This
meets that definition. This will spur businesses to say: Hey, let's
start planning. Let's upgrade our technology. Granted, we may have 5
years of depreciation, but with this 30-percent depreciation, this
bonus depreciation, this makes economic sense for us.
What will be the result of that? Our businesses will be more
productive. They will be more efficient. But those who produce and
fabricate the chips, those who assemble the computers, those who
develop the programs will all have jobs. And they are good-paying jobs.
And that helps out the whole economy.
So the tendency we have right now of people delaying the decision to
make new investments will certainly be changed by this amendment. So I
ask that all our colleagues unite for the one thing that really does
unite us; and that is this amendment by Senator Smith of Oregon.
There are many cosponsors, including virtually everyone on the High
Tech Task Force on the Republican side. I hope our friends on the other
side of the aisle, who have made progress from the original proposal,
will realize this is the ideal and this will not only be bonus
depreciation for businesses and entrepreneurs and enterprises across
America, and help create jobs, but it will be a bonus for the American
economy.
I commend Senator Smith of Oregon and ask my colleagues to support
this amendment. Let's get America working again. I yield the floor.
The PRESIDING OFFICER. The Senator from Oregon.
Mr. SMITH of Oregon. While we are waiting for the next speaker, I ask
unanimous consent to have printed in the Record a letter from the
Republican High Tech Task Force to the chairman and ranking member of
the Senate Finance Committee and the chairman and ranking member of the
House Ways and Means Committee dated November 30, 2001.
There being no objection, the letter was ordered to be printed in the
Record, as follows:

November 30, 2001.
Hon. Max Baucus,
Chairman, Committee on Finance, U.S. Senate, Washington, DC.
Hon. Chuck Grassley,
Ranking Member, Committee on Finance, Washington, DC.
Hon. William Thomas,
Chairman, Committee on Ways and Means, U.S. House of
Representatives, Washington, DC.
Hon. Charles Rangel,
Ranking Member, Committee on Ways and Means, Washington, DC.
Dear Chairmen and Ranking Members: As members of the Senate
Republican High Tech Task Force (HTTF), we write to recommend
that any final economic stimulus package include an enhanced
expensing provision. We view the expensing provision in the
House-passed stimulus bill. H.R. 3090, which would allow 30
percent enhanced expensing over three years, as the minimum
the Congress should enact.
Enhanced expensing would be highly beneficial to the high
technology community--the sector of the economy that has
driven productivity growth and created millions of jobs
during the last decade. The information technology (IT)
industry makes up only 8.2 percent of the U.S. economy, yet
it accounted for almost 30 percent of real Gross Domestic
Growth (GDP) from 1994 to 2000. Much of this growth resulted
from the increased investment in hardware, software,
networking and communications systems. As the economic
slowdown has persisted, decreasing IT investments have
substantially weakened U.S. economic growth. During these
uncertain economic times, businesses' decreased motivation to
buy new equipment or build new plants will further impact
opportunities for job creation and squander revival of the IT
industry. A robust expensing provision can turn around this
bleak scenario.
Enhanced expensing has broad support. As we noted above,
H.R. 3090, the Economic Security and Recovery Act, passed by
the House of Representatives, included the 30 percent, three-
year expensing provision. The Bush Administration also
supports this provision, which also was included in the
Senate Republican stimulus proposal. On behalf of the HTTF,
Senator Gordon Smith filed an amendment to the substitute
amendment to H.R. 3090 offered by Senator Baucus to include
the House-passed expensing language. Leading high tech trade
association, including AeA, CapNet, EIA, the Information
Technology Association of America, the Information Technology
Industry Council, and TechNet, have placed enhanced expensing
among their most important legislative goals for the year. We
urge you to--at a minimum--include the House-passed expensing
provision in any final stimulus bill.
We appreciate you consideration.
Sincerely,
Senator Gordon Smith, Senator George Allen, Senator Sam
Brownback, Senator John Warner, Senator Wayne Allard,
Senator Mike Crapo, Senator John Ensign, Senator Conrad
Burns, Senator Kit Bond, Senator Day Bailey Hutchinson,
Senator Tim Hutchinson.

Mr. SMITH of Oregon. Mr. President, while we have this moment, I ask
for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
At the moment there is not a sufficient second.
The Senator from Missouri.
Mr. BOND. Mr. President, I planned on rising to ask to set this
amendment aside so I might offer an amendment. I understand there is to
be an objection on the other side, so I want to take these moments to
tantalize my colleagues with the thought of the tremendously important
amendment that I will, at some time, offer. Frankly, it follows very
closely along the lines of the amendment that the Senator from Oregon
has offered and the Senator from Virginia has just so eloquently
explained.
Basically, if we are going to get the economy moving again, it is
very important that we get small business moving. I do not know about
my colleagues, but I can tell you in my State there are a very
significant number of small businesses that have been very directly
hurt and very heavily impacted by the events of September 11 and the
follow-on necessary reaction to shut down on terrorism.
We need to get support for small business. I have, in the past,
worked with the chairman of the Small Business Committee, Senator
Kerry, to provide assistance for loans. We hope that will be included
in this bill.
But the bill I am talking about would raise the expensing limits for
small business. This is extremely important because right now, even
under the Daschle amendment, if there is a 30-percent bonus, you still
have to depreciate the rest of the equipment over 5 years. If you are
buying a computer, in

[[Page S91]]

5 years there is going to be something totally different. You need to
be able, as a small business, to purchase equipment and write it off.
Why do we say it is for small business? Because we would raise the
threshold. But the threshold would still be $325,000 worth of assets
put into place during the year. So only the smallest businesses that
are struggling to get back on their feet, that seek to grow by buying
equipment, would be able to take advantage of this expensing.
Expensing means, in this instance, if it is up to $40,000, you write
it off. You do not have to set up a depreciation schedule. You do not
have to hire accountants. You do not have to have all that folderol
that you go through for depreciation.
For the smallest businesses, the ones we hear from the most--at least
the ones I hear from back home--they are really the smallest ones which
have several employees. They are busy providing a product or a service.
They do not have time to go out and hire an accountant and set up
depreciation schedules.
So this amendment says--the amendment that at some point I will
offer--that small businesses will be able to expense up to $40,000 a
year, which is an increase from $24,000, and it would increase the
phaseout threshold to $325,000 of assets put in play in the year from
the current $200,000 limitation. This is similar to but $5,000 more
generous than the centrist proposal. Frankly, the centrist proposal had
$35,000. This is a $40,000 limit. I think that is a reasonable figure.
I think this would encourage the small businesses to put capital to
work to buy the equipment they need.
With the freed up capital, the business can invest in equipment. The
small enterprise will stimulate other enterprises. The more they can
reduce their taxes by making the purchase of the equipment, the more
employees they will be able to keep working.
Chairman Greenspan has indicated again in his testimony today that
small businesses expanding and growing is a vitally important part of
the long-term vitality of our economy. Small businesses, we know,
represent about 99 percent of all employers. They employ 51 percent of
the private-sector workforce. They provide about 75 percent of the net
new jobs. They contribute 51 percent of the private-sector output. And
they represent 96 percent of all exporters of goods.

Size is the only small aspect of small business. It really is a
dynamic force in our economy. As the distinguished Senator from
Virginia was discussing, this would allow the smallest businesses to
buy a computer or other information technology equipment for up to
$40,000 and write it off immediately and not have to go through the 5-
year depreciation system.
My colleague from Nevada is in the Chamber. I ask if I can gain
unanimous consent to set the underlying amendment aside or if he wishes
me to offer it later.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. Reserving the right to object, the Senator from Missouri is
always very courteous. I certainly do not want to be discourteous to
him, but we believe, with this most important legislation pending, we
should work on an amendment at a time. We just completed the
agriculture amendment. We are now going to bonus depreciation. We will
have a vote on that tomorrow. Following that vote, I think we should
have another amendment laid down. And using this tradition--I do not
know if ``tradition'' is the right word--usually, on these bills, where
there is an open amendment process, we go back and forth--Democrat-
Republican--amendment by amendment. So having said that, I object.
The PRESIDING OFFICER. Objection is heard.
Mr. BOND. Mr. President, I understood they would object. Senator
Collins and I do wish to have this amendment included at the
appropriate time. I ask the managers, as they work out the schedule, to
put this amendment in the queue at the first available opportunity.
Mr. GRASSLEY. Mr. President, if the Senator will yield.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. GRASSLEY. If I understand what the Democratic assistant leader
said, we will have a Democrat amendment. So then Senator Bond's should
be the first Republican amendment up after we have a Democrat amendment
up.
Mr. BOND. Mr. President, I thank the floor manager and the majority
whip. I appreciate very much their consideration of it. I will offer
this to the floor manager to introduce at the appropriate time.
I thank the Chair.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. GRASSLEY. Mr. President, I ask unanimous consent to be added as a
cosponsor of the amendment of the Senator from Oregon.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. GRASSLEY. Mr. President, I rise to speak in support of the
amendment.
Bonus depreciation was one of the proposals that both Chairman
Greenspan and former Treasury Secretary Robert Rubin uniformly endorsed
for a stimulus package.
They argued accelerating depreciation was the most stimulative thing
that we could do to jump start the economy.
They said it would increase cash flows and add to asset values.
They lauded its immediate stimulus effect on the economy and
emphasized that a temporary enactment would not have long-term
budgetary impact.
Despite all these advantages and the endorsement of Chairman
Greenspan and former Clinton Treasury Secretary Rubin, and Democrats
have give us an inadequate depreciation proposal.
They would allow 30 percent bonus depreciation for only 1 year.
Granted, this is an improvement on their first idea. That was to
allow only 1 percent bonus for 1 year.
The bipartisan White House-Centrist economic stimulus package offered
a solid proposal calling for a 30 percent bonus depreciation over 3
years.
Senator Daschle's bonus depreciation proposal is only for one year.
Now what does 1-year period allow us to stimulate?
Well, it probably gives business people time to buy an office copier,
desks, or some new throw rugs for front office.
But I do not think this bill includes any incentives to continue
projects that are already in the pipeline.
It does not give companies time to do a major project, which could
generate thousands of jobs.
It does not allow us to build heavy equipment, modernize a lumber
mill, repair a railbed, revamp a management information system for a
factory, or construct an airplane.
Farmers may not see an economical turnaround until after 2002. When
they do, they will need to update their equipment. The farm economy has
been so bad for so long that many farmers have not been in a financial
position to replace unreliable equipment. They will need more time than
1 year to do this.
And aircraft is an interesting point. This is one of the industries
that has been hit the hardest by the events of September 11.

We know from our discussions with the few remaining U.S. aircraft
manufacturers, that it can take up to 18 months to build an airplane.
One year is not enough time to finish a project of this size.
Moreover, a 1-year bonus depreciation period does not provide
insurance against a future down tick in our recovery cycle. This
commonly occurs as an economy struggles to throw off the shackles of
recession. We need to capture a booming economy not just for today but
for the next several years.
Economic growth is key to eliminating the future budget deficits that
have been forecast by the CBO.
So I must emphasize that the Democrat's 1-year bonus depreciation
package is seriously lacking in economic weight.
It is a temporary proposal for what should be the centerpiece of an
economic recovery package.
Bonus depreciation is probably the best idea any stimulus proposal.
Senator Daschle's proposal simply fails to recognize its importance to
our economy.
The PRESIDING OFFICER. The Senator from Oregon is recognized.
Mr. SMITH of Oregon. Mr. President, I have just been handed a press
release by the Secretary of the Treasury. I ask

[[Page S92]]

unanimous consent that it be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

Statement by Secretary Paul O'Neill on Bonus Depreciation Amendment
Before the Senate

The economic stimulus bill under consideration in the
Senate includes a 30% bonus depreciation provision which
expires in one year. Senator Gordon Smith has introduced an
amendment for consideration on the Senate floor that would
make the same bonus depreciation available for 3 years.
Treasury Secretary Paul O'Neill made the following comment:
The short period of eligibility for new investment under
the base proposal would result in no stimulus to the kind of
job creating major projects that are fundamental to our
growing economy. Under the base proposal, a project begun
tomorrow must be completed by December 31 of this year to get
any benefit. Senator Gordon Smith is right to propose an
amendment extending the 30% bonus depreciation provisions to
3 years, so that more investment takes place and more jobs
are created. Senator Smith's amendment greatly enhances the
job creation that will be generated by the bonus depreciation
provisions under consideration in the Senate.

Mr. SMITH of Oregon. Mr. President, I want to do this in concert with
the majority. But I am asking for the yeas and nays and am anxious to
know at what point either Senator can get a vote.
Mr. REID. Mr. President, we are in the process of getting consent on
the Senator's matter and other matters for tomorrow. I think we will be
able to work it out soon.
Mr. SMITH of Oregon. I thank my friend from Nevada.
The PRESIDING OFFICER. The Senator from Nevada is recognized.
Mr. REID. Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. REID. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. REID. Mr. President, I ask unanimous consent that on Friday,
January 25--tomorrow--the time until 10:30 a.m. be equally divided and
controlled for debate with respect to the Smith of Oregon amendment;
that at 10:30 a.m. the Senate vote in relation to the amendment, with
no intervening amendment in order prior to the disposition of the Smith
amendment; further, that on Friday the next amendment be one offered by
the majority leader or his designee regarding unemployment insurance;
that following the presentation of that amendment, and a brief
explanation, the amendment be temporarily laid aside and that Senator
Bond or his designee offer the next Republican amendment regarding
small business.
The PRESIDING OFFICER. Is there objection?
Without objection, it is so ordered.
Mr. REID. Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. REID. Mr. President, I ask unanimous consent the order for the
quorum call be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.

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