Max Baucus

Mr. BAUCUS

Mr. BAUCUS. I thank my friend from Georgia. I yield the floor.

Mr. BAUCUS. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.

Mr. BAUCUS. Mr. President, if I may have the indulgence of the Senator from Georgia, I ask unanimous consent that the pending amendment be set aside, and on behalf of Senator Specter, I call up amendment No. 2557.

Mr. BAUCUS. Madam President, I suggest the absence of a quorum.

Mr. BAUCUS. Mr. President, I yield whatever time the Senator from Iowa desires.

Mr. BAUCUS. He has just gone above and beyond. Senators and the people from the State of Utah, I think, should know that. He has done a super job. I know a number of Senators have been seeking to speak, and I want to protect them. So I ask unanimous consent that the following Senators be recognized in the following order: first, Senator Nelson of Florida, then Senator Thune of South Dakota, and then Senator Lautenberg of New Jersey.

Mr. BAUCUS. Mr. President, first, I thank Senator Hatch. He has been very hardworking and dedicated to the goal of trying to find a balanced, bipartisan solution to help expand the Children's Health Insurance Program. I compliment him very deeply for all of his terrific work.

Mr. BAUCUS. I am not going to belabor this crowd-out issue. A lot of people watching are probably asking what in the world is crowd-out. For those wondering what in the world crowd-out is that we are talking about here, basically it is how many people of those this legislation covers--how many people would be crowded out of private health care insurance. That is, if they are on private health care insurance today, how many would leave private health insurance to go to the Government program. A couple of points here. No. 1, those who might be inclined to vote for the McConnell substitute know this, but actually the so-called crowd-out is greater in the McConnell-Lott proposal than it is on a percentage basis under my bill. On a percentage basis, under the McConnell-Lott bill, more people would be leaving private health insurance to go to the Children's Health Insurance Program. Second, the figure we hear is 1 to 1. That is not accurate. That is selective use of the tables. If you look at the real facts, at the bottom line under CBO's estimates, they actually say it is more in the neighborhood of--it is not 50 percent that is represented here, but actually it is about 30 percent. It also has been represented here that maybe under tax credits, which is a better way to go to cover health insurance, the implication is there will be less crowd-outs. Well, let me just point out that there is a fellow named John Gruber, and he is an MIT professor, a health economist. He is often quoted by the President. Professor Gruber is often quoted by President Bush in this general area. What does Professor Gruber say? He says that the tax credit crowd-out is, in his estimate, 77 percent. Much higher. So for those concerned about the so-called crowd-out, I would think they would like the underlying bill because of all of the approaches we have discussed here, there is less crowd-out in the underlying bill than in the substitute or under the Kyl-Lott amendment and much less than would be the case under a tax credit approach to help low-income kids. I think the record should show that so Senators have full information and those watching this debate, wherever they may be, also have the facts before them. Madam President, I suggest that the Chair recognize Senator Murray.

Mr. BAUCUS. Mr. President, I understand the Senator from Massachusetts, Mr. Kerry, is about to speak. As he gets ready to speak, there are a couple of points I wish to make. We are still working the numbers on the McConnell-Lott amendment. I wish to point out a couple of points. No. 1, the McConnell-Lott amendment, although it is advertised to do this, does not put kids first. Despite prohibiting coverage of nonpregnant adults and limiting all State income disregards, this legislation does not cover substantial numbers of additional children. On the surface, they think they may cover 700,000 additional kids, but we are trying to get the numbers from CBO and trying to determine the actual effect; whereas, the Finance Committee bill the CBO has analyzed very carefully it will cover an additional 4 million children. About two-thirds of those will be on Medicaid, and roughly a million will be under the Children's Health Insurance Program. The big difference is the different effects between the Finance Committee-passed bill and the McConnell-Lott bill on uninsured Medicaid-eligible children; that is, children today who are not on Medicaid but are eligible--what is the effect of the two various approaches on those low-income kids. Again, I give the caveat we do not have all the actual language and do not have all the numbers exactly crunched by CBO, but a first analysis essentially looks like this. It looks basically like the McConnell-Lott bill will not add many new kids to be covered under Medicaid; whereas, the Finance Committee bill has about 1.7 million children now not covered under Medicaid who will be covered. It is complex legislation we are considering. This is a Children's Health Insurance Program. But as we work to get more kids covered under the Children's Health Insurance Program, by definition there are going to be more kids also covered under Medicaid--that is children whose income levels are so low they are covered under Medicaid as opposed to the Children's Health Insurance Program. There is a huge difference there. It looks like the McConnell-Lott bill will not help the very low-income kids who are currently eligible under Medicaid to be covered. In fact, the Finance Committee bill covers at least five times more. I might say a word about the so-called crowding out. Senators are concerned this legislation will have the net effect of encouraging some children, now under private health insurance, to drop their private health insurance coverage to take advantage of the Children's Health Insurance Program expansion. There are a couple of points about that. No. 1, under the McConnell-Lott amendment, it looks like their so- called crowd-out ratio is even more adverse from their perspective than the crowd-out ratio under the Senate Finance Committee bill. I don't wish to belabor the point. It is roughly the same, roughly 30 percent, but their crowd-out rate is a little greater on a percentage basis as to how many kids are there who will drop private health insurance for the Children's Health Insurance Program. But theirs is no better in fact a little worse, from that perspective. Also, it is important and worth noting that when Congress passed the Medicare Modernization Act a few years ago and it provided for the Part D benefits for senior citizens, CBO said the crowd-out rate for that program would be much higher--and it was. I think there is one estimate beginning at 75 percent. I think it dropped to around 40 percent. I might not be entirely accurate on those numbers, but it is much higher than the 30 percent predicted under the Finance Committee CHIP bill and also about the same under the McConnell-Lott substitute. In addition to that, we on the Finance Committee wanted to reduce the so-called crowd-out as much as we possibly could. We asked the Congressional Budget Office, especially the Director of the Budget Office, Peter Orszag, to tell us on the committee what did we have to do on this legislation; tell us how we should write it to minimize crowd-out as much as we possibly can, be as efficient as we possibly can. He told us what to do and we did it. In the Finance Committee markup, when asked about crowding out; that is, kids moving from private health insurance coverage over to the Children's Health Insurance Program, he said you have done it efficiently. You have done it as well as you can do it. I wish to make the point very clear. While we are helping children, while we are helping low-income kids get health insurance--as we clearly should--we also do not want to disrupt the private industry any more than need be. It is important to remember that States are given power to decide how they want to administer the Children's Health Insurance Program. It is up to the State. Some States add it to Medicaid. Some States have separate programs. Most States use health insurance companies to administer the health insurance program, the Children's Health Insurance Program, with copays and deductibles, and so forth. So those who on the surface might be concerned if their ideology is it should be private health insurance, not the Children's Health Insurance Program, should not be too concerned, frankly, because we have gone the extra mile to make sure that so-called crowd-out is minimized as much as we possibly could. I will have other points to make later on about the McConnell substitute. Basically, I wish to say it states that if you are at 200 percent poverty or a little above 200 percent of poverty, despite what we anticipated when we passed this legislation in 1997, I am sorry, you can't go above 200 percent if you want to have the benefit of the Children's Health Insurance Programs match rate, which is a little more beneficial to the States than the Medicaid match rate. That is not right. So many States are at least above 200 percent of poverty. I think that is wrong. The other major thrust of the McConnell substitute is if you are above 200 percent of poverty, you have to go into the private market. That encourages them very strongly. That is not right either. Fundamentally, the Children's Health Insurance Program was written first, in 1997--again, it is a block grant program that gives States flexibility and recognizes that every State is different. So often Senators say we should not enact one size fits all. I have heard that 100 times around here. Basically, that is correct--not always but basically. Senators who are advocating McConnell-Lott say one size fits all, basically, not recognizing that different States have different costs of living, some States are much more expensive to live in than others. I saw a chart the other day that showed if you take 200 percent of poverty and matched that against the cost of living in various States in our country, in some States, the parity level would be maybe down around, oh, say, 150 percent of poverty. But there is one State that was 300 percent. If you translate the 200-percent nationwide figure to what the cost of living is in that State, it comes out to 300 percent. I think that is fair because different States are so different. I ask unanimous consent, now, that the pending amendment also be temporarily laid aside so Senator Kerry may offer an amendment.

Mr. BAUCUS. I urge the Presiding Officer to recognize the Senator from South Carolina.

Mr. BAUCUS. Because that will be three on your side in a row before we go back to this side. Is the Senator speaking on the same subject?

Mr. BAUCUS. Mr. President, I might inquire of the Senator from South Carolina, how long does he wish to speak? We have been trying to go back and forth.

Mr. BAUCUS. Mr. President, Senator Cantwell is on her way to speak. She is not here. I see the Senator from Pennsylvania on the floor. I know he desires to seek time. I urge the Chair recognize the Senator from Pennsylvania who I think is going to speak about 8 to 10 minutes.

Mr. BAUCUS. I don't want to belabor the point. Some of the points the Senator makes are very good. Sure, he wants to do more research, but still the fact is the amendment takes dollars away from kids, away from the Children's Health Insurance Program. In the children's health care program, 1.4 million American children will lose coverage under the Senator's amendment. That is CBO, that is not me. That is CBO. I do not think we want to take away our current coverage under the program. One minor point that is not relevant to the amendment, but is relevant to the bill, is the Senator talks a little about something called crowd-out; that is, the number of kids who might not have private coverage who move to the CHIP program. That happens in every single program. Do you know what the crowd-out estimate was with the Medicare Modernization Act, Part D? It was 75 percent. That was the estimate on how much crowd-out there would be for that legislation, which this body strongly supported. It actually turned out to be much less than that. When this program was initially enacted in 1997, the Children's Health Insurance Program, CBO estimated crowd-out to be 70 percent. It was much less than that. We have asked the CBO Director to design this legislation to minimize crowd-out as well as we possibly can. And he, in testimony before the committee, said: You have done a very efficient job to minimize so-called crowd-out. So we are cognizant of the point. But the main point is to get more health insurance coverage for kids. That is what the underlying bill does. Mr. President, I yield back the remainder of our time.

Mr. BAUCUS. Mr. President, I think it is important to talk about the amendment, not all these other very important points with respect to health care. The effect of this amendment, the way it is written, will be to spend the same dollar twice. If the effect is what the Senator says it is, and he intends it--although that is not the amendment--if he intends to have all additional tobacco taxes go to the trust fund, then the net effect of this amendment is about 1.4 million American low-income kids will lose coverage. That is CBO. They will lose it, if that is the intent of the amendment. The actual effect of the amendment the way it is written is the dollars have to be spent twice. We can't do that. I don't know how we do that. But, again, if the intent of the amendment is dollars do not go to kids, then the effect of the amendment is about 1.4 million children will lose health insurance coverage; that is 5.7 million fewer kids will be covered under insurance than under our amendment. In the Senator's own statements, he admits it. He apparently does not want to add dollars, he wants to take away the $35 billion raised by the tobacco tax and the honest effect of that $35 billion is to help prevent about 1.4 million kids from losing coverage as well as adding additional coverage. It is both. If the amendment is what the Senator wants it to do and says it is, then about 1.4 million kids will lose coverage.

Mr. BAUCUS. So the Senator wishes to take all the tobacco taxes in the underlying amendment, take all those dollars away from kids?

Mr. BAUCUS. I will take it on our time.

Mr. BAUCUS. Will the Senator yield for a question on that one point?

Mr. BAUCUS. Mr. President, it is important to look at what this amendment actually does. It is a remarkable amendment. What does it do? It would try to spend the same dollar twice, take a dollar from tobacco taxes, spend it in the trust fund and spend it on CHIP--doing two things at once. I don't think we can do that in the real world. It is too good to be true. We can't do it. That is what the amendment says, basically. I do not think the Senator wants to take money away from kids, from the CHIP fund, the CHIP program. The amendment doesn't say that. I am sure he doesn't intend to do that. But what the amendment does say is the same dollars are going to be spent twice--one way we spend it is for this trust fund, the other way is we spend it on kids. I don't know how we do that; how in the real world we can do that. It is fantasy land. We can't do it. Again, surely the Senator does not want to repeal the entire Children's Health Insurance Program. I am sure he doesn't want to do that. He does not do that in this amendment. But he still sets up the tension between the two, between research and all the good causes the Senator talks about on the one hand, and children's health insurance on the other, pitting one against the other. I don't think he wants to do that. He does not do that directly but he does that indirectly by trying to spend the same dollar twice. That might be possible in Hogwarts; it might be possible in Harry Potter's world. But I don't think it is possible in the real world. Back here in the real world I want Senators to know this amendment is a thinly veiled attempt to steal the funding from the children's health care program. It is an attempt to undermine children's health care coverage. That is what this bill does. It takes a dollar from the tobacco tax--it is amazing--and that dollar is going to be spent on this trust fund and that same dollar is going to be spent on children's health care. We can't do that. I urge my colleagues to reject the amendment. I reserve the remainder of my time.

Mr. BAUCUS. It is exactly right.

Mr. BAUCUS. No, take it from the Children's Health Insurance Program.

Mr. BAUCUS. Mr. President, I want to move things along here and set an order of speakers. I ask unanimous consent that Senator Mikulski be recognized to speak for 5 minutes; following that, Senator Chambliss be recognized to speak for 5 minutes. Following him, Senator Brown be allowed to speak for 8 minutes; following him, Senator Coburn, for 10 minutes; following that, Senator Webb be allowed to speak for 10 minutes.

Mr. BAUCUS. Mr. President, I object.

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

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I am proud to join with Senator Hatch to introduce the Trade Enforcement Act of 2007. This bill will provide the administration additional tools, resources, and accountability to enforce international trade agreements abroad and domestic trade remedy laws here at home. Over 400 years ago, William Shakespeare wrote ``The law hath not been dead, though it hath slept.'' The same could be said of our trade enforcement laws today. The administration has many tools at its disposal to enforce international trade agreements. It can file dispute settlement cases in the World Trade Organization, WTO. It has Section 301 to fight market access barriers. It has Special 301 to address intellectual property violations abroad. It has Section 421 to remedy Chinese import surges that cause injury here at home. But having these rules on the books is not enough. We need to enforce them. There is a very real sense among Americans that our trading partners do not play by the rules. And there is a very real sense that the U.S. Government is allowing them to get away with it. That is why I am introducing the Trade Enforcement Act of 2007--to ensure that the administration has the resources to enforce our existing trade laws, to provide political accountability when it does not, and to create new tools that address the enforcement priorities of American farmers, ranchers, manufacturers, and service suppliers. This legislation bolsters enforcement of U.S. trade agreements in three important ways. First, it requires the U.S. Trade Representative, USTR, to dedicate more time to enforcement. The bill requires USTR to provide an annual report to Congress identifying the most significant barriers to U.S. companies abroad and to take enforcement action to resolve them. It also makes trade enforcement more accountable to Congress. The bill allows the Senate Finance Committee or the House Ways and Means Committee to require USTR to identify a specific barrier in its annual report. And, significantly, the bill creates a Senate-confirmed Chief Enforcement Officer at USTR to investigate and prosecute trade enforcement cases. Second, the bill addresses serious concerns that have been raised about the quality of recent World Trade Organization dispute settlement decisions. It does so by establishing a commission of retired judges and international trade law experts to review the decisions and determine whether they impose obligations on the U.S. that are not found in the text of the WTO agreements. The bill also prevents the administration from changing a regulation to comply with an adverse WTO decision until Congress receives the commission's report. Third, the bill ensures that other U.S. government agencies do not use foreign policy and other noneconomic rationales to block USTR from taking tough enforcement actions. It clarifies that while USTR must carefully consider any advice provided by the interagency trade organization established under the Trade Expansion Act of 1962, it need not, and shall not, seek approval of its actions from the organization. The bill also bolsters enforcement of U.S. trade remedy laws in four important ways. First, the bill limits the President's discretion to deny relief in Section 421 cases to address Chinese import surges. This administration has utterly failed to use this trade remedy as Congress intended. It has denied relief in every case where the International Trade Commission, ITC, determined that relief was warranted. Our bill remedies this deficiency by requiring the President to proclaim any import relief that the ITC recommends unless the President finds, in extraordinary cases, that the relief would seriously harm our national security or would have an adverse impact on our economy that clearly and significantly outweighs the benefits. Congress may override the economic determination and reinstate the ITC's decision if it enacts a joint resolution of disapproval. Second, the bill makes it easier for U.S. companies to obtain relief from subsidized imports from certain countries. It clarifies that the Commerce Department may apply countervailing duties to nonmarket economies like China. The Commerce Department has long taken the position that our countervailing duty laws do not apply to nonmarket economies, and it has refused to do so until very recently. The bill closes this loophole and eliminates any remaining uncertainty. Third, the bill makes it easier for U.S. companies to obtain relief from subsidized and dumped imports from all countries by overriding the Federal Circuit's recent Bratsk decision. The bill provides that the ITC must make its injury determinations in antidumping and countervailing duty cases without regard to whether imports from other countries are likely to replace imports from the country under investigation. Fourth, the bill increases intellectual property expertise at the ITC. It authorizes the ITC to appoint hearing officers, rather than administrative law judges, ALJs, to take evidence and make initial decisions in intellectual property investigations under Section 337 of the Tariff Act of 1930. Unlike the current ALJs, the hearing officers would be required to have technical expertise and experience in intellectual property law. The overarching goal of this bill is, as Shakespeare might say, to ``wake up'' our trade laws from their current slumber and ensure that the administration enforces them to the fullest extent. Our farmers, ranchers, and companies deserve nothing less. I therefore hope that my colleagues will support the Trade Enforcement Act of 2007.