Max Baucus

Mr. BAUCUS

Mr. BAUCUS. Madam President, in Taming of the Shrew, William Shakespeare wrote: There is small choice in rotten apples. I am here to talk about the choice we have this afternoon, on voting for final passage of H.R. 3606. Over the past week, the Senate has been debating a bill the House has called the JOBS Act. But as former Securities and Exchange Commission chief accountant Lynn E. Turner said recently: It won't create jobs, but it will simplify fraud. I fully support finding ways to help the private sector create good- paying jobs. Last year, I worked with my colleagues on both sides of the aisle to pass the Vets Jobs bill, cutting taxes for small businesses while helping veterans get back to work. This Chamber also passed three free trade agreements, setting the stage to increase American exports to Korea, Colombia, and Panama by an estimated $13 billion a year, resulting in tens of thousands of new jobs. And just last week, the Senate passed overwhelmingly the highway bill, which will create and sustain more than 14,000 American jobs per year. But our choice today leaves much to be desired. While this bill includes some very positive changes to enhance and encourage small business investment, it includes several rotten apples that roll back important investor protections and put the integrity of our markets into question. So quickly we forget the past. Just over a decade ago, a company called Enron revealed one of the largest corporate and accounting scandals of our time. We all remember the stories of documents shredded, shell companies, exaggerated profits, and lax accounting rules. Within 1 month, shareholders lost nearly $11 billion as Enron stock plummeted. Families and employees lost their entire savings in a matter of days. Investor confidence in the entire system evaporated. Just a few years earlier, the dot-com boom hit a fever pitch. Wall Street firms worked frantically to put together initial public offerings for fledgling Internet companies. At the same time, these firms would agree to release upbeat research reports supporting the upcoming IPO in exchange for the company's underwriting business. Unassuming investors relied on this public research touting the IPOs, while firms failed to fully disclose the inherent conflicts of interest. Congress and the Securities and Exchange Commission responded to these scandals by putting investor protections in place to restore confidence in the markets and ensure companies provide comprehensive and honest information to the public. Thanks to these protections, investors no longer have to wonder whether the accounting and auditing disclosures are, in fact, independent and accurate. We can't afford to go backward. Still, these rules are not perfect. Congress should be looking at ways to ensure small businesses are given a level playing field. I hear from Montana small businesses that rules under the Sarbanes- Oxley Act can be costly and time-consuming for small companies which simply lack capacity to handle the extra regulation. I agree we must also look at what these rules may be doing to hamper growth of U.S. small businesses. But we should not forget the past. We should not exempt big business carte blanche without fully discerning the implications. There are several pieces of this legislation with which I agree. I commend my colleague and friend from the State of Montana, Senator Tester, for his tireless effort to address legitimate concerns with the current cap on small business public offerings. Senator Tester introduced his bipartisan measure after meeting and talking to growing companies in Montana and elsewhere that could benefit greatly from raising the cap on regulation A small public offerings. Rob Bargatze, founder and CEO of Ligocyte, in Bozeman, MT, and chairman of the Montana Bioscience Alliance, testified in the Banking Committee last year on ideas to improve access to capital for the emerging bio industry. Rob rightly points out that the current $5 million cap ``does not allow for a large enough capital influx for companies to justify the time and expense necessary to satisfy even the relaxed offering and disclosure requirements.'' Senator Tester has done extraordinary work to shepherd this bill forward. It received considerable support in the House, and was included in the Senate substitute amendment that I supported on Tuesday. However, this straightforward update to regulation A has been folded into a broader House package. This package includes enough rotten apples to spoil the whole bunch. The House fails to take heed of past history. This bill goes too far in relaxing investor protections critical to preserving the integrity and transparency our markets depend on to function. For example, this bill includes a new IPO process to exempt companies from many SEC rules for a period of 5 years. The idea is to give small emerging companies time to comply with new auditing and reporting requirements. However, the House bill applies to all offerings by companies with sales less than $1 billion. At this level, even the very large, well-established companies will have a free pass for 5 years before complying with the very rules put in place to protect investors and the markets from another Enron-type scandal. Furthermore, the House creates a gaping hole in the rules set up after the dot-com bubble to prevent an underwriting bank from publishing research reports in support of the upcoming IPO. The House bill would now allow underwriting banks to issue such research to unsuspecting investors. And it limits the company's responsibility to make sure such research is accurate and comprehensive. We have seen too many examples lately of what can happen when we don't protect the little guys from Wall Street greed--just look at how MF Global took advantage of Montana ranchers, and that is when there were rules in place. We can't afford to go back to the days when Enron was able to swindle thousands of Americans out of their life savings. I appreciate the work of my colleagues on this matter, but we owe it to American workers and families to see to it that this bill preserves investor confidence and integrity in our markets. I simply cannot support the House package containing so many bad apples.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, we mark March as Women's History Month, as a time of year for us to remember the valiant female leaders of our great Nation. One of them is very special to Montana. In 1916 Jeannette Rankin was the first woman elected to the United States Congress, 4 years before women were granted the right to vote. As a member of the House of Representatives, her daring and vocal stance on controversial issues such as war and peace brought critical recognition from the press. In every situation, the strength of her values persisted, even under the pressures of unanimous opposition to a war with Germany. Jeannette Rankin said, ``I may be the first woman Member of Congress, but I won't be the last,'' and helped to pave the way for future generations of women leaders. This past Saturday, March 17, 2012, marked a monumental day in American history. The Senator from Maryland, Ms. Barbara Mikulski, celebrated her 35 year in the United States Congress. That important accomplishment is a milestone for American culture and female leaders in Congress. Senator Mikulski is now the longest serving female in the Senate and in the history of the U.S. Congress. She spent her first 10 years in the House of Representatives, followed by the next 25 years here in the Senate. She has worked every day to make America a better place for the next generation. When Senator Mikulski began her work in the House of Representatives, there were 18 female Members of the House and three female Members of the Senate. When she began her first term in the Senate, there were 23 female Members of the House and only one other female Member of the Senate. Now, she is a leader among our 17 female Senators and 76 female Members of the House of Representatives. Her strong sense of community and instinctive nature pertaining to the needs of Americans is exemplified by her action-oriented attitude. Even before her tenure in Congress, as a social worker for the people of Maryland, Ms. Mikulski was active in local issues in and around the Baltimore area and worked to help at-risk children and seniors. She continues working passionately to address those issues throughout her tenure in Congress. Her advocacy for justice and contributions to social issues are evident with her work to fight for women's rights and improved access to health care, to better education, and to volunteering and national service opportunities. She offers tremendous leadership for the Senate both as the chairwoman of the Health, Education, Labor, and Pensions Subcommittee on Primary Health and Aging, and as the chairwoman of the Appropriations Subcommittee on Commerce, Justice, Science, and Related Agencies. Like Jeannette Rankin, Senator Mikulski has been a leader and an exemplar for strong and courageous women leaders in America. Senator Mikulski gets things done, and I have enjoyed our friendship during our work together in the Senate. Her brave spirit is one that sets the bar for new and incoming Senators, both male and female. I congratulate Senator Mikulski on her special day and I look forward to continuing our work in the Senate together. Mr. President, I yield the floor.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to support our contract with rural America for decent roads and explain an amendment the Senate adopted last Thursday. Counties lose local tax revenue due to large Federal landholding. So, for over a century, Congress has supported payments to counties to make up the difference. Secure Rural Schools and Payments in Lieu of Taxes-- known as PILT--continue that important commitment to these communities. Rural counties that are home to large swaths of Federal lands rely on these funds to keep schools warm and keep the lights on at the county road department. These investments are rightfully due to rural counties as part of their compact with the Federal Government. These funds support jobs in Montana, education, and important county road projects. For counties such as Lincoln, Beaverhead, and Ravalli in Montana, these payments are a lifeline. My amendment keeps that lifeline intact, and it does so without adding a dime to the debt. We are considering a 2-year surface transportation bill in the Senate. And let me make clear: county payments are about roads. Secure Rural Schools requires payments to be spent either on roads or on schools. Over the last decade, over 50 percent of payments went to roads. In States like Idaho and Oregon, this makes up 20 percent of all highway spending in those States. U.S. Census survey data suggests that much of PILT is spent on highways too. For example, in Nevada and Iowa, counties spend one in six dollars on highways. In Alabama, Arkansas, and Missouri that figure is one in five, and in the Dakotas and Oklahoma, it is nearly one in three. Each of my colleagues has a list of the payments that went to their counties this year. Last Thursday, I and Senators Murkowski, Bingaman, Crapo, Wyden, Risch, Merkley, Tester, and Bennet offered an amendment to extend Secure Rural Schools and PILT payments for 1 additional year. The amendment was adopted by a vote of 82 to 16. This amendment was paid for with commonsense offsets. One of the provisions I wanted to highlight is the offset that establishes reporting requirements for the sale of a life insurance contract. Even though we know it needs a little fine tuning, it is a tax gap provision that has the support of all the industries affected, and we look forward to working with them to improve it. A second offset provides a new tool for Federal agencies to manage their workforce as well as for employees to manage their careers. Currently, Federal employees who are eligible for retirement cannot collect their retirement without quitting Federal service. This results in a drain on experienced Federal workers. It also encourages employees to leave government, even though they may want to stay. This proposal will allow Federal employees to phase into retirement by reducing their workload and receive a portion of their retirement benefit. It allows Federal agencies to save money because they don't have to hire new employees and it allows the Federal retirement trust fund to save money by paying only a portion of retirement benefits. And it is totally optional to the employee, so it is a win for the employee and a win for American taxpayers. Another offset in this proposal partially closes a loophole regarding roll-your-own tobacco. Congress raised taxes on tobacco to pay for the reauthorization of the Children's Health Insurance Program in 2009. Tax rates on pipe tobacco were not increased as much as on roll-your-own tobacco; therefore, tobacco companies are selling bags of roll-your-own tobacco and labeling them as pipe tobacco. In other words, the pipe tobacco is masquerading as tobacco to be rolled into cigarettes to avoid the additional tax. That isn't right. We should close this loophole. The abuse is so prevalent that gas station owners now have cigarette rolling machines to facilitate the loophole. A customer purchases a bag of pipe tobacco and then uses the machine to roll cigarettes. This provision helps close this loophole by treating establishments with cigarette rolling machines as manufacturers and therefore subject to the Federal excise taxes on tobacco manufacturers. This would raise $99 million. This highway bill was the right place to extend Secure Rural Schools and PILT for rural Americans who deserve decent roads. I thank my colleagues for supporting my amendment. We have done great work for rural America.

Mr. BAUCUS. Mr. President, I am delighted that the surface transportation bill that we just passed includes a very important provision that will help to stabilize the level of contributions that employers will have to make to their defined benefit pension plans. When I talk with employers in Montana and throughout the country, one of the biggest drawbacks they cite for sponsoring a pension plan for their employers and the biggest reason most employers decide not to sponsor a plan is the inability to predict how much it is going to cost. Employers have to make a guess as to how much their benefits will be in future years, discount that value to the present, and make a contribution today that will meet that obligation. This is all in addition to guessing other variables, such as how long their employees will work for them and how long they will live after retirement. We all worked hard in 2005 and 2006 to develop pension funding rules that work, so that assets will be in the plan to meet the employer's promise to its employees. However, the Pension Protection Act of 2006 did not, and could not, account for the unforeseeable slide in asset values in 2008 and now the historically low interest rates that employers have to use in valuing their obligations. As a result of the artificially low interest rates today, employers will have to put about twice as much into their plans this year as they did last year, according to the Society of Actuaries, and that steep increase in required contributions will continue until 2016. There is nothing that will discourage an employer from keeping its plan or creating a new one than this kind of steep and unexpected increase in required contributions. The bill we passed today provides significant stabilization in the interest rates that employers have to use in determining their contributions, and employers will be able to use the rules immediately. I am pleased that we were able to do this for employers. More important, the provision is good for employees because it helps to keep pension plans viable. I remain open to other proposals that will help employers to continue to provide a secure retirement for employees and their families.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I would like to thank leaders Reid and McConnell for emphasizing the importance of getting extenders done. As we prepare for tax reform, it will be important for us to examine these provisions to determine whether we are getting the most bang for our buck. Tax reform, however, will take some time and these provisions have already expired. We should provide certainty to taxpayers by extending them through this year as soon as possible. These provisions are important to American families and businesses. These provisions include college tuition relief for working families. These are tax provisions that help create jobs, support research and development, and bolster growth of American businesses across the globe. It is also critical for our energy sector. A dozen energy tax incentives expired at the end of last year and several more expire this year. Each day we fail to extend these incentives means jobs for our economy. I am glad we are working on a bipartisan basis to extend these provisions and I hope we can do so as soon as possible. We need to make sure that taxpayers don't see tax increases because Congress failed to do its duty.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, this amendment does two things. First, it increases taxes on business men and women trying to provide some alternative energy for this country. It increases taxes on those men and women. Second, it eases out revenue by increasing taxes on individuals and uses it to lower the corporate tax rate. That is one of the main things this does. Third, it repeals credits and deductions on one section of our energy industry--the renewables, the alternatives--but it doesn't for conventional oil and gas. So, No. 1, this raises taxes on individuals and uses it to lower the corporate rate; and, No. 2, it is unbalanced because it reduces credits and deductions in the alternative area but not on the conventional energy area. It is unbalanced and wrong. I urge my colleagues to vote against this amendment.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I call up amendment No. 1825.

Mr. BAUCUS. Mr. President, I ask for the yeas and nays.

Mr. BAUCUS. Mr. President, I ask unanimous consent that Senators Crapo and Risch be added as cosponsors to this amendment.

Mr. BAUCUS. Mr. President, this is a very simple amendment. It compensates counties that have the lack of a private land base; that is, counties that do not have the ability to collect property taxes because of Federal land. This revenue goes to schools, it goes to jobs and roads. I might add, in the State of Oregon, 20 percent goes to highway spending. This is the highway bill. It has been supported strongly in the past by this body. The offset has been worked out. I strongly urge my colleagues to support it. This is a good, solid program. I yield the remainder of my time to my colleague from Oregon, Mr. Wyden.

Mr. BAUCUS. Mr. President, I move to reconsider the vote.

Mr. BAUCUS. Mr. President, I ask unanimous consent that Senator Murkowski be added as a cosponsor to the preceding amendment.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I would ask, what is the pending business before the Senate?

Mr. BAUCUS. Mr. President, I rise to object to the Blunt amendment. I believe this amendment is extreme and it would undermine the delicate balance between religious freedom and a woman's health. It would be a mistake. It goes too far. It would allow any employer to prevent a woman's access to mammograms, prenatal care, even vaccinations or any other form of preventive care. In Montana, my State, 62,000 women could lose access to preventive care. I am here to say that is wrong, and I am going to go to bat for them. I think a woman should decide for herself and her family what preventive care makes the most sense for her. As Americans, we believe in individual liberties and equal access to health care. Current policy upholds those values. It preserves the integrity of a woman's freedom and the right to access all health care services. It protects the religious liberties that so many Americans, including myself, value. And that is why both faith-based and health communities support this policy--not the Blunt amendment but the current policy. The Blunt amendment would overturn this. It would allow any corporation or health plan to deny women and their families access to preventive health care for almost any reason. It is written so broadly that an employer or an insurance company could deny access to preventive care for virtually any reason. That is not right. I urge my colleagues to vote against the Blunt amendment. I urge them to protect the health of all Americans. That includes our mothers, wives, sisters, and daughters in Montana and across the country. In Montana, we are very proud to have sent the first woman to Congress--Ms. Jeannette Rankin--in 1916. We have a very strong tradition in our State of respecting women--women who are not only the hearts of our families but are also those providing the fabric of our communities. When we support women's health, we are supporting healthy communities that could be strong for our kids and our grandkids. Let's uphold our values of liberty. Let women choose for themselves individually. It is their responsibility what preventive care they think makes the most sense for them. And let's treat all Americans fairly. Let's defend against discriminatory health insurance practices, and let's do so while protecting everyone's fundamental rights. Mr. President, on another matter, I ask unanimous consent to speak as in morning business.

Mr. BAUCUS. In ``Common Sense,'' the American patriot Thomas Paine wrote in 1776 as follows: The landholder, the farmer, the manufacturer, the merchant, the tradesman, and every occupation, prospers by the aid which each receives from the other, and from the whole. Common interest regulates their concerns, and forms their law. Common interest produces common security. In the 240 years since Paine's pamphlet helped define who we are as Americans, our transportation system has become the cornerstone of our common interest. There are few things under the Sun that are not impacted by our highways, our roads and bridges, and our transit systems, yet we can too easily take our network for granted. A recent Rockefeller Foundation survey found that two-thirds of all respondents believe America should invest more in infrastructure. It is a common interest. That same survey found that two-thirds of all Americans believe they should not have to pay any more for this increase in infrastructure investment. That means we have to rise to the challenge in Congress to come up with a highway bill that invests in infrastructure without asking folks to pay more than their fair share. According to the U.S. Chamber of Commerce Transportation Performance Index, we could lose nearly $340 billion in potential economic growth over the next 5 years if we do not pass a highway bill and provide the certainty our economy needs. Let me make that statement again. We could lose $340 billion in potential economic growth over the next 5 years if we do not pass a highway bill and provide the certainty our economy needs. Our transportation system depends on substantial investments from the Federal Government. This investment consistently yields a big return for American jobs. In my home State of Montana, the last highway bill created or sustained more than 18,000 good-paying jobs, and nationwide it put approximately 35,000 people to work for every $1 billion invested. So for every $1 billion invested, it created 35,000 jobs. These are not just statistics, these numbers represent families able to put food on the table. They are good jobs. These numbers represent small businesses able to attract new customers. I know these types of investments work because I spent a day working alongside a road construction crew on Amsterdam Road in Bozeman. They showed me the ropes of running a road grader, a paver, and an excavator. I might say, the grader was really up to date. All I had to do was get in the grader, move forward, and it was guided by a GPS system that raised the blade, turned the blade, tilted the blade at exactly the right location, and it was a perfect line I made down that road, whereas if I had had to do it by myself, it would have been a mess. The GPS made it work. During the workday, I talked to about a dozen workers who said their families depended on the project for their livelihood. It was very impressive. Their work also had a major impact on the community because Amsterdam Road is one of the most traveled roads in the area. Investing in our transportation infrastructure is investing in our families and our economy. It is an investment. It yields great returns. It pays dividends. This bill seeks to maintain that investment through 2013; that is, the underlying bill that is before us--not the Blunt amendment but the underlying bill. I would prefer a longer period of time in the underlying bill to provide greater certainty. We are already 2 years past due. We have had lots of extensions. We must work together now to get something done at least until the end of next year, and a 2-year bill provides the compromise we need to get there. I have worked on this bill for about 4 years from the leadership perspective of two different Senate committees: the Environment and Public Works Committee, which provided the authorization for roads, highways, bridges, and various forms of nonmotorized transportation, and the Finance Committee, which provided the money so we can have the proceeds and the resources to pay for these highways. From the perspective of investment, I can tell you firsthand that this bill specifically focuses on those programs that are truly in our shared national interest. It consolidates nearly 90 road programs down to approximately 30. Consolidating 90--lots of individual, separate programs that kind of divide our country, didn't bring us together--to 30--30 programs that rely on the highway trust fund. This bill also focuses on dramatically improving our national capacity for data-gathering and data-sharing--desperately needed. We sought to enable States to address safety and mobility difficulties by seeing what solutions have worked in other States. More data will help them better answer those questions. For example, why in some States--my State of Montana--is the highway fatality rate 2\1/2\ times the national average? There are a lot of ideas, but what are the real reasons? We need data to find out. This bill creates for the first time a dedicated freight program to address interstate commerce. The bill extends a program called TIFIA. That is a lending program that leverages private sector investment, good investment, building roads and bridges. History tells us that every $1 we put in can leverage $30 in private sector investment. This bill has no earmarks--no earmarks. Senators Boxer, Inhofe, Vitter, and I worked hard to achieve agreements, and I thank my colleagues who serve on the Environment and Public Works Committee for unanimously approving this bill and its reforms--unanimously. I especially would like to applaud Chairman Boxer and Ranking Member Inhofe for their leadership. They worked very hard, and they worked together. Sometimes people think Washington can't work together. Let me tell you, I have watched these two people work very closely together. They were a team to get a highway bill here before the Senate. Next, from the perspective of the Finance Committee, the bill provides the highway trust fund with sufficient funding to last at least until the end of fiscal year 2013. The highway trust fund simply does not bring in enough revenue from traditional funding sources, such as the fuel tax, to meet our national needs. As a result, Democrats and Republicans on the committee had to look elsewhere to ensure for the short term that we could maintain current levels of Federal investment. In the long term, we should use the opportunity to decide what we want for a transportation network in the 21st century. So we are going to pass this short-term bill, and while we are passing this short-term bill, we have to give a lot of thought to what we want to do for the long term. We should use that opportunity to decide what makes the most sense for the 21st century. Where we could apply unused fuel tax money that currently goes to the leaking underground storage tank trust fund surplus, the Finance Committee did so with support from Democrats and Republicans. And where we transferred money from the general fund to the highway trust fund, we sought to backfill the general fund by closing tax gaps or focusing on tax scofflaws. It is important that we make sure the highway bill stays focused on supporting the economy. In Montana, our highways are our lifeblood. We are a highway State. We log a lot of hours at the wheel. It is a part of who we are. We are the fourth largest State in the Nation for land mass, but we have fewer residents than Rhode Island, the smallest State in size. My friend the former Senator Mike Mansfield said in 1967: Montanans are formed by the vastness of a state whose mountains rise to 12,000 feet in granite massives, piled one upon another as though by some giant hand. To drive across the state is to journey, in distances, from Washington, DC, north to Toronto, or south to Florida. In area, we can accommodate Virginia, Maryland, Delaware, Pennsylvania and New York, and still have room for the District of Columbia. Yet, in all this vastness, we are . . . less than a million people. A few weeks ago, we just tipped the needle on 1 million residents. I might say, I am not sure we are happy about that. Some of us want to be under 1 million in population and some kind of like 1 million. It is a big debate in our State: Should we be 1 million or less than 1 million? Nonetheless, we lack the population to make the necessary investments in Federal aid roads and interstates by ourselves, and we shouldn't have to do so. Montana alone could not support the Interstate Highway System--we couldn't do it--or the other national highways in our State. We don't have the people. With more than 10 million visitors annually and with the majority of our truck traffic originating and ending out of State, we rely on the Federal program with good reason: It is in our common interest--in the interest of Montana, in the interest of all those folks who transport freight across our State, and in the interest of people who want to visit Glacier Park or Yellowstone Park. It is in our common interest. I am here to say that the more we keep our eye on the ball, with a transportation bill that keeps our common interests in mind, the more successful we will be. Mr. President, I suggest the absence of a quorum.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I ask unanimous consent that the following staff of the Finance Committee be allowed on the Senate floor for the duration of the debate on S. 1813: Johannes Echeverri, Whitney Lott, Samson Chen, Edward Torres, Derrick Riggins, Elizabeth Samson, Amanda Summers, and Danielle Dellerson.

Mr. BAUCUS

Mr. BAUCUS. I yield back all time.

Mr. BAUCUS. Mr. President, I request the yeas and nays.

Mr. BAUCUS. Mr. President, I ask unanimous consent that notwithstanding lack of receipt of the papers from the House with respect to the conference report to accompany H.R. 3630, the Senate proceed to vote on adoption of the conference report, as provided under the previous order.

Mr. BAUCUS. Mr. President, I assume the next business is the vote on the payroll bill. Before that, I will take 1 minute. As we vote on this bill and prepare to go home, I ask you to remember four numbers: No. 1, 160 million; that is the number of Americans who are helped by this bill. The next number is 1,000; that is $1,000 that each of those Americans is going to benefit by, by passage of the bill. The next number is 13 million, which is the number of Americans who are unemployed and would be dramatically helped by this bill. Finally, 48 million, which is the number of seniors in America who have doctors take care of their health care needs. Remember those four numbers and vote for this bill. Remember, the other body passed this bill by a margin of 293 to 132, evenly split between Republicans and Democrats. I urge passage of the bill. Mr. President, there are a number of mistakes in the Joint Explanatory Statement of the Committee of Conference on H.R. 3630 related to sections 7003 and 7004 and the current law description of those sections: No. 1, on page 36, in the paragraphs describing current law, the last clause of the last sentence of the third paragraph should read: A Senate point-of-order against emergency designations under BBEDCA exists pursuant to section 511 of public law 112 78. No. 2, on page 37, in the paragraphs describing the conference substitute, the description of section 7003 should be deleted, and the paragraph labeled Section 7004 should be re-designated as section ``Section 7003'' and should read: Paygo Scorecard Estimates--The budgetary effects of this Act shall not be entered on either PAYGO scorecard maintained pursuant to section 4(d) of the Statutory Pay-As-You-Go Act of 2010.

Mr. BAUCUS. I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, Benjamin Franklin once said, ``Promises may fit the friends, but nonperformance will turn them into enemies.'' We should be clear about what the debt limit means and what it does not. Raising the debt limit does not authorize new spending. Let me make that clear. Raising the debt limit does not authorize new spending. It does not mean an increase in future spending. What does it mean? It simply means the United States will be able to meet its obligations. Increasing the debt limit only permits the Treasury Department to pay the bills we have already incurred. It does not authorize new spending. It permits the government to pay the bills that have already been incurred. They have been incurred. We owe the obligation. It says: OK, we owe that. It is in the law, passed. It is history. We have to pay the bills. It allows our country to meet our promises to our citizens, and it means there is money to provide the benefits to millions of seniors and veterans whose families depend on them every day to make their ends meet. We should remember why we are taking today's vote. Last August, Congress enacted the Budget Control Act of 2011. We all remember it. This legislation reduced spending by $2.1 trillion. That was a budget action taken by the President and the Congress together that reduced Federal spending by $2.1 trillion. It is a reduction. That is not commonly understood, not widely known, but that is the fact. And it provided a plan to raise the debt limit by the same amount. It did so so that the Federal Government could meet its financial obligations so we could keep our promises. Today's vote would reverse that agreement in August. Voting to disapprove an increase in the financial limit is unreasonable. It would be very much like your bank increasing your line of credit unless you tell them not to. Nonetheless, that is the issue we are voting on and debating in the Senate. Passing this resolution would mean there would be no money to keep our promises. The United States would default for the first time in its history. It would send a message to the world that the United States does not keep its promises. With all of the uncertainty in the world, especially in Europe, that could have disastrous consequences. It could be a contagion. There could be a reaction, a debt spiral in the wrong direction, an interaction between the two--the United States defaulting on its debt and Europe--some countries defaulting on theirs, perhaps Greece. This is clearly the wrong time to take an action that would leave the United States to be placed in default. There would be disastrous consequences for our economy alone, irrespective of the repercussions and reverberations around the world, especially Europe. Our gross domestic product would shrink by as much as 1 percent and more than $150 billion. We would be defaulting. That default would compromise our credit rating. What would happen if our credit rating was in jeopardy? It would cause interest rates to skyrocket. Just think what would happen if the United States, as we are struggling to slowly get our economy going, was faced with a big spike in interest rates. That would stop the recovery dead in its tracks. It would do more than that. It would probably plunge us back into recession. That is what would happen. Yearly prices for food, gas, and utilities would increase by hundreds of dollars for American citizens. Americans could lose thousands in retirement savings; that is, if we default and interest rates have to go up so much as a consequence of default. We have to act so investors would want to invest in the United States. If we default, U.S. businesses would not be able to meet payroll much less expand. Millions of Americans would not be paid. Millions more would lose their jobs. We are trying to get the unemployment rate down. This would cause it to go up dramatically. Default would cause it to go up. If this passes, that would mean the United States would be in default and jobs would be harder to find and unemployment would rise. Americans would be unable to access credit to buy a home, a car, or take out loans for college. The housing market would plummet again. The economy would fall into another recession or even a depression. At a time when our economy is starting to show signs of recovery, now is exactly the wrong time to risk a contraction. American workers, families, and small businesses cannot afford that, to say the least. If today's vote succeeds and causes a default, the Federal Government would not have funds to pay troop salaries. What about SEAL Team 6 who took on Osama bin Laden? We read about them in the last couple of days rescuing an American out of Somalia. There would not be a SEAL Team 6, let alone the other troops that would not be paid. Social Security benefits would not be paid. Just think of that. Medicare bills would not be paid. Think of that. These programs would all be in danger if we were to default, and a positive vote here would cause default. We are voting on a motion to disapprove. That would hurt the families and seniors who rely on these programs I just mentioned. We need to do all we can to help these families make ends meet, not put their jobs and paychecks in danger. There is no doubt that we need to work together to reduce the deficit. Everybody agrees on that. We need to work together to get it done. Clearly, we need to make changes to both revenue and the spending sides of the budget. That is clear. We need to do so in a way that doesn't put jobs and economic growth at risk. We need to do it, obviously, in a fair and balanced way. That is why the people in our States sent us here. As we do that, we can't refuse to meet our country's obligations. There have been many efforts to reduce the budget deficit, whether it was the Biden deficit commission, the so-called supercommittee, and the many budget proposals we talked about--Bowles-Simpson and Rivlin- Domenici--and we are getting closer and closer and we are going to get the job done. As we work on that, again, we cannot refuse to meet our country's obligations, and we have to make sure we pay the bills we have already incurred. We need to show the world the United States keeps its promises. We have to show people we live up to our word. I urge my colleagues to keep our promises and to vote no on the motion to proceed. I yield the floor.

Mr. BAUCUS. Mr. President, I yield 10 minutes to my colleague from Illinois.

Mr. BAUCUS. Mr. President, I will speak on a different matter for about 2 minutes. I wish to compliment the senior Senator from Kentucky for his longtime work on behalf of dissidents in Burma. Very recently, he visited Burma. He met Aung San Suu Kyi, who was awarded the Nobel Peace Prize. As the senior Senator from Kentucky reported to us earlier this morning on the floor of the Senate, we as Americans are making real progress in Burma. Our sanctions in Burma are working. The government there is relenting. I have had briefings from the State Department, and while we need to retain sanctions for the time being to encourage further progress, it is undeniable that we have been seeing real progress in Burma. The dissidents, as led by Aung San Suu Kyi, are engaged in this process. Again, I want to compliment the Senator from Kentucky for his 20 years of work in this area, and I think it is probably in large part due to his efforts that we are making progress in Burma. Mr. President, turning back to the subject at hand, Alexander Hamilton once said: To be able to borrow upon good terms, it is essential that the credit of a nation should be well established. That is obvious. We have low interest rates today because so far we have been able to borrow on good terms. The good terms are that the American people and investors worldwide know the United States is a safe haven given all the consternation occurring in the world, the problems in Europe, for example, and other countries. The United States is a safe haven. Investors want to borrow on U.S. Treasurys. That is why the rate is low, the lowest in recent history. And that is essentially because our credit is good. Investors trust the United States. It is important to also remember that this debt limit we are voting on today is not an authorization for new spending. I repeat, it does not authorize new spending. That is not what this is. It has nothing to do with new spending. It just says that we have to honor our past bills, honor our past debts. As Alexander Hamilton said, for a country to be on good terms, it is important that we honor our past debts. The credit of a nation should be well established. I strongly urge our colleagues to vote no on this motion to proceed to disapprove because the result would be chaos. If that were to pass, it would be chaos. We would plunge ourselves back into recession, probably through that into a depression. Interest rates would skyrocket. Inflation would skyrocket. We are trying to lower unemployment rates, not increase unemployment rates. We want people to have jobs, not people not to have jobs. If the United States did not honor its bills, if the United States did not honor its debt it has heretofore incurred, it would cause chaos. It would show we are not a creditworthy country. For that reason, I think it is a no-brainer that this bill should be disapproved and, frankly, should be unanimously disapproved. I think every Member of the Senate wants to honor the credit of the United States of America, wants to pay the bills we incurred in the past. It is an entirely different question as to what we do in the future, entirely different question as to how much we reduce our debt, entirely different question as to how much we cut spending and increase revenues in order to reduce our deficits and our debt. That is an entirely different issue--an extremely important issue but entirely different. That has nothing--nothing--to do with this vote. This vote is only whether we honor our past debts. Once we say yes, we are going to honor our past debts, then clearly it is imperative that this body move ahead to reduce deficits, reduce our national debt. There has been a lot of discussion about that. We have not made as much headway as we should have. But it is important to remember that in August of last year, this Congress voted to reduce spending by $2 trillion, $2.1 trillion--to reduce spending by $2.1 trillion over 10 years. Close to $1 trillion of that was accomplished on that vote, and the other $1.2 is part of the sequestration which goes in effect in January of next year. It is not unimportant that this body voted to reduce spending by about $2 trillion. So we should honor our past debts. We should reduce spending--we should reduce our budget debt and deficit. We do that by cutting spending and increasing revenue. That is a different issue. That is what we do in the future. That is what we have to work on this year and next year. But today, it is important for the world to know that we honor our commitments; the United States can be trusted; we have credit that is well established because we honor our past obligations. I strongly urge Members of the Senate to vote no on the motion to proceed to disapproval because I think there would not be a positive outcome if that vote were to pass. I am not one who is prone to exaggeration or to hyperbole, but I might say in this case that if this motion were to proceed, we would be on the border of catastrophe. I yield the floor.

Mr. BAUCUS

Mr. BAUCUS. Madam President, I ask unanimous consent that the Senate proceed to a period of morning business until 5 p.m., with Senators permitted to speak for up to 10 minutes each; further, that the time from 1 p.m. to 2 p.m. in morning business be reserved for the majority.