Max Baucus

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I do not see any Senators seeking time. I will have to, therefore, suggest the absence of a quorum.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, today I rise to introduce the Montana Rural Aviation Improvement Act. As many in this body know, flying in Montana can be an adventure. There's an old saying in Montana that ``if you want the weather to change, wait five minutes''. Simply put, this act would provide the aviation public with an accurate report of Montana's weather conditions at airports across the state. This year the Federal Aviation Administration eliminated the use of on-site certified weather observers at Service Level D Airports in Montana. These Level D Airports are an important part of Montana's transportation infrastructure and economy. Without accurate information, both commercial and private planes may not be able to land at these airports because of inaccurate readings from the Automated Surface Observing System, ASOS. In August 2000 I directed a member of my staff to spend a day at the Miles City weather observation station, where the Automated Surface Observing Systems system was being tested. I am now even more convinced that the commission of the Automated Surface Observing Systems as a stand-alone weather observation service is a grave mistake. Many of the following conditions are characteristic of Montana's complicated weather patterns and can't be accurately read by the Automated Surface Observing System. The Automated Surface Observing System User's Guide, dated March 1998, states that the following weather elements cannot be sensed or reported by Automated Surface Observing System; hail; ice crystals (snow grains, ice pellets, snow pellets); drizzle, freezing drizzle; volcanic ash; blowing obstruction sand, dust, spray; smoke; snow fall and snow depth; hourly snow increase; liquid equivalent of frozen precipitation; water equivalent of snow on the ground; clouds above 12,000 feet; operationally significant clouds above 12,000 feet in mountainous areas; virga; distant precipitation in mountainous and areas and distant clouds obscuring mountains; and operationally significant local variations in visibility. Five of the seven airports affected provide commercial airline service through the Essential Air Service, EAS, program--a program that is indispensable to the transportation and economy of Eastern Montana. With Automated Surface Observing System on stand-alone, Montana's EAS commercial carrier has expressed real reservations to landing at airports where data may or may not be current or correct, and especially in circumstances where Automated Surface Observing System does not yet read inclement or severe weather conditions common to Montana. As you know, airline service is dependent on one thing-- passengers. If they cannot land, who would pay to fly? This past summer I hosted the Montana Economic Summit, a statewide conference that brought together a strong public- private partnership to examine the evidence, chart a course and focus on those elements we can execute to help move this state forward. Transportation is a strong component of this state's economy. If commercial air service is impacted, it will have a dire and immediate impact on my state's economy, currently ranked at 49th in per capita income and struggling to climb out of the basement. I would like to add an accountability log compiled by the Miles City weather observers that identifies errors Automated Surface Observing System in data collected and reported by the Automated Surface Observing System at the Miles City Airport from April-July 2000. My staff observed the hourly accounting throughout the day, particularly noting the frustration by weather observers to input, correct and transmit data via the keyboard and terminal. It is extremely important to note that Montana's weather observers see the Automated Surface Observing System as a compatible tool to complement their professional training and provide the safest environment for Montana aviation. Maintenance and operational backup are of additional concern in Montana's rural landscape. It goes without saying that in instances of severe weather, when the Automated Surface Observing System should go down without backup, it effectively closes the airport to any traffic, commercial or private, that cannot or will not land without the technological benefit of reliable weather data. This process could clearly impact the safety of Montana's flying public. It cannot be overemphasized that in many smaller airports, specifically Service Level C&D sites, these observers are critical to the overall operation and safety of community airspace. I know you would have felt the same pride and support for the human weather observer positions that I do. We are one team, working for the same goal. The best available tools should be used to provide the most accurate data in situations involving public safety. The human weather observers assure me that Automated Surface Observing System as a tool, combined with their individual ability to override, correct or supplement weather data gathered by the sensors, will provide the American public with the highest quality safety and weather reporting capability in the world. I ask unanimous consent that the text of the bill be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, today I rise to introduce the Montana Rural Aviation Improvement Act. As many in this body know, flying in Montana can be an adventure. There's an old saying in Montana that ``if you want the weather to change, wait five minutes''. Simply put, this act would provide the aviation public with an accurate report of Montana's weather conditions at airports across the state. This year the Federal Aviation Administration eliminated the use of on-site certified weather observers at Service Level D Airports in Montana. These Level D Airports are an important part of Montana's transportation infrastructure and economy. Without accurate information, both commercial and private planes may not be able to land at these airports because of inaccurate readings from the Automated Surface Observing System, ASOS. In August 2000 I directed a member of my staff to spend a day at the Miles City weather observation station, where the Automated Surface Observing Systems system was being tested. I am now even more convinced that the commission of the Automated Surface Observing Systems as a stand-alone weather observation service is a grave mistake. Many of the following conditions are characteristic of Montana's complicated weather patterns and can't be accurately read by the Automated Surface Observing System. The Automated Surface Observing System User's Guide, dated March 1998, states that the following weather elements cannot be sensed or reported by Automated Surface Observing System; hail; ice crystals (snow grains, ice pellets, snow pellets); drizzle, freezing drizzle; volcanic ash; blowing obstruction sand, dust, spray; smoke; snow fall and snow depth; hourly snow increase; liquid equivalent of frozen precipitation; water equivalent of snow on the ground; clouds above 12,000 feet; operationally significant clouds above 12,000 feet in mountainous areas; virga; distant precipitation in mountainous and areas and distant clouds obscuring mountains; and operationally significant local variations in visibility. Five of the seven airports affected provide commercial airline service through the Essential Air Service, EAS, program--a program that is indispensable to the transportation and economy of Eastern Montana. With Automated Surface Observing System on stand-alone, Montana's EAS commercial carrier has expressed real reservations to landing at airports where data may or may not be current or correct, and especially in circumstances where Automated Surface Observing System does not yet read inclement or severe weather conditions common to Montana. As you know, airline service is dependent on one thing-- passengers. If they cannot land, who would pay to fly? This past summer I hosted the Montana Economic Summit, a statewide conference that brought together a strong public- private partnership to examine the evidence, chart a course and focus on those elements we can execute to help move this state forward. Transportation is a strong component of this state's economy. If commercial air service is impacted, it will have a dire and immediate impact on my state's economy, currently ranked at 49th in per capita income and struggling to climb out of the basement. I would like to add an accountability log compiled by the Miles City weather observers that identifies errors Automated Surface Observing System in data collected and reported by the Automated Surface Observing System at the Miles City Airport from April-July 2000. My staff observed the hourly accounting throughout the day, particularly noting the frustration by weather observers to input, correct and transmit data via the keyboard and terminal. It is extremely important to note that Montana's weather observers see the Automated Surface Observing System as a compatible tool to complement their professional training and provide the safest environment for Montana aviation. Maintenance and operational backup are of additional concern in Montana's rural landscape. It goes without saying that in instances of severe weather, when the Automated Surface Observing System should go down without backup, it effectively closes the airport to any traffic, commercial or private, that cannot or will not land without the technological benefit of reliable weather data. This process could clearly impact the safety of Montana's flying public. It cannot be overemphasized that in many smaller airports, specifically Service Level C&D sites, these observers are critical to the overall operation and safety of community airspace. I know you would have felt the same pride and support for the human weather observer positions that I do. We are one team, working for the same goal. The best available tools should be used to provide the most accurate data in situations involving public safety. The human weather observers assure me that Automated Surface Observing System as a tool, combined with their individual ability to override, correct or supplement weather data gathered by the sensors, will provide the American public with the highest quality safety and weather reporting capability in the world. I ask unanimous consent that the text of the bill be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I look forward to joining my colleagues from Tennessee and Iowa in working on this matter. I also hope our effort will give us an opportunity to address the problem of structured settlements, which are also funding mechanisms for the disabled. As the chairman knows, I have been trying to fix the structured settlement problem for a long time, and I welcome this chance to fix the two matters together. high speed rail

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

Mr. BAUCUS. Mr. President, on behalf of Senator Kerry, I offer amendment No. 787. We neglected to put it in the package. It promotes tax simplification by expanding the current IRS demonstration project which combines State and Federal employment tax for reporting on a single form. I ask unanimous consent that the amendment be taken up and adopted.

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

Mr. BAUCUS. Mr. President, I rise to make a commitment regarding the High Speed Rail Investment Act. I support passenger rail in the United States and I support Amtrak. The State of Montana relies on Amtrak in the north and hopes to secure passenger rail in the south. Last Congress, I worked with Senators Lautenberg, Moynihan and Roth to protect the Highway Trust Fund from a raid by Amtrak. I have been working with Senator Biden this Congress to ensure a similar protection of the Highway Trust Fund. I am extremely concerned about Amtrak ``Double Dipping,'' by raiding the Highway Trust Fund in addition to selling bonds. I was so concerned that I withdrew my name as a cosponsor of the bill. I am pleased to say that since then, I have worked with Senator Biden on acceptable language to protect the trust fund. However, this language has not been added to the current High Speed Rail Investment Act, S. 250. It has been included in an amendment that Senator Torricelli filed during the mark-up of this tax package in the Finance Committee and that Senator Biden offered and withdrew today. I can support the language in this amendment. I know that Senators Torricelli and Biden and others wanted to offer this amendment today. I appreciate that they withdrew this amendment, because I don't think that this language belongs on this tax bill. I feel very strongly that we need to examine this bill further before we include it in any package. As ranking Democrat on this Committee, with the changes included in this amendment, it is my intention to go through the official Committee process of mark-up and hearings, before we let this amendment be voted on. I would like to hold a hearing within a month after the completion of this tax package.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I ask unanimous consent to proceed as in morning business for 10 minutes.

Mr. BAUCUS. Mr. President, I thank all Senators for their patience and for their goodwill. This has not been easy. This has been a debate that has been conducted under difficult circumstances. I thank Senators. I commend them. Some were justifiably frustrated, as I was, at the short time constraints of this process. But I think, by and large, we have conducted this debate in a dignified way, and I deeply appreciate that. I most especially thank our chairman, Senator Grassley. He has reached out with me to craft a very fair, bipartisan compromise. He has made all the difference in the world. I especially thank the assistant Democratic leader, Senator Reid. He has been at his post throughout the debate, keeping us on track. I deeply appreciate his fairness, his ability. We were able to pass this bill fairly expeditiously in large part because of the efforts of the Senator from Nevada. Let me turn to the bill and make the case one more time. Some Senators might say--and they have said--that the tax cut is too large. With deepest respect, I say to those Senators that that issue has been decided in the budget resolution. I also note that we have added a ``circuit breaker'' to this bill. This provision allows us to make changes to the tax cut if our budget targets are not met. Some will say the tax cut is unfair. I disagree. This tax cut is very fair. I take issue with many of the statements made on the floor. Some are not entirely accurate. In the first place, our tax cut is much more fair on a distributional basis than the President's proposal. But forget about the President's proposal for a minute and compare it with current law. If you set aside changes to the estate tax, which virtually every Senator supports, this bill is significantly more progressive than current law. Taxpayers earning less than $100,000 will pay a smaller share of the overall tax burden. Taxpayers earning more than $100,000 will pay a larger share of the overall tax burden. In other words, we make the income tax more progressive, not less. Our income tax system is made more progressive compared with current law, not less. Let me also remind Senators of some provisions of the bill that are very important. We create a new 10-percent bracket that replaces part of the 15-percent bracket in current law--the single largest piece of the bill. It cuts income taxes for every American who pays income taxes, including everyone in the 15-percent bracket, and it reduces the marginal rate from 15 percent to 10 percent for 19 million low-income taxpayers. That is a rate reduction of one-third. We double the child credit, and we make it partly refundable. Thirty million families get a higher child tax credit. For 10 million, the credit is refundable. We expand and simplify the earned income credit. This will help 4 million low-income working families. We include a $35 billion package of education incentives, including a new provision that makes up to $5,000 worth of tuition payments deductible. We expand IRAs; we expand 401(k)s. We create new incentives to help low-income earners save for retirement. We reduce the marriage penalty to the benefit of 40 million couples and, of course, we address the estate tax. Of course, this bill is not perfect, but it is balanced. It is bipartisan. It is good for taxpayers. It is good for working families, and it is good for the economy. It is good for the country. Now comes the conference. That is going to be difficult. We want to come back with a bill that is balanced and that is fair; that is, a bill very close to the Senate position. After all, the Senate is 50/50, and it is going to be difficult to come back with a conference report that gets at least 51 votes in the Senate. We will be more likely to attain that the more it adheres to the Senate position. A strong vote for final passage will certainly strengthen our hand, and we did receive a strong vote of 62 Senators. I respectfully ask my colleagues, especially on this side of the aisle, for their forbearance and for their help as we work on, and work to adopt, the conference report. I add my deepest thanks and gratitude to the people who did the real work; that is, our staff. I will begin with John Angell, who is the Democratic staff director, Mr. Calm and Collected, keeping things all nice and even when otherwise people are frenetically running here and there. That is what a good staff director does. Democratic staff director John Angell filled that bill. Mike Evans, deputy staff director, he is our ``points of order'' guy. He knows more about Senate rules or at least as much as the Parliamentarian. I might say, I deeply relied on him as we worked out points of order. Then there is Mr. Everything, Mr. Russ Sullivan, chief tax counsel. Russ knows this Code as well as anybody I can think of. He is out negotiating. He is advising me. He is helping put amendments together. He has done a heck of a job. Cary Pugh is our amendments maven. She was making sure all the amendments were worked out and in order. Pat Heck is Mr. R&D and knows that subject more than I care to admit. Maria Freese handled our estate tax matters as well as pension provisions. Mitchell Kent really has helped so much in crafting the child care provisions of the bill, one heck of a job. We have our Brookings fellows: Luis Rivera and Frank Rodriguez, my thanks to them. Our law clerks: Jonathan Selib and Todd Smith. Jonathan came to work for us last Monday--his baptism by fire. He has worked so hard, such late nights, as has everyone. My deepest thanks to them. They are not getting paid. Our office manager, Josh LeVasseur, has done a heck of a job. Josh is sort of our home base manager. He keeps our office organized. Our office assistant, Jewel Harper, is always upbeat, always cheerful. And our interns: Lindsay Crawford; Emilie Klein; and Annabelle Bartsch, who has been a numbers cruncher; she did one great job. Our ``budgeteer,'' Alan Cohen. Alan knows more about debts and budgets than I care to admit. Liz Fowler, our chief health counsel, has helped so much with health matters. Tom Klouda, who works on Social Security. And then, of course, Michael Siegel in my personal office has done a super job dealing with the press, and many others in my personal office. I also commend Senator Conrad's Budget Committee staff. Senator Conrad has had about six or seven staff on the floor at all times, probably to carry all those charts he brings over here. I don't know anybody who has more charts than the Senator from North Dakota. They have been very instructive, very helpful. There is the staff of the Joint Committee on Taxation. They are the ones who really are not honored enough and do so much work. And I thank the entire floor staff and all the pages. On the other side of the aisle, I thank Kolan Davis, Mark Prater, Dean Zerbe, Elizabeth Paris, Ed McClellan, Diann Howland, Brig Pari, Leah Shimp, Jeanne Haggerty, and Gina Falconio. I save my greatest thanks to those who really have the hardest job of all; that is, our leader, Senator Daschle, Democratic leader. Senators from both sides of the aisle pummel him with their requests, with their demands, with what they want. It is an impossible job to be leader in this body. I thank Senator Lott as well. I have the highest regard and respect for the Senator from South Dakota as well as the Senator from Mississippi. They have done one heck of a job. I wish more Americans knew how hard they tried to corral and herd 100 Senators together to reach a result that is good for our country. In summary, my heartfelt thanks and gratitude for all the people who have worked so hard. We have other issues ahead of us, more amendments, more bills, but thus far, they have been just great. I thank, finally, my good friend from Iowa, Chuck Grassley. Many times I have told the world of the high regard I have for him. It is pretty hard to say much more. He is such a great guy. Deep down, nobody is more salt of the earth, a straight shooter who tells it like it is and is dependable, honest, and direct--making him very popular--my good friend, Chuck Grassley. I yield back the remainder of my time.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, the Senate is not in order.

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

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 to voice my support for the Rocky Boy/North Central Montana Regional Water System Act of 2001. I join Senator Burns, Representative Rehberg, and Governor Martz in recognizing the problem that the Chippewa Cree Tribe and other Montana residents in the surrounding area face in getting clean, affordable drinking water. The population of the Rocky Boy Reservation, which grew by over 40 percent in the last decade, is dangerously underserved. Many other residents in the North Central Montana area are completely without water service, and the problem is worsening because of the drought conditions plaguing our State. Many families must haul in their own water, or pay to have it delivered. This is just unacceptable. Within the region, many homes can turn on the faucet in the kitchen or bathroom and see a black liquid come pouring out. Others are exposing their families to dangerously high levels of arsenic. I ask my colleagues if they would be willing to subject their husbands, wives, and children to these water quality issues? The situation has become so desperate that the current area water systems have ``qualified'' for the EPA's Significant Non-compliance list. I say again, this is unacceptable. Without a reliable, accessible safe drinking water source, North Central Montana cannot diversify its economy or encourage future economic growth. The Rocky Boy/North Central Montana Regional Water System Act would address these important water needs by constructing a Regional Water System. The system would involve fifteen participants, eight water districts, and six municipalities. It would cover a six-county region, and its service area would span more than 10,000 miles. By allowing current water systems to cooperate under a larger regional framework, the proposal will allow for more efficient management. For the Chippewa Cree Tribe, the Act would represent the fulfilment of a Water Compact which was ratified by the Montana Legislature and signed by President Clinton in December, 1999. The Compact guaranteed the Tribe a 10,000 acre feet water allocation from the Tiber Reservoir south of Chester. In order to honor this agreement, the Act authorizes the construction of a water treatment plant at Tiber Reservoir, along with the 50 miles of pipeline necessary to connect the Reservoir and the Reservation. The Rocky Boy/North Central Montana Regional Water System Act is also extremely important to other Montana households as well in the area, in fact, it is important to over 7000 additional households. Fourteen off- reservation towns and counties have expressed their interest in the program by signing an Interlocal Agreement to create the North Central Montana Regional Water Authority. The Authority is the legal entity, required under Montana law, that will administer the non-tribal components of the regional system. This project is important to me and to North Central Montana. Water is life and without it our communities cannot continue to flourish and grow. This region in Montana is economically very important to our state. But, if they don't have clean, safe water to drink, their economic future looks uncertain. How will their business continue to expand? How can you build new houses? The answer is simple. They will not and you cannot. Without water, all growth and progress stops. That is why I will do everything I can to see that this project is authorized and funded.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise to send three separate bills to the desk, S. 935, S. 943, and S. 944. The bills I am introducing provide authority to negotiate bilateral free trade agreements with three important trading partners: New Zealand, Australia, and the Republic of Korea. Over the next several months, the Senate will turn its attention to international trade. As we do so, we find ourselves under serious scrutiny. Will we be able to reach consensus? Will we be able to break the impasse? I don't know the answers to these questions. I have been working hard to find common ground on issues like labor and the environment, and on ensuring the strength of our trade laws. I will continue to do so. But we have a long way to go. As we think about these issues, though, there is another, more subtle logjam within the trade agenda. Right now, our vision of the future seems locked in on sweeping, multilateral agreements, Free Trade for the Americas, the launch of a new round of global trade negotiations under the WTO. These are enormous and complicated undertakings. These agreements are also major opportunities for trade liberalization, and we should continue to work hard to get agreements that are good for our workers, farmers, and companies. But it is interesting to listen to the rhetoric. Why can't we advance labor and environment issues in the WTO? Some say developing countries simply would not allow it. Why can't we agree that our fair trade laws are not for sale in FTAA negotiations? Some say Brazil will never relent. Indeed, our trade policy seems to have become so focused on sweeping multilateral agreements, that we ignore other avenues to trade liberalization--much to the detriment of U.S. competitiveness. Take a closer look at this so-called trade impasse: The U.S.-Jordan Free Trade Agreement contains extensive and enforceable provisions on labor and the environment. Our free trade agreement with Canada and Mexico also addresses labor and environmental issues, with potential recourse to trade sanctions. We are moving towards completing an agreement with Chile--a country we know is open to labor and environment issues because they just recently struck a free trade agreement with Canada that includes enforceable provisions on both. What's the moral of this story? It's simple. These agreements demonstrate we can break the impasse on trade. Indeed, we must move forward where we can, whenever we can. If not fast track for all, then fast-track for some, specifically, those countries where we have strategic commercial and political interests. Those countries that will share our commitment to open markets, and our values for environmental quality and labor rights. Today, I am introducing legislation that would authorize trade negotiations with Australia, New Zealand, and the Republic of Korea. It would grant fast track consideration for these agreements, while also establishing a general policy framework for future negotiations. Trade agreements must address the full range of issues, from guaranteeing national treatment and market access, to protecting intellectual property. From promoting electronic commerce to ensuring that countries do not gain unfair advantage by lowering labor and environmental standards. And these agreements must not weaken our fair trade laws. I believe there are many countries ready to take that deal. Australia and New Zealand are two countries eager to negotiate free trade agreements. We must continue to build our economic alliances in the Asia-Pacific region, and both countries have been strong partners in trade. We must also be realistic. An FTA would present tremendous opportunities, but we must recognize where there are differences. One such difference is the operation of the Australian wheat board, which, despite recent reforms, still works to distort world markets. Agriculture negotiations with both countries would require careful treatment, but should allow us to better work together to reduce unfair trade barriers in other parts of the world. A trade agreement with Korea will take more time, as the issues are more difficult to resolve. For example, Korea maintains very high tariffs on beef, hurting ranchers in my home state of Montana. High tariffs, high taxes, and other trade-restrictive practices in Korea, reduce the competitiveness of American automobiles from Michigan and Ohio. Government subsidies in Korea undercut American semiconductor manufacturers in Idaho and Utah. But we must not wait to negotiate agreements until all these problems are solved. Rather, we should use FTA negotiations as part of the solution. And with Korea, there are benefits that extend well beyond trade. An FTA would help lock in Korea's economic and political progress, and would also be an important part of our strategic interests in Asia. The bottom line is this: while America hesitates on trade liberalization, and while many reject trying to reach a bipartisan consensus, the rest of the world continues to move forward. Regional trade arrangements in Europe, Latin America, and Asia put U.S. exporters at a competitive disadvantage. We lose overseas markets to foreign competitors who enjoy trade preferences for which our farmers, manufacturers, and service providers are ineligible. I hope this legislation will send a strong signal to the rest of the world: America intends to continue its leadership in the global trading system.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise to send three separate bills to the desk, S. 935, S. 943, and S. 944. The bills I am introducing provide authority to negotiate bilateral free trade agreements with three important trading partners: New Zealand, Australia, and the Republic of Korea. Over the next several months, the Senate will turn its attention to international trade. As we do so, we find ourselves under serious scrutiny. Will we be able to reach consensus? Will we be able to break the impasse? I don't know the answers to these questions. I have been working hard to find common ground on issues like labor and the environment, and on ensuring the strength of our trade laws. I will continue to do so. But we have a long way to go. As we think about these issues, though, there is another, more subtle logjam within the trade agenda. Right now, our vision of the future seems locked in on sweeping, multilateral agreements, Free Trade for the Americas, the launch of a new round of global trade negotiations under the WTO. These are enormous and complicated undertakings. These agreements are also major opportunities for trade liberalization, and we should continue to work hard to get agreements that are good for our workers, farmers, and companies. But it is interesting to listen to the rhetoric. Why can't we advance labor and environment issues in the WTO? Some say developing countries simply would not allow it. Why can't we agree that our fair trade laws are not for sale in FTAA negotiations? Some say Brazil will never relent. Indeed, our trade policy seems to have become so focused on sweeping multilateral agreements, that we ignore other avenues to trade liberalization--much to the detriment of U.S. competitiveness. Take a closer look at this so-called trade impasse: The U.S.-Jordan Free Trade Agreement contains extensive and enforceable provisions on labor and the environment. Our free trade agreement with Canada and Mexico also addresses labor and environmental issues, with potential recourse to trade sanctions. We are moving towards completing an agreement with Chile--a country we know is open to labor and environment issues because they just recently struck a free trade agreement with Canada that includes enforceable provisions on both. What's the moral of this story? It's simple. These agreements demonstrate we can break the impasse on trade. Indeed, we must move forward where we can, whenever we can. If not fast track for all, then fast-track for some, specifically, those countries where we have strategic commercial and political interests. Those countries that will share our commitment to open markets, and our values for environmental quality and labor rights. Today, I am introducing legislation that would authorize trade negotiations with Australia, New Zealand, and the Republic of Korea. It would grant fast track consideration for these agreements, while also establishing a general policy framework for future negotiations. Trade agreements must address the full range of issues, from guaranteeing national treatment and market access, to protecting intellectual property. From promoting electronic commerce to ensuring that countries do not gain unfair advantage by lowering labor and environmental standards. And these agreements must not weaken our fair trade laws. I believe there are many countries ready to take that deal. Australia and New Zealand are two countries eager to negotiate free trade agreements. We must continue to build our economic alliances in the Asia-Pacific region, and both countries have been strong partners in trade. We must also be realistic. An FTA would present tremendous opportunities, but we must recognize where there are differences. One such difference is the operation of the Australian wheat board, which, despite recent reforms, still works to distort world markets. Agriculture negotiations with both countries would require careful treatment, but should allow us to better work together to reduce unfair trade barriers in other parts of the world. A trade agreement with Korea will take more time, as the issues are more difficult to resolve. For example, Korea maintains very high tariffs on beef, hurting ranchers in my home state of Montana. High tariffs, high taxes, and other trade-restrictive practices in Korea, reduce the competitiveness of American automobiles from Michigan and Ohio. Government subsidies in Korea undercut American semiconductor manufacturers in Idaho and Utah. But we must not wait to negotiate agreements until all these problems are solved. Rather, we should use FTA negotiations as part of the solution. And with Korea, there are benefits that extend well beyond trade. An FTA would help lock in Korea's economic and political progress, and would also be an important part of our strategic interests in Asia. The bottom line is this: while America hesitates on trade liberalization, and while many reject trying to reach a bipartisan consensus, the rest of the world continues to move forward. Regional trade arrangements in Europe, Latin America, and Asia put U.S. exporters at a competitive disadvantage. We lose overseas markets to foreign competitors who enjoy trade preferences for which our farmers, manufacturers, and service providers are ineligible. I hope this legislation will send a strong signal to the rest of the world: America intends to continue its leadership in the global trading system.

Mr. BAUCUS. Mr. President, I am glad to cosponsor this bill from my colleagues Senators Graham and Hutchison. It's an important matter for those of us who represent less prosperous States. I have worked hard to promote economic development in Montana. It is crucial to providing a better future for the children of my great State. Until the economy improves in Montana, I will advocate for measures such as this one, which help alleviate the difficulties that stem from our circumstances. When we enacted welfare reform in 1996, a law I am glad to have supported, there was much discussion here about the appropriate way to allocate welfare funds among States. The old funding formula had produced wide disparities, especially between high per capita income States and low per capita income States. In the end it was resolved to provide additional funding in the form of ``TANF supplemental grants'' to certain states which were poorer or had high growth rates or both. However, the funding was only provided through fiscal year 2001, while the rest of the welfare funds were provided through fiscal year 2002, as part of an effort to balance the budget. Well, the budget is in surplus now. And we need to continue the TANF supplemental grants for one more year, as this legislation would do, so that we can assess it as a part of the policy on overall welfare funding during next year's reauthorization of the 1996 welfare reform law. The TANF supplemental grants represent a substantial source of welfare funds in several states. Failing to continue this funding would mean, in effect, a 10 percent reduction in the allocations for states such as Georgia, North Carolina, Florida, and Louisiana. My own state of Montana received $1 million last year. I assure you we can use those funds to help poor children in Montana, especially the many who have low-income working parents, the kind who hold down two or three part- time minimum wage jobs, which is all too common in my State. I thank my colleagues for their leadership and look forward to working with them on this bill.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I am glad to cosponsor this bill from my colleagues Senators Graham and Hutchison. It's an important matter for those of us who represent less prosperous States. I have worked hard to promote economic development in Montana. It is crucial to providing a better future for the children of my great State. Until the economy improves in Montana, I will advocate for measures such as this one, which help alleviate the difficulties that stem from our circumstances. When we enacted welfare reform in 1996, a law I am glad to have supported, there was much discussion here about the appropriate way to allocate welfare funds among States. The old funding formula had produced wide disparities, especially between high per capita income States and low per capita income States. In the end it was resolved to provide additional funding in the form of ``TANF supplemental grants'' to certain states which were poorer or had high growth rates or both. However, the funding was only provided through fiscal year 2001, while the rest of the welfare funds were provided through fiscal year 2002, as part of an effort to balance the budget. Well, the budget is in surplus now. And we need to continue the TANF supplemental grants for one more year, as this legislation would do, so that we can assess it as a part of the policy on overall welfare funding during next year's reauthorization of the 1996 welfare reform law. The TANF supplemental grants represent a substantial source of welfare funds in several states. Failing to continue this funding would mean, in effect, a 10 percent reduction in the allocations for states such as Georgia, North Carolina, Florida, and Louisiana. My own state of Montana received $1 million last year. I assure you we can use those funds to help poor children in Montana, especially the many who have low-income working parents, the kind who hold down two or three part- time minimum wage jobs, which is all too common in my State. I thank my colleagues for their leadership and look forward to working with them on this bill.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I appreciate the amendment by my good friend from Wisconsin. Medicaid spend-down is a large problem. All who have studied this know it needs to be dealt with. This amendment was offered in committee and defeated in committee. It is not germane to this bill. This is a tax bill, not a Medicaid bill. I urge Senators not to support it. The pending amendment is not germane. Therefore, I raise a point of order that the amendment violates section 305(b)(2) of the Congressional Budget Act of 1974.

Mr. BAUCUS. I move to lay that motion on the table. The motion to lay on the table was agreed to. Amendment No. 736, Withdrawn

Mr. BAUCUS

Mr. BAUCUS. I move to lay that motion on the table. The motion to lay on the table was agreed to. Amendment No. 771

Mr. BAUCUS. I move to lay that motion on the table. The motion to lay in the Table was agreed to. Amendment No. 698

Mr. BAUCUS

Mr. BAUCUS. Mr. President, last night, I spoke by phone to Taiwan President Chen Shui-bian shortly after he arrived in New York on a so- called ``transit stop'' on his way to Latin America. I told him how pleased I was the he was able to make this visit and that I regretted that I could not travel to New York to meet with him personally because of the tax bill now on the Senate floor. I strongly opposed the restrictions placed on President Chen when he passed through Los Angeles last summer and was not permitted to meet with members of Congress. That is no way to treat the democratically elected President of Taiwan. We are in a different era than in the 1970s when Richard Nixon opened up China, the three Communiques were produced, and the Taiwan Relations Act was passed. On the one hand, we still honor the one China policy. The American message to Beijing and Taipei continues to be that they must negotiate together to resolve their differences by peaceful means. We are determined that neither side should be able to take unilateral steps that would fundamentally change the situation. But, on the other hand, we need to understand that Taiwan now has a government that is as accountable to its people as is our own government. Although Taiwan had an authoritarian system until the late 1980s, today it is an active democracy based on a market economy. With U.S. support, Taiwan made this transformation into a free market democracy. We should be looking at Taiwan as one of the great success stories of America's foreign policy. And that means we need to treat Taiwan differently than in the past. It is the 12th largest economy in the world. Taiwan is our 7th largest export market. In fact, we sold more goods and services to Taiwan last year than we did to China. Once Taiwan joins the World Trade Organization, and I hope it is soon, I believe that we should begin work on a free trade agreement with Taiwan. I will shortly introduce legislation to provide fast track negotiating authority for such a negotiation. Taiwan has taken many measures to liberalize its economy in recent years, especially in response to negotiations with the United States. While they await formally accession to the WTO, they are working hard to bring their laws and regulations into compliance with WTO requirements. They still have a lot of work to do to complete their liberalization efforts. Sectors such as telecommunications, financial services, and electronic commerce need to be freed up significantly. Protection of intellectual property needs to be improved. But a free trade agreement would help lock in the important economic changes already made, and it would also encourage continuing liberalization. A free trade agreement with Taiwan would provide an even better market for American goods, services, and agricultural exports. It would reward Taiwan for the dramatic political and economic progress it has made. And it would benefit our economy, enhance our security, and promote global growth. China would probably object to a US-Taiwan free trade agreement. But there would be no legal or diplomatic basis for such a protest. Taiwan is joining the WTO as a ``separate customs territory'' and will have all the rights and obligations of every other WTO member, including Beijing. We have been negotiating with Taiwan for years on market access, trade, and regulatory issues. Taiwan is a member of APEC, the Asia-Pacific Economic Cooperation forum. We must determine what will be U.S. policy toward Taiwan. I recognize that this is an unusual proposal. I don't expect negotiations on a free trade agreement to start right away. But it is a vision toward which we should all work. To conclude, I hope that President Chen has a useful stay in New York. I also hope that we will see a meeting between President Chen and Chinese President Jiang Zemin at the APEC summit in Shanghai in October. The dialogue that should emerge from such a meeting could help ensure peace across the Taiwan Strait.

Mr. BAUCUS

Mr. BAUCUS. Yes. Mr. President, all time in opposition to the amendment is yielded back.

Mr. BAUCUS. Mr. President, we are still in the period of offering amendments. Under the unanimous consent agreement we don't get to general discussion until 4 o'clock.