Max Baucus

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I yield to the Senator from North Dakota for purposes of offering an amendment.

Mr. BAUCUS. Mr. President, in 1882, an Irish immigrant named Marcus Daly set off an explosion that shook the world. It happened 300 feet under the ground, near Warm Springs Creek, 26 miles west of Butte, MT. When the dust settled, Daly saw before him the shiny ore of the largest copper deposit ever known. The rich copper vein transformed the American economy. It made America the world's largest copper exporter. And it inaugurated an economic boom for my home State that lasted for decades. It also enriched many parts of America. Thousands of immigrants made the boom happen. They came from Ireland and Italy, Canada and Scandinavia, Serbia and Croatia, Greece and Syria. They came to America to find work in the new mining town, christened Anaconda. By 1900, immigrants made up 40 percent of Anaconda's population. These new Americans formed the backbone of the mining economy. And their descendants have woven the colorful fabric of Montana. Immigrants helped build the American economy. In the 1850s, hundreds of thousands of young Chinese men helped construct the Transcontinental Railroad. At the beginning in the 1870s, Basque shepherd immigrants helped shape the western ranching economy. Beginning in the 1890s, hundreds of thousands of Norwegian farmers lay the foundations of a competitive farming economy in Wisconsin, Iowa, Minnesota, and the Dakota territories. And in the first decades of the 20th century, more than 100,000 Jewish immigrants created New York City's famous garment industry. Immigrant entrepreneurs and innovators revolutionized the American economy. Scotsman industrialist Andrew Carnegie transformed the American steel industry and consolidated the Nation's railroads. Hungarian Joseph Pulitzer produced a legacy in newsprint. Polish-born producer Samuel Goldwyn left his mark on film. Once-foreign names became American household brands. Russian-born Max Factor made makeup. Bavarian-born Levi Strauss manufactured clothes. Hessian-born Adolphus Busch brewed beer. And today, immigrant innovators still populate the cutting edge. Moscow-born Sergey Brin helped found Google. Taiwan-born Jerry Yang founded Yahoo. French-born Pierre Omidyar founded eBay. And Hungarian- born Andy Grove founded Intel. America remains a nation of immigrants. More than 33 million people living in America were born abroad. More than 9 million came to our shores just between 1990 and 2000. Since colonial times, immigrants have been vital to the American economy. Their skills and their labor have made our companies, our industries, and our economy more competitive. Some immigrants come with little more than their strength and ambition. They become our economy's machine operators, factory workers, farm laborers, and service workers. But many come with master's and doctorate degrees. They work in research laboratories and universities. They sharpen our economy's cutting edge. This is my seventh address to the Senate on economic competitiveness. Since summer, I have highlighted the importance to competitiveness of education, international trade, healthcare, national savings, and energy, all components we must focus on to make our country more competitive so we have better high-paying jobs and more paying jobs for more Americans. Today, I speak about immigration and economic competitiveness. Immigrants make our economy more competitive in at least four ways. First, immigrants provide labor. Marcus Daly needed workers to dig his Montana copper mine. Similarly, today's booming industries require global talent. Without foreign-born workers, the largest economic expansion in our Nation's history would not have been possible. In the boom years of the 1990s, the labor force grew by nearly 17 million workers. Nearly 40 percent of them were born abroad. Most of these immigrants came when unemployment was at record lows. They filled 4 out of 10 job vacancies, often in regions short on workers, and often in jobs that natives had no desire to fill. Had these immigrants not lent us their strength, our economy would surely have faltered. Second, immigrants help balance the budget. Tally up taxpayer-funded benefits to immigrants--education, healthcare, social security--and match those costs against what immigrants pay in State, local, Federal taxes. On balance, each immigrant provides a net benefit to the American economy of about $90,000 in taxes over a lifetime. Overall, immigrants contribute $15 billion to our economy every year. And immigrants will make an important fiscal contribution as the baby boom generation retires. In just 5 years, the number of Americans approaching retirement will increase by nearly half. Most new foreign- born immigrants, on the other hand, are between 10 and 39 years old. And immigrants are likely to have more children than the U.S.-born population. These younger workers will help fund the coming Social Security, Medicare, and Medicaid benefit payments. Immigrants bolster the deteriorating ratio of workers to retirees. Immigrants provide a shiny vein of ore in a graying economy. Third, immigrants push the envelope of innovation. Foreign students earn more than a quarter of the Nation's science and engineering degrees. They earn more than a third of science and engineering doctorates. Most of those are in computer sciences and electrical engineering. Foreign students account for as many as four out of five doctoral students in a number of highly-ranked universities. And foreign students bring $13 billion a year to our economy in tuition and fees. Foreign students' minds help sharpen our economy's cutting edge. Foreign student researchers support work on new medicines, software, and other innovations. Universities patent this research. A 10 percent increase in the number of foreign graduate students would increase patents granted by more than 7 percent. Patents mean new inventions. Inventions mean new products. And new products mean new profits and new jobs. Just as important, nearly three-quarters of highly-skilled students stay in America. Instead of taking their skills home and using them to compete with us, they join highly specialized professions in research and academia. They contribute their knowledge to our economy. At IBM Research and Intel, for example, foreign nationals make up about a third of high-level researchers. At the National Institutes of Health, foreign-born workers make up about half of researchers. In America's top immigration States, foreign-born workers account for 40 percent of teachers and more than a quarter of physicians, chemists, and economists. Fourth, immigrants drive entrepreneurship. Entrepreneurship is the irreplaceable genius that sparks economic growth. For every famous immigrant entrepreneur like Hungarian financier George Soros or Belgian designer Liz Claiborne, legions of other immigrants push the limits of the economy, or simply provide a neighborhood service. For more than a century, immigrants have been more likely than native-born Americans to be self-employed entrepreneurs. Since the 1970s, immigrants have helped reverse a national decline in self- employment. Immigrant-run businesses create jobs, tax revenues, and growth. Even small neighborhood businesses can revitalize entire neighborhoods. And small businesses are the primary driver of new jobs. Immigrants also swell the ranks of high-technology entrepreneurs. Most of the foreign-born scientists and engineers in Silicon Valley have helped found or run a start-up company. Sixty percent of Indian scientists there have participated in start-ups. And fully three- quarters of Indians and most of the Chinese scientists there have plans to start a business. These entrepreneurs are thinking about tomorrow's economy today. Immigrants devote their labor. They boost our balance sheets. They drive innovation. And they energize entrepreneurship. Immigrants are vital to our economic competitiveness. Unfortunately, America is not welcoming global talent and labor. In some cases, we have pulled in welcome mat. State Department visa procedures and security checks intended to keep out terrorists are instead keeping out talent. In the post-September 11 world, America must vigilantly protect its borders. But we must also strike a balance between this vigilance and economic health. Look at the case of foreign students who want to study at American universities. In 2003, foreign applications to American engineering doctoral programs fell by more than a third--with Chinese applications dropping nearly in half. Despite considerable efforts to reverse this trend, total foreign graduate school applications declined further last year, by double digits in some cases. This year, the number of international students entering American graduate schools finally held steady, despite a 5 percent drop in applications from foreign students. The decline in applications is not an anomaly. It is a clear trend. At the same time, our economic rivals are actively attracting the world's brightest. Canada doubled its foreign student enrollment last year. And South Korea will triple its foreign student enrollment by 2010. We unfortunately have also closed the door on talented workers who drive our companies' competitiveness. Our leading high-tech companies-- companies like Intel, Microsoft, and Hewlett-Packard--are imploring Congress to raise the cap for visas for highly-skilled workers--known as H-1B visas. These visas are capped at 65,000. That limit is so out of line with demand that we reached the 2005 cap months before 2005 began. Today's visa and immigration restrictions also make it difficult for major American companies to employ and train their workforce. Take this example: A global American entertainment company with headquarters in New York hired Indian managers to run its Bangalore office. The company wanted to train these new hires to company standards, as it does with all employees. The company wanted to send the new hires to New York to receive this training, as it does with all management. The company applied for visas on behalf of its soon-to-be Indian office managers. What happened? The company filed the paperwork. Months came. Months went. It took 3 months just to get an appointment at the U.S. Embassy. Delays continued. Patience wore thin. Costs mounted, with untrained managers on the payroll. And the company finally gave up. The company applied for visas to Ireland, where the company had its European branch. The visas came in 4 days. The company trained these new managers at the company's facilities in Ireland, and then sent them back to India to work. This created jobs in Ireland, because the company set up a training program there, instead of using existing trainers in America. This is no way to do business. We are shooting ourselves in the foot. We must lift the cap on H-1B visas. We do not have a centrally planned economy. The American Government does not tell companies how many workers they need each year. But the cap has that effect, the effect of a centrally planned economy. That is wrong. Let us listen to business leaders and help them maintain and improve their competitiveness. When our premier global companies implore us to lift the H-1B visa cap or risk hampering their growth, the time for politics is over. We must simplify temporary entry for foreign workers who need to come to America to help our companies succeed. If we wish to remain a cutting-edge economy, we can no longer obstruct companies from training their overseas employees, participating in meetings and conferences, or traveling to trade shows. Our companies have global markets, global supply chains, and global strategies. We need a global workforce. Our current commitment of 65,000 H-1B visas each year is outdated. It is outmoded and out of touch with today's needs. We should make a bold commitment to expand that cap. Such a commitment would allow us to lock in similar commitments from our trading partners and enhance exports and American services. We must actively encourage talented foreign students to study, do research, and innovate at American universities and American research institutions. Visa renewals during multiyear studies need to be routine. These renewals should not require all students to first return to their home countries. For the most exceptional of these students, who have earned advanced science degrees at American universities, we need a simpler process to obtain permanent residence. These are talented, highly educated individuals, who are in a position to keep our economy competitive. If we do not welcome them into our economy--guess what--then China, India, Europe, or Japan will welcome them into theirs. Three weeks ago, the National Park Service designated the old mining town of Anaconda, MT, as a national historic landmark. Anaconda's mining boom times are now preserved as part of our Nation's history. But Marcus Daly's explosion--when he found all that copper ore-- continues to reverberate through the American economy today. Let us not stamp out the spark of future booms. Let us, rather, welcome the labor, the innovation, and the entrepreneurship of our new immigrants. Let us ensure for ourselves and for our children the shining ore of boom times to come. Mr. President, I yield the floor.

Mr. BAUCUS. Mr. President, I suggest the absence of a quorum and ask unanimous consent it be charged to both sides.

Mr. BAUCUS. Mr. President, I commend my colleagues from New York and South Carolina. This is an appropriate way to handle this issue. Clearly China pegging their yuan to the dollar has caused immense dislocations. It is also fairly clear that a 27-percent tariff on Chinese products coming to the United States is an untenable position and it would not be the right action for the United States Congress to enact legislation which would enact a 27-percent tariff on Chinese goods coming into the United States that, in effect, is a 27-percent tax on products that American consumers would otherwise be purchasing. Having said that, it is a problem--that is, the Chinese failure to let their currency float. They did let it float a little bit by a couple percentage points not long ago, but most all observers agree that is not enough. To some degree, this issue is tied to Chinese banking reform. Chinese financial institutions have asked the United States and other countries for advice on how to reform their system. There are too many nonperforming loans in the Chinese banking system, which is related to China's inability thus far to let its currency valuate totally freely. There will come a time--and the time is probably sooner rather than later--when this will become an issue and it will come to a head. Right now is not the time. The Finance Committee clearly takes this issue very seriously. We in the Finance Committee will pay great attention to the degree to which this measure, the Schumer-Graham amendment, should be taken up and passed or modified before reporting it to the floor. Waiting until the end of March of next year certainly is appropriate. I say to everyone concerned with this issue, we will act in time, and hopefully it is a time when it is an accommodation rather than a confrontation. It is up to both sides of the Pacific, frankly--China and the States--to recognize that we have to get a resolution here. We are two great countries. It is by far better for each country to gauge each other appropriately with eyes wide open. It is not appropriate for either country to sort of stiff-arm each other. We are here. We are on the world scene. China is on the world scene. China has a huge interest, of course, in China's development but also a huge interest in the stability of the U.S. economy. And vice versa; we do, too, in China. I urge real leadership in both countries to try to find a solid resolution so we can avoid confrontation. I again thank my friends from New York and South Carolina for their statesmanlike approach to this; namely, not pressing the issue abruptly but rather agreeing to postpone, until March 31, the next deadline. Mr. President, I would like to turn to the bill before us. The Book of Proverbs counsels: ``Do not quarrel with a man for no cause.'' One might rephrase that for modern times: ``Know when to take `yes' for an answer.'' That is how I feel about this tax bill before us today. Last Tuesday, when the chairman of the Finance Committee gave notice of his intention to hold a markup on the tax reconciliation bill, I thought that we were going to have a knock-down, drug-out fight over capital gains, dividends, and the budget deficit. Now it appears that we are going to have an entirely different debate. When Chairman Grassley first raised the issues of this tax bill with me, I told him: If you take capital gains and dividends out of the bill, I can support it. And the chairman and now the Finance Committee have taken capital gains and dividends out of the bill. And now I do support it. I am willing to take ``yes'' for an answer. I am gratified that the chairman and the committee have chosen to forgo the capital gains and dividend provisions that they once contemplated. That is a fundamental change. And from this side of the aisle, that is a welcome change. The job of a committee chairman is a large part of brokerage job. A committee chairman tries to do the most that he can with the votes that he has. I compliment the chairman of the Finance committee for being among the best at counting the votes. And I think that the bill that the Finance Committee brings before us today represents the moderate consensus of the Senate. For many reasons, the bill before us today is not all that I would have preferred. It is not always the case, as with any Senator. I would have preferred that we had handled this tax cut legislation outside of the reconciliation straightjacket. I would have preferred that we had done more to address the immediate needs of the people affected by the hurricanes that ravaged the gulf States. I would have preferred that we had done more to address active financing, the provision that we have to help our companies be competitive with companies overseas. And I would have preferred that the committee would have paid for the tax cut in this bill. It is not appropriate by any stretch of the imagination that we add to the deficit rather than not adding to the deficit. But I know that the chairman and the majority leader would have preferred that the votes had added up a little differently in other ways. That would have been their preference. I gave my preference. They, their preference. Neither of us prevailed. There are many good things in this mark. Extension of the R&D credit is crucial for American businesses to remain competitive. The devastated Gulf States desperately need the help to rebuild that is in the mark. And I appreciate the work that was done to extend the tax provisions that we all know need to be extended. This is the business of the Finance Committee, to make sure that these extensions are extended so there is no cutoff date which causes a lot of problems for people trying to plan, trying to determine what the future is. That is also the business of the Senate. The bill before the Senate today thus advances what we have in common. It avoids a massive quarrel. Later, we will need to resist the fiscally irresponsible road down which the House of Representative seems headed. If the conference reports comes back to the Senate with capital gains and dividends it is, we will be back to a different bill. And will be back to the knock- down, drag-out fight we have thus far avoided. I am pleased that we have a bill before us without capital gains and divided tax cuts it in. I am pleased that we received ``Yes'' for an answer. ``Proverbs'' is something I think we should listen to from time to time. And as a result, I look forward to fewer quarrels on this bill over the balance of the week. I yield the floor and suggest the absence of a quorum. I will ask the quorum call be equally charged to both sides.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, first, I thank my friend from Alaska for his courtesy in working out this accommodation. I rise to speak on the Commerce-Justice-Science appropriations bill conference report that might be coming before us later on this day for a vote. I must say I am outraged. This bill makes further cuts to critical programs that help local law enforcement fight methamphetamine nationwide. These cuts--and they are dramatic-- have a particularly damaging impact on my State of Montana. Why? Because we are a rural State. We have very limited resources. When I ask Montana law enforcement officers what is the No. 1 law enforcement problem they are facing, an open-ended question, they all come back with the same answer: methamphetamine. That is the biggest problem Montana law enforcement officers have. The Byrne grant program and similar programs support most of the proactive drug enforcement in the 56 counties of my State, and I dare say that is true for a majority of States in this Nation. Why is Byrne grant money so important? Again, it is because we are spread so thin across a vast area in Montana, a small population with an international border. An adequately funded Byrne program, particularly when combined with a high-intensity drug trafficking area, or HIDTA program, is essential. These programs are critical to help us maintain our seven multijurisdictional regional drug task forces, which have been a huge boon to successful efforts in Montana to fight methamphetamine. Let me give an example. In eastern Montana, we have what is called the Eastern Montana Drug Task Force that is based in Miles City, MT. We also have the Tri-Agency Drug Task Force in Havre that is near the Canadian border. We have a third drug task force in our State, and that is the Big Money Drug Task Force based outside of Wolf Point. They all rely entirely on Byrne funding. These task forces also happen to cover some of the most open, most rural areas in my State where meth enforcement is particularly challenging. This Commerce report that is soon to be before us guts the Federal Government's commitment to State and local law enforcement. It funds the Byrne grant program at just $416 million for this next fiscal year. That $416 million may sound like a lot of money, but it represents a nearly 35-percent cut over current year funding. We are cutting this law enforcement program by 35 percent. Is that bad? That is terrible. But it is even worse because that 35- percent cut is on top of a 26-percent cut in funding in reallocation of local law enforcement resources that occurred in 2005. First we had a 26-percent cut last year. Now this is a 35-percent cut on top of the 26-percent cut. This bill cuts the Community Oriented Policing Services, otherwise known as COPS. That is cut by one-third and provides no funding for communities to hire additional police officers. According to the president of the Montana Association of Chiefs of Police, COPS funding is necessary to maintain an adequate number of police in the field to protect our communities. One law enforcement officer back home told me that without COPS funding, the number of crimes, especially violent crimes, begins to rise again. Currently, there is no other alternative to the COPS Program. He tells me that the COPS Program is one of those programs that works, one of those programs that is directly responsible for protecting our communities and for getting officers out on the street to protect us all. COPS works. We all know the COPS Program has worked, particularly for us in rural States. So I ask, where are our priorities? The Senate did its job. We sent over a bill to the House that contained nearly $900 million for the Byrne program, yet somehow we will end up later today with a conference report that funds this program at close to a paltry $348 million. We had $900 million. The conference report comes back at $348 million. Where were our Senate conferees? Why did they not stand up for the Senate version? Why did they not stand up for the Senate? The Montana Narcotics Officers Association has told me that if the House version of the CJS bill is passed, this would gut Montana's meth enforcement abilities, especially in rural areas. They told me this would result in an elimination or a dramatic reduction in services provided by Montana's regional drug task forces. The 26-percent cut in Byrne funding in this last fiscal year resulted in nearly a 50-percent cut in Byrne funding for the entire State of Montana, and that is because of a block grant allocation which has that result. I frankly cannot believe we are being asked to support a conference report that has cut law enforcement, especially in the areas to fight methamphetamine enforcement, as much as we are asked to. I am also very disappointed that this conference did something else which I think is a very bad idea. What did they do? They did not accept the Senate-passed combat meth bill. What was that? That bill would put certain methamphetamine ingredients behind pharmacy counters nationwide. We all know that the precursors of methamphetamine over the counter in drugstores are a big inducement for meth manufacturers to take these ingredients and go to local labs out in rural areas and make methamphetamine. It only makes sense that these methamphetamine precursors not be sold over the counter but only sold by prescription or at least behind the counter so there is much more control over the purchase of those ingredients. We passed that in the Senate. What did the conference do? No, they did not adopt it. Let us look at what this conference report says with respect to rural States that are trying to fight methamphetamine. I might say it is not just rural States; it is most States trying to fight methamphetamine. First, it did not take up and agree to the combat meth bill. The precursor provisions are not in here anymore. Willy-nilly, they are out of there. It also dramatically cut the Byrne grant money, which is so important. I made a good part of my job in the Senate devoted to fighting methamphetamine. I have gone to a lot of these drug task force meetings. I go to many assemblies in Montana with high school and middle school students. I put on these programs that show how bad methamphetamine is. I have law enforcement officers there during these sessions with middle school and high school students. I have counselors there. We go over what has to be done to fight methamphetamine. Again, a reminder, methamphetamine is the No. 1 law enforcement problem in the State of Montana, and I am sure that is true in a lot of other States as well. I ask for a show of hands at these assemblies. These are schoolwide assemblies. I ask: How many of you here know of somebody who is on meth or recently on meth? Fifty to 70 percent of the students' hands go up. It is such an outrage. We talk about pandemics with the Asian flu. I might say we certainly have an epidemic with methamphetamine. In a certain sense it may be a pandemic. It is a huge problem. If we are going to fight it--and I hear in my State of Montana, and I am sure the Presiding Officer hears the same thing in his home State of South Dakota--we need to have dollars out in the field to fight methamphetamine. There are all kinds of ways to attack this problem, but certainly dollars out in the field on the law enforcement side are absolutely critical. It is essential, and they are not in this bill. We need a lot more prevention efforts. That is clear. We need more counseling efforts. That is clear. We need drug counseling and other ways to get people off of methamphetamine. We also need the law enforcement there to catch the bad guys who are doing it. In a certain sense, this conference report is a huge victory for the druggies. It is a huge victory for those who are peddling methamphetamine in America because they know if there is much less law enforcement, if the dollars are not there to stop them, they have an open field. They are not dumb. The big drug manufacturers and peddlers are not stupid. They know where they can go. They know where there is law enforcement and where there is not. When I talk to local drug task forces in my State, it is so clear to me how desperately they need these dollars. They beg me for these dollars. That is why I have offered amendments in this body to provide funding to fight methamphetamine. We passed legislation in the Senate. We have been doing our job. But for the Senate conferees to come back with a conference report which allows all of these antimethamphetamine efforts to be gutted and to be diluted and cut back and ask us to vote for that conference report I think is an outrage. For that reason, I strongly oppose this conference report. It is a bad idea. It is going to allow more methamphetamine in our country, one of the biggest problems this country has. This is a victory for the drug dealers. It is a big victory for drug dealers. They know where they can deal drugs. They know where there is law enforcement and where there is not. When we start to cut back money--not status quo but cut back law enforcement dollars--that is going to be a huge problem. I very much hope this Congress finds a way to redress this imbalance, to deal with this problem so we can adequately fight methamphetamine. I have all kinds of PSAs running in Montana, public service ads, against methamphetamine. I have been working in schools to get rid of methamphetamine. There are other people in Montana who are paying a lot of dollars out of their own pockets, with very effective antimethamphetamine ads. Part of the solution is to make sure we have adequate law enforcement. I strongly urge my colleagues to not agree to this conference report until this problem is solved. I ask unanimous consent that a letter from the National Sheriffs' Association be printed in the Record.

Mr. BAUCUS. No objection.

Mr. BAUCUS. Whatever works out for the two Senators.

Mr. BAUCUS. Madam President, I see that the ranking member of the HELP Committee is now on the floor and also the Senator from Hawaii, Mr. Akaka. I wonder if the Senator might allow the ranking member to speak, and then we could be at a point to bring up the amendment of the Senator from Hawaii. Under the unanimous consent agreement, I believe we have about 30- some minutes remaining. I yield as much time as the Senator from Massachusetts desires. When the Senator finishes, I urge the Presiding Officer to recognize the Senator from Hawaii for an amendment which he has to offer.

Mr. BAUCUS. Mr. President, first, I thank my colleague, Senator Enzi from Wyoming, the chairman of the HELP Committee. As he has indicated, his committee, along with Senator Kennedy, the ranking member of that committee, Senator Grassley, chairman of the Finance Committee, and myself, the four of us worked together to be where we are today. Clearly we are where we are today because a lot of employees, a lot of retirees are very worried about their pension benefits. The essential way to help address that situation is to make sure these plans are more fully funded so as the promise is made, the promise is kept and, second, to make sure the backstop of the PBGC is also there when companies facing incredible pressures worldwide feel they have to no longer live up to their pension obligations and those obligations are passed on to the PBGC. It is worldwide competitive pressures that big American companies and smaller American companies are facing as well as the Enron collapse which has forced us to take a good, hard look at this to try to find some good solutions. I thank Senator Enzi, Senator Grassley, and Senator Kennedy for their very good work. It is important to say a little bit about this bill so Americans know what we are doing today. Millions of workers clearly have worked very hard over their lifetime. American workers, when they work, feel they are playing by the rules. They want to play by the rules and they want to do what is right. This bill, frankly, is about making sure that the retirement benefits are there when people need them, more likely to be there than a lot of people think. As we start the debate, let's remember why we are here. We are here to protect workers' pension benefits, plainly and simply. That is why we are here. This need was highlighted recently by cover stories in Time magazine and the New York Times Sunday magazine. Their titles were ``The Broken Promise''--that was Time magazine--and ``The End of Pensions'' in the New York Times magazine. I highly recommend all Members of this body read these articles. I read them both. They are very thorough and very perceptive in stating the problems and some of the solutions to the problems Americans face in having retirement benefits. The Pension Benefit Guaranty Corporation, PBGC, was established to protect workers' pensions, but there are limits on PBGC's guarantees. Many participants have been promised benefits in excess of those guaranteed by the PBGC. When a company fails and the pension plan terminates with unfunded benefit promises, these workers and retirees pay severely for pension underfunding with part of their own hard- earned retirement benefits. For example, the PBGC--and that is the outfit that takes over failed plans--has estimated that almost 7,000 United Airlines workers will lose 50 percent or more of the benefits they had earned under their pension plans. Another 28,000 United Airlines workers will lose between a quarter and half of their benefits. Clearly, as a result, promises to those employees are not being kept. We are here to try to help make sure those promises are better kept, and this bill will help move in that direction. The most basic building block of pension funding is the interest rate used to determine the present value of benefits to be paid for the plan in the future. This bill provides a permanent replacement for the 30- year Treasury rate which has been used basically for this purpose--that is, determining the interest rate--under current law. Under this legislation, we will change that. It is true Congress did pass a temporary substitute last year. This bill is to enact a permanent interest rate calculation. This bill would extend the current temporary interest rate--a corporate bond rate--for an additional year, and then begin phasing in a permanent solution known as a modified yield curve of interest rates. Using a yield curve to determine the value of future benefit payments is more accurate than using a single interest rate because the yield curve recognizes that you get a different interest rate on a 5-year loan than, say, on a 15-year loan, and that is relevant because clearly more people work longer than others, so their retirement is a different period of time. This bill simplifies that yield curve by breaking it into three segments--retaining the improved accuracy of a yield-curve measurement, while making it easier to apply the rates. There are other key changes to the funding rules. Unfunded benefit liabilities would have to be paid off over a 7-year period. Ideally, every plan would be 100 percent funded every year, but with fluctuating asset values and interest rates, that is not practical. Large companies could base cost calculations on their own mortality experience. Workers in some industries do not live as long as the general population. That affects the cost of providing lifetime pensions and should be reflected in an accurate measurement of funding obligations. The increased utilization of early retirement subsidies that occurs when troubled companies start downsizing is reflected in a special at- risk liability calculation. This will ensure that companies begin funding for subsidized benefits before it is too late. The at-risk calculation is not a penalty imposed on companies when they are down and out. It is a reflection of increased costs. Someone has to pay those costs. The question is who. Should other companies pay through increases in PBGC premiums? Should workers pay through lost retirement benefits? Or should we, as I believe, require the company that made the promise fund the promise? Failure to recognize the real cost of benefits is one reason for the system's funding problems. Another is that current law actually would have penalized many employers if they had contributed more to their pension plans. Employer after employer has told us that we need to allow companies to contribute and deduct more in good times to build a cushion for bad times. This bill does that. It allows companies to deduct contributions that would fund the plan up to 180 percent of the cost of benefits already earned and allows employers to maintain a prefunding account with these extra contributions, which is sort of a rainy day fund, to help them meet contribution requirements when cash is a little tighter. Our goal is retirement security, assuring workers that benefits they had been promised will be paid. There are two sides to keeping that promise--funding what is promised by the company and also not promising more than a company can afford to pay. This bill limits increases in a plan's benefit formula if the plan is less than 80 percent funded. If a plan is less than 60 percent funded, then no more benefits can be earned until funding improves. Employers would have to fund up collective bargaining plans to keep these limitations from kicking in. To make sure poorly funded plans do not become even more unfunded, this bill limits the portion of a benefit that can be paid in a lump sum if a plan is less than 60 percent funded. Lump sum payment of pension benefits can drain plan assets and hurt other workers. No benefits would be forfeited. The difference would be paid as an annuity. Retirement benefits are the largest asset of many workers, and they deserve timely, complete information on the state of their investment. Under this bill, most workers and retirees will receive detailed funding information within 90 days after the end of the year. That is new. There was a time when pension plans paid monthly benefits at normal retirement age, usually based on years of service and some average compensation. The benefits were heavily weighted to workers who spent their entire career with one company. But in today's competitive world, that is not likely to be the future. Today many companies have moved to cash balance plans or other hybrid arrangements that are structured more similar to 401(k) plans, defined contribution plans. Benefits are earned more evenly over a worker's career and are more portable--easier to move from one job to another--than the traditional pension benefit. There has been uncertainty surrounding these plans, and litigation is ongoing. If defined benefit plans are to be a viable, attractive option in the future--and there is a real question whether they can be, and we are trying to make sure we can be--we must bring some certainty to the rules governing these arrangements. That is cash balance and hybrids. This bill lays down the rules for moving forward with these plans. It recognizes the legitimacy of the basic design. It also provides protections for older workers when a traditional plan that rewards a lifetime of hard work is converted to one of these hybrid arrangements that is designed for a more mobile workforce. I think we have done a good job of protecting participants without putting too onerous a burden on employers. Let me emphasize that this is a prospective provision; it is not retroactive. We do not step into the legal quagmire that exists with regard to the past. I want to make it clear that this bill offers neither side an inference as to interpretation of existing rules. Some of the provisions in this bill that provide participant protections were in a bill we introduced in the 107th Congress, a bill designed to help prevent another Enron. We all remember Enron. Thousands of workers lost their jobs. Because their 401(k) accounts were heavily invested in company stock, these workers lost most of their retirement savings as well. In February 2002, ``60 Minutes'' did a segment called ``Who Killed Montana Power,'' about my own State's experience with employers behaving badly and havoc wreaked on employees and their savings. The story reported one worker had lost $350,000 in his 401(k) plan because of the crash of employer stock. He certainly was not alone. This is not to say company stock is a bad investment. Sometimes it is a wonderful investment. So this bill does not prohibit investment in employer stock. It simply puts the choice where it should be--in the hands of participants who are building up their retirement savings. To help make that decision, we give workers tools to make good decisions and understand the consequences of their actions. We require more frequent benefit statements, and we provide a safe harbor to make it easier for employers to make independent investment advice available to plan participants if they want independent investment advice. This bill has a number of other provisions that will make it easier for a worker to move retirement plans from employer to employer or from an employer plan to an IRA. There are also provisions that make it easier to administer retirement programs. All of us are fortunate to have the benefits of the Federal retirement system. We have good pensions. We have good retiree health benefits, and I might add the PBGC does nothing to health benefits. This legislation does nothing to health benefits. It is only pension benefits. Health benefits is something that has to be addressed clearly and solidly at a not-too-distant date. Imagine, however, if the Government all of a sudden said: Sorry, we can't afford that retirement, all you folks in Federal Government; we are going to cut it back; you will have to learn to live on less. That would be a problem, and it is a problem for many Americans. That is what many of America's older workers and retirees are facing. Our steel workers, our airline workers, and many others have had the rug pulled out from under them. It is no one's fault, certainly not theirs. America's companies are competing in a cutthroat world. It is important to remember that. They have problems too. What we are trying to do today is ask everyone to be more responsible and strike the right balance. We need a system where companies put enough money aside to pay for what they promise. And we need a system where workers who carry out their part of the bargain do not have to worry that a pension was more dream than substance. This is a tough challenge. The bill is not perfect. It is a compromise. But I believe it is a good bill and should become law. The retirement security of millions of workers deserves our attention. I urge my colleagues to support keeping promises, to support protecting workers' retirement benefits. I urge my colleagues to support the bill. Mr. President, I yield the floor.

Mr. BAUCUS. Madam President, I understand the majority manager favors the Isakson amendment. I control time on this bill, as well as the Senator from Georgia. I support the amendment. Given all of that and the support on both sides, I am prepared to yield back the remainder of time we have on this amendment so we can then prepare to vote on the amendment.

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

Mr. BAUCUS. Mr. President, I reinforce a theme that has been in the Senate, working together in bipartisanship. I have thought I am one of the luckiest Senators here because the chairman is Senator Grassley, a great Senator to work with. We work very closely together. That is not rhetoric. That is true. That is accurate. The same is also true with Senator Enzi, the chairman of the HELP Committee, and Senator Kennedy. They work very closely together. Not only do they work well together, here are two committees working well together. A lot of Americans think there is a lot of partisanship in Washington. There is. There is too much. But there are also pockets of cooperation. We are witnessing today one of those pockets, one of those times when we are working together. I take my hat off to the chairman of the HELP Committee, the chairman of the Committee on Finance, Senator Kennedy, and the staffs. This is an effort to solve a problem in a nonpartisan way. I thank the chairman.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I am pleased to introduce with Senator Smith a bill that would provide for the establishment of voluntary, ``health-based'' remediation guidelines for former methamphetamine laboratories, an issue of great importance to Montana, Oregon, and all of rural America. The material and chemical byproducts of methamphetamine production pose novel risks to the environment and public health. These risks are compounded by the sheer number of meth labs and the vulnerability of police, social service workers, and children exposed to meth production. The DEA estimated that there were as many as 16,000 meth labs in operation in 2004. Additionally, thousands of meth labs have been busted over the years but never properly remediated. Producing one pound of meth leaves behind six pounds of hazardous waste. In addition to bulk waste, cooking meth infuses toxic chemicals into the walls, carpeting, and ventilation systems of the homes, apartments, motel rooms, and parks where meth is produced. Unremediated methamphetamine labs pose significant public health risks. The Department of Health and Human Services has reported that law enforcement officials and social service workers exposed to meth labs, or even just individuals removed from meth labs, have complained of severe headaches, eye and respiratory irritations, nausea, and burns. The need for remediation guidelines is clear. Currently, eight States, including Montana, have ``feasibility- based'' remediation standards. ``Feasibility-based'' standards consider cost as a key factor in determining what level of remediation is desirable. While such standards are a start, we need greater certainty that our public servants and children are adequately protected. Our bill provides a remedy. It directs the Assistant Administrator for Research and Development of the EPA to establish voluntary remediation guidelines, based on the best available scientific knowledge. To further this effort, our bill provides for a program of research to identify methamphetamine laboratory-related chemicals of concern, assess the types and levels of exposure to chemicals of concern--including routine and accidental exposures--that may present a significant risk of adverse biological effects, and evaluate the performance of various methamphetamine laboratory cleanup and remediation techniques. Our bill does not regulate States. The remediation guidelines are purely voluntary, meant to put States, remediation consultants, homeowners, and realtors on the same page. Methamphetamine production poisons not only users but also spouses, children, public servants, and any future owners of properties exposed to meth production. To protect the public we need consistent, scientifically-based remediation guidelines.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to commend the contribution of our Armed Forces to this great Nation. It is important to reflect on the sacrifice and commitment of the brave men and women who have put their lives on the line to defend what our Nation stands for--freedom, equality, and justice for all Americans. Without our veterans, we would not be the free Nation that we are today. The marines, airmen, and soldiers of Montana have always risen to the challenge by fighting overseas and protecting our homeland. Over the past 2 weeks 700 members of the first of the 163rd infantry battalion of Montana's National Guard returned home after an 18 month deployment in Iraq and 250 troops from the first of the 189th aviation battalion will return home before the holidays. I am extremely proud of these men and women, but I also have great concern for them. Montana now has the highest percentage of veterans per capita in its population than any other state. We also have the highest percentage of female veterans in the country, per capita. According to the most recent census, the veteran population in Montana is 108,476 out of an adult civilian population of 668,651. Simply put, veterans, and families of veterans, constitute a significant portion of the population in Montana. They are our mothers, fathers, daughters, sons, sisters, brothers, and friends who are making sacrifices. I take our Nation's commitment to our veterans seriously. Many Montanans choose to serve because of the economic situation in rural America. There is no question that rural States are carrying a huge burden when it comes to our current conflicts abroad and these veterans deserve proper healthcare. I am proud to say that this year the VA Hospital at Fort Harrison, Helena, MT and its outpatient clinics have been ranked as the best VA medical system in the country; however, the shortfalls that we faced in veterans healthcare funding nationwide in 2005 and 2006 are discouraging. We still need to ensure that those who have given so much for our country are granted their due benefits, and treated with respect. Let's think big when it comes to providing for our veterans and health care. We must fully fund the veterans' health care system and we should make spending mandatory in order to ensure that those who have given so much to our country are granted their due benefits and are treated with respect and thanks. Let's think big when it comes to providing for our veterans and health care. We must fully fund the Veterans health care system and we should make spending mandatory in order to ensure that those who have given so much to our country are granted the benefits they deserve. Since September 11, 2001, about 80 percent of Montana's National Guard members have been deployed to the Middle East, some of them more than once. This Monday in Great Falls, MT, members of our 341st space wing and Red Horse Squadrons from Malmstrom Air Force Base and the Air National Guard will deploy to Iraq. When they return, they should not have to worry about getting health care and benefits. As we welcome home our new veterans and deploy troops overseas, let us remember those who have served honorably in all wars, and pay particular attention to those who have made the ultimate sacrifice. The current wars in Afghanistan and Iraq have taken the lives of the following brave Montanans: SPC Travis Arndt, Great Falls; CPT Michael MacKinnon, Helena; PFC Andrew Bedard, Missoula; LCpl Nicholas Bloem, Bozeman; SFC Robbie McNary, Lewistown; CPL Raleigh Smith, Troy; LCpl Nathan Wood, Great Falls; SSG Aaron Honeyman, Glasgow; LCpl Kane Funke, Kalispell; CPL Dean Pratt, Stevensville; PFC Owen D. Witt, Sand Springs; 1LT Edward Saltz, Big Fork; PFC Kristofer Stoneisfer, Missoula; 1LT Josh Hyland, Missoula.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I ask unanimous consent that Stuart Sirkin, a detailee with the Finance Committee, be granted the privilege of the floor during consideration of the pension bill.

Mr. BAUCUS. Mr. President, I ask unanimous consent that the following fellows and interns of the staff of the Finance Committee be allowed floor privileges for the duration of the debate on the tax reconciliation bill: Brian Townsend, Mary Baker, Stuart Sirkin, Richard Litsey, Jorlie Cruz, James Reavis, Jennifer Alwood, Ray Campbell, Will Larson, Andreas Datsopoulos, Mandy Cisneros, and David Hain.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I am pleased to introduce with Senator Smith a bill that would provide for the establishment of voluntary, ``health-based'' remediation guidelines for former methamphetamine laboratories, an issue of great importance to Montana, Oregon, and all of rural America. The material and chemical byproducts of methamphetamine production pose novel risks to the environment and public health. These risks are compounded by the sheer number of meth labs and the vulnerability of police, social service workers, and children exposed to meth production. The DEA estimated that there were as many as 16,000 meth labs in operation in 2004. Additionally, thousands of meth labs have been busted over the years but never properly remediated. Producing one pound of meth leaves behind six pounds of hazardous waste. In addition to bulk waste, cooking meth infuses toxic chemicals into the walls, carpeting, and ventilation systems of the homes, apartments, motel rooms, and parks where meth is produced. Unremediated methamphetamine labs pose significant public health risks. The Department of Health and Human Services has reported that law enforcement officials and social service workers exposed to meth labs, or even just individuals removed from meth labs, have complained of severe headaches, eye and respiratory irritations, nausea, and burns. The need for remediation guidelines is clear. Currently, eight States, including Montana, have ``feasibility- based'' remediation standards. ``Feasibility-based'' standards consider cost as a key factor in determining what level of remediation is desirable. While such standards are a start, we need greater certainty that our public servants and children are adequately protected. Our bill provides a remedy. It directs the Assistant Administrator for Research and Development of the EPA to establish voluntary remediation guidelines, based on the best available scientific knowledge. To further this effort, our bill provides for a program of research to identify methamphetamine laboratory-related chemicals of concern, assess the types and levels of exposure to chemicals of concern--including routine and accidental exposures--that may present a significant risk of adverse biological effects, and evaluate the performance of various methamphetamine laboratory cleanup and remediation techniques. Our bill does not regulate States. The remediation guidelines are purely voluntary, meant to put States, remediation consultants, homeowners, and realtors on the same page. Methamphetamine production poisons not only users but also spouses, children, public servants, and any future owners of properties exposed to meth production. To protect the public we need consistent, scientifically-based remediation guidelines.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I move to reconsider the vote, and 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, I am not going to spend much time, frankly. (Several Senators addressed the Chair.)

Mr. BAUCUS. Mr. President, I ask the Senator from Pennsylvania if I may have 5 minutes. I have to leave very quickly.

Mr. BAUCUS. Mr. President, I am not going to spend a lot of time on this because this is just ``kabuki'' tonight. Everyone knows this is not a serious effort. Everyone knows that this is an attempt, frankly, to make a statement to the press and the people back home. It is very disingenuous, in this Senator's view, because it is not serious, and it is playing with the lives of a lot of senior citizens who wonder what is going on. This consent asks the Finance Committee to be discharged of the legislation. I do not understand that at all. If this is such an important issue, why doesn't the Finance Committee deal with that? I think the answer to that is because there are not the votes in the Finance Committee. The majority of Republicans would not support this in the Finance Committee. They know privatization of Social Security is one of the worst ideas that has come out of this body by any group of Senators in a long time. Why? The DeMint bill increases the Federal debt held by the public by $1 trillion in current dollars in the first 10 years. It increases the Federal debt by $1.7 trillion the first 20 years. By 2080, the debt will be higher under current law by more than $800 billion. So it is a massive increase in the Federal debt. Secondly, it will cause a huge increase in the annual budget deficits for the same reasons. Third, what does it do? It means a reduction in benefits that would otherwise go to Social Security recipients. Why is that? Because the money taken out of Social Security would not be available to pay for Social Security benefits. That will reduce the benefit payments out of Social Security. The argument is private accounts would offset that. All studies show, at best, that is barely a wash, probably worse than that because the private accounts would be subject to the vagaries of the markets. Over the long haul, seniors would not be doing very well at all. Add to that, it usually creates a huge risk. More than that, it creates a very large administrative cost not recognized by the authors. Jason Furman, from the Center on Budget and Policy Priorities, estimates the plan would have administrative costs of at least $25 billion over the first 10 years. That is above what is paid now in the current Social Security system. Also, the DeMint proposal would treat individuals with different years of birth in different ways. It would cause an inequity among benefits of Social Security recipients. So I am not going to say much more about this. It is flawed. Frankly, it is a phony gimmick. One has to call a spade a spade around here sometimes and not be too deferential, not be too nice, too courteous, but to call it a spade. This is a fraudulent effort to play with people's lives, and at the appropriate time, it will be appropriately objected to.

Mr. BAUCUS

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, I rise today to introduce the Trade Adjustment Assistance Improvement Act of 2005. I want to begin with some simple facts about international trade. The benefits of trade are vast in absolute terms, but so diffuse that individuals are generally unaware of how much they personally gain from trade. By contrast, the harms from trade, while small in absolute terms, are localized and intense. Research shows that, on average, a worker who loses his job due to trade will make 17 percent less in his new job. The older the worker and the lower his level of education, the larger the lifetime wage cut he is likely to experience. With statistics like these, is it any wonder that workers who believe their jobs are at risk from international competition are skeptical about trade? With increasing numbers of Americans feeling vulnerable in the global economy--even though many of them will never lose their jobs because of trade--the potential pool of trade skeptics is growing. There is a solution. In a June 2002 poll conducted by the Chicago Council on Foreign Relations and Harris Interactive, respondents were asked which of three positions most closely reflects their views on international trade. Nearly three quarters of those surveyed, 73 percent, agreed with this statement: ``I favor free trade, and I believe that it is necessary for the government to have programs to help workers who lose their jobs.'' Sixteen percent said they favored free trade and did not think it necessary for the government to help those who lose their jobs. Nine percent said they do not favor free trade. The results were even more striking in a 1999 poll conducted by the Program on International Policy and Attitudes at the University of Maryland. In that poll, 87 percent of participants agreed with this statement: ``I would favor more free trade, if I was confident that we were making major efforts to educate and retrain Americans to be competitive in the global economy.'' Only 11 percent disagreed. If there is a more compelling case to be made for Trade Adjustment Assistance, I do not know what it is. For more than 40 years, TAA has been providing retraining, income support, and other benefits to workers who lose their jobs due to trade. Montana workers tell me that TAA has been a lifeline, making it possible for them to gain new skills and start new careers rather than merely survive a layoff. In the Trade Act of 2002, I spearheaded the most comprehensive expansion and overhaul of the TAA program since 1974. We expanded the kinds of workers who are eligible for TAA benefits. We added new benefits like wage insurance and the health coverage tax credit. We also streamlined the application deadlines to get workers enrolled and retraining sooner. I am proud of this landmark legislation. It unified a splintered TAA program to create a single, comprehensive set of benefits. Like most successful legislation, however, it was the product of compromise. While TAA was expanded to cover secondary workers, it was not expanded to cover service workers. While we added new benefits, we also added eligibility tests for those new benefits that have proven burdensome and unduly restrictive in practice. While we made more workers eligible for training, we did not provide training funds adequate to serve those workers. In order for TAA to truly meet the needs of displaced workers, it needs to be a lot more user-friendly. This bill accomplishes that goal by eliminating barriers to entry that, in practice, defeat the purpose of TAA. The bill's goal is simple: to get every trade-displaced worker who needs a new start into meaningful training and back into the workforce at comparable wages. The TAA Improvements Act makes the following changes to TAA: First, it provides that all deadlines and time limits for applying for benefits are suspended when workers are appealing the Department of Labor's denial of a TAA eligibility petition. According to DOL statistics, in 2004 DOL denied approximately 35 percent of the TAA petitions on which it ruled. Among the TAA petition denials appealed to the Court of International Trade in the past several years, the vast majority have been reversed. Numerous judges on the Court have expressed growing impatience with the Labor Department's propensity to stick by denials for years until workers--ultimately vindicated through protracted litigation--lose the ability to receive full benefits. This bill rectifies the problem by allowing workers who successfully appeal denials of their TAA petitions to receive the benefits to which they are entitled regardless of intervening deadlines. Second, the bill creates a TAA Petition Adviser within the Department of Labor to assist workers and those who prepare TAA petitions on their behalf. Most workers and employers who prepare TAA petitions have no experience with the program and seldom have access to experienced counsel. The petition form itself, while improved over prior versions, provides little guidance on the kinds of factual information upon which DOL bases eligibility determinations. As the Court of International Trade has found on numerous occasions, the Department's practice is to do little, if any, investigation beyond the facts presented on the petition. Accordingly, if an inexperienced group of workers fails to say ``the magic words'', their petition is likely to be turned down. The new Petition Adviser would be responsible for assisting workers to prepare petitions by advising them on the kinds of information that are necessary to demonstrate TAA eligibility--eliminating much of the guesswork that can turn applying for TAA into a game of roulette. Sadly, not all employers make their best efforts to help their displaced workers qualify for TAA. Employers who prepare TAA applications for their workers may assign the task to Human Resources staff, who may lack sufficient knowledge to provide the appropriate information to the Labor Department. They sometimes provide inaccurate or incomplete evidence that prevents DOL from certifying the workers. The bill addresses this problem by requiring that all information provided to DOL by the petitioning workers' employer be certified as to its completeness and accuracy by counsel or by an officer of the company. This requirement assures that petitions will receive high- level management attention and, in the case of counsel, imposes an external ethical check. In the Trade Act of 2002, Congress had the wisdom to create a program of wage insurance, called Alternative TAA. Unlike traditional TAA, which requires a worker to remain unemployed until training is completed, wage insurance creates an incentive for workers to return to work sooner and train on the job. It does so by assuring the worker that, if the new job pays less than the old one, he can receive a subsidy equal up to half the wage differential up to $10,000 over two years. This innovative program has the potential to facilitate the most effective kind of training, reduce worker transition time, and reduce the per-worker cost of adjustment assistance. Experience under the Trade Act of 2002 indicates low participation in this program, both because it is limited to workers over 50 and because the steps a worker needs to take to choose wage insurance have proved difficult to satisfy. This bill streamlines the application process for alternative TAA and lowers the minimum age for participating workers from 50 to 40--the average age of TAA participants. The Trade Act of 2002 expanded TAA eligibility to include so-called ``shifts in production''--when a plant in the United States closes and moves overseas. The law makes eligibility automatic when production shifts to a country with which the United States has a free trade agreement or a unilateral preference program. But when production shifts to another country--such as China or India--workers must satisfy additional criteria before they are eligible. This limitation is one of the compromises that shaped the Trade Act of 2002. But I have never thought it fair or equitable. A worker whose plant moves overseas has the same adjustment needs no matter where the plant relocated. The TAA Improvement Act eliminates this distinction, making eligibility for TAA automatic for shifts in production to any country. It also eliminates a similar provision that limits coverage of certain secondary workers to trade with Canada and Mexico. In a recent review of the TAA program, the Government Accountability Office noted that inflexible training enrollment deadlines have made it difficult for workers to make timely and informed decisions about their training plans and career options. Experience has shown that the deadlines we set may be too short in some cases. Community colleges, the principal providers of TAA training services, often enroll students only twice a year, making it difficult for some workers to enroll in the courses they need within the applicable deadlines. Even the most motivated among laid-off workers find it difficult to do the research and soul-searching necessary to make informed and sensible choices about retraining in the time provided. For these reasons, this bill extends the training enrollment deadline by several weeks. Perhaps the single most important problem facing the TAA program today is the chronic shortage in training funds. Every year, there are states that run out of training funds and are forced to ration training. In some cases, states have even stopped workers from enrolling, which can reduce the total TAA benefits the worker can receive even if funds later become available. The Department of Labor has wisely issued guidelines to states to help them better manage their training resources. But the truth of the matter is that Congress has failed to provide states with enough training funds to adequately serve the number of people who qualify for retraining. Rather than cap training spending each year at an arbitrary amount arrived at through political negotiations, this bill sets the training budget with reference to program enrollment and average per person training costs. The bill also gives the Department of Labor flexibility to steer workers into some less traditional but practical training options. Many workers who go through the TAA program ultimately end up self-employed. Under the Workforce Investment Act, a general retraining program for dislocated workers, workers can participate in entrepreneurial training that prepares them for self-employment. This bill extends the same option to workers in the TAA program. More than 10 percent of TAA participants are not native English speakers. Because English proficiency is a prerequisite for most occupational training courses, these workers are generally steered into English language classes and tend to use up their training benefits before receiving occupational training. Under WIA, the Department of Labor has recently begun promoting ``integrated workforce training,'' which combines occupational training with job-related English proficiency. My bill allows the same kind of training to be provided under TAA. For workers entering the TAA program, the most important service they receive is guidance from case workers provided by the state. These case workers help displaced workers learn about local career options, make informed choices about training programs, prepare necessary paperwork and meet deadlines for TAA income support and other benefits. They keep workers from being taken advantage of by unscrupulous training providers who prey on confused dislocated workers and make sure workers know about all the benefits to which they are entitled. Because TAA is a federal program delegated to the states, the federal government provides the states with funding to meet the program's administrative costs. According to a survey by the GAO, however, the cost of providing case worker services far exceeds the amount that the federal government provides. States must either divert money from other training programs or skimp on the services they provide to workers under TAA. The goal of TAA is to have workers make sensible choices about training that will lead to successful new careers. My bill makes that possible by requiring the federal government to provide the states with adequate funds to meet these critical administrative costs. This legislation requires the Department of Labor to improve its data collection and to disseminate more information about the operation of the TAA program. Better and more accessible data will permit Congress and the public to more accurately assess the program's successes and failures and make it easier for workers to prepare successful petitions. Finally, this legislation makes some needed changes to the TAA for Farmers program. For many years, Congress and the Labor Department tried--unsuccessfully to shoehorn farmers into the traditional TAA program. But the adjustment issues facing American farmers from global competition are fundamentally different than those facing manufacturing workers. In the Trade Act of 2002, we created TAA for Farmers by modifying the eligibility criteria and benefits package to more closely meet the needs of agricultural producers. Congress dedicated $90 million annually to this program, with the intention of helping farmers to become more competitive before losing their farms. After several years in operation, however, much of the money provided by Congress has not been spent. The legislation I am introducing today fine tunes the eligibility criteria, based on experience, to eliminate some of the pitfalls that have excluded some crops from the program. The Trade Adjustment Assistance Improvement Act is the fourth in a series of bills I have recently introduced to improve and reform TAA. The Trade Adjustment Assistance for Firms Reorganization Act, S. 1308, makes needed changes to the management structure of TAA for Firms at the Department of Commerce. The Trade Adjustment Assistance Equity for Service Workers Act, S. 1309, extends TAA to the 80 percent of American workers in the service sector. The Trade Adjustment Assistance for Industries Act, S. 1444, simplifies the TAA petition process and ties TAA more closely to displacements caused by specific trade agreements. In the future, I plan to introduce additional legislation addressing the TAA health coverage tax credit. HCTC is a critical new benefit added to the TAA package in 2002. As with many new programs, the implementation process for HCTC has been bumpy. Armed with several years of experience and several objective studies of the program, the time has come to start smoothing out those bumps by revisiting the structure and operation of the HCTC. This further legislation should be ready for introduction in the coming months. Whenever I speak about the need to expand and improve TAA, the first question I usually get is: how much will it cost? Clearly, my proposals will add to the cost of the program and I will ask CBO to provide a score. But the strong implication of this common question is that we cannot afford to add to the cost of the TAA program. I think that is the wrong starting point. First, we need to put the cost of TAA in perspective. At present, TAA costs around one billion dollars per year to operate. That is a cost of less than $10 per American household per year. By contrast, a study by the Institute for International Economics recently concluded that the American economy is roughly $1 trillion per year better off thanks to global integration, which comes to about $9,000 in extra income every year for each American household. Looking at these figures, we should be embarrassed at the paltry fraction of the economic gains from trade that we are plowing back into adjusting and retraining our workforce. The truth is, the United States as a country cannot afford not to make these changes. We need to be putting more resources into worker retraining. We need to make sure we do not marginalize an entire generation of manufacturing workers. Now more than ever, we have to prepare workers for the challenges of the global market. The domestic auto industry faces unprecedented challenges to remain competitive in today's world. In October alone, a major auto parts supplier filed for bankruptcy, General Motors slashed wages and legacy benefits, and the Ford Motor Company announced substantial layoffs. Thousands of specialized workers will be displaced and have to start over. At the same time, I continue to read warnings of an impending labor shortage--even in the manufacturing sector. Baby boomers will soon begin retiring in large numbers. Our educational system is not turning out enough new workers with the skills our employers need to succeed in global competition. I have seen estimates of a shortage of 20 million workers by 2020--with the most severe shortages in the most skilled jobs. Economists estimate that increasing the education level of American workers by one year would increase productivity by 8.5 percent in manufacturing and 12.7 percent in nonmanufacturing industries. Is expanding TAA too high a price to pay to address the coming labor shortage and to achieve productivity gains on this order? I certainly do not think so. Experts with a wide range of views on issues surrounding trade and competitiveness agree that, if our nation is to thrive in the global economy of the 21st century, we must expand our worker adjustment program. From Jagdish Bagwati to Tom Friedman, from Alan Greenspan to the AFL-CIO--there is near universal agreement on this point. I believe the legislation I have introduced today and over the past weeks creates a strong platform to build on and I will work to see these bills enacted into law. But trade adjustment for workers alone cannot prepare America for the competitive challenges ahead. We must aggressively pursue our interests through the trade agreements we negotiate with other countries, and we must enforce them just as aggressively. Recently I laid out my vision for closer congressional oversight of trade enforcement by the United States Trade Representative. I intend to introdue legislation to address the need for better, more aggressive enforcement of our trade agreements. Finally, I believe that our global competitiveness strategy must go beyond trade negotiations. Over the course of several months, I have highlighted many opportunities to enhance our global competitiveness in areas such as healthcare, energy, education, and savings. We must prepare the American people to take full advantage of these opportunities and many more. I ask unanimous consent that the text of the bill be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to introduce the Trade Adjustment Assistance Improvement Act of 2005. I want to begin with some simple facts about international trade. The benefits of trade are vast in absolute terms, but so diffuse that individuals are generally unaware of how much they personally gain from trade. By contrast, the harms from trade, while small in absolute terms, are localized and intense. Research shows that, on average, a worker who loses his job due to trade will make 17 percent less in his new job. The older the worker and the lower his level of education, the larger the lifetime wage cut he is likely to experience. With statistics like these, is it any wonder that workers who believe their jobs are at risk from international competition are skeptical about trade? With increasing numbers of Americans feeling vulnerable in the global economy--even though many of them will never lose their jobs because of trade--the potential pool of trade skeptics is growing. There is a solution. In a June 2002 poll conducted by the Chicago Council on Foreign Relations and Harris Interactive, respondents were asked which of three positions most closely reflects their views on international trade. Nearly three quarters of those surveyed, 73 percent, agreed with this statement: ``I favor free trade, and I believe that it is necessary for the government to have programs to help workers who lose their jobs.'' Sixteen percent said they favored free trade and did not think it necessary for the government to help those who lose their jobs. Nine percent said they do not favor free trade. The results were even more striking in a 1999 poll conducted by the Program on International Policy and Attitudes at the University of Maryland. In that poll, 87 percent of participants agreed with this statement: ``I would favor more free trade, if I was confident that we were making major efforts to educate and retrain Americans to be competitive in the global economy.'' Only 11 percent disagreed. If there is a more compelling case to be made for Trade Adjustment Assistance, I do not know what it is. For more than 40 years, TAA has been providing retraining, income support, and other benefits to workers who lose their jobs due to trade. Montana workers tell me that TAA has been a lifeline, making it possible for them to gain new skills and start new careers rather than merely survive a layoff. In the Trade Act of 2002, I spearheaded the most comprehensive expansion and overhaul of the TAA program since 1974. We expanded the kinds of workers who are eligible for TAA benefits. We added new benefits like wage insurance and the health coverage tax credit. We also streamlined the application deadlines to get workers enrolled and retraining sooner. I am proud of this landmark legislation. It unified a splintered TAA program to create a single, comprehensive set of benefits. Like most successful legislation, however, it was the product of compromise. While TAA was expanded to cover secondary workers, it was not expanded to cover service workers. While we added new benefits, we also added eligibility tests for those new benefits that have proven burdensome and unduly restrictive in practice. While we made more workers eligible for training, we did not provide training funds adequate to serve those workers. In order for TAA to truly meet the needs of displaced workers, it needs to be a lot more user-friendly. This bill accomplishes that goal by eliminating barriers to entry that, in practice, defeat the purpose of TAA. The bill's goal is simple: to get every trade-displaced worker who needs a new start into meaningful training and back into the workforce at comparable wages. The TAA Improvements Act makes the following changes to TAA: First, it provides that all deadlines and time limits for applying for benefits are suspended when workers are appealing the Department of Labor's denial of a TAA eligibility petition. According to DOL statistics, in 2004 DOL denied approximately 35 percent of the TAA petitions on which it ruled. Among the TAA petition denials appealed to the Court of International Trade in the past several years, the vast majority have been reversed. Numerous judges on the Court have expressed growing impatience with the Labor Department's propensity to stick by denials for years until workers--ultimately vindicated through protracted litigation--lose the ability to receive full benefits. This bill rectifies the problem by allowing workers who successfully appeal denials of their TAA petitions to receive the benefits to which they are entitled regardless of intervening deadlines. Second, the bill creates a TAA Petition Adviser within the Department of Labor to assist workers and those who prepare TAA petitions on their behalf. Most workers and employers who prepare TAA petitions have no experience with the program and seldom have access to experienced counsel. The petition form itself, while improved over prior versions, provides little guidance on the kinds of factual information upon which DOL bases eligibility determinations. As the Court of International Trade has found on numerous occasions, the Department's practice is to do little, if any, investigation beyond the facts presented on the petition. Accordingly, if an inexperienced group of workers fails to say ``the magic words'', their petition is likely to be turned down. The new Petition Adviser would be responsible for assisting workers to prepare petitions by advising them on the kinds of information that are necessary to demonstrate TAA eligibility--eliminating much of the guesswork that can turn applying for TAA into a game of roulette. Sadly, not all employers make their best efforts to help their displaced workers qualify for TAA. Employers who prepare TAA applications for their workers may assign the task to Human Resources staff, who may lack sufficient knowledge to provide the appropriate information to the Labor Department. They sometimes provide inaccurate or incomplete evidence that prevents DOL from certifying the workers. The bill addresses this problem by requiring that all information provided to DOL by the petitioning workers' employer be certified as to its completeness and accuracy by counsel or by an officer of the company. This requirement assures that petitions will receive high- level management attention and, in the case of counsel, imposes an external ethical check. In the Trade Act of 2002, Congress had the wisdom to create a program of wage insurance, called Alternative TAA. Unlike traditional TAA, which requires a worker to remain unemployed until training is completed, wage insurance creates an incentive for workers to return to work sooner and train on the job. It does so by assuring the worker that, if the new job pays less than the old one, he can receive a subsidy equal up to half the wage differential up to $10,000 over two years. This innovative program has the potential to facilitate the most effective kind of training, reduce worker transition time, and reduce the per-worker cost of adjustment assistance. Experience under the Trade Act of 2002 indicates low participation in this program, both because it is limited to workers over 50 and because the steps a worker needs to take to choose wage insurance have proved difficult to satisfy. This bill streamlines the application process for alternative TAA and lowers the minimum age for participating workers from 50 to 40--the average age of TAA participants. The Trade Act of 2002 expanded TAA eligibility to include so-called ``shifts in production''--when a plant in the United States closes and moves overseas. The law makes eligibility automatic when production shifts to a country with which the United States has a free trade agreement or a unilateral preference program. But when production shifts to another country--such as China or India--workers must satisfy additional criteria before they are eligible. This limitation is one of the compromises that shaped the Trade Act of 2002. But I have never thought it fair or equitable. A worker whose plant moves overseas has the same adjustment needs no matter where the plant relocated. The TAA Improvement Act eliminates this distinction, making eligibility for TAA automatic for shifts in production to any country. It also eliminates a similar provision that limits coverage of certain secondary workers to trade with Canada and Mexico. In a recent review of the TAA program, the Government Accountability Office noted that inflexible training enrollment deadlines have made it difficult for workers to make timely and informed decisions about their training plans and career options. Experience has shown that the deadlines we set may be too short in some cases. Community colleges, the principal providers of TAA training services, often enroll students only twice a year, making it difficult for some workers to enroll in the courses they need within the applicable deadlines. Even the most motivated among laid-off workers find it difficult to do the research and soul-searching necessary to make informed and sensible choices about retraining in the time provided. For these reasons, this bill extends the training enrollment deadline by several weeks. Perhaps the single most important problem facing the TAA program today is the chronic shortage in training funds. Every year, there are states that run out of training funds and are forced to ration training. In some cases, states have even stopped workers from enrolling, which can reduce the total TAA benefits the worker can receive even if funds later become available. The Department of Labor has wisely issued guidelines to states to help them better manage their training resources. But the truth of the matter is that Congress has failed to provide states with enough training funds to adequately serve the number of people who qualify for retraining. Rather than cap training spending each year at an arbitrary amount arrived at through political negotiations, this bill sets the training budget with reference to program enrollment and average per person training costs. The bill also gives the Department of Labor flexibility to steer workers into some less traditional but practical training options. Many workers who go through the TAA program ultimately end up self-employed. Under the Workforce Investment Act, a general retraining program for dislocated workers, workers can participate in entrepreneurial training that prepares them for self-employment. This bill extends the same option to workers in the TAA program. More than 10 percent of TAA participants are not native English speakers. Because English proficiency is a prerequisite for most occupational training courses, these workers are generally steered into English language classes and tend to use up their training benefits before receiving occupational training. Under WIA, the Department of Labor has recently begun promoting ``integrated workforce training,'' which combines occupational training with job-related English proficiency. My bill allows the same kind of training to be provided under TAA. For workers entering the TAA program, the most important service they receive is guidance from case workers provided by the state. These case workers help displaced workers learn about local career options, make informed choices about training programs, prepare necessary paperwork and meet deadlines for TAA income support and other benefits. They keep workers from being taken advantage of by unscrupulous training providers who prey on confused dislocated workers and make sure workers know about all the benefits to which they are entitled. Because TAA is a federal program delegated to the states, the federal government provides the states with funding to meet the program's administrative costs. According to a survey by the GAO, however, the cost of providing case worker services far exceeds the amount that the federal government provides. States must either divert money from other training programs or skimp on the services they provide to workers under TAA. The goal of TAA is to have workers make sensible choices about training that will lead to successful new careers. My bill makes that possible by requiring the federal government to provide the states with adequate funds to meet these critical administrative costs. This legislation requires the Department of Labor to improve its data collection and to disseminate more information about the operation of the TAA program. Better and more accessible data will permit Congress and the public to more accurately assess the program's successes and failures and make it easier for workers to prepare successful petitions. Finally, this legislation makes some needed changes to the TAA for Farmers program. For many years, Congress and the Labor Department tried--unsuccessfully to shoehorn farmers into the traditional TAA program. But the adjustment issues facing American farmers from global competition are fundamentally different than those facing manufacturing workers. In the Trade Act of 2002, we created TAA for Farmers by modifying the eligibility criteria and benefits package to more closely meet the needs of agricultural producers. Congress dedicated $90 million annually to this program, with the intention of helping farmers to become more competitive before losing their farms. After several years in operation, however, much of the money provided by Congress has not been spent. The legislation I am introducing today fine tunes the eligibility criteria, based on experience, to eliminate some of the pitfalls that have excluded some crops from the program. The Trade Adjustment Assistance Improvement Act is the fourth in a series of bills I have recently introduced to improve and reform TAA. The Trade Adjustment Assistance for Firms Reorganization Act, S. 1308, makes needed changes to the management structure of TAA for Firms at the Department of Commerce. The Trade Adjustment Assistance Equity for Service Workers Act, S. 1309, extends TAA to the 80 percent of American workers in the service sector. The Trade Adjustment Assistance for Industries Act, S. 1444, simplifies the TAA petition process and ties TAA more closely to displacements caused by specific trade agreements. In the future, I plan to introduce additional legislation addressing the TAA health coverage tax credit. HCTC is a critical new benefit added to the TAA package in 2002. As with many new programs, the implementation process for HCTC has been bumpy. Armed with several years of experience and several objective studies of the program, the time has come to start smoothing out those bumps by revisiting the structure and operation of the HCTC. This further legislation should be ready for introduction in the coming months. Whenever I speak about the need to expand and improve TAA, the first question I usually get is: how much will it cost? Clearly, my proposals will add to the cost of the program and I will ask CBO to provide a score. But the strong implication of this common question is that we cannot afford to add to the cost of the TAA program. I think that is the wrong starting point. First, we need to put the cost of TAA in perspective. At present, TAA costs around one billion dollars per year to operate. That is a cost of less than $10 per American household per year. By contrast, a study by the Institute for International Economics recently concluded that the American economy is roughly $1 trillion per year better off thanks to global integration, which comes to about $9,000 in extra income every year for each American household. Looking at these figures, we should be embarrassed at the paltry fraction of the economic gains from trade that we are plowing back into adjusting and retraining our workforce. The truth is, the United States as a country cannot afford not to make these changes. We need to be putting more resources into worker retraining. We need to make sure we do not marginalize an entire generation of manufacturing workers. Now more than ever, we have to prepare workers for the challenges of the global market. The domestic auto industry faces unprecedented challenges to remain competitive in today's world. In October alone, a major auto parts supplier filed for bankruptcy, General Motors slashed wages and legacy benefits, and the Ford Motor Company announced substantial layoffs. Thousands of specialized workers will be displaced and have to start over. At the same time, I continue to read warnings of an impending labor shortage--even in the manufacturing sector. Baby boomers will soon begin retiring in large numbers. Our educational system is not turning out enough new workers with the skills our employers need to succeed in global competition. I have seen estimates of a shortage of 20 million workers by 2020--with the most severe shortages in the most skilled jobs. Economists estimate that increasing the education level of American workers by one year would increase productivity by 8.5 percent in manufacturing and 12.7 percent in nonmanufacturing industries. Is expanding TAA too high a price to pay to address the coming labor shortage and to achieve productivity gains on this order? I certainly do not think so. Experts with a wide range of views on issues surrounding trade and competitiveness agree that, if our nation is to thrive in the global economy of the 21st century, we must expand our worker adjustment program. From Jagdish Bagwati to Tom Friedman, from Alan Greenspan to the AFL-CIO--there is near universal agreement on this point. I believe the legislation I have introduced today and over the past weeks creates a strong platform to build on and I will work to see these bills enacted into law. But trade adjustment for workers alone cannot prepare America for the competitive challenges ahead. We must aggressively pursue our interests through the trade agreements we negotiate with other countries, and we must enforce them just as aggressively. Recently I laid out my vision for closer congressional oversight of trade enforcement by the United States Trade Representative. I intend to introdue legislation to address the need for better, more aggressive enforcement of our trade agreements. Finally, I believe that our global competitiveness strategy must go beyond trade negotiations. Over the course of several months, I have highlighted many opportunities to enhance our global competitiveness in areas such as healthcare, energy, education, and savings. We must prepare the American people to take full advantage of these opportunities and many more. I ask unanimous consent that the text of the bill be printed in the Record.

Mr. BAUCUS

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