Max Baucus

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to introduce legislation to transfer 4.3 cents of the Federal gas tax currently used for deficit reduction to transportation purposes. Specifically, this bill will transfer 3.8 cents to the highway account of the highway trust fund and one-half penny to a new intercity passenger rail account to be used for Amtrak or other intercity passenger rail service. Mr. President, this bill is important because it is time to give the American taxpayers the confidence that the fuel taxes they pay will be used for transportation purposes. The 3.8 cents deposited in the highway account means over $5.5 billion in additional funds would be available each year for transportation improvements. Those improvements could be for highway maintenance or other infrastructure safety improvements; mass transit projects; bikepaths; pedestrian walkways; or a variety of other transportation projects that are eligible today under the Intermodal Surface Transportation Efficiency Act. This Nation is losing ground with regard to transportation investments. Japan spends four times the United States on transportation as a percentage of gross domestic product. And the Europeans spend twice as much. These and other countries envy our transportation system. We cannot afford to allow our global competitors to outspend us on infrastructure improvements. Our ability to remain competitive in the future is tied to maintaining an efficient transportation system and highly mobile workforce. And Amtrak remains an important component of such a transportation system. Every country that has a passenger rail system provides some government financial assistance. It only makes sense that this country do the same. Amtrak is important to many communities around the country--it serves over 530 cities and towns. These include 12 in my State of Montana-- Libby, Whitefish, West Glacier, Essex, East Glacier, Cut Bank, Malta, Browning, Shelby, Havre, Wolf Point, and Glasgow. These Montana communities rely upon Amtrak as a transportation option. And Amtrak is an important economic lifeline. Not only for the jobs directly related to Amtrak service, but Amtrak is an important tool in Montana's tourism industry. Each year, Amtrak brings thousands of folks to our State to ski, hike, or just enjoy the beauty of Montana. But in order for Amtrak to remain a component of this Nation's transportation system, it must have a dedicated revenue source. Such a revenue source will give Amtrak the ability to do long-term capitalization planning--planning and improvements that must be made in order for Amtrak to remain viable. While I do not agree that Amtrak should be funded off of the top of the highway trust fund as has been suggested by the administration, I do feel we need to financially support Amtrak into the next century. My bill will do that. It will provide a substantial increase in available funds for all modes of transportation. Mr. President, I ask unanimous consent that the bill be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to introduce legislation to transfer 4.3 cents of the Federal gas tax currently used for deficit reduction to transportation purposes. Specifically, this bill will transfer 3.8 cents to the highway account of the highway trust fund and one-half penny to a new intercity passenger rail account to be used for Amtrak or other intercity passenger rail service. Mr. President, this bill is important because it is time to give the American taxpayers the confidence that the fuel taxes they pay will be used for transportation purposes. The 3.8 cents deposited in the highway account means over $5.5 billion in additional funds would be available each year for transportation improvements. Those improvements could be for highway maintenance or other infrastructure safety improvements; mass transit projects; bikepaths; pedestrian walkways; or a variety of other transportation projects that are eligible today under the Intermodal Surface Transportation Efficiency Act. This Nation is losing ground with regard to transportation investments. Japan spends four times the United States on transportation as a percentage of gross domestic product. And the Europeans spend twice as much. These and other countries envy our transportation system. We cannot afford to allow our global competitors to outspend us on infrastructure improvements. Our ability to remain competitive in the future is tied to maintaining an efficient transportation system and highly mobile workforce. And Amtrak remains an important component of such a transportation system. Every country that has a passenger rail system provides some government financial assistance. It only makes sense that this country do the same. Amtrak is important to many communities around the country--it serves over 530 cities and towns. These include 12 in my State of Montana-- Libby, Whitefish, West Glacier, Essex, East Glacier, Cut Bank, Malta, Browning, Shelby, Havre, Wolf Point, and Glasgow. These Montana communities rely upon Amtrak as a transportation option. And Amtrak is an important economic lifeline. Not only for the jobs directly related to Amtrak service, but Amtrak is an important tool in Montana's tourism industry. Each year, Amtrak brings thousands of folks to our State to ski, hike, or just enjoy the beauty of Montana. But in order for Amtrak to remain a component of this Nation's transportation system, it must have a dedicated revenue source. Such a revenue source will give Amtrak the ability to do long-term capitalization planning--planning and improvements that must be made in order for Amtrak to remain viable. While I do not agree that Amtrak should be funded off of the top of the highway trust fund as has been suggested by the administration, I do feel we need to financially support Amtrak into the next century. My bill will do that. It will provide a substantial increase in available funds for all modes of transportation. Mr. President, I ask unanimous consent that the bill be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, the public expects some essential services from the Government. Social security payments, highway funding, national defense, a safety net in bad times, clean air and water, the National Park System, and so on. These are important to the country and the Government should provide them. So most folks are willing to pay their fair share of taxes. Nobody likes it, but most of us do it regularly and honestly. But we do expect the Government to keep it fair, make it as simple as possible, and keep it private. And we've recently found that in their zeal to catch the few people who don't pay their taxes, some tax collectors forget the most fundamental truth about our tax system. Citizens have rights that must be protected. One of the first bills I introduced when I first came to the Senate was a Taxpayers' Bill of Rights, to protect taxpayers in disputes with the Internal Revenue Service. And I noted: Oliver Wendell Holmes reasoned that ``Taxes are what we pay for a civilized society.'' However, Justice Holmes did not consider additional burdens imposed on taxpayers--added costs and delays that result from inefficiencies and inconsistencies in the administration of tax law. That was back in 1979. And it took a while, but in 1988 we finally passed a comprehensive Taxpayer Bill of Rights. That went a long ways toward defining taxpayer rights and gave some protection against arbitrary actions by the IRS. This law made IRS give at least 30 days' notice before levying on a taxpayers' property, so that he or she would have time to file an appeal. It exempted more kinds of property from IRS levies, and raised the wage total exempt from collection. It allowed taxpayers to collect costs and attorney's fees from the Government if the IRS acted without substantial justification. And it let taxpayers sue the Government for damages if IRS employees acted recklessly in collecting taxes or intentionally disregarded any provision of the Internal Revenue Code. This helped make taxation a little more fair and accountable. But it didn't solve all the problems. Last year, we did some more with the Taxpayer Bill of Rights II. This created an Office of Taxpayer Advocate within the IRS to help taxpayers resolve their problems with the IRS. It gave taxpayers more power to take the IRS to court in order to abate interest and eased the burden of proof for collecting attorney's fees and costs when you challenge an IRS decision and win. And it raised the damages a taxpayer can collect in the event an IRS agent recklessly or intentionally disregards the Internal Revenue Code. But as important as these laws are, we need to do a lot more to give taxpayers confidence in the system and the people who work in it. Today we're going to go a little further. Every once in a while we find that some IRS employees are snooping around in tax returns that ought to be private. That's happened twice this year--first, with the revelation that President Nixon tried to pressure his IRS Administrator to look through political opponents' returns, and now when we hear that some IRS employees have browsed in returns for fun. Our bill today will impose criminal penalties on anyone who does it. And we'll make sure the taxpayer whose records have been violated in this way can be notified so that they too can take action. Without this high level of protection of taxpayer privacy, we undermine our ability to make a system of voluntary taxation work. Once this bill is signed into law, as I am confident that it will be, we must not rest on our laurels. There is still much work to be done to fully protect the rights of taxpayers. The administration proposes simplification and Bill of Rights initiatives that we must review very soon. The Commission on the Restructuring of the Internal Revenue Service will also issue a bipartisan report that will help us address a broad range of problems with the IRS. That should be a top priority. We need a tax system that brings in the revenue to pay for essential services. One that balances the budget. But also one that is fair and reasonable, and understands that most of us are good people who obey the law and shouldn't be picked on all the time. It's that simple.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I am very pleased today to join my colleagues Senator Nickles and Senator Breaux in introducing legislation to help support America's small businesses. This bill will address the problem created for the small business community by the Internal Revenue Services' requirement that they convert to a system of depositing payroll taxes by electronic funds transfer. IRS has been implementing legislation directing the agency to begin collecting a progressively larger percentage of Federal tax deposits from employers by electronic funds transfer, rather than the current Federal tax deposit coupon system. The intent behind the legislation was to simplify the tax deposit system and reduce paperwork for taxpayers, financial institutions, and the Internal Revenue Service itself. The Senate report accompanying the bill recommended that the implementation of this mandate not create hardships for small businesses, and that no small business should be required to purchase computers or gain access to any electronic equipment other than a touch-tone telephone. The report also urged Treasury to take into account the specific needs of small employers, including possible exemption for the very smallest businesses from the electronic deposit system. We do not believe the Treasury Department has accomplished this goal. While a timetable for compliance has been established, there is little evidence that the concerns of the small business community have been alleviated as July 1, 1997, the deadline for implementation, draws near. Business owners who have used the coupon system for years to diligently pay their taxes on time do not understand why they are being required to convert to an electronic funds transfer system. Many small business owners I have spoken with in Montana fear IRS access to their bank accounts, particularly in light of recent reported incidences of IRS employee browsing through taxpayer records without a valid reason. Other small business owners are concerned, and not unreasonably, that banks may begin charging fees for these transactions, adding to their costs of doing business. Finally, many small businesses are discovering that their current banks do not even participate fully in the electronic transfer system, forcing them to find a new bank through which to send in their deposit payments. Mr. President, I agree with my colleagues that small businesses have not been given enough time or information to make an orderly transition to the new electronic funds transfer system. I also agree that they should not be required to pay a fee in order to pay their taxes. The bill we are introducing today will exempt businesses who annually deposit under $5 million in payroll taxes from the electronic payment requirement permanently, and phase it in for the rest at a much more manageable rate. I believe this bill will preserve the right of small business owners to pay their taxes in a manner which best suites their business needs. I commend Senators Nickels and Breaux for the work they have done on this bill, and encourage our other colleagues to join in our effort.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I am very pleased today to join my colleagues Senator Nickles and Senator Breaux in introducing legislation to help support America's small businesses. This bill will address the problem created for the small business community by the Internal Revenue Services' requirement that they convert to a system of depositing payroll taxes by electronic funds transfer. IRS has been implementing legislation directing the agency to begin collecting a progressively larger percentage of Federal tax deposits from employers by electronic funds transfer, rather than the current Federal tax deposit coupon system. The intent behind the legislation was to simplify the tax deposit system and reduce paperwork for taxpayers, financial institutions, and the Internal Revenue Service itself. The Senate report accompanying the bill recommended that the implementation of this mandate not create hardships for small businesses, and that no small business should be required to purchase computers or gain access to any electronic equipment other than a touch-tone telephone. The report also urged Treasury to take into account the specific needs of small employers, including possible exemption for the very smallest businesses from the electronic deposit system. We do not believe the Treasury Department has accomplished this goal. While a timetable for compliance has been established, there is little evidence that the concerns of the small business community have been alleviated as July 1, 1997, the deadline for implementation, draws near. Business owners who have used the coupon system for years to diligently pay their taxes on time do not understand why they are being required to convert to an electronic funds transfer system. Many small business owners I have spoken with in Montana fear IRS access to their bank accounts, particularly in light of recent reported incidences of IRS employee browsing through taxpayer records without a valid reason. Other small business owners are concerned, and not unreasonably, that banks may begin charging fees for these transactions, adding to their costs of doing business. Finally, many small businesses are discovering that their current banks do not even participate fully in the electronic transfer system, forcing them to find a new bank through which to send in their deposit payments. Mr. President, I agree with my colleagues that small businesses have not been given enough time or information to make an orderly transition to the new electronic funds transfer system. I also agree that they should not be required to pay a fee in order to pay their taxes. The bill we are introducing today will exempt businesses who annually deposit under $5 million in payroll taxes from the electronic payment requirement permanently, and phase it in for the rest at a much more manageable rate. I believe this bill will preserve the right of small business owners to pay their taxes in a manner which best suites their business needs. I commend Senators Nickels and Breaux for the work they have done on this bill, and encourage our other colleagues to join in our effort.

Mr. BAUCUS

Mr. BAUCUS. Madam President, I rise today to tell my colleagues about some events that took place in Billings, MT, a few years ago. It is the story of a town whose citizens decided that hatred and bigotry were not welcome in their community. The people of Billings enjoy the high quality of life that only Montana can provide. The magic city is the largest city in Montana, but it still has the feel of a small town. Folks still say hi to each other on the street. Families go to the symphony in Pioneer Park during the summer. And neighbors still go out of their way to help someone when they need a hand. That placid life was shattered in November 1993, when a group of skinheads threw a bottle through the glass door of a Jewish home. A few days later they put a brick through the window of another Jewish home-- with a 5-year-old boy in the room. Then they smashed the windows of a Catholic high school that had a Happy Hanukkah sign on its marquee. The events frightened and repulsed the citizens of Billings. They were shocked to find that hatred and violence had penetrated their peaceful community. But the people of Billings did not allow this outside menace to take root. The community banded together. Thousands of people put menorahs in their homes. They showed the skinheads that they were united against hate. And that year, Billings held the largest Martin Luther King Day march ever in Montana. The skinheads left town. Billings showed that hatred can be overcome. Madam President, the people of Billings didn't ask to be recognized. They just did what came naturally. Recently, the USA network has decided that the Billings story was worth telling to the world. With all the bad news out there these days, it is refreshing to know that someone wants to tell a positive story. The people of Billings can be a shining example to the rest of our country; Montana will not tolerate hatred in any way, shape, or form. I commend the USA network and--most important--the people of Billings, for their efforts in making this country a more tolerant place for us all.

Mr. BAUCUS

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

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

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I am pleased today to introduce the Surface Transportation Authorization and Regulatory Streamlining Act, or STARS 2000. I am joined in this effort by my colleagues on the Environment and Public Works Committee, Senators Kempthorne and Thomas. And by Senators Dorgan, Conrad, Daschle, Johnson, Burns, Craig, Enzi, Harkin, Bingaman, Roberts, and Kerrey of Nebraska. This bill reauthorizes this Nation's surface transportation programs for the year 2000, and beyond. As most of my colleagues know, we must act soon to renew these programs since today's law, the Intermodal Surface Transportation Efficiency Act, or ISTEA, will expire on September 30. STARS 2000 builds on the progress already made by ISTEA. But it also makes some important improvements. Let me focus on the three most significant aspects of the bill. funding levels First, the bill increases funding for our highway programs to $27 billion annually. Transportation is a critical part of our Nation's economic growth and prosperity. The investments we make today in transportation will help keep us globally competitive well into the next century. Furthermore, these investments directly generate hundreds of thousands of jobs--in Montana, in Idaho, in Illinois, in every State. They also indirectly help sustain businesses and millions more jobs all across the country. The funding in STARS 2000 will support all types of transportation projects. It also will enable States and local governments to make the investment decisions that best reflect their transportation priorities. The funding level in STARS 2000 corresponds to the amount of money estimated to be in the highway trust fund over the next 6 years. As my colleagues know, this is money already being collected from the tax on gasoline and other fuels. My view is that we should spend it for the purpose for which it was collected. Even with this increase, however, we will not eliminate the shortfall in meeting our transportation needs. The Department of Transportation estimates that over $50 billion would be needed each year in order to just maintain current highway and bridge conditions. Yet, today annual spending by all levels of government is only $39 billion per year. Our competitors know the advantage of a sound transportation system. That is why Japan invests over four times what we do in transportation as a percentage of GDP. The Europeans spend twice as much. We cannot afford to squander this important competitive edge. While STARS 2000 is not the complete solution, it is a big step in the right direction. streamlining Second, STARS 2000 dramatically streamlines and simplifies today's transportation programs. It reduces administrative burdens on the States and the complexity of the programs by consolidating several funding categories and by allowing for greater flexibility in decisionmaking. The bill has two key categories for funding. The National Highway System, which makes up 60 percent of the core program, and the Surface Transportation Program, which accounts for the remaining 40 percent. The National Highway System carries the bulk of our recreational and commercial traffic. It consists of 160,000 miles of highways, including the entire 45,000 mile Interstate System. These roads connect our cities and towns. Our farms to their markets. And our manufacturing facilities to our seaports. It just makes sense that the NHS should be a priority. STARS 2000 devotes over $14 billion annually to these roads. As with current law, the Surface Transportation Program remains the most flexible category of funds. States can shift funds among projects to best serve their transportation needs. STARS 2000 retains ISTEA's programs and project eligibilities and includes over $9 billion annually for them. funding formulas Third, STARS 2000 updates ISTEA's funding formulas. One criticism of the current formulas is that they are based on outdated and unnecessary data. This bill rectifies that problem by using up-to-date information. The STARS formula also reflects the transportation needs of a State. We have included such factors as lane miles, vehicle miles traveled, and freeze-thaw cycles, to better account for the cost of maintaining and improving our highway system. environment STARS 2000 also continues the commitment to the environment that began in ISTEA. It dedicates some $380 million annually to congestion mitigation and air quality projects. Furthermore, it requires that these funds be spent on projects in areas that have not attained our transportation-related air quality standards. Frankly, I had hoped to include more funding for these projects in this bill. But as this legislation progresses, I intend to work with my colleagues to see if we can't be more generous here. STARS 2000 also continues the transportation enhancement program. This is an innovative program that has given States the ability to invest in nontraditional highway projects such as bike paths, pedestrian walkways and historic preservation. conclusion In conclusion, STARS 2000 is a good bill. But it also is one of several bills that our committee will consider in the coming weeks. Under the leadership of our chairman, Senator Chafee and our subcommittee chairman, Senator Warner, along with Senator Moynihan, and others, I have no doubt that these various proposals will be brought together to produce a fair bill. A bill that will bring this Nation and its transportation system into the next century. Before yielding the floor, I wish to thank the primary cosponsors of this bill, Senators Kempthorne and Thomas, for their hard work in developing this legislation. I am also grateful for the help of our State transportation departments, particularly in Montana and Idaho, and their staff, in fashioning this bill. STARS 2000 brings a new approach and some new ideas to our surface transportation policy. I commend it to my colleagues for their consideration. Mr. President, I ask unanimous consent that a copy of the bill and a short summary of it be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I am pleased today to introduce the Surface Transportation Authorization and Regulatory Streamlining Act, or STARS 2000. I am joined in this effort by my colleagues on the Environment and Public Works Committee, Senators Kempthorne and Thomas. And by Senators Dorgan, Conrad, Daschle, Johnson, Burns, Craig, Enzi, Harkin, Bingaman, Roberts, and Kerrey of Nebraska. This bill reauthorizes this Nation's surface transportation programs for the year 2000, and beyond. As most of my colleagues know, we must act soon to renew these programs since today's law, the Intermodal Surface Transportation Efficiency Act, or ISTEA, will expire on September 30. STARS 2000 builds on the progress already made by ISTEA. But it also makes some important improvements. Let me focus on the three most significant aspects of the bill. funding levels First, the bill increases funding for our highway programs to $27 billion annually. Transportation is a critical part of our Nation's economic growth and prosperity. The investments we make today in transportation will help keep us globally competitive well into the next century. Furthermore, these investments directly generate hundreds of thousands of jobs--in Montana, in Idaho, in Illinois, in every State. They also indirectly help sustain businesses and millions more jobs all across the country. The funding in STARS 2000 will support all types of transportation projects. It also will enable States and local governments to make the investment decisions that best reflect their transportation priorities. The funding level in STARS 2000 corresponds to the amount of money estimated to be in the highway trust fund over the next 6 years. As my colleagues know, this is money already being collected from the tax on gasoline and other fuels. My view is that we should spend it for the purpose for which it was collected. Even with this increase, however, we will not eliminate the shortfall in meeting our transportation needs. The Department of Transportation estimates that over $50 billion would be needed each year in order to just maintain current highway and bridge conditions. Yet, today annual spending by all levels of government is only $39 billion per year. Our competitors know the advantage of a sound transportation system. That is why Japan invests over four times what we do in transportation as a percentage of GDP. The Europeans spend twice as much. We cannot afford to squander this important competitive edge. While STARS 2000 is not the complete solution, it is a big step in the right direction. streamlining Second, STARS 2000 dramatically streamlines and simplifies today's transportation programs. It reduces administrative burdens on the States and the complexity of the programs by consolidating several funding categories and by allowing for greater flexibility in decisionmaking. The bill has two key categories for funding. The National Highway System, which makes up 60 percent of the core program, and the Surface Transportation Program, which accounts for the remaining 40 percent. The National Highway System carries the bulk of our recreational and commercial traffic. It consists of 160,000 miles of highways, including the entire 45,000 mile Interstate System. These roads connect our cities and towns. Our farms to their markets. And our manufacturing facilities to our seaports. It just makes sense that the NHS should be a priority. STARS 2000 devotes over $14 billion annually to these roads. As with current law, the Surface Transportation Program remains the most flexible category of funds. States can shift funds among projects to best serve their transportation needs. STARS 2000 retains ISTEA's programs and project eligibilities and includes over $9 billion annually for them. funding formulas Third, STARS 2000 updates ISTEA's funding formulas. One criticism of the current formulas is that they are based on outdated and unnecessary data. This bill rectifies that problem by using up-to-date information. The STARS formula also reflects the transportation needs of a State. We have included such factors as lane miles, vehicle miles traveled, and freeze-thaw cycles, to better account for the cost of maintaining and improving our highway system. environment STARS 2000 also continues the commitment to the environment that began in ISTEA. It dedicates some $380 million annually to congestion mitigation and air quality projects. Furthermore, it requires that these funds be spent on projects in areas that have not attained our transportation-related air quality standards. Frankly, I had hoped to include more funding for these projects in this bill. But as this legislation progresses, I intend to work with my colleagues to see if we can't be more generous here. STARS 2000 also continues the transportation enhancement program. This is an innovative program that has given States the ability to invest in nontraditional highway projects such as bike paths, pedestrian walkways and historic preservation. conclusion In conclusion, STARS 2000 is a good bill. But it also is one of several bills that our committee will consider in the coming weeks. Under the leadership of our chairman, Senator Chafee and our subcommittee chairman, Senator Warner, along with Senator Moynihan, and others, I have no doubt that these various proposals will be brought together to produce a fair bill. A bill that will bring this Nation and its transportation system into the next century. Before yielding the floor, I wish to thank the primary cosponsors of this bill, Senators Kempthorne and Thomas, for their hard work in developing this legislation. I am also grateful for the help of our State transportation departments, particularly in Montana and Idaho, and their staff, in fashioning this bill. STARS 2000 brings a new approach and some new ideas to our surface transportation policy. I commend it to my colleagues for their consideration. Mr. President, I ask unanimous consent that a copy of the bill and a short summary of it be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, as a newly inducted member of the downtown Optimist Club of Great Falls, MT, I take great pride in telling my colleagues about the new Optimist International Child Safety Awareness Program. In recent months, there have been numerous reports of serious and even fatal injuries to children as a result of incorrect positioning or improper restraint in vehicles. Often these injuries are preventable. The Optimist International Child Safety Awareness Program operates under the premise that adults must assume the responsibility to see that their kids are safe while driving in a motor vehicle. The Optimist Club seeks to increase adult awareness of the hazards of incorrectly positioned children. I am very excited about this plan because I think we can make a real difference. The Optimists have always been strong advocates for children's safety. I encourage all of my colleagues in Congress to become familiar with the Optimists program and give it their full support. Our children are depending on it. Mr. President, I yield the floor.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I am very pleased to join my colleague Senator Chafee in introducing the American Farm and Ranch Protection Act today. This bill represents a bipartisan effort to help protect the open lands of our great country. Montana is know as Big Sky country for a reason, our expansive open areas dedicated to farming, ranching, and forestry rather than building and development. Our open lands represent a way of life in Montana, they are part of our environmental and cultural heritage. And they are rapidly disappearing as ranches and farms make way for houses and building complexes. America is losing over 4 square miles of land to development every day. In Montana alone, since 1987 over 560,000 acres of farmland have been taken out of farm use. Since 1974 the number of acres of land taken our of farm use exceeds 2.5 million. Frequently, the pressure to abandon the farm use of land comes from the need to raise funds to pay estate taxes. For those families where undeveloped land represents a significant portion of the estate's total value, often the heirs must develop or sell off part or all of the land merely in order to pay the tax. Because land is typically appraised by the Internal Revenue Service according to its highest and best use, which usually assumes development on the property, retention of undeveloped land is very difficult. I have attempted to resolve this problem through changes in the estate tax itself by my sponsorship of the bipartisan Estate Tax Relief for the American Family Act of 1997. That bill will make it easier for all family-owned businesses, including farms and ranches, to be passed on to succeeding generations. At the same time, however, I believe it is important to provide an incentive for the permanent preservation of environmentally significant land, so that our legacy to our children will include Montana's open lands. The American Farm and Ranch Protection Act, which Senator Chafee and I are introducing today, will help to achieve this goal by providing an exemption from the estate tax for the value of land that is subject to a qualified, permanent conservation easement. Conservation easements, which are entirely voluntary, are agreements negotiated by landowners in which a restriction upon the future use of land is imposed in order to conserve those aspects of the land that are publicly significant. To qualify for the estate tax exemption under this bill, the easements must be perpetual and must be made to preserve open space, to protect the natural habitat of fish, wildlife or plants, to meet a government conservation policy, or to preserve a important historical heritage area. Title 5 of this bill represents an effort to clarify an area of the law that is of particular importance in Montana. Under current law, when mineral rights have been severed from the surface rights in a piece of property, and a qualified conservation easement is created by the owner of the surface rights for the benefit of a nonprofit entity, that owner is unable to take a charitable deduction unless two conditions are met: the probability of surface mining occurring on the property must be so remote as to be negligible, and the severance of the mineral rights must have occurred before June 13, 1976. In Montana, severance of mineral rights for many properties occurred many generations earlier, and they have often been disbursed to farflung relatives in very small portions. So the probability that mining will occur is, indeed, very remote. The Internal Revenue Service, however, has asserted that some uncertainty exists about the congressional intent behind the term ``ownership of the surface estate and mineral interest first separated after June 12, 1976.'' I was the original authority of the language in question, and I have communicated with the IRS regarding my intention when the language was drafted. However, IRS has been unwilling to issue a favorable letter ruling which would clarify this issue, and as a consequence, it is impossible for many Western landowners to make voluntary charitable contributions of conservation easements in order to protect important Western land. In light of the confusion that this date has caused, and because it has no policy justification, our legislation would eliminate the 1976 date from the statute. I believe this bill can be an important tool for America's farm and ranch families to utilize in preserving their homesteads. At the same time, it makes a significant contribution to the larger public good of conserving America's increasingly threatened rural lands. I urge my colleagues to join on the bill as cosponsors, and encourage the administration to support the legislation.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I am very pleased to join with Senator Grassley and my other colleagues in introducing the Estate Tax Relief for the American Family Act of 1997 today. This bill is designed to provide farmers, ranchers, and others who own family businesses and much needed relief from the estate tax. Montana is a small-town, rural State, Mr. President. People run farms, ranches, and work in small businesses. One of the wonderful things about life in rural Montana is the way these operations stay in the family. It holds communities together, and creates a lasting bond between generations. As I listen to farmers, ranchers and small business owners, one topic comes up every time, and that is the estate and gift tax. I hear about the burden it puts on agricultural producers and small businesses, and about how difficult this tax makes it to hand down an operation to your sons and daughters. To avoid this tax, an operation today has to be under $600,000 in value. That amount hasn't budged since 1987. Our State, one the other hand, has changed a lot in that time. In 1988, the average Montana farm was worth $579,735. In 1995, that amount was up to $867,769. If we had figures for today, I am confident this amount would be even higher. So if you're an average fellow, you often have three choices when your farm goes on to the next generation. You can subdivide the land and thus decrease production. You can sell off part of the farm to pay the taxes. Or, you can sell the whole thing and get out of farming altogether. None of these options are good for the family, nor are they necessarily good for the community. Unbridled development brings with it its share of problems, and changes the nature of Montana life--not always for the better. Our farms, ranches and other small businesses are a part of our heritage and valuable contributors to our economy and the Montana way of life. It is simply not right to destroy them with onerous estate taxes. The Estate Tax Relief for the American Family Act of 1997 is the first step toward bringing the estate tax up to date and making it more fair. Our bill raises the unified credit to cover estates up to $1 million, which is roughly where the cap would be if the credit had kept pace with inflation all these years. We give folks a bit longer to pay off the bill when they do have a tax due, by lengthening the deferral from 10 years to 20. We provide additional exemptions for family-owned small businesses, by allowing them to exclude completely the first $1.5 million in value of their estates, and one-half of the next $8.5 million. We also make a few other common-sense changes to make it easier to keep these business operations in the family. That's good news for farmers, ranchers and small business owners. It's good for the communities they live in. And more than anything else, it's the right thing to do. So I'm very proud to be a part of this effort today, and I look forward to working with my other colleagues, and with the administration, to get this relief enacted into law this year.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise to introduce the State and Local Interstate Waste Control Act of 1997. This bill will give our cities and States the authority they need to stop imports of trash coming from other States. We have been working on this issue for 7 years. We have explored all options. We have held hearings, debated the issues. The Senate has passed interstate waste bills in each of the last four Congresses. It is time we put this issue behind us. Anyone who has kept up with New York State's decision to close the Freshkils landfill knows why we must act and why we must act now. As my colleagues may be aware, the Freshkils landfill on Staten Island, which takes all of New York City's garbage, is closing. What does that mean? That means 13,000 tons of garbage a day, almost 5 million tons a year, need a new home. It is hard to visualize how much garbage that is. What does it mean? It means about 1,200 trucks of garbage a day coming out of New York City, every one of them packed to the brim. Or, in other words, a convoy of trash trucks 12 miles long, 365 days a year--imagine that, a convoy of trash trucks 12 miles long each of 365 days a year coming out of New York City. That is what that means with the closure of Freshkils landfill on Staten Island because that garbage has to go someplace. Soon it will not go to Staten Island. Where is it going to go? We have no idea where these trucks will go. One thing is clear. New York will have virtually no way to get rid of its trash when Freshkils does close in the year 2001. The entire State of New York can take only about 1,200 tons of New York City's trash each day and that means the rest, over 4 million tons a year, must go out of State. What's worse, as far as I know, New York has not taken any steps to build or to grant permits to new in-State landfills. I guess it is far easier to send trash out of State than to fight the not-in-my-backyard opponents blocking new landfills and incinerators in New York State. I do not want to single out New York. Many other great cities have similar troubles. Trash disposal is tough. But many States have taken the old adage ``it is better to give than to receive'' to the extreme. When it comes to trash, there is just too much giving and too much receiving, especially when those receiving the trash have no choice. The fact is every city should take care of its own trash if possible. No city should be able to simply dump the problem on its neighbors. Yet that is precisely what could happen. Why? That is because today no State or town can stop shipments of garbage from other States. They do not have the authority. A few years ago, Miles City, MT, my home State, faced the prospect of becoming a dumping ground for Minneapolis, MN, trash. The 5,000 citizens of Miles City had no say at all in whether a mega-fill landfill could go up in their backyards to take care of garbage from a city nearly 800 miles away in another State. That is wrong. It is clearly wrong. It is unfair. Every town in America should have the right to say no. But today they do not have that right. And why is that? Every time a State law restricting out-of- State garbage imports has come up, they have been challenged in the courts. The courts have overturned those State laws based on the commerce clause of the Constitution. So we need a national law to preserve this basic part of self-determination, that is, the right to decide whether or not a community wants to accept out-of-State garbage. The bill I introduce today strikes a balance that will work for every community, for every State. It is very similar to the bill the Senate and House nearly passed about 3 years ago. The cornerstone of my bill is the new authority it gives to all States and communities to restrict municipal solid waste imports. First, every Governor may freeze future imports of garbage at the level his or her State received in 1993. Second, the bill makes it illegal to ship any new imports of municipal waste unless the local community specifically wants it. Third, to reduce pressure on local communities, my bill gives large importing States like Pennsylvania and Ohio the right to lower their imports. Finally, some communities have built regional landfills and we respect those agreements as well. My bill is about returning decisionmaking back to the people, giving people in importing States what should be their birthright, a chance to determine their own destiny. I ask unanimous consent a summary of my bill, along with the text of the bill, be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise to introduce the State and Local Interstate Waste Control Act of 1997. This bill will give our cities and States the authority they need to stop imports of trash coming from other States. We have been working on this issue for 7 years. We have explored all options. We have held hearings, debated the issues. The Senate has passed interstate waste bills in each of the last four Congresses. It is time we put this issue behind us. Anyone who has kept up with New York State's decision to close the Freshkils landfill knows why we must act and why we must act now. As my colleagues may be aware, the Freshkils landfill on Staten Island, which takes all of New York City's garbage, is closing. What does that mean? That means 13,000 tons of garbage a day, almost 5 million tons a year, need a new home. It is hard to visualize how much garbage that is. What does it mean? It means about 1,200 trucks of garbage a day coming out of New York City, every one of them packed to the brim. Or, in other words, a convoy of trash trucks 12 miles long, 365 days a year--imagine that, a convoy of trash trucks 12 miles long each of 365 days a year coming out of New York City. That is what that means with the closure of Freshkils landfill on Staten Island because that garbage has to go someplace. Soon it will not go to Staten Island. Where is it going to go? We have no idea where these trucks will go. One thing is clear. New York will have virtually no way to get rid of its trash when Freshkils does close in the year 2001. The entire State of New York can take only about 1,200 tons of New York City's trash each day and that means the rest, over 4 million tons a year, must go out of State. What's worse, as far as I know, New York has not taken any steps to build or to grant permits to new in-State landfills. I guess it is far easier to send trash out of State than to fight the not-in-my-backyard opponents blocking new landfills and incinerators in New York State. I do not want to single out New York. Many other great cities have similar troubles. Trash disposal is tough. But many States have taken the old adage ``it is better to give than to receive'' to the extreme. When it comes to trash, there is just too much giving and too much receiving, especially when those receiving the trash have no choice. The fact is every city should take care of its own trash if possible. No city should be able to simply dump the problem on its neighbors. Yet that is precisely what could happen. Why? That is because today no State or town can stop shipments of garbage from other States. They do not have the authority. A few years ago, Miles City, MT, my home State, faced the prospect of becoming a dumping ground for Minneapolis, MN, trash. The 5,000 citizens of Miles City had no say at all in whether a mega-fill landfill could go up in their backyards to take care of garbage from a city nearly 800 miles away in another State. That is wrong. It is clearly wrong. It is unfair. Every town in America should have the right to say no. But today they do not have that right. And why is that? Every time a State law restricting out-of- State garbage imports has come up, they have been challenged in the courts. The courts have overturned those State laws based on the commerce clause of the Constitution. So we need a national law to preserve this basic part of self-determination, that is, the right to decide whether or not a community wants to accept out-of-State garbage. The bill I introduce today strikes a balance that will work for every community, for every State. It is very similar to the bill the Senate and House nearly passed about 3 years ago. The cornerstone of my bill is the new authority it gives to all States and communities to restrict municipal solid waste imports. First, every Governor may freeze future imports of garbage at the level his or her State received in 1993. Second, the bill makes it illegal to ship any new imports of municipal waste unless the local community specifically wants it. Third, to reduce pressure on local communities, my bill gives large importing States like Pennsylvania and Ohio the right to lower their imports. Finally, some communities have built regional landfills and we respect those agreements as well. My bill is about returning decisionmaking back to the people, giving people in importing States what should be their birthright, a chance to determine their own destiny. I ask unanimous consent a summary of my bill, along with the text of the bill, be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Seven minutes. (The remarks of Mr. Baucus pertaining to the introduction of S. 443 are located in today's Record under ``Statements on Introduced Bills and Joint Resolutions.'')

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to introduce the Rural Health Improvement Act of 1997. This bill makes rural health care more convenient, more effective, and more responsive. The cornerstone of this bill is an extension of the successful medical assistance facility program, known as MAF's. Without the Rural Health Improvement Act, MAF will remain only a test program which could be discontinued in the future. Passing this legislation will make MAF's permanent and nationwide. Big Timber, MT, is a good example of how MAF could help out a community. It is a small ranching and farming town on the edge of the Absaroka mountain range. People in that town of Big Timber say hi and chat when they see each other on the street. They are very friendly, very down to Earth, very basic. Every year, the town puts on the Big Timber rodeo and black powder shoot. Big Timber is a town like many in rural Montana. A few years back, the hospital in Big Timber had to shut down, as is the case with many hospitals in our country. They could not make ends meet with the regulations of the current system. But instead of watching their health care services leave town, the people of Big Timber got together and applied for a MAF waiver. I was fortunate enough to be in Big Timber last summer for the grand opening of their new MAF building. It was a pretty typical July day in Montana, which means it was very hot. But that did not stop the whole town from turning out for the dedication ceremony. The MAF Program not only saved Big Timber's hospital, but it renewed their sense of community spirit. It was wonderful to watch, wonderful to see. Big Timber faced the same situation many rural communities face every day. They found the solution. Rural life has qualities you cannot find in big cities: The crime rate is low; people go out of their way to help a friend in need; and folks take the time to know their neighbors, even if that neighbor happens to live 5 miles down the road. But challenges come with living in such remote surroundings. One of the biggest is access to quality health care. Randy Dixon, a physician's assistance at Philipsburg MAF, really hit the nail on the head when he wrote to me: Having arrived in your home State, I am greatly impressed with its magnitude and expanse. However, those same attributes turn into detriments when you are considering access to primary health care. My history and recent acquaintances have taught me that the people of Montana are a tough, resilient people. But those acquaintances also tell me that they have not had consistent, reliable primary care available when that ``toughness'' had a dent or two in it. Randy sums up life in rural Montana pretty well, but what he really underscores is the importance of rural medical facilities. In Montana, vast distances and bad weather are about the only two things you can count on. Rural hospitals make up a network that blankets Montana and makes access to health care convenient for folks who are isolated by distance and weather. When one of these hospitals closes its doors, the network falls apart, and people can no longer depend on access to health care. Jordan, MT, is another example. Without an MAF, the nearest health facility would be Miles City, over 80 miles away. And whether you have a serious medical emergency or simply need a routine checkup, 80 miles is too far, often, to travel. Rural communities often don't have the patient base or the money to support a fully functional hospital. Yet, the care that these hospitals provide is irreplaceable. Essentially, Mr. President, there are a lot of communities like Jordan, like Big Timber, Ekalaka, and other small communities in Montana and other parts of our Nation. Under my bill, an MAF can provide emergency services during the day and have someone on call at night. In a small town, that means that the hospital can be opened at a moment's notice. Folks can still have immediate access to emergency care, and rural hospitals do not have some of the same burdens and overhead expenses and all the redtape and regulations that the big hospitals, unfortunately, often have. MAF makes exceptions to rules like that. The whole point of this legislation is to make the MAF waiver permanent, so that hospitals do not have to apply year after year for MAF status. Rather, once that status is determined, that status can be permanent and people in rural communities can rest a little more assured they are going to have pretty good health care.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to introduce the Rural Health Improvement Act of 1997. This bill makes rural health care more convenient, more effective, and more responsive. The cornerstone of this bill is an extension of the successful medical assistance facility program, known as MAF's. Without the Rural Health Improvement Act, MAF will remain only a test program which could be discontinued in the future. Passing this legislation will make MAF's permanent and nationwide. Big Timber, MT, is a good example of how MAF could help out a community. It is a small ranching and farming town on the edge of the Absaroka mountain range. People in that town of Big Timber say hi and chat when they see each other on the street. They are very friendly, very down to Earth, very basic. Every year, the town puts on the Big Timber rodeo and black powder shoot. Big Timber is a town like many in rural Montana. A few years back, the hospital in Big Timber had to shut down, as is the case with many hospitals in our country. They could not make ends meet with the regulations of the current system. But instead of watching their health care services leave town, the people of Big Timber got together and applied for a MAF waiver. I was fortunate enough to be in Big Timber last summer for the grand opening of their new MAF building. It was a pretty typical July day in Montana, which means it was very hot. But that did not stop the whole town from turning out for the dedication ceremony. The MAF Program not only saved Big Timber's hospital, but it renewed their sense of community spirit. It was wonderful to watch, wonderful to see. Big Timber faced the same situation many rural communities face every day. They found the solution. Rural life has qualities you cannot find in big cities: The crime rate is low; people go out of their way to help a friend in need; and folks take the time to know their neighbors, even if that neighbor happens to live 5 miles down the road. But challenges come with living in such remote surroundings. One of the biggest is access to quality health care. Randy Dixon, a physician's assistance at Philipsburg MAF, really hit the nail on the head when he wrote to me: Having arrived in your home State, I am greatly impressed with its magnitude and expanse. However, those same attributes turn into detriments when you are considering access to primary health care. My history and recent acquaintances have taught me that the people of Montana are a tough, resilient people. But those acquaintances also tell me that they have not had consistent, reliable primary care available when that ``toughness'' had a dent or two in it. Randy sums up life in rural Montana pretty well, but what he really underscores is the importance of rural medical facilities. In Montana, vast distances and bad weather are about the only two things you can count on. Rural hospitals make up a network that blankets Montana and makes access to health care convenient for folks who are isolated by distance and weather. When one of these hospitals closes its doors, the network falls apart, and people can no longer depend on access to health care. Jordan, MT, is another example. Without an MAF, the nearest health facility would be Miles City, over 80 miles away. And whether you have a serious medical emergency or simply need a routine checkup, 80 miles is too far, often, to travel. Rural communities often don't have the patient base or the money to support a fully functional hospital. Yet, the care that these hospitals provide is irreplaceable. Essentially, Mr. President, there are a lot of communities like Jordan, like Big Timber, Ekalaka, and other small communities in Montana and other parts of our Nation. Under my bill, an MAF can provide emergency services during the day and have someone on call at night. In a small town, that means that the hospital can be opened at a moment's notice. Folks can still have immediate access to emergency care, and rural hospitals do not have some of the same burdens and overhead expenses and all the redtape and regulations that the big hospitals, unfortunately, often have. MAF makes exceptions to rules like that. The whole point of this legislation is to make the MAF waiver permanent, so that hospitals do not have to apply year after year for MAF status. Rather, once that status is determined, that status can be permanent and people in rural communities can rest a little more assured they are going to have pretty good health care.

Mr. BAUCUS

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

Mr. BAUCUS

Mr. BAUCUS. I thank the Chair. (The remarks of Mr. Baucus pertaining to the introduction of S. 415 are located in today's Record under ``Statements on Introduced Bills and Joint Resolutions.'')

Mr. BAUCUS. How many minutes do I have, Mr. President?

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

Mr. BAUCUS

Mr. BAUCUS. I might say, too, Madam President, that the people understand this. Last year they came from all over Montana to a trade conference I hosted on how we can establish better trade relationships with and engage more deeply with China. People came from all over our State. I was amazed at the success of that conference. The Chinese Ambassador was there, and also, I might add, we invited our U.S. Ambassador to China, the Honorable Jim Sasser--he very much wanted to come but was unable because of a last moment conflict. I might also remind us that American imports also hit a record of about $949 billion last year. We imported more than we exported. That may not be so good. But the point is that we as Americans are competing more than ever before against foreign competition, whether it is in heavy industry, high technology, or agricultural services. It all underlines the importance of trade in general and also the importance of being sure that we have a top-notch trade negotiator to make sure it is all fair. And we certainly have that in Charlene Barshefsky. What has she done? For my State of Montana, I'll mention one thing in particular. She and her predecessor, Mickey Kantor, worked vigorously to enforce agreement with Canada to restrict the deluge of grain coming down to the United States as near as 1993 and 1994. Wheat ordinarily received in the United States was about 1.35 million metric tons of Canadian grain. In those 2 years it rose to about 2.4 million metric tons. It depressed prices in the American markets and violated, frankly, a tentative, implicit agreement with the Canadians. I must say I was very impressed with the vigor and enthusiasm with which Charlene Barshefsky helped negotiate that agreement. Because of her work, Montana farmers got some confidence that trade would be fair. Second, exports of beef. This is the first time in American history-- in 1996--when we exported more beef than we imported. A lot of beef producers in the United States are concerned and have the impression that we import more than we export. That has been true in the past. I might say that about 5 years ago we imported about 2 million pounds of beef and we exported only about 75,000 pounds, in that magnitude. But in the last 5 years it has reversed, and for the first time, in 1996, we exported more. We exported more beef than we imported because, again, of the vigorous efforts of our trade negotiators in opening up foreign markets for American products. I am sure other folks from around the country understand and have similar stories that they can pass on to us. She has done a terrific job. And we need someone of her caliber on the job full time, as we enter a new era in tackling very difficult new issues. I might remind us that for most of the 1980's and 1990's, trade policy revolved around three major areas: in the Uruguay round of GATT, NAFTA, and our market access problems with Japan. These areas still remain on our agenda. We have to monitor the WTO. We have to monitor the NAFTA closely. And our trade imbalance with Japan remains our largest bilateral deficit yet, although it is being surpassed by that of China. It is only fair to say that after a great deal of hard work from Charlene Barshefsky and the USTR staff that our performance with Japan has improved markedly. Counting goods and services, exports are up from $75 billion to over $100 billion last year; quite an improvement. As important as these issues are, we now must look ahead to two new strategic challenges in trade. First is whether to negotiate new trade agreements, and, if so, what should they be? For example, the administration has pledged to work toward a hemispheric trade agreement and also to pursue market access in Asia through the Asia-Pacific Economic Cooperation Forum, and through bilateral agreements. These are broad, long-term, important goals. Much about them remains to be decided. But the administration will soon ask for fast-track authority to make any serious steps forward, and it is clear that Americans have a right to expect greater market access from these countries. I look forward, as we all do in the Senate, to hearing from the administration as to what specific agreement it envisions and how these agreements will address contentious issues like treatment of trade- related labor and environmental issues. When that is available, in principle, I believe the Congress should grant fast-track authority. And I will work with Ambassador Barshefsky and the administration as to what the terms are, of how broad the scope is, so that we have in the Congress a very good mutual agreement and partnership with the administration as we work together to develop these trade agreements. The second is the integration of formerly Communist countries into the world trade system. China, Russia, Ukraine, Vietnam, and other post-Communist nations make up about a third of the world's population. They are large producers of manufactured products, primarily commodities, and agricultural goods. All hope to enter the WTO, the World Trade Organization. Their reform efforts are commendable but remain incomplete. Most of these countries retain pervasive subsidies, poorly developed price systems, and close links between government and business which make them particularly challenging candidates for WTO membership. Weak accession protocols could make market access very difficult for years to come and could also promote dumping in a wide range of areas. China is the largest of these countries and the most immediate candidate for WTO membership--not to mention that it is the world's largest country and the fastest growing large economy. So its WTO access will have enormous consequences in its own right, and it will very likely serve as a model for others. I will have more to say on this subject at a later date. But the USTR and Congress must be very careful and very rigorous. China and other WTO applicants must meet international standards not only on traditional tariff and quota issues but also on national treatment, trading rights, transparency, subsidies, and safeguards against import surges, and many other issues. On our side of the table, we must be willing to address the question of permanent MFN status for these countries if we are to gain the full benefit of their WTO membership. These are difficult and complex issues, but I am confident that Ambassador Barshefsky is the right person to take them on. I can think of none better. She is terrific. She is intelligent, tough, capable, and she has proven herself one of the best public servants America has, and we need her on the job. I support the nomination and I support the waiver to make it possible. And while the Senator from South Carolina has an amendment which raises a very serious and very important issue, that is one which we should bring through the normal committee process. It should not stop the nomination of Charlene Barshefsky. We need a tough negotiator. We have her right before us. We need her now in Geneva. During this week WTO is attempting to negotiate terms with China. We need her there to negotiate for us. I warmly endorse her nomination. I hope my colleagues will do the same. Thank you, Madam President. Mr. ROTH addressed the Chair.

Mr. BAUCUS. Mr. President, I support strongly the nomination of Charlene Barshefsky as U.S. Trade Representative. Why is that? Although the Senator from South Carolina raises very important issues--and I underline that; they are extremely important--I think we can't wait. We have very important trade issues facing us at the moment. We have a superb candidate in Charlene Barshefsky, who is awaiting confirmation. I believe we have no alternative, no choice, but to do the right thing. And the right thing is to get on with it, let her get on with the job, and let's confirm her as our USTR. At the appropriate time, at a later moment, we will take up the issues raised by the Senator from South Carolina, and they are very important issues indeed. I might remind everyone that our international trade is growing dramatically. When Congress created the position of USTR just over 20 years ago, imports and exports, together, made up only about one-eighth of the U.S. economy. Today, international trade makes up nearly a full third of our economy. That is a dramatic increase, from one-eighth to one-third, in just over 20 years. Last year, exports of goods and services reached a total of $835 billion, and in agriculture, which is the largest industry in my State of Montana, we saw exports hit $60 billion last year. (Ms. COLLINS assumed the chair.)

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 Senators Abraham, Boxer, Bingaman, Conrad, D'Amato, DeWine, Dorgan, Moseley-Braun, Murray, and Rockefeller 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 provided a modest but crucial incentive for companies to conduct their research in the United States, thus creating high-skilled, high-paying jobs to 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 $2 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 than does the United States. As a result, while spending on nondefense 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 technological 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 work forces 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-technology 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.