Robert Bennett

Mr. BENNETT

Mr. BENNETT. Madam President, last Friday the majority leader, Senator Daschle, along with the minority leader in the House, Congressman Dick Gephardt, presided over an economic summit and discussed the state of the economy. Since that summit was called, the Dow Jones average has gone up close to 800 points. I would like to congratulate them for their wisdom in calling such a summit and producing that result. I hope they will have another one and we will have the Dow go up another 800 points. I was not planning to talk about this, but when I was on my way to lunch, I checked and discovered that at that time, at least, the Dow was at 8200, whereas it was down in the low 7000s just a week ago. I know this will come as something of a disappointment to those who are hoping in the election that the economy will be seen as terribly under water and will do their very best to try to stir up a sense of blame for the lousy economy and blame it on one party or the other. I am encouraged by the wisdom of the American people. According to the latest polls, the majority of the American people, who have a view on the economy and where it is, understand that we are not in a recession anymore. We are, in fact, in a recovery; all of the rhetoric is to the contrary here on the floor of the Senate. Secondly, the recession that preceded this recovery was caused primarily by the business cycle and was not caused by President Bush's election or any other political event. As I have said here on the floor before, the business cycle has not been repealed. We would like to think we could repeal the business cycle. Indeed, if we knew how, both parties would do it because neither party wants to go into an election situation where the economy appears soft. So both parties--if they understood how to repeal the business cycle-- would quickly take the steps to do that. As a matter of fact, however, as we look at it throughout our history, Congress's record--indeed the administration's record--has not been all that good in terms of dealing with the business cycle. Usually, when we get into the business of trying to outguess it, we make things worse rather than better. I remember reading a book by Paul Johnson where he was talking about the Great Depression and the great efforts being expended by the New Deal. He said the efforts expended by the New Deal administration in the 1930s made the Great Depression last longer and go deeper than would have been the case if they had done absolutely nothing. I commented on that to some Ph.D. economists and said that I understand that is heresy, and they said: No, quite the contrary, Senator. That is basically what has been understood and is being taught in the schools of economics around the country--that the intervention in an attempt to override the marketplace and the laws of economics, however well-meaning on the part of the Government, actually makes things worse rather than better. As we look at our last recession, we know now pretty clearly what caused it. It was the bubble of speculation that surrounded the high- tech industry, and people got carried away with their conviction that the bull market was never going to turn to a bear; that we were always going to be going up, up, and up--as Lucy wanted to in the Charlie Brown cartoon. Charlie said, ``Life has its ups and downs.'' She said, ``I want nothing but ups.'' There were plenty of people in the 1990s looking at the market and the economy and saying: We want nothing but ups. Sometimes that cannot be accomplished. We got out ahead of ourselves--there was too much capacity. The business cycle kicked in, as it always does, and there we were in a recession. The slowdown began--we now know--in the midyear of 2000. I remember, with some interest, because there was an election going on, there were those who criticized then-Governor Bush, who was saying that we were going into a slowdown. They said: No, no, we are not going into a slowdown. You are trying to pretend that it is for political purposes, and isn't it terrible for you to be saying there is a slowdown underway when, indeed, we are still having ups, ups, and ups. We now know that then-Governor Bush was right; we were going into a slowdown in the last half of 2000. It turned into a recession that lasted for three quarters--the last three quarters of 2001. Then we started coming out of it. Well, those numbers don't add up. The recession started in the beginning of 2001. We have now had five quarters of growth--admittedly, not as strong as we would like to have. Admittedly, there are sectors of the economy that are still mired in recession. Talk to the people in the hospitality industry. Travel has not come back since September 11 to the degree that it was there before--particularly business travel. Airplanes are full, but the airplanes are not making any money because in order to get them full, the airlines are heavily discounting fares. So that portion of the economy is not doing well. Housing has done extremely well. Consumer spending stays up because household income has held. The sense of wealth has held because people's houses are worth more. They have lost money in the stock market, but they have seen equity increases in housing, primarily because of lower interest rates. I think the lesson is that we can get carried away with our economic analysis. We can look back and say the economy boomed in the nineties because Bill Clinton was elected President or we can say, no, the economy boomed because Newt Gingrich was the elected Speaker. The fact is, we need more humility as politicians and we need to understand the economy boomed because the American entrepreneurs and business people did a good job. Those of us in Congress and those in the White House contributed to it basically to the extent that we got out of the way and let it happen. Now, we need to have some of that same understanding. I would like to pass the terrorism insurance bill. I think that would go a long way toward bringing the commercial real estate sector of the economy back. That sector is hurting, and one of the reasons is that people will not engage in major commercial enterprises if they cannot get terrorism insurance. We have been sitting on that bill in this body for close to a year. We passed it. It has gone to conference. The conferees have not been allowed to produce a product yet. I hope the majority leader will work with the conferees in allowing them to bring a conference report to the floor before we adjourn. I think that is one thing we can do that would make the recovery more robust than it is. Basically, Madam President, I think we need, as I say, a little humility as politicians, and we need to understand the economy is very sound, very strong, and it is coming back--but a little more steady as she goes rather than a sense of panic is what is called for. I yield the floor and suggest the absence of a quorum.

Mr. BENNETT

Mr. BENNETT. Turning to a piece which also appeared in the Washington Post written by Bernard Lewis, who is considered by some to be the ultimate authority on conflicts in the Middle East, it is entitled: ``Targeted By a History of Hatred--The United States Is Now the Unquestioned Leader of the Free World, Also Known as the Infidels.'' That is an interesting tie: We are the unquestioned leader of the free world, also known in many parts of the world as the infidels. Put that headline against the statement contained in Jackson Diehl's summary of the Bush position paper authored primarily by Condoleezza Rice, and once again you see the big picture. We do live in a world where we are the only superpower. We have the responsibility to do something with that, and President Bush and his advisers have now come to the conclusion that the ultimate test of how we use our power should be how will it ultimately spread liberty throughout the world. That is the kind of flag to which I can repair. That is the kind of standard I can follow. If we were the British in the 1700s and 1800s presiding over the world, the grand scheme would be: How can we enhance and increase British Imperial power? If we were the Romans when they were the only superpower in that portion of the world they cared about, the only big picture item would be: How can we secure and extend the power of the Roman legions? But as President Bush makes this truly Presidential decision out of his gut, he has made it clear that the ultimate question he is asking, and we must ask with him, is, How will this expand the role of liberty throughout the world? That, as I say, is a standard I can follow. So I will be voting in favor of the resolution, not because I have figured out all of the unknowables and imponderables relating to it and not because I am absolutely sure that the Presidential power will be used in the right possible way in every possible circumstance. I will be doing it because I trust George W. Bush's instincts as outlined as clearly as any post-war President has ever outlined America's role in the post-war world. He will use his power to expand and defend liberty throughout the world. He may use it by mistake. He may do things that do not produce that result. But that will be his polestar; that should be America's polestar; that should be the policy we lay down and hold now for generations to come. It resonates with the decision of the Founding Fathers when the country was created. It is a worthy position for us to take now that the country has become preeminent in the world. Let us hope and pray that as we give this President this power it is always used to that end. I yield the floor. Exhibit No. 1 Bush's Foreign Policy First (By Jackson Diehl) For a decade U.S. internationalists bemoaned the absence of any coherent policy for engaging the world after the fall of communism. The Clinton administration, like the Bush team before it, was excoriated for stumbling from crisis to crisis and for consistently making bad judgments about where and how to use America's sole-superpower strength. Now, at last, the internationalists have gotten what they wanted--and the reaction of too many of them is to be aghast. The national security doctrine issued this month by the White House packs into just 34 pages everything the foreign policy of the 1990s lacked. It begins by embracing two facts that have been obvious since 1991, but hard for a democratic and sometimes insular society to accept: that America has unmatched and unprecedented power in the world and therefore no choice but to shape the international order; and that it faces threats that are utterly different but in some ways more dangerous than the threats from the old Soviet Union. The Bush doctrine commits the United States to act aggressively, with others or alone, ``to promote a balance of power that favors freedom.'' The phobias about engaging abroad that paralyzed policy in the '90s, and infuriated the internationalists, are banished. This isn't just the Jacksonian assertion of American interests, though that is surely part of it. There is also a Wilsonian promise to ``bring the hope of democracy, development, free markets and free trade to every corner of the world''--and a Kissingerian strategy of maintaining a ``great power balance'' that decisively favors the United States. the ambition is breathtaking; ``We will work to translate this moment of influence,'' declares the doctrine, ``into decades of peace, prosperity and liberty.'' It is, in short, a bold--and mostly brilliant--synthesis, one that conceivably could cause national security adviser Condoleezza Rice, who executed it, to be remembered as the policymaker who defined a new era. The first proof that Rice and her team are on to something is the alarmist reactions that have greeted her paper. Scandalized members of the foreign policy establishment are calling its treatment of preemptive action an unprecedented policy departure that endorses blitzkrieg as the remedy for anti-Americanism. In a chat with National Public Radio, historian Douglas Brinkley claimed that it ``is simply saying, `We do what we want when we feel like it, and we will declare war on anybody if we think they might be declaring war on us.' '' Policy perestroika usually provokes such first responses. But American presidents have been engaging in unilateral and preemptive military actions all along--most recently in Panama, Grenada and Haiti, and in Iraq following the 1998 expulsion of the inspectors. And what the new policy actually says is this: Because terrorists and rogue dictators now have the potential to do enormous harm to Americans with weapons of mass destruction and are not easily deterred, it may be necessary to strike at some before they can act. Should we again sit still if a future al Qaeda operates large terrorist training camps in a future Afghanistan? Rice's document treats this question as ``a matter of common sense,'' which it is. It also says, sensibly, that preemption is not the answer to all threats--and so far, at least, it hasn't been the legal basis for the White House campaign against Iraq. That Colin Powell now is negotiating the text of another Security Council resolution on U.N. inspections with Russia, Syria and France points to the real weakness of the Bush doctrine--not that it is too radical but that it lacks the political momentum needed to overcome decades of encrusted old thinking and bureaucratic inertia. It's not just that liberal academics haven't signed on to the new doctrine. Inside the administration, it's hard to find anyone--other than Rice--who subscribes to every part of it. Instead, some push the unilateral offense, some the democratic nation- building--and no one quite gets his or her way. In practice, despite all the alarms, the administration's foreign policy, when not entirely paralyzed by internal infighting, mostly follows the old norms. George Kannan's theory of containment eventually won over challengers from the right and left, and thus became the consensus doctrine of the Cold War. Will Rice have the same luck? So far preemption is no more than a scary word used to motivate the United Nations--which, at least in the case of Iraq, is perhaps its best use. Meanwhile, the real heart of the doctrine--the proposition that U.S. strength be wielded to spread liberty through the world--has been barely acknowledged by a policy apparatus that continues to cultivate old and new autocratic allies in the Middle East and Asia. Does George Bush really subscribe to the doctrine issued in his name? Ask Hosni Mubarak, or Pervez Musharraf.

Mr. BENNETT. Jackson Diehl summarizes this way: The real heart of the doctrine, the proposition that U.S. strength be wielded to spread liberty throughout the world, has been barely acknowledged by a policy apparatus that continues to cultivate old and new autocratic allies in the Middle East and Asia. I ask unanimous consent that the entire article appear at the conclusion of my remarks.

Mr. BENNETT. Mr. President, all I know is what I read in the newspapers. Based on what I do know about public policy and what I read in the newspapers, I would be very frightened if all I knew was what I read in the newspapers because newspapers often get things wrong. It has been interesting to me, as we have had the buildup to this discussion in the Senate about Iraq, there have been a number of very thoughtful pieces written that have appeared in the newspapers, and I wish to draw on some of those and quote from some of them at length here today. It so happens that both of the pieces I will use today appeared in the Washington Post, but there have also been useful pieces in the New York Times and the Wall Street Journal. Before I get to that, I want to describe a conversation I had once as a younger man that has been an absolute paradigm conversation in my understanding of politics. I was having lunch with an old friend, a very experienced political hand, a man who had once served President Eisenhower as a close member of his staff. We were discussing a certain candidate for President. I said, somewhat improperly, because it was rather arrogant for me to do this: Is this candidate smart enough to be President of the United States? My old friend answered immediately. He said: Of course not. Nobody is. Then he went on to explain. As I say, he was a man who had been at Eisenhower's elbow during some of the most significant decisions of our time, and he made this point. He said: Every truly Presidential decision is so loaded down with unknowable consequences, with unforeseen possibilities, and unforeseeable challenges that no truly Presidential decision is ever made on the basis of intellect. It is made on the basis of instinct. He mentioned this same candidate, and he said: He has good instincts, and you can back him with a clear conscience. I have thought about that ever since that conversation, and I have realized the wisdom of it. If difficult decisions could be made by smart people and resolved, they would be resolved before they got to the President of the United States because any President in either party has plenty of smart people around him who can figure things out and come to a neat, tidy, absolutely defensible conclusion. But those decisions that do not lend themselves to neat and tidy and absolutely defensible conclusions are the ones that ultimately end up on the President's desk and are ultimately made, as my old friend said, on instinct, out of the gut, rather than intellect out of the analysis. I remember a President who many people thought was lacking in intellectual candle power, who made a very momentous decision. His name was Harry Truman. He described how he was at his mother-in-law's home for Sunday dinner back in Missouri when the phone rang. He went to the entry hall of that old home where the phone was kept--showing how long ago this really was. There was no black box following him around. There was no communications apparatus with instant ties to the White House, just a phone in the entry hall where the phone used to be put in the days when there was only one phone per house, and that would be in a central location. He answered the phone. It was Dean Acheson, who told him the North Koreans had just started across the border into South Korea. President Truman said: We have to stop the--expletives deleted. In later years, he was asked to outline his decisionmaking analysis of the decision to hold the line in North Korea, and he told of the phone call and said: My decisionmaking analysis was that one sentence when I told Dean Acheson: We have to stop the--expletives deleted. He did not think about it any more than that. That came straight out of his gut. And it was Harry Truman's gut that made him one of the Presidents we now revere as one of the greatest of the past century. This decision is about going to war in Iraq or about, putting it more properly, giving the President authorization to move ahead with force if at some point it becomes clear to him that is what we should do. It is in the category of those truly Presidential decisions. As I listen to the debate on the floor, the questions being asked, the analysis being demanded, the effort being made to come up with a clear set of tidy pros and cons that can then be weighed on a balance sheet or an accounting statement and then a carefully crisp decision made on the basis of all of that evidence, I go back to my conversation with my friend. We do not know. No one knows what will be the situation in Iraq if we attack after it is over. We do not know whether the Middle East will be a more beneficent place or a more malevolent place if that attack takes place, and no one does. I can find experts who will tell us this would be the very best thing we could possibly do, and that the Middle East will be much more peaceful, and that liberty will be on the march if we just stand firm. Out of the newspapers we can find plenty of columnists who will tell us that. I can find other experts who will say this is the greatest disaster we would possibly bring upon the Middle East, and that if we attack Iraq, we will unleash a whole Pandora's box of problems. The Arab street will rise up, and America will be hated for 100 years. There are plenty of columnists in the newspapers who will tell us that. I can find experts who will say: Weapons of mass destruction will be used against Israel if we move ahead against Iraq; that there will be biological and chemical attacks not only against Israel but against American installations everywhere; that American multinational companies will become the targets of biological and chemical attacks; and that all of this can be averted if we just continue the discussions. I can find plenty of columnists and people in the newspapers who will tell us that. Then there are those who say: If we do not act, we will so embolden Saddam Hussein and all the other dictators of the area that they will never move in a peaceful direction; we will have inevitable war, and it will be many times worse than anything that would be triggered by action taken now. Again, in the newspapers, I can find plenty of columnists who will tell us that. So this is a truly Presidential decision, and it will be made not in George Bush's head or in the heads of those around him--Dick Cheney, Colin Powell, Don Rumsfeld, Condoleezza Rice, brilliant people all; they stack up their degrees, they stack up their accomplishments in the world, and this is as glittering an array of talent as any President has ever assembled to advise him on foreign policy matters--but the ultimate decision will be made in the President's gut because this is a truly Presidential decision fraught with so many unknowable consequences and possible side effects that no one, no matter how smart, can accurately analyze them in advance and come to a neat and tidy and firm conclusion. I take some comfort in an analysis that has been made of what I would call the long-term and big-picture question, a big-picture question that perhaps can be analyzed a little better than the specifics of whether or not we move ahead with force in Iraq. I refer first to a piece that appeared in the Washington Post written by Jackson Diehl entitled ``Bush's Foreign Policy First--But no one seems to notice-- even at the White House.'' That is the subhead. The ``foreign policy first'' that Mr. Diehl is talking about is the fact that the Bush administration, for the first time since the cold war, has laid down a coherent doctrine and strategy with respect to America's role in the post-cold war world. We all sat in the House Chamber 10 days after the attack, perhaps a week or so after the attack, on September 11, and we heard President Bush deliver a fabulous speech. It had some of the most dramatic rhetoric I expect to ever hear in my lifetime, and it was the finest Presidential speech I have ever heard in my lifetime. As I stepped away from that speech and the emotion of the moment and analyzed it, realized President Bush had, in fact, for the first time in the post- cold war world, laid down a vision of that world and America's role in it. That speech was more than a rhetorical masterpiece. It was a serious policy statement of where America should be. That has been fleshed out in a 34-page statement of foreign policy issued by the White House. That is what Jackson Diehl is referring to when he says Bush's foreign policy first--the first statement of the situation post-cold war as seen by an American administration looking at it in toto. Quoting from Mr. Diehl's presentation, he says: For a decade U.S. internationalists bemoaned the absence of any coherent policy for engaging the world after the fall of Communism. The Clinton administration, like the Bush team before it, was excoriated for stumbling from crisis to crisis and for consistently making bad judgments about where and how to use America's sole-superpower strength. Now, at last, the internationalists have gotten what they wanted, and the reaction of too many of them is to be aghast. Continuing the quote: The national security doctrine issued this month by the White House packs into just 34 pages everything the foreign policy of the 1990s lacked. It begins by embracing two facts that have been observed since 1991, but hard for a democratic and sometimes insular society to accept: that America has unmatched and unprecedented power in the world and therefore no choice but to shape the international order; and that it faces threats that are utterly different but in some ways more dangerous than the threats from the old Soviet Union. I think that is exactly what the President was saying in his statement to the Joint Session of Congress. We must face the fact that we have power unmatched in history and, therefore, cannot abdicate our responsibility to shape the international order and, two, we must face the fact that we still live in a dangerous world and we are ironically more vulnerable now than we were before. Mr. Diehl goes on, after talking about the situation surrounding the word ``unilateral,'' or ``presumptive action,'' and he makes this point: American presidents have been engaging in unilateral and preemptive military actions all along--most recently in Panama, Grenada and Haiti, and in Iraq following the 1998 expulsion of the inspectors. And what the new policy actually says is this: Because terrorists and rogue dictators now have the potential to do enormous harm to Americans with weapons of mass destruction and are not easily deterred, it may be necessary to strike at some before they can act. Should we again sit still if a future al-Qaida operates large terrorist training camps in a future Afghanistan? Rice's document treats this question as a matter of common sense, which it is. It also says, sensibly, that preemption is not the answer to all threats--and so far, at least, it hasn't been the legal basis for the White House campaign against Iraq. I ask unanimous consent that I be allowed to continue for an additional 5 minutes.

Mr. BENNETT

Mr. BENNETT. Mr. President, I join with my colleagues rising not to bury Jesse Helms but to praise him. We can take Shakespeare and turn him on his head for just a moment. I find it interesting that there are some people in the press gallery. That is not very often the case in this situation, in this circumstance in the Senate. I welcome the presence of reporters who will pay attention now as Senators talk about Jesse Helms, because the press, for Jesse's entire political career, has made a caricature of this man, outlined him as some kind of a demon, some kind of an anti- intellectual, some kind of a throwback to an earlier time, and that the body politic would be best served if somehow he could be removed from it. He has demonstrated his appeal to the voters of his State and has stoutly resisted the attempts of those to remove him from politics. Now he has decided that the time for retirement has come. He is leaving at the top of his game and on his own terms. I listened to the stories being told by those who have served with Jesse for a long period of time. I have not had that privilege because I have not been here that long. I have my own story to add, which demonstrates a side of Jesse that needs to be on the record and, once again, people in the press need to understand about this man. My story arose from the fact that I, too, disagree with Jesse Helms on occasion. The issue on which I disagree with Jesse Helms has to do with the National Endowment for the Arts. I have been dedicated to support for the arts all of my life. I have been enriched by association with the arts. In my home, food was a necessity, but music lessons for the children were almost as big a necessity, at my wife's insistence. We have supported the symphony, operas, things of that kind, all of our lives. So when the Gingrich revolution occurred in 1994 and the House sent us an appropriations bill that would have eliminated the National Endowment for the Arts, I found myself in that battle. We came to a late night session where the fight was rising as to what would happen in this situation. I had expressed myself on one side of that issue and had not realized what I had done by virtue of that expression because as we were in the Republican cloakroom that late night, someone said to Senator Dole: What about the NEA? As he walked through these doors on to the floor, leaving us all behind, he said: Bennett is going to handle that. I suddenly realized I had a responsibility I hadn't known about. I took up what could only be called Kissingerian shuttle diplomacy between the Republican cloakroom, between Jesse Helms and Ted Kennedy and Pat Leahy on the other side, and back and forth. Finally, I arrived at a deal. I thought I understood the terms of the deal and took it back to the Democratic cloakroom: If you will allow this, Jesse will allow that. We will get it all done. Grumbling and complaining a little, the Democrats said: All right, we will at least keep the NEA alive. We will give Jesse his pound of flesh. We don't like it, but this is where we are. I reported that to Slade Gorton, chairman of the subcommittee handling the appropriations. He said: It is too late at night. My memory is, this was about 10:30 or 11. He said: It is too late tonight. We will do it first thing in the morning. The next morning came. I went to Slade and repeated the terms of the deal as I had understood them. He said: Fine, let's go ahead. Jesse was in the cloakroom, and I went to the cloakroom to tell him we were about to implement this deal. He looked at me--a very young, new, fresh Senator--and he said: Senator, that is not my understanding. That is not what I agreed to. My heart fell. I didn't know what to say. Here was this pillar of the Senate who had staked his reputation on this particular fight, and he said: If I agree with that, that means that I have agreed to vote against my own amendment. I can't do that. I looked at him in great agony, and I said: Senator, this will set off a whole filibuster, a whole disaster on the other side. I have told the Democrats that this is what it would be. That is what I had understood. I didn't have any solution. I was just there trying to figure out where I had gone wrong in going back and forth. Jesse Helms looked at me, and he said: Senator, that is not my understanding of what we agreed to last night. But if that is your understanding and you have pledged your word to the other side that that is what you will deliver, I will honor your agreement. There are not many around here who would do that, not many Senators who would take a position that was contrary to that which they had publicly espoused for decades, to keep an agreement, when the Senator believed the agreement was not what he had agreed to. There are not many senior Senators who would defend the honor of a junior Senator to make sure that the junior Senator was not embarrassed. I have told that story a lot. I have told that story to the supporters in the NEA, both in my home State and in Washington. I have said to them: You need to understand Jesse Helms. Yes, you will disagree with him. You believe that he is a philistine when it comes to the arts; you don't understand how he can possibly hold the position. But you need to understand the integrity of this man, the compassion of this man, and the willingness of this man to keep alive important personal relationships to see to it that the Senate works. This was an action on his part to see to it that the Senate worked. I am grateful to have had the experience. I am grateful for the opportunity of repeating it to those who might not understand this man. And like those who have spoken before, I will miss him. I pay whatever tribute I can in my humble way to the public service and the public integrity and the example of Jesse Helms.

Mr. BENNETT

Mr. BENNETT. When the bill comes to the floor of the Senate, I will be happy to give it consideration, and I see no reason at the moment why I should oppose it. The Senator commented on unemployment rising. The fact is the unemployment rate is falling. The unemployment rate hit its high in the circumstance of 6 percent and starting to come down in August. It was 5.7 percent. We do not have the September numbers yet. I remember being taught in economics if we were at 6 percent unemployment, we were at full employment. The assumption was the economy could not absorb more jobs than that without going into inflation. We have proven that is not the case. But to panic because unemployment hits 6 percent and is now falling and to say we are not in recovery is, frankly, not accurate. We are in a recovery. However slow it may be, however sluggish it may be, it is a genuine recovery, and we should not panic everybody into believing we are on the verge of a double dip or a major recurrence of recession. Personal income was unchanged in July and rose in August. The Senator said personal income was falling. Again, that is not sustained by the actual numbers. Personal income is rising, and the recovery is stronger than the Senator from New York would have us believe. I spoke on this issue yesterday, and pointed out we were in a recovery which began in the fourth quarter of 2001 when the gross domestic product rose at 2.7 percent. From the first quarter of this year, gross domestic product rose at 5 percent. Previous figures for the second quarter of this year indicate the gross domestic product was rising at 1.1 percent. Those figures have now been revised. They have been revised upward. Looking back over it, we are now told the recovery continued in the second quarter with gross domestic product rising at 1.3 instead of 1.1, and the blue-chip forecast which said in the current quarter--the third quarter--we would see gross domestic product rising at 2.7, the same rate it did in the fourth quarter of last year, that those figures are low; that, in fact, the forecast now is the third quarter of this year will see gross domestic product numbers closer to 3 percent instead of 2.7 as previously forecast. I don't expect anyone to remember all of these numbers I recite. I hope they will remember that the general trend is up and is more encouraging than the Senator from New York and others would lead us to believe. We keep being told we are in a period of great distress and disaster, and we must do something and do something drastic about it. One of the things that is proposed is we must postpone the effect of the tax cut that was passed by wide margins--both in this body and the other body-- at the beginning of the Bush Presidency. I want to discuss that for just a moment. It has been framed with the same kind of statistical maneuvering I have tried to address here. The question that makes for a good headline in a political stump speech is who lost the surplus? They are talking about a $5.6 trillion surplus that was projected at the time we had the tax cut debate. That surplus has now disappeared in the projections that were being made, and we are being asked again and again, Who lost the surplus? The first point I want to make on that score is the surplus never existed. The surplus was a projection. I can take the Nation back through every projection made by the CBO; before that by the Office of Management and Budget; before the Congressional Budget Office was created, by the old Bureau of Budget; and before the Office of Management and Budget was created, and demonstrate virtually every projection of surplus or deficit made by those entities has always been wrong. Sometimes it has been wrong on the high side. Sometimes it has been wrong on the low side. But the one consistency is every project, surplus, or deficit in future years has always been wrong. It comes as no surprise to discover the projection of the $5.6 trillion surplus was wrong in this case as well. I remember a discussion with Alan Greenspan when he was before the Banking Committee, or perhaps the Joint Economic Committee. I sit on both, and he testifies before both. Someone asked him about the projections that were being given to us at the time with great confidence. They said, Mr. Chairman, how likely is it this projection will be realized? He said it will not be realized. This projection will be wrong. He said I cannot tell you whether it will be wrong on the high side or the low side. I cannot tell you and neither can any other economist tell you whether we will reap the benefits of the new age economy to a degree far greater than demonstrated by this projection or whether we will fall on our face and come in flat. The problem is--I am not now quoting Greenspan--with an economy doing something like $11 trillion a year and subject to the uncertainties of the business cycle as well as the outside shocks that can occur in this world, no one can look 10 years into a crystal ball and tell you with absolute certainty what is going to happen. I find it interesting that those who insist the loss of the $5.6 trillion surplus is due to the Bush tax cut and solely to the Bush tax cut also say to us why don't we deal with our current economic problems by postponing the effective date of the Bush tax cut? And, after all, that is going to take place in the outyears, anyway. So postponing the effective date will have no particular impact short term. All right. Hold onto that argument for just a minute and listen to the other argument that we are being told. We are being told it was the Bush tax cut that blew the hole into the surplus. Wait a minute. If the impact of the Bush tax cut is going to come in later years so it can be postponed without making any difference, how could it have been the primary mover in creating the deficit right now? Well, I can tell you how. I was part of the discussions as we crafted the tax cut. Democrats said to us at the time the tax cut was being considered it would have to have an immediate impact. We have to put money in the hands of people right now. We can't wait for the tax cut impact in the outyears. The proposal was made primarily from the Democratic side of the aisle that in addition to cutting the marginal rates for taxes there be an immediate rebate, $300 per taxpayer, right away. That was not part of the original Bush proposal. That came out of Democratic proposals. And, frankly, it seemed like a good idea. The Bush administration embraced it. We have a combination of cutting the marginal tax rates over a period of time into the future and a rebate to get money into the hands of the economy and into the hands of people right away. If, indeed, it was the tax cut that destroyed the surplus right away, it was the rebate side of the tax cut that was proposed by Members of the Democratic party and endorsed certainly by me and other Members of the Republican party. You cannot have it both ways. You cannot say postponing the effective date of the tax cut won't affect the present situation. You cannot say there was an immediate impact which was bad and then say our proposal will have no immediate impact and that is good. This debate has gotten somewhat into Alice in Wonderland. I hope we can stay with the facts.

Mr. BENNETT. I have not gotten to the issue of extending unemployment. I have no particular objection to extending unemployment. I am trying to set the record straight about some of the statistics that are being quoted.

Mr. BENNETT. I will be happy to yield for a comment.

Mr. BENNETT. Mr. President, I have listened with some interest to the Senator from New York and I have some comments to make which I hope will clearly set the record in some areas. She referred to the jobless recovery in which we find ourselves. This is exactly parallel to the jobless recovery that occurred in the early 1990s as we came out of the recession that started in 1990, and the recovery started in 1991. There was a period when the Congress was concerned about the fact that we were recovering, but not enough jobs were created. That is fairly typical of a recovery. The present recovery is no different in that regard.

Mr. BENNETT

Mr. BENNETT. Mr. President, I listened with interest while my two friends discussed this issue. I may as a footnote point out they really are my two friends. My mother used to say you could always tell how much a Senator hated another one by how many ``distinguished'' and ``great friend'' adjectives he used. But, in this case, it is genuine. I think the Senator from North Dakota has raised a legitimate issue about the tone. I would like to do what I can to change the tone of this debate. As I see it, speaking solely for myself as maybe the last Member of the committee, the fight here is about the President's ability--or, more appropriately, the new Secretary's ability--to manage the Department efficiently and effectively. I do not see the history quite the same way in terms of the dispute, Should we have a Department or should we not have a Department in the months leading up to the President's request. I believe that within the administration there was always an assumption that a Department, at some point, made sense, but the administration was not willing to identify a specific set of recommendations as to how that Department would be formed until the President made his statement. So I do not think it was a matter of resisting, resisting, resisting, and suddenly changing his mind. I think it was: We are going to keep our options open. We will not endorse anything. Therefore, we will not endorse the Lieberman bill until we have decided what it is we want. I think the Senator from Connecticut has been more than generous in his willingness to grant good faith to the administration on that issue. I think that is correct on both sides. Now, as I understand the issue, listening to members of the administration, as we meet in our meetings, and listening to the debate both in committee and on the floor, there is no desire, at least substantively within the true policymakers of the administration, to turn this into a partisan fight. I will grant there are those who are willing to grab for any partisan advantage they can find. I would suggest that people who have that inclination exist on both sides of the aisle, populate both parties, and, indeed, may even be found in the Green Party or some other party that likes to pose as being above searching for a partisan advantage. But I believe the problem in this circumstance stems from the high stakes that are involved in making sure the Department is done right. I have addressed this on the floor before, and the Senator from Connecticut has heard me address it in committee. The challenge of putting together a Department such as this is so overwhelming, and the possibilities that it will go wrong if it is not properly constructed in the first instance are so great, that things that might have been resolved on a more normal legislative question become sticking points on this one. I have said on the Senate floor before that I was involved in the creation of the Department of Transportation, which has some similarities to this. Because we took the Coast Guard out of the Treasury Department--I say ``we''; it was done in the Johnson administration. I was in the Nixon administration that inherited this shortly after it was created but while the problems still existed. They took the Coast Guard out of the Treasury Department. They took the Highway Administration out of the Commerce Department. They took the FAA from its status as an independent agency. They took the Urban Mass Transit Administration out of the Department of Housing and Urban Development. And they took several other agencies of smaller stature, pasted them together into a single Department, and discovered major management challenges. Whenever I address this issue in front of a group of business executives who say, Why can't we put this together very quickly, I always ask them the question, Have any of you ever been engaged in a major corporate merger? And when they nod their heads, I say, Do any of you have any thoughts that this will be easy? It is at least twice as large as the challenge creating the Department of Transportation. This is not the same thing as creating the Department of Education, which simply took the Office of Education and slapped the ``Department'' label on it. It still had the same culture, the same work rules, the same procedures. It is not the same thing as taking the Department of Veterans Affairs, which was simply taking an existing office, slapping a new label on it, and saying, OK, we are now going to take veterans and elevate them to Cabinet status. In this case, it is putting together so many disparate agencies, many of which have been functioning in an atmosphere where homeland security is a part, but almost an unimportant part, of their main mission, but because of where they are, they need to be pasted together in this new Department and have a major change. As I listen to the White House individuals talk to us on the Republican side--as we talk about this, they say: This is not really a matter of union versus nonunion; this is a matter of the power of the President and, through the President, his delegate, the Secretary, to organize the Department in the most efficient way. And we are afraid--I am speaking now for the administration, which is maybe presumptuous on my part, but as I hear what they say, it is: We are afraid that if it comes in the form we are talking about here, we will end up with a Department that is unmanageable, and the President will have to go through so many hoops, laid out in departments that are not focused on homeland security, that it will be impossible for the new Secretary to function. I ask all of my colleagues this rhetorical question--I have asked the Senator from Connecticut this question, and he has answered yes--but I ask all of the Senators this rhetorical question: Would you be willing to accept appointment as the new Secretary of this Department in the form in which it is being proposed to us under the Breaux-Chafee-Nelson amendment? I have some management experience. I have been in the executive branch in a Cabinet-level Department. I could not honestly answer that question yes for myself because I watched as the first Republican Secretary of Transportation, John Volpe, wrestled with all of the problems of moving people around the Department. The Congress gave him, a high degree of management flexibility. He could move people around without asking congressional approval for a certain period of time. I should probably research the exact period. My memory is that it was 3 years after the creation of the Department. He could move people, almost capriciously, for 3 years. Secretary Boyd, who was the first Secretary of Transportation, did it for 18 months. I know Secretary Volpe did it until the time came. It was absolutely essential for me, in the office I organized for the Secretary, to have that kind of flexibility. I was moving people around, violating what had been their traditional kinds of protections, simply because the whole thing would not function if we did not have that kind of flexibility. The Congress put a time limit on it because they wanted to make sure that the Secretary would not abuse that power. I remember how concerned Secretary Volpe was that the clock was running, and he had to get the reorganization done before midnight struck and suddenly everything would be frozen again. We were talking about a Department dealing with entirely domestic issues, having no national security implications, in a situation where there was no external pressure, such as a potential attack. And it took 3 years or more before that Department came together and functioned. As I have reminded Senators before, an even larger example of this kind of organization, which is the closest parallel we have to creating the Department of Homeland Security, was the reorganization of the Department of Defense that came after the Second World War. That was in 1947. The Department of Defense probably did not fully function until the Goldwater-Nichols Act of Congress stepped in, what, 15 years later? Certainly more than a decade later. And it is instructive to remember that the first Secretary of Defense, faced with all of these challenges, committed suicide. There are those who say, well, there were other problems in his life. And I am sure that is true. I will not attribute his ultimate depression and decision to end his life to the difficulties of managing the Department of Defense, but it certainly can be said that those difficulties did not help. So if the President were to call me and say: Bob, you have had experience at Transportation; you have been in the executive branch; you have been an appropriator; you have a unique background; I want you to be the Secretary of Homeland Security and serve the country; I would have to say to him: Mr. President, not under the terms of this bill. My ability as the CEO would be hamstrung. The Senator from Connecticut is exactly right. Through his good efforts and his willingness to be open, which is his hallmark and his trademark as a Member of this body, he has worked with the White House in crafting something that is agreeable to both sides 95 percent, maybe even more than 95 percent. There is no point in putting a firm number on it because the two are now tremendously close. The remaining issue is the kind of issue that would cause me to turn down service in this position. May I hasten to say, I am not running for the position, lest anybody have any mistakes about this. I enjoy the Senate too much. As I have tried to look at it as objectively as possible, I have decided that the President's statement that he would veto this bill is a correct one. It is not rooted in a desire to embarrass the Senate or impugn the integrity or the ability of the Senator from Connecticut or his committee on which I serve. It is rooted in a firm belief that the management procedures of this Department, as structured in this bill and as they would remain structured under the proposed amendment, would prevent the next Secretary, whomever he or she may be, from having absolutely essential authority to organize the Department. I have said this before--I will say it again; no one has taken me up on it--I would be willing to put a time limit on the kind of flexibility I think we need. If indeed there are those who are nervous that some future President, even if they give this one every benefit of the doubt, those who are nervous that some future President might abuse this power, I would say: Let's give the President the power he wants on management flexibility and put a time limit on it and say his ability to move people around would expire after 5 years, I would think would be more logical, if he had the experience of something like 3 at the Department of Transportation. On the issue of his ability to designate people for national security, the President probably does not want a time limit on that. He probably believes that every President should be preserved in the rights they have had. That one might be negotiated as well. But as I understand it, these are the two challenges: First, the flexibility factor which, frankly, we have not been talking about on the Senate floor because we have been so hung up on other ones. That would be the one that would give me the most pause if I were the potential Secretary. I would be willing to see if we couldn't work that one out with a time limit. And then the second issue, the right of the President to make a national security decision, maybe we could find a way around that one, too, in terms of some sort of time circumstance. I don't think just because it was done with Jimmy Carter means that it has to remain sacrosanct forever. We can look at it in view of the threat, get some experience under our belt as to how the new Department works, and say that Congress will relook at this at X particular point. My bottom line, speaking solely for myself and not for the administration--because I am not authorized to do that--is that I hope we can, in fact, reach out in the spirit the Senator from Connecticut has always shown, find some solution, but recognize that it is not a political fight to determine who is protecting unions and who is the most patriotic. It is a serious, legitimate, important management challenge as to how much power this President and future Presidents, the newly appointed Secretary and future Secretaries, are going to have to manage the Department in the most efficient possible way to preserve our homeland against attacks. The reality is that the attacks will come. The reality is that some of them will get through. No matter how well the Department is manned, no matter how well the Department is structured, no matter how vigilant the employees of the Department will be--and I will stipulate, I expect that all of them will be vigilant, whether they are union members or nonunion members or don't care--an attack will make it through somehow, somewhere. And then we want to look back on it and say: We did the very best we could to see to it that the Secretary had all of the tools he or she might need. And, yes, this attack got through, but these didn't because we put the Department together intelligently in the first place. I will be happy to enter into whatever discussion the Senator from Connecticut may want to have, knowing that I don't speak for the administration, but I speak as a member of his committee from the other side of the aisle who has always had the highest respect for his willingness to listen, his willingness to cooperate, acknowledge that he has helped me on some of the issues I believe strongly about to his own political peril because there are some Members on his side who did not want to do some of the things I wanted to do. I would hope in the same spirit that he has mentioned here that something can be worked out.

Mr. BENNETT

Mr. BENNETT. Mr. President, we have had a lot of discussion on this floor about the economy recently. Since we are in an election period, we have a lot of discussion on the campaign trail about the economy, with a number of questions being raised--in raised voices--as often happens during a campaign. One of the questions we have heard thunder forth on this floor is: Who lost the surplus? Where did the Government surplus go? Those who ask the question almost always answer it by saying: It was the Bush tax cut that destroyed the surplus. And it is the Bush tax cut that causes us now to be in deficit. As I have contemplated responding to this, my mind has gone back to an old Peanuts cartoon. Charlie Brown and Lucy are having a conversation. In the first panel, Lucy is complaining about various problems in her life. In the second panel, Charlie Brown says: Yes, Lucy, life does have its ups and downs. In the third panel, Lucy makes her position very clear. She says: I don't want any downs. I only want ups. And in the fourth panel, she is marching off saying: Nothing but ups, ups, ups. And Charlie Brown responds with the time-honored comment: Good grief. There are many people who view our economy the same way Lucy does. They do not want ups and downs; they just want ups: a continuum, as far as the eye can see, of years that are better economically than the years before. There was a period of time, in the 1990s, when we were in the longest sustained expansion of our history, where people were saying: Lucy has finally got her wish. We have nothing but ups. During that period, I had the opportunity to talk with Alan Greenspan when he appeared before the Banking Committee. I asked him the question--not necessarily in Lucy Van Pelt terms--but I said to him: Have we repealed the business cycle? As we look at the strength of the economy, and all of the years that are ups, have we now reached the point when the business cycle will not kick in and we will not see a downturn? Well, Mr. President, as you know, Alan Greenspan is one who spoke of the new economy, who spoke of structural changes in the economy as a result of the information age and the application of technology to our decision making. But when I asked him the question with respect to the business cycle, he smiled that wry smile of his and said: No, Senator, we have not repealed the business cycle; it will still manifest itself in the years ahead. And it has. I brought this chart to the Chamber to demonstrate when the business cycle started to give us a ``down.'' You can see, in the third quarter of 1999, we were still in a strong ``up'' mode. In the fourth quarter, Christmastime, it was strong. While we did not do so well in the first quarter of 2000, we were still in the very strong ``up'' territory. But by the third quarter of 2000, all of a sudden we were down dramatically. We were still not in a recession, because a recession technically is when the economy is shrinking rather than growing, but there was very anemic growth, indeed, of 0.6 percent in that quarter. You get to the fourth quarter, Christmastime, where before you were up with a growth of 7.1 percent, and now you have a growth of 1.1 percent. It was not a recession technically, but it certainly felt like one. Before, we had been in strong territory, through the 1990s and on into the first half of 2000, and suddenly we were down in this weak territory in the last half of 2000. In the first quarter of 2001, we slipped into red territory and negative growth, minus 0.6 percent growth in the first quarter; minus 1.6 percent growth in the second quarter; coming back out of the business cycle, minus 0.4 percent growth in the third quarter; and then, in the fourth quarter of 2001, back into positive territory again. In the first quarter of 2002, we have strong growth again. Then we are back to 1.3 percent growth. But these cross-hatched areas show what the economists are predicting for the remainder of the year. So we go from the stronger period of the ups that Lucy Van Pelt loves, then the business cycle comes again, we have a recession, and then we start to come out of it again. To those who say: Where did the surplus go? and, Wasn't it eaten by the tax cut? I say the answer is very clear: It was eaten by the business cycle. What causes the business cycle? What causes things that have been going well for so long to suddenly go wrong? There are several reasons. Let me try to discuss each one of them. The first thing that causes the business cycle is, quite frankly, bad decisions--bad decisions on the part of policymakers in Government, bad decisions on the part of business men and women, bad decisions on the part of managers. One of the reasons we have seen the severity of the business cycle tamp down a little, so that the swings are not nearly as wide as they used to be in my father's business days or my grandfather's business days, where we do not have anything like the panic of 1873, we do not have anything like the Great Depression of the 1930s anymore, is that business men and women have better access to information and, therefore, they make fewer mistakes. The classic business cycle in the manufacturing world would run like this--this is oversimplified, but it illustrates the point. You open a factory, and you start to produce widgets. You can see I went to business school because in business school they always talk about widgets as the generic product. All right. You open a factory. You start to make widgets. Let's say your widgets sell pretty well. As the sales reports come in, you, as the manager of the factory, the manager of that business, say: We need to build more capacity. We need to make more widgets because there is demand for widgets out there. So you double your shift. You put on two shifts, and you are having twice as many widgets come out of your factory. Pretty soon, people say to you: The wear and tear on our machinery is such that we need to build a new factory to meet this demand for widgets. So you invest in a new factory, and you are back to one shift, but now you are producing something like three times as many widgets as you were before. And you are now in the ``up'' period because people who make the raw materials that go into widgets are selling them to you, they are paying their employees, they are buying raw materials from their suppliers, and it is all running through the economy. There is prosperity. While there is prosperity in the economy, there is prosperity in the Government, because all of the employees of all of these companies being hired to help you make more and more widgets are paying taxes on their income. They are paying taxes on the profits they make in selling supplies and other material to the widget maker. Then one day, someone walks into your office as the head of that widget company and says: Have you noticed how many widgets we have in the storeroom? Have you noticed how big our inventory of widgets has gotten? We have so many extra widgets that we have not shipped that we need to shut the factory down until we work off the excess inventory. We need to shut down at least half of our capacity until all the widgets in the storeroom have been cleared out and sold. You made a wrong decision to keep manufacturing widgets when the demand started to fall off or level off. You didn't realize it was the wrong decision. It didn't feel like the wrong decision, as you expanded capacity, but now the proof is in the inventory. It is piling up on the back lot, and it is overrunning your storehouses. You have so many extra widgets, you have to say: Shut the factory down; mothball the extra factory we built because we are not going to be returning to that for quite a while; lay people off until we can get rid of all of the excess widgets we have. So you go into the downside of the business cycle. You go into a recession. And as you stop manufacturing widgets, you stop ordering raw materials from all your suppliers, and they stop ordering goods and services from the people who supply them. And those people get laid off, and the Government doesn't get any taxes because none of those employees is taking home a paycheck. Indeed, they are now drawing unemployment compensation so the Government is seeing more money go out at the very time less money is coming in, and the Government starts to run deficits. We are in a recession and everybody gets concerned. Gloom and doom overhang the economy. Then one day the same person who walked into your office and said, do you know how many widgets we have in the storeroom, walks into your office and says: Do you know how bare the storeroom is? We have sold all of those widgets. We have sold all the widgets that were in the back lot. We have sold all the widgets that were in the warehouse. We don't have any widgets. There is still a demand for them out there. You better gear up the factory. So you get on the phone and you call your workers back and you say: We have to gear up the factory. Once again, you should have done it earlier, but you made a mistake. You had bad information. In the 1950s, in the 1960s, in the 1970s, you were dependent on hand counts of inventory, sales figures that were sometimes weeks, if not months, after the fact, and it was inevitable that even the best manager would make the wrong decision on the upside and make the wrong decision on the downside, which meant that the business cycle was more and more extreme by virtue of bad information. The main contribution of the information revolution to the business world has been good information with which a manager can now say: Wait a minute. There is a softening in widget demand. We will eliminate the second shift, but we will continue to operate both factories. Instead of the wild swings that we used to have in the business cycle, today's swings are narrower and softer, but they are still there because, inevitably, at some point, someone will overestimate sales and thereby build too much capacity and then, on the other end, underestimate sales and have to turn around, and you will get a business cycle. In historic terms, this recession, outlined on this chart, is milder than any we have had. Those with memories go back to the recession that started in the early 1990s. That recession was much sharper and more difficult and more painful than this one has been. If you have an even longer memory, go back to the recession of the double dip in the early 1980s when we had economic devastation that would make these kinds of numbers look like paradise. I remember being taught in school that 6 percent unemployment was full employment, that the economy could not absorb any more than 94 percent of the available workers and when you got to 6 percent unemployment, you were at full employment. In the 1990s, we got down in some parts of the country to 2 and 3 percent unemployment. There were times in my State where employers could not hang on to workers because there were so many jobs. They said: Our biggest problem is trying to get labor. Interestingly, at the height of the latest recession, at the time of greatest difficulty in the job market, there was wringing of hands, weeping and wailing and gnashing of teeth because we hit 6 percent unemployment. The unemployment rate has started to go down now from 6 percent, after hitting that peak. So in historic terms, this is a mild recession, but what comfort is that to people who have lost their jobs and, more importantly, to the issue I started out to discuss: How about the surplus and what has happened to the surplus and who lost the surplus? You can anticipate my answer to that. The surplus was lost to the business cycle. I said there were several things that cause a business cycle. I have given you the one that happens within the business cycle itself. The other is that outside things come along. The oil shock that hit us in the 1970s helped trigger difficult times. September 11 hit us just as we were struggling with the economic downturn and made it deeper and longer than it would otherwise have been. Outside shocks and outside circumstances can also trigger a business cycle. So it is not just bad decisions on the part of business leaders; it is also outside problems. We had both of those hit at the same time. The business cycle turned us down, and then September 11 hit us. We have still not recovered from September 11. I was speaking to a good friend in the hospitality industry. He said: After September 11, we were off 20 percent from the norm. This is an industry that is bigger than the automobile industry in its total impact on the economy. I spoke to this leader over the weekend and said: Have you recovered yet? He said: No, we have come back in relative terms. We are now only 10 percent down from the norm. But in that industry, 10 percent is huge. We have seen airlines that are faced with bankruptcy because people are afraid to fly. They are filling their planes, but they are filling their planes with cut rates that can't possibly give them an adequate rate of return. What happened to the surplus? What happened to the surplus is that the economy got hit with business cycle problems and with outside shocks simultaneously and, as I was describing in the widget business, when the economy gets hit, the Government gets hit. Tax revenues go down as business activities go down. As these numbers remain strongly blue and go strongly blue into the future, the tax revenues will come back. They will come back by virtue of the strength of the economy. The fundamental rule I want everyone to understand is this: Money does not come from the budget. Money comes from the economy. We can pass any kind of budget we want. We can make any kind of projections we want. But we will be humbled by the realities of the marketplace every single time. Sometimes the marketplace will produce more revenue than we budgeted for. That is what happened in the 1990s. We budgeted, hopefully, to get to a balance by 2002, and the economy surprised us and took us not only to balance, but surplus, in 1999. We were then budgeting surpluses for as long as the eye could see. The economy said: No, you are forgetting the business cycle. That, plus the attack of the terrorists, threw us into this situation, and Government revenues went down, regardless of what we budgeted. Let us understand, when we talk about what happened to the surplus, that it was not the passage of the tax cut that caused the surplus to disappear, it was not really much of anything we did here on the floor--except as we reacted to the two realities that hit us unexpectedly. The business cycle came along and said I have not been repealed, and the economy slowed down, and then outside shocks hit us in the form of a terrorist attack that devastated large segments of the economy that have still not recovered. Those of us who are so sure that we control this economy, and what it does by virtue of what we pass here, need to have a little more humility and a little more understanding and realize once again that the most important thing the Government can do in order to maximize Government revenues is to create an economic climate in which market forces can produce the greatest beneficial result. But even at those times, when the atmosphere is most conducive, the business cycle is still with us and will humble us if we keep thinking that, like Lucy Van Pelt, we can go through life with nothing but ups, ups, and ups, and never face the reality of the occasional down. I appreciate the indulgence of my fellow Senators. I will have more to say on this at another time when we have a sufficient amount of morning business. I recognize the time has come to return to the debate of the bill on the floor. I yield the floor.

Mr. BENNETT

Mr. BENNETT. I thank the Chair and ask unanimous consent that I be recognized for the next 20 minutes.

Mr. BENNETT. For another 20 minutes?

Mr. BENNETT. Mr. President, may I inquire as to the parliamentary situation? Are we in morning business?

Mr. BENNETT

Mr. BENNETT. I will yield the floor. The Senator from Texas wants to get into this, and I am more than happy to facilitate that for him. Let me close my statement with this comment. By virtue of my own background and my committee assignments, I happen to find myself in front of groups made up of executives perhaps more often than not. I asked this question, whenever this subject comes up, to the executives that are talking to me about this Department. The first question: Have any of you ever been involved in a major corporate merger? Immediately, the smiles start around the room as the understanding of the implications of that question get through to them. They nod, yes. I ask: Has it been a pleasant experience? In every case, the answer is no. Mergers are always difficult. Here is a merger involving 170,000 employees gathered together from some 22 different agencies, each with its own culture, background, personnel procedures, and understanding. Anyone who thinks Government employees live in a monolithic world, regardless of which agency they work in, lives in ``Alice in Wonderland.'' Every agency has its own culture and its own way of doing things, and it is almost impossible to get them to deal with each other. Then I say to them: If you were tapped by the President to be the chief executive officer of this new agency and you were told the employees who came into the agency in the process of it being created brought with them, by law, all of the personnel procedures and activities they had in their previous agencies, would you take the job? I have not found a single volunteer yet. Basically, aside from the legalities of this--which, again, as a layman I hear the lawyers arguing back and forth--aside from the legalities, that is what drives me in this debate. I want to view this as an agency which is governable when it is created. As I said on the floor before, I lived through the creation of the Department of Transportation and all of the difficulties connected with bringing those groups together--a big Department but, compared to this, relatively small. I was at the shoulder of the second Secretary of Transportation, John Volpe, as he wrestled with those problems. I saw firsthand how essential it was for him to have flexibility in a variety of ways which the organized government employees unions did not want to give him. He got it in the creation of that Department by congressional mandate, and he was able to do what he was able to do by virtue of that. I was not around, but I can read about the creation of the Department of Defense, which was on the scale that we are talking about here. It is not beyond the importance of our understanding how significant this challenge is going to be for us to recognize that the first Secretary of Defense committed suicide under the pressures of trying to make this all work. The Department of Defense probably never did work until after the Goldwater-Nichols Act, some 15 or 20 years after it was formed. Let us understand as we go forward that we should be erring on the side of giving the Secretary and the President more flexibility, more authority, more ability to move quickly rather than less. I yield the floor.

Mr. BENNETT. I thank my friend from Nebraska. But he comes back to the basic statement I made to the Senator from Connecticut. If in fact this is not really changing anything, and in fact there will be no significant delays, and if in fact the President has not lost any power, why is the amendment being offered? Why don't you just say if, in fact, nothing is going to change, we will not change it? And the issue that has been raised again and again is that the Senator from Texas put that exact statement in his amendment, he and the Senator from Georgia, that says nothing in this bill shall diminish the existing power of the President and the amendment before the Senate makes it very clear that statement has to go. There has to be, by definition, some diminution of the power of the President. I remember in such few Supreme Court cases I have reviewed one situation where the Court was confused what Congress was doing-- surprising the Court would ever be unclear what we do; it is always so clear--the Court came down on the one side of the case with this comment. It said: We cannot assume that Congress committed a vacuous act. Therefore, they must have intended to have changed something or they wouldn't have passed this. That is where we are here. We must, if we adopt the amendment proposed by the Senator from Nebraska, be assuming some diminution of the President's power. If not, why are we doing it? Once again, I am perfectly willing to talk about diminution of the President's power if it is arbitrary and capricious and if it is damaging to the due process of employees. But this Department is not the place to experiment with that. This Department is the Department that is geared for quick action, for quick protection of Americans under attack, and of all places where the President's ability, the Secretary's ability to move quickly should not be hampered by additional requirements, this is the place. This is the Department where that should not happen. To turn that proposition on its head and say that the President's power is as it is in every other Department, but it will be slowed down in this Department, is something I don't understand.

Mr. BENNETT. I am happy to yield, with the understanding I do not lose the floor.

Mr. BENNETT. Mr. President, I thank my friend from Connecticut, the chairman of the committee, for his attitude and his approach to this. I will, in good faith, go back and examine it. In honesty, though, I must indicate I am not sure examining it is going to change my position, for this reason: The Senator from Connecticut has magnanimously, and I think accurately, said he does not believe our current President will abuse this power, and he has referred to some future arbitrary President. Nonetheless, he says there will be some kind of review. At the risk of sounding paranoid myself, I think that is enough of an opening, enough of a crack in the door, for some future union leader, who might not have the same kind of motives that are being attributed to our current President, to go through that opening and, for reasons totally unrelated to the mission of the Department, reasons totally unrelated to the protection of the American homeland, decide that he or she wants to pick a fight with the President and set in motion a series of hearings and activities within the civil service procedure. I do not know how many other Members of this body have served in the executive branch and been involved in civil service procedures. I have. I went into the executive branch thinking I knew something about personnel. I had hired and fired, I had been involved in difficult challenges, and I thought I understood the process. I was the biggest babe of all the babes in the woods when I got into that circumstance. I ended up with an employee who was totally incompetent, totally unqualified for the position into which I innocently and foolishly placed her. I immediately tried to get rid of her. I served in the administration for 2 years. Then I left the administration, and while I was in my private life, I got a phone call saying I had been summoned to a civil service hearing on the case of this woman X number of years after I had left the Government. I went to her hearing, and I testified in her hearing as to the situation. I was astounded that it was 3 or 4 years--whatever the amount was--after we had initiated the action to remove her from the position for which she was totally unqualified. It had dragged on that long. I had finished my service in the executive branch. I was out in private practice. I was called back in to testify, and it was made clear to me that this hearing was by no means going to be dispositive of the case; it would go on beyond that. If there are additional hurdles being placed on the President's authority in this Department by this amendment, in all good faith, with a sincere attempt on the part of my friends who are working on this amendment to try to come to a resolution, my hesitancy stems from that experience. If indeed some labor leader decides he or she wants to pick a fight with the President and use those additional hurdles for some motive unconnected with national security, I am not comfortable giving them that opportunity, particularly when they do not have it now. The argument is being made, they are being transferred into a new Department and so they need to be protected. The statement by the Senator from Connecticut, that I quoted back to him and he said I was probably right, is this is being done to give them a sense of protection and comfort but that substantively it is not any different. It may very well be that at the end of the day, after it goes through the courts, substantively it will not be any different. The position taken by the Senators from Louisiana, Connecticut, and Nebraska will be exactly right. But if that day comes after 6 years of adjudication and fooling around, with a Department that must be almost at hair-trigger capacity to deal with the threat, I am not going to accept that. That is my concern. To say at the end of the procedure the President will not have lost any power, all he will have had to do is go through some additional procedures to exercise his power and therefore nothing is threatened, is to say we are not focusing on the mission of the Department. The whole reason we are creating the Department is so we will have faster response time, so we will have better coordination on a threat that did not exist when these situations were created in the first place.

Mr. BENNETT. The question arises, why are we doing it? Either there has been a misleading of the unions so they feel a false sense of security that they do not really get or there is, in fact, some substantive change that we are supposed to not notice on this side of the aisle. As I say, I do not challenge the intelligence, the integrity, or the motives of anybody who has engaged in this debate, but as a layman, standing here for an hour and a half, listening to the debate go back and forth, I draw that conclusion. I find myself quite perplexed over the intensity with which this battle has been fought if indeed that is where we are. I see the Senator from Connecticut is on the floor, and I will be happy to yield to him for whatever comment he may wish to make.

Mr. BENNETT. Mr. President, I have been here for an hour and a half now listening to this debate, listening to the argument going back and forth, and the conclusion I think I hear from the Senator from Louisiana and the Senator from Connecticut is an interesting one. It may not be the conclusion they really think they came to, but the conclusion I hear them saying, particularly in the final statements that took place, is they put this in the amendment to give the labor unions a sense of security but, in fact, that security is not there, so we can vote for the amendment with a clear conscience; that they did what the unions wanted them to do so they would not feel nervous about being put into this new Department, but reading their interpretation of the law, they are saying it really does not make any difference. The last comment from the Senator from Connecticut that even an arbitrary and capricious action by a President--and he made it clear he did not expect this President to do that, and I appreciate his graciousness in that, but then in a hypothetical, an arbitrary or capricious action by a President could still go unchecked under this amendment and, therefore, we ought to embrace it. If that is, in fact, the case--I will look at it very closely with some help from people who are burdened with a legal education, as I am not--if that is, in fact, the case, I think the Senator from Connecticut has just exposed himself to a little criticism from the unions. How can he have misled them into thinking he was doing something substantive on their behalf and at their behest if, in fact, it is not substantive and the President would get everything he wants? Of course, the same question arises from the White House. If, in fact, the White House is seeing no substantive change and this is more of a cosmetic kind of a thing, why are they threatening to veto? So I am now going to leave the floor and go to lunch. I have some time scheduled later in the afternoon when I will talk about something else, but I have found this to be a very interesting exchange. Without in any way attempting to diminish the sincerity, integrity, or intelligence of those who have engaged in the debate on both sides, it strikes me a little like the medieval debate about the number of angels who can dance on the head of a pin. If, in fact, as the Senator from Louisiana said and then the Senator from Connecticut summarized, the net effect of this amendment in this area is to not change the law or ultimately take any of the President's power away----

Mr. BENNETT. Mr. President, I ask unanimous consent I be allowed to make a comment without the Senator from Tennessee losing the floor.

Mr. BENNETT. I am not challenging that. I don't want to trigger another discussion of all the rationality. I want to cut to the question that the Senator from Connecticut asked: Why can't we come together, as we always do with legislation, and get this thing moving forward? I ask the Senator from Tennessee, Should we be aware of the fact that, right or wrong, the President, as is his right under the Constitution, has made his intentions very clear? And shouldn't we be paying attention to that as we make our negotiations as well as all the other issues that have been discussed on the floor?

Mr. BENNETT. Mr. President, I have heard this debate. It reminds me of why I didn't go to law school. It is easier to hire people with the expertise of the Senators here who have gone to law school to try to explain this than it is to understand it yourself. I have a very simple question coming from a more simple attitude about this whole thing. Is it not true that the President of the United States has said he will veto this bill if it has this in it? If that is the fact, it doesn't matter if we have 99.400-percent agreement on everything else. The legislation is not going to go forward. I ask the Senator from Tennessee, who is in closer touch with the White House than I am, if it is not true that the President said he will veto this bill if this is in it?

Mr. BENNETT. Mr. President, will the Senator yield for a further question?

Mr. BENNETT

Mr. BENNETT. Madam President, I have no objection to this request, but I understand there is a Senator on this side who wants to review it further, and on his behalf I object at this time.