Max Baucus

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to recognize the accomplishments of two outstanding Montana cattlewomen, Michelle Tebay and Lisa Schmidt of Whitehall, MT. This past year has been tough in Montana and across the West for many cattle producers. They incurred severe losses due to floods and blizzards. But thanks to the hard work and vision of Michelle Tebay and Lisa Schmidt, hope is on the horizon. They initiated a project called ``One Good Cow,'' and it certainly deserves our attention. In Montana, we pride ourselves on looking out for one another-- especially during challenging times. When Michelle heard about all the cattle losses Western ranchers were suffering, she contacted Lisa who works as an Ag Extension agent for Madison and Jefferson Counties. Together, the two women formulated a plan. And, that plan was to convince ranchers who survived the storms to help the less fortunate replenish their herds. The dream has become reality. Today, the ``One Good Cow'' project is working to collect and transport 80,000 healthy, pregnant cows to folks who lost significant portions of their herds last winter. And the good news is that their fellow ranchers from across the Nation are donating these cattle. This teamwork has resulted in success for all. It has even gained national media attention and will be featured on national TV network news later this week. The ``One Good Cow'' program is a prime example of how ranchers from all over the United States can work together in times of adversity. That shouldn't surprise anyone. Ranchers have always relied on each other as they face the worst that Mother Nature has to offer. But the real credit goes to Michelle and Lisa. Mr. President, it is impossible to count the number of lives that will be touched by their idea. I would just like to add my voice to all the others and say ``Thank you, so much, Michelle and Lisa.'' I encourage all of my colleagues to become familiar with the ``One Good Cow'' Program and give it their full support. Our ranchers are depending on it.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, it is with great pleasure that I join with my colleague from Utah, Senator Hatch, and my other colleagues to introduce this bill, which is so critical to the ability of American businesses to effectively compete in the global marketplace. Companion legislation has been introduced in the House by Representatives Nancy Johnson and Robert Matsui. Our Nation is the world's undisputed leader in technological innovation, a position that would not be possible absent U.S. companies' commitment to research and development. Investment in research is an investment in our Nation's economic future, and it is appropriate that both the public and private sector share the costs involved, as we share in the benefits. The credit provided through the Tax Code for research expenses provides a modest but crucial incentive for companies to conduct their research in the United States, thus creating high-skilled, high-paying jobs for U.S. workers. The R&E credit has played a key role in placing the United States ahead of its competition in developing and marketing new products. Every dollar that the Federal Government spends on the R&E credit is matched by another dollar of spending on research over the short run by private companies, and two dollars of spending over the long run. Our global competitors are well aware of the importance of providing incentives for research, and many provide more generous tax treatment for research and experimentation expenses that does the United States. As a result, while spending on non-defense R&D in the United States as a percentage of GDP has remained relatively flat since 1985, Japan's and Germany's has grown. The benefits of the credit, though certainly significant, have been limited over the years by the fact that the credit has been temporary. In addition to the numerous times that the credit has been allowed to lapse, last year, for the first time, when Congress extended the credit it left a gap of an entire year during which the credit was not available. This unprecedented lapse sent a troubling signal to the U.S. companies and universities that have come to rely on the Government's longstanding commitment to the credit. Much research and development takes years to mature. The more uncertain the long-term future of the credit is, the smaller its potential to stimulate increased research. If companies evaluating research projects cannot rely on the seamless continuation of the credit, they are less likely to invest on research in this country, less likely to put money into cutting-edge technology innovation that is critical to keeping us in the forefront of global competition. Our country is locked in a fierce battle for high-paying technological jobs in the global economy. As more nations succeed in creating educationally advanced workforces and join the United States as high-technology manufacturing centers, they become more attractive to companies trying to penetrate foreign markets. Multinational companies sometimes find that moving both manufacturing and basic research activities overseas is necessary if they are to remain competitive. The uncertainty of the R&E credit factors into their economic calculations, and makes keeping these jobs in the United States more difficult. Although the R&E credit is not exclusively used by high-technology firms, they are certainly key beneficiaries of the credit. In my own State of Montana, 12 of every 1,000 private sector workers were employed by high-tech firms in 1995, the most recent year for which statistics are available. Almost 400 establishments provided high- technology services, at an average wage of $34,500 per year. These jobs paid 77 percent more than the average private sector wage in Montana of $19,500 per year. Many of these jobs would never have been created without the assistance of the R&E credit. Making the credit permanent would most certainly provide the incentive needed to create many more in the future. I urge my colleagues to support this legislation, and look forward to working with them and with the administration to make the research and experimentation tax credit permanent.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, it is with great pleasure that I join with my colleague from Utah, Senator Hatch, and my other colleagues to introduce this bill, which is so critical to the ability of American businesses to effectively compete in the global marketplace. Companion legislation has been introduced in the House by Representatives Nancy Johnson and Robert Matsui. Our Nation is the world's undisputed leader in technological innovation, a position that would not be possible absent U.S. companies' commitment to research and development. Investment in research is an investment in our Nation's economic future, and it is appropriate that both the public and private sector share the costs involved, as we share in the benefits. The credit provided through the Tax Code for research expenses provides a modest but crucial incentive for companies to conduct their research in the United States, thus creating high-skilled, high-paying jobs for U.S. workers. The R&E credit has played a key role in placing the United States ahead of its competition in developing and marketing new products. Every dollar that the Federal Government spends on the R&E credit is matched by another dollar of spending on research over the short run by private companies, and two dollars of spending over the long run. Our global competitors are well aware of the importance of providing incentives for research, and many provide more generous tax treatment for research and experimentation expenses that does the United States. As a result, while spending on non-defense R&D in the United States as a percentage of GDP has remained relatively flat since 1985, Japan's and Germany's has grown. The benefits of the credit, though certainly significant, have been limited over the years by the fact that the credit has been temporary. In addition to the numerous times that the credit has been allowed to lapse, last year, for the first time, when Congress extended the credit it left a gap of an entire year during which the credit was not available. This unprecedented lapse sent a troubling signal to the U.S. companies and universities that have come to rely on the Government's longstanding commitment to the credit. Much research and development takes years to mature. The more uncertain the long-term future of the credit is, the smaller its potential to stimulate increased research. If companies evaluating research projects cannot rely on the seamless continuation of the credit, they are less likely to invest on research in this country, less likely to put money into cutting-edge technology innovation that is critical to keeping us in the forefront of global competition. Our country is locked in a fierce battle for high-paying technological jobs in the global economy. As more nations succeed in creating educationally advanced workforces and join the United States as high-technology manufacturing centers, they become more attractive to companies trying to penetrate foreign markets. Multinational companies sometimes find that moving both manufacturing and basic research activities overseas is necessary if they are to remain competitive. The uncertainty of the R&E credit factors into their economic calculations, and makes keeping these jobs in the United States more difficult. Although the R&E credit is not exclusively used by high-technology firms, they are certainly key beneficiaries of the credit. In my own State of Montana, 12 of every 1,000 private sector workers were employed by high-tech firms in 1995, the most recent year for which statistics are available. Almost 400 establishments provided high- technology services, at an average wage of $34,500 per year. These jobs paid 77 percent more than the average private sector wage in Montana of $19,500 per year. Many of these jobs would never have been created without the assistance of the R&E credit. Making the credit permanent would most certainly provide the incentive needed to create many more in the future. I urge my colleagues to support this legislation, and look forward to working with them and with the administration to make the research and experimentation tax credit permanent.

Mr. BAUCUS

Mr. BAUCUS. Madam President, I rise to discuss the state visit of Chinese President Jiang Zemin to the United States last week. goals of asia policy Let me begin with a reminder of our goals in Asia policy. They are: A peaceful Pacific, open trade, joint work on problems of mutual concern like environmental problems and international crime, and progress toward respect for internationally recognized human rights. This morning I would like to discuss my view of the results. accomplishments of summit To begin with the positive, I believe this visit will be particularly helpful in the first area--that of ensuring a stable peace in the Pacific. The major elements of our security policy in the region are the United States alliance with Japan; a permanent troop presence in Asia; deterrence of North Korean aggression; a one-China policy coupled with a commitment to help Taiwan ensure its security; and preventing proliferation of nuclear weapons. We have had a chance to discuss all of these issues in detail with President Jiang and China's senior foreign policy officials. And we have emerged without any serious short-term differences, plus an important agreement on China's part to cease nuclear cooperation with Iran. This will reduce the chances of a crisis in the region, and make peace in the Pacific generally more stable and permanent. I see this renewed strategic dialogue and understanding of our mutual interest in a peaceful region as the major accomplishment of the visit. I would also note some important specific agreements on a range of issues, including: In return for China's halt of nuclear cooperation with Iran, we will open up sales of civil nuclear power technology to China; China will enter the Information Technology Agreement, thus eliminating tariffs on a range of high-tech products in which American companies are highly competitive--for example, semiconductors. The United States will increase our assistance to China's efforts to combat pollution; the United States Justice Department will support efforts to develop the rule of law in China, and the military services of both countries will make their military-to- military dialogs more intense and frequent. These are good, constructive agreements that will serve the interest of both countries. It is quite clear, however, that a great deal of work lies ahead. Our goal should not only be to avoid crises and find common ground on areas of concern to both countries, but to solve problems. Here, we saw relatively little advance in two critical areas, and one is international trade. tasks ahead: trade Last month, China passed Japan as the source of our largest trade deficit--and this in a year when our deficit with Japan has risen substantially over last year's totals. And the main reason for this deficit is the fact United States exports to China have been flat for 3 years: $11.7 billion last year, $11.7 billion last year, on track for the same this year. During this period, of course, China's economy has grown by about 30 percent. Our strategy for change has been to encourage China's membership in the World Trade Organization on commercially acceptable grounds. That is the right strategy. I believe that China should have permanent MFN status when it occurs. But the progress on WTO membership has been so slow this year--even with the incentive of the first United States-China summit since President Bush visited China nearly 9 years ago--that we need to begin thinking about a fall-back option. That is, China may well have concluded that the status quo is acceptable for the time being--that the price for entering the WTO in terms of trade reform is higher than the price for remaining outside. If so, we need to change that calculus. I suggest as one possibility that the administration begin to think about self-initiating a broad section 301 case, as the Bush administration did in 1991. This would tackle some of the main trade problems we are focusing on in the WTO accession talks. This is obviously a less attractive, less cooperative approach than the WTO accession. But we have already waited 8 years for China to make a good WTO offer, and we cannot afford to wait very much longer. We remain very much open to imports from China, while China keeps out our wheat, our manufactures, our services, and all the rest. It is not fair, and our legitimate complaints about market access cannot be held hostage forever to WTO entry. human rights The second is human rights. Since World War II, we have viewed human rights practices within nations as intimately linked to the willingness of governments to use force and coercion outside their borders. We have also seen promotion of human rights as a humanitarian, nonpolitical responsibility that all of us hold. I agree with both of those considerations. I believe they apply in China as well as in other countries. And I am disappointed by the lack of any significant change in Chinese policy, especially on the political prisoner question, during this summit. As we look to the future, though, I believe we need to remember three things. First, broad long-term trends in most areas are good. During the past decade, the number of political prisoners in China has fallen from about 5,000 to about 2,500; controls on information in a number of once-sensitive areas like official corruption and workplace abuses have relaxed; and China has taken steps like introducing village elections that have made the political system somewhat more accountable. Second, we should set limited, achievable goals where we do not see a great deal of progress. These should include freedom for dissidents like Wei Jingsheng and Wang Dan; a clear public accounting of the number of people jailed for strictly political reasons; talks with the Dalai Lama; and so forth. Short of areas like rule of law or parliamentary procedure, in which China is seeking our assistance, human rights policy should not include very broad, ambitious efforts to change the Chinese political system. Such efforts would be seen not as humanitarian in nature, but either as an effort to overthrow the Chinese Government, or more likely a rhetorical policy without much serious content. And third, human rights is a long-term issue. The keys to success are patience and persistence. We will need to continue raising the cases of individuals held in prison with Chinese officials, continue our work in areas like the U.N. Human Commission on Human Rights next spring. We need to be persistent and don't give up. the road forward In the broader sense, with the summit behind us our next steps in China policy are clear. We have set a good foundation in the political and security arena. We have done a good job in identifying other areas of mutual interest, from environmental protection to nuclear plant sales to the rule of law. We need to keep at these issues; and we need to work harder in areas like market access and human rights, where this summit brought less than we would have hoped for. And we should avoid reckless steps like broad new sanctions laws which are likely to make things worse rather than better. On the whole, we are on the right course and we should stay there. Step by step, issue by issue, we are getting the results we should seek in China policy--a stable peace in Asia; fairness in trade; respect for international standards of human rights; and cooperation in areas of mutual interest like the environment. This summit has made a very important contribution to the effort, and I look for it to continue. Madam President, I yield the floor and suggest the absence of a quorum.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, with all due respect to my good friend from Michigan, I must object.

Mr. BAUCUS. The Senator is referring to next year.

Mr. BAUCUS. Mr. President, I very much hope that the other body takes up and passes this measure because it has been our judgment that it is about the only approach that is going to allow States to continue the continuity in their highway programs until next year when we pass the full 6-year program. This measure that we have just adopted here in the Senate is formula neutral. It is designed in a way to make sure that all of the different States who are in different situations are treated reasonably fairly. Nothing is perfect. But this is a very good effort to deal with various differences among the States. It also will provide enough funds for the Congress next year to take up the full 6-year bill in a reasonable period of time. So I very much hope that the other body takes it up and passes this bill because it is in the States' best interests to continue that continuity of funding. Mr. WARNER addressed the Chair.

Mr. BAUCUS. Mr. President, there are two points that I want to make. We are passing this rather significant piece of legislation because we are doing it in a bipartisan basis. I must remind all of my colleagues that when we get into partisan fights often nothing happens. We make political points but don't pass legislation. This has been very, very cohesive and bipartisan on both sides of the aisle. It has been an honor for me--a privilege for me--to participate with Senator Warner, Senator Chafee, Senator Bond, and Senator Byrd in putting this together. My second point is to reaffirm just how lucky we are to have such a dedicated staff who are so able and so talented. I am always in awe in seeing just how right these people are and how necessary they are. But, for the record, the one lady who came up with the final solution is on my staff. Her name is Kathy Ruffalo. I yield the floor.

Mr. BAUCUS. I say to my friend that this measure about to be passed is formula neutral. It in no way would prejudice the amendment to be offered at a later date by the Senator from Michigan, or other amendments offered by other Senators who wish to accomplish objectives for their States as well.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I was not present for the cloture votes on October 31, 1997. I would like to record my position, had I been present for the votes. Had I been present for the cloture vote on H.R. 2646, the Education Savings Act for Public and Private Schools, I would have opposed cloture. In addition to the many serious public policy implications raised by this legislation, as a member of the Senate Finance Committee I have serious concerns about the virtually unprecedented manner in which it was brought to the floor. After H.R. 2646 was approved by the House it was sent directly to the desk, where it was pulled from and sent to the floor--completely bypassing the Finance Committee where virtually all tax legislation is reviewed. The lack of review is particularly distressing given the budget implications of H.R. 2646--it would increase spending by $4 billion over 10 years. It is both shortsighted and unwise to make major modifications in the Tax Code without review by the committee of jurisdiction and without first asking a simple question: Are these IRA's our highest priority for educational funding? To my way of thinking, that question has not been addressed. When this bill was immediately considered under a cloture strategy, all ability to make any changes in this policy were blocked. That is simply unacceptable. This legislation should be considered under a less restricted approach. In keeping with the customary Senate approach we should conduct a thorough debate with ample opportunity for amendments. Anything less should be rejected. I should also note my absence for the cloture vote on the Defense authorization conference report. Cloture was invoked in an overwhelming vote. Had I been present, I too would have cast my vote in favor of cloture. Mr. President, there are many demands made on the time of a Senator. Few are as important or as rewarding as being a part of the life of our school children. And on last Friday, when presented with a choice between keeping important commitments to Montana students or procedural votes in the Senate, I faced a difficult decision. And while I take my responsibilities here in Washington very seriously, I decided that I needed to be with these Montana students on this occasion. And in this particular instance my votes would not have affected the ultimate outcome of either vote.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I want to take this opportunity to express my support for the nomination of Charles Rossotti to be the new Commissioner of the Internal Revenue Service. Mr. Rossotti will face a daunting challenge as he takes over the reins of this besieged agency. The IRS has suffered from years of neglect and lack of focus. As new Commissioner, Mr. Rossotti will need to repair the damage that has eaten away at the Service's foundation and try to restore some semblance of respect for the IRS among the average taxpayer. At the same time, he will need to be preparing the IRS for the challenges of the next century. The public expects some essential services from the Government, and most people are willing to pay their fair share of taxes in order to pay for these services. Nobody likes paying taxes, but most of us do it regularly and honestly. In return, we expect the Government to keep the process fair, make it as simple as possible, and keep our personal information private. Running the IRS is a study in careful balances. And I believe that the IRS has somehow lost its ability to maintain one side of the equation over the years. Many tax collectors, in their zeal to catch the few people who don't pay their taxes, seem to have lost sight of the most important truth about our tax system--that citizens have rights that must be protected. Anything less undermines our ability to make a system of voluntary taxation work. We certainly don't want to tie IRS's hands so much that tax cheats are encouraged, because the rest of us end up picking up the tab when someone cheats. At the same time, we also can't have IRS harassing innocent citizens, assuming everyone is guilty the minute they walk in the door. Mr. Rossotti will be the one person we will expect to help IRS find its way back to the reasonable balance that our tax system requires. I hope and expect that we in the Congress will do our best to help. We will be looking at legislative solutions, to give the new Commissioner the tools to encourage the climate of change we need if we are to reverse the past years of decline. We will be looking at stable funding, to make sure Mr. Rossotti has the money to pay good people and buy new computers. I hope we would also be looking at tax simplification, to make it a little easier for both taxpayers and the IRS to figure out how much our fair share really amounts to. Mr. Rossotti has the background and expertise to help him achieve the difficult tasks we expect of him in the days ahead. I wish him every success, and look forward to working with him to make sure the Internal Revenue Service reaches its full potential.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I would just like to say a few words about where we are on the highway bill. It is due to internal political discussion and confrontation that we have not been able to move on the highway bill. There has been a bipartisan effort to try to get an agreement on campaign finance reform. We are still at loggerheads. Mr. President, it is imperative that we in the Senate find some way to get a highway bill passed. It has been a month now since the authorization expired. It expired on September 30. We in the Senate are derelict by not passing highway legislation. I say that because there are many States that are going to run out of money very soon. My State of Montana will run out the first part of February. It takes a long time to let contracts, to bid on contracts, to get the pipeline lined up so dollars are out to the States for jobs. I have been in favor of the 6-year bill. It only makes sense that we have some continuity in our highway program. This is not some abstract theory, Mr. President. This is jobs. This is local people, cities and counties and States, that very much depend upon this multibillion-dollar program. So I urge us to find some pragmatic, practical way to get some form of a highway bill passed. I hope it is 6 months. It may not be 6 months. I hope it is 6 years. It may not be 6 years. But we have to pass something so when we go home over the holidays we will at least have built a bridge so next year we take up a full 6-year bill and find a way to get that passed. I urge my colleagues to find some way to solve this impasse now so we as a practical matter do our duty to get highway legislation passed. Mr. DASCHLE addressed the Chair.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I ask to speak for 2 minutes out of order.

Mr. BAUCUS. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today in support of the Interior appropriations conference report. I do so with great respect for its managers, Senators Byrd and Gorton and in recognition of the difficult job which they have faced in bringing this bill together. They have done a fine job juggling this contentious bill and I applaud them for their efforts. Mr. President, I'd like to talk a minute about worthwhile Federal investments contained in this bill. First, let me talk about the National Endowment for the Arts. This agency makes a real difference in Montana. It allows groups like Shakespeare in the Parks to go to over 50 Montana towns, including Birney, a town of only 17. Every year, the cast and supporters of Shakespeare in the Parks clear a spot on Poker Jim Butte and put on a show. Citizens come from the nearby reservation, area ranches, and over the border from Wyoming to see classic Shakespeare works. It's a real community gathering and balloons the size of Birney for the day. And make no mistake, it probably wouldn't happen without NEA funding. This bill funds this valuable program. I have been a longtime advocate of preserving the quality of life we in Montana and in America enjoy. This Interior bill also goes a long way toward preserving some of the last, best places for our children. First, it dedicates $1.5 million to help finish the Gallatin II land exchange near Bozeman, MT. Next, it earmarks $1 million for purchasing easements and land in the Blackfoot Valley. This area isn't far from where I grew up. I've hunted, fished, and hiked in those hills and I can tell you of its beauty. We can be proud that because of this investment, our children will have the same access to this region that I did as a boy. Mr. President, our rivers are under attack by a malady known as whirling disease. This parasitic condition causes the deterioration of fish muscles, eventually causing the fish to die. It has been found in many Blue Ribbon Montana rivers and is slowly spreading across the West. Our critical fisheries are at risk and Western States are faced with the potential loss of millions of dollars in tourism and fish agricultural revenues. Scientists at Montana State University's Fish Technology Center are hard at work today identifying the causes of this disease and potential cures. It is cutting edge science and it is making a difference. This bill recognizes that and funds this research at an appropriate level. The Interior Appropriations bill also contains $699 million in increased funding for the land and water conservation fund. This will help our Nation to acquire environmentally critical lands including a number of parcels that have been rated as a high priority in Montana. Specifically, the bill provides $65 million in land and water conservation funding to acquire the New World Mine property next to Yellowstone National Park. If built, this mine would have harmed Yellowstone National Park. It would have polluted waters flowing into the park and would have harmed the park's wildlife herds. Montanans overwhelmingly opposed construction of this mine. Last year, when the Clinton administration, local citizens, and the mining company reached an agreement that would keep the mine from being built, the entire region breathed a sigh of relief. And now it is time to finish that agreement. The New World agreement provides that the Federal Government will purchase the property from the mining company, thus protecting Yellowstone for our children. But its benefits don't stop there. The agreement also requires the mining company to spend $22.5 million to clean up historic mining pollution in the area. This not only improves the environment, it also creates jobs for Montana. That is truly a win- win solution. As this bill moved through Congress, I worked hard to ensure that the money would be included to complete the New World agreement. And I am glad that has been done. As part of the New World negotiations, we were able to further protect the local economy in Montana by appropriating $12 million to repair the area's main highway leading into Yellowstone National Park. Charles Kuralt called the Beartooth Highway the most beautiful road in America. With the money contained in this bill, we will be able to maintain that highway, enhance the local economy, and ensure that the American people continue to have access to the treasures of Yellowstone National Park. The agreement reached between me, the administration, and House and Senate negotiators is truly in the best interests of Montana and of the Nation. It protects Yellowstone, cleans up the environment, creates jobs, and helps provide public access to our Nation's first national park. However, the final version of the Interior appropriations bill also contains a provision that we did not agree to. It requires the transfer of $10 million or more worth of coal to the State of Montana. This provision was outside of the scope of the agreement that we negotiated with the White House and the other Members of Congress. I support the development of coal in eastern Montana. But I also understand that the White House objects to the inclusion of this coal transfer. I expect that the White House will attempt to remove this coal either through a full veto of the bill or through a line-item veto of the coal transfer. Coal was not included in our negotiated agreement on New World because the White House objected to its inclusion and because of fears that it could jeopardize the New World agreement. Now that Congress has included coal in the final bill, I hope that this issue does not stand in the way of our ability to complete the New World agreement. It would be a crime to get this close to completing the agreement only to have it fall apart--jeopardizing Yellowstone, MT jobs and the Beartooth Highway as well. So, Mr. President, we are nearing the conclusion of a long process. I hope that all parties will continue to work with me to complete the New World agreement as expeditiously as possible. And I urge my colleagues to join me in supporting this measure that will achieve the successful protection of this national treasure.

Mr. BAUCUS

Mr. BAUCUS. Tomorrow. Good.

Mr. BAUCUS. I think it is very clear. The point of this is we transferred 4.3 cents to the highway trust fund. Those are dollars that Americans expect to be used for highways. And I think the Senator is correct in saying there is a very strong presumption that that contract authority will be spent someday. The Budget Committee and the Appropriations Committee along with the rest of Congress will decide if the contract authority will be spent. But that is only if economic savings are realized. But the beauty of the amendment is if for some reason it does not make sense next year to increase transportation spending, they still have that discretion. That is the beauty of it. So, in answer to the Senator, it is very clear. It could not be more clear. Yes, there is a very strong presumption because the amendment says it should be spent. But it does not say it must be spent. It does not mandate that. But I personally feel it should be spent. The cosponsors of this amendment very strongly believe that those dollars should be spent. But, still, we can't totally predict the future. I can't. I don't think anybody in this body can. So next year if for some reason the Budget Committee and Congress decides it wants to make some other decision, it can. And the Senator knows, under the terms of this amendment, the Budget Committee can. But the Senator also is correct in saying there is a strong presumption under this amendment that this money should be spent on highways if the savings are realized. Again, the amendment provides ``if the savings are realized.'' I have one question for the Senator. When are we going to see the amendment of the Senator?

Mr. BAUCUS. If the Senator will yield, if I understand the Senator, he is saying under the Byrd-Gramm-Baucus-Warner amendment it is true that it is up to the discretion of the Budget Committee and appropriations committees to make these decisions, but that they will be under such pressure that they will not be able to decide responsibly what is right for the country? That is what I understand the Senator to be saying.

Mr. BAUCUS. I appreciate the good points made by my friend from Rhode Island, but they are really sort of obfuscation. They really don't get to the central point, the central point being should we or should we not pass the Byrd-Gramm-Baucus-Warner amendment which will increase the contract authority or authorization of transportation programs. There have been a lot of statements from my colleagues about this amendment already. So I will be very brief. The most important point is one the Senator from West Virginia has so correctly made. We have tremendous transportation infrastructure needs, and that they are not being met. Indeed, the Department of Transportation has concluded under the current highway program we need about $15 billion a year in additional spending to meet our highway needs. And these investments help us compete globally. It is this competition that has helped us reach the economic growth we have today. But we have to invest more in the engine of the economy, our transportation network. Other nation's are investing more in infrastructure in order to catch up to us. If you look at what other countries spend on infrastructure, Japan is four times as a percentage of GDP and Europe twice as much as we do. Just look around the D.C. area. Anybody who drives around here, with all the pot holes and congestion, knows how much we need to improve the highways in this country. So how do we meet these transportation needs? We begin by increasing the authorizations for transportation spending. We have to do that with the Byrd-Gramm amendment because we are faced with a budget resolution which has limited the amount of money that the Environment and Public Works Committee can spend. And these limits are too low. So the amendment Senator Byrd is offering is a very creative way to meet the needs of our highway system. It is very simple. It says that if the savings, or a portion of the savings projected in OMB's midsession review are realized and if Congress decides to spend them, then transportation programs should be fully funded. Let me emphasize the key words here. If there are additional savings from the economy and if Congress decides to spend them, then transportation should be fully funded. So nothing is mandated. There is no automatic increased spending. All of that will be decided by Congress next year and in future years. We are only saying that we should authorize these additional funds so that if additional spending is available, the authorization process is complete. We do not mandate anything. We are not mandating the Budget Committee to take action. We are not mandating the Appropriations Committee to spend any additional money. We are just saying they should spend the additional savings if that savings is available. Now, the total savings available, if OMB's midsession review is accurate, will be about $200 billion. That is to say that we in the Congress will have $200 billion more than we thought we had when we passed the last budget resolution. That is, the economy has been doing so well that there will be about $71 billion less in spending--that is less in unemployment compensation insurance, for example--and about $130 billion in additional revenues because the economy is doing so well. This is over a 5-year period. It is these savings that we are targeting in this amendment. Let me also say what this amendment does not do. Some Senators have said, and I think it is true that it is based on incorrect information--it is not their fault; the amendment has not been available for them to read. Some Senators said, well, this amendment will cut other programs. It is going to cut Head Start. It is going to cut education programs. Let me be clear. This amendment in no way cuts funding for any program. Let me repeat that. The effect of this amendment is not to cut any program. That is because we are only authorizing additional spending with the anticipation that future economic savings will be available to fund these authorizations. If we do not do this, if we are locked into the lower numbers in the underlying bill, we will not be able to increase these numbers during the six year authorization. Not unless the Environment and Public Works Committee writes a new bill to do so. We do not want to have to write a new highway bill every year. That does not make sense. But the important point is that increasing the contract authority will not cut the spending for other programs. And this amendment does not bust the budget. Again, that is because it only increases the contract authority for transportation programs. Another point. If this amendment does not pass, the balances in the highway trust fund will be $71 billion by the year 2003. That is not right. Congress would continue to use this money to mask the true budget deficit. It is phony business. It is smoke and mirrors to let that happen. It just is not right to let these balances accumulate to such a large degree to mask the true budget deficit. That is wrong. And again that would happen if this amendment does not pass. It just happens automatically if it doesn't pass. I might also add, Madam President, that I hear some Senators who are unhappy with the formula in the underlying bill. They have asked for more money for their States. I have heard from many States. It is a rare State that doesn't make that plea. There is only one way to help States get more money and that is to vote for the Byrd amendment. Every State will receive more contract authority. If we do not have this extra contract authority, there is no way we can help States get more money. So if you need more money and if you feel you are not being dealt with fairly, this amendment will help bring that result. We will not be able to help any States or any programs without more money. Madam President, I have more points I want to make, but I think it is probably more appropriate to bring those points up when the amendment is actually before us. But I just wanted to summarize by saying that I ask Senators to read the amendment now that it is available and they will see it does not cause all these problems that some fear it will cause. And on the contrary, they will see that it does not bust the budget and will not cause a funding cut to other programs. Madam President, I yield the floor.

Mr. BAUCUS. I have no idea.

Mr. BAUCUS. Madam President, I would like to ask the Senator, if he is going to speak, not to speak in my time because I would like to finish my statement, and I see it slowly slipping away.

Mr. BAUCUS. I say to the Senator, back in 1993, it was a very difficult time. The President and the Democratic majority of the Congress were trying to figure out a way to get us on the path toward deficit reduction. I might say to my good friend from Rhode Island that I think it worked. That package dramatically set us on a glidepath which has enabled us to begin to reduce our budget deficit. In fact, the budget resolution which was passed this year, which allows us to balance the budget was due in large part to that 1993 package. Having said that, I can remember when I cast that vote. At first, some were proposing a higher tax than 4.3-cents per gallon. I think it was up to a nine cents or so. I argued that I opposed using a gasoline tax for deficit reduction. And because of these arguments, the final number was 4.3 cents. So while I didn't like the idea of a gas tax for deficit reduction, I supported it for the greater good of getting the deficit reduced. And again, that package led get down the road to deficit reduction. But I knew at that time, that once the deficit was reduced, we would be working get this money back to the trust fund for transportation uses. Indeed, that is what this Congress has done. We have voted to transfer the 4.3 from deficit reduction to the trust fund. That vote passed by a very large margin with a majority of Republicans voted for it. Mr. CHAFEE addressed the Chair.

Mr. BAUCUS. How much time do I have left?

Mr. BAUCUS. I yield to the Senator from West Virginia such time as he needs.

Mr. BAUCUS. Will the Senator yield on that point?