Jeff Bingaman

Mr. BINGAMAN

Mr. BINGAMAN. Mr. President, that does not. It leaves the funding at the level the administration requested, which is $29 million, but it would delete the initial $118 million that was added by the committee.

Mr. BINGAMAN. That would be fine if we could have 15 minutes tomorrow morning before the vote, equally divided.

Mr. BINGAMAN. Mr. President, reserving the right to object, can I just clarify something? If we can have that half hour of debate beginning at 9:15 tomorrow right before the vote, that would be ideal.

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

Mr. BINGAMAN. Mr. President, I yield the floor.

Mr. BINGAMAN. Mr. President, let me just add a couple of items that I overlooked, since we have just another couple of minutes here before the vote occurs. As I indicated in describing the amendment, we are suggesting that the $118 million which we are trying to delete from the bill for the space-based laser program be, instead, transferred over for Air Force and Navy flying hours. The reason I have offered that suggestion is a letter from the Secretary of Defense to Senator Levin, and I am sure Senator Thurmond also received a copy of it. The letter is dated the 23d of May. Former Senator Cohen, now Secretary Cohen, stated in this letter: In addition to adjustments reflective of the Quadrennial Defense Review, I recommend a fact-of-life adjustment concerning flying hour costs. The Navy and the Air Force are both experiencing greater costs per flying hour than anticipated in their budgets. We are currently analyzing the causes of this increase, but the preliminary indications are that the increase is caused by greater spare parts requirements per flying hour than were experienced in the past. We estimate the impact of these increases to be $350 million for the Navy and $200 million for the Air Force. So he has requested that we add the total of $550 million to the combined flying hours for the Air Force and the Navy. This amendment adds $59 million to the Air Force and $59 million to the Navy. Obviously, it does not meet the entire requirement as stated by the Secretary of Defense, but it moves us in the right direction. So I do think this is a better use of the funds. It is a use that the Pentagon itself and the Secretary of Defense have indicated they support. For that reason, that is what we are suggesting be done with the funds. Mr. President, let me also, before I yield the floor again, ask unanimous consent that Senator Dorgan be added as a cosponsor of this amendment.

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

Mr. BINGAMAN. Mr. President, as I indicated, the bill that we have before us adds $118 million to what is called the space-based laser readiness demonstrator program. That funding level represents 5 years' worth of the planned space-based laser funding--planned by the Pentagon. In order to sustain the program at this increased level, which the committee has reported here, would require an additional expenditure of somewhere between $200 million and $300 million a year, which is more than 10 times what is planned for future budgets. Mr. President, let me try to demonstrate the difference that I am talking about with this chart. This chart tries to lay out between now and the year 2005 the current rate--which is in green here on this chart--the current rate of funding, cumulative funding, that is requested for this space-based laser activity by the Pentagon, and the yellow in this chart is what the committee would propose to begin adding. Now, we do not do all of that. This is a 1-year defense authorization bill. We just add $118 million to the $29 million that the Pentagon requested the first year. But if you take the best figures that have been given us and say we are going to have an additional $200 million a year added, so you put the cumulative amount there, you can see that the total amount by the year 2005 is a very substantial figure. The larger context for considering this space-based laser program involves four basic questions. Let me briefly go through each of those. First of all, what is a space-based laser? People need to understand something about that, and I will try to explain it. Second, how would a space-based laser fit into the U.S. plan for a national missile defense? Third, is there a threat that warrants or justifies developing and deploying a space-based laser? And finally, No. 4, would it be affordable for us to do so? Would it be cost effective for us to do so? Let me try to explain first what a space-based laser is and then answer each of these other questions. Mr. President, the space-based laser, which is the subject of this amendment, is technology that was born in the early days of the Strategic Defense Initiative, SDI. For those who have followed this set of issues over the last decade or so, they will remember the star wars proposals that we debated on the floor. The crown jewel of that star wars program was the space-based laser. It held out the promise of tens of satellites constantly orbiting the Earth ready to zap the hundreds upon hundreds of Soviet nuclear ballistic missiles that were launched from land and sea both. The idea behind the space-based laser is that we would orbit a group of perhaps 20 or perhaps more very large satellites. Each satellite would be in the range of 80,000 pounds and each of them would be equipped with a chemical laser on the satellite. The chemical laser would produce a beam of very high-energy laser light that would then be focused very carefully with a very huge mirror so that the laser beam could be focused on missiles when they were first launched. That was the idea of getting up in space, so that you could zap a missile when they first launched it. You didn't have to wait until the missile actually came near your territory. This would require having equipment on the satellite capable of detecting and tracking and pointing the laser at a relatively small object some 1,300 kilometers away over a long enough period of time to permit the laser energy to destroy the missile. The satellites are so large, the satellites contemplated in this program of space-based lasers are so large and so heavy, we would have to design and build an entire new series of heavy space-launch vehicles with enough lifting power to get one of these huge payloads, 40 tons, into space--80,000 pounds, 40 tons. There is today no rocket, there is no space-launch vehicle currently in our inventory that can boost such a large payload into space. The cost of building such a booster would represent a significant part of the cost of any space-based laser system. The space-based laser readiness demonstrator which we would fund or begin to fund with the $118 million provided in the bill is meant to demonstrate that the many technologies that are required in order to accomplish what I have just described can be met and overcome. The demonstrator would be a reduced size system with all the necessary technology and parts to make all the components work together at the same time. This would presumably cost several billion dollars to find out the answers to these questions. The money does not exist anywhere in the Pentagon's budget plan for this coming year or the next 5 years, or the out years even after that. So, clearly that money would have to come from other defense programs. I should point out that this chart, which takes us through the year 2005, does not get us to actual deployment, or development even of a space-based laser. This only gets us to the development of this demonstrator, which I think, as I indicated, is a half-size replica of what we would actually be talking about developing at some future date. The second question I mentioned, which needs to be dealt with, is, how does this space-based laser fit into our National Missile Defense Program? The United States is developing a National Missile Defense System to defend against a small Third World nation ICBM program, an intercontinental ballistic missile program that has not emerged yet and is not, in fact, expected to emerge for another 15 years. But we are developing that program. The National Missile Defense Program is designed to be compliant with the ABM Treaty, although it remains to be seen whether we might need to change or propose changes or withdraw from that treaty at some time in the future. There is no U.S. plan to deploy a space-based laser system, and we know of no justification today for doing so. That is why the Pentagon has asked merely to continue with research and development funding in this area. Furthermore, the cost of deploying such a system would be enormous. The existing National Missile Defense System Program involves developing a ground-based missile interceptor capability which is very different from a space-based laser. The ground-based defense system just had its development cost increased from $2.3 to $4.6 billion. The administration requested that increase. Our committee is proposing that the Senate go along with that increase. We are adding $474 million to this year's defense bill in order to do that, and nothing in our amendment that I am talking about here would affect that at all. But the cost to deploy the National Missile Defense System last year was pegged at about $10 billion. When you add to that the space and missile tracking system, you get another $5-or-so billion. So we are already planning on paying something in the order of $17 billion for the limited National Missile Defense System that is designed to stop a handful of rogue missiles coming into this country. As I said before, we have no plan, however, to pay the additional tens of billions of dollars to actually develop and deploy a space-based laser. The third question that I cited when I began my comments is, is there a threat that this country faces to our national security, a threat that would justify developing and deploying the space-based laser? The National Missile Defense System that we are developing today that I just described is meant to defend against a handful of these ICBM's that might be launched at some future date by some rogue nation, if they develop the capability to do that. According to the administration, there is no significant ballistic missile threat being faced by the United States today. North Korea is the only nation considered to be actively trying to develop such a missile. But the North Korean economy is in terrible shape. Their own military, according to the best information we have, is going hungry in some cases. The Defense Intelligence Agency publicly stated that their country is--I believe they used the phrase ``probably terminal.'' Neither Russian nor Chinese strategic missiles are considered a threat today because neither nation has a plausible reason to attack the United States. And, of course, we maintain an overwhelming nuclear deterrent capability, which we should maintain. The United States and Russia have detargeted their ICBM's and their SLBM's, which means that no accidental launch could be expected from either territory toward the other country. So this is not a threat situation that requires a space-based laser. This is not a threat situation that requires rapid and expensive development of this so- called readiness demonstrator, as this accelerated program is referred to. The final issue I wanted to mention is the issue of cost. Is the space-based laser either affordable or cost effective? Last year's Defend America Act, as proposed but not as enacted, included a requirement for space-based lasers. That was a primary factor that led the Congressional Budget Office to estimate the cost of the system at up to $60 billion to procure and up to an additional $120 billion to operate it over the next 30 years. The Department of Defense stated recently that CBO's cost estimates may have been too low and that the cost of building and launching a space-based laser system is almost certainly higher than those figures. One reason for the high cost, as I mentioned in describing a space- based laser, is the cost of launching the heavy laser systems into space. We need a heavy-lift booster that does not exist today. It would be very expensive to develop. The cost of such a system is totally outside the realm of the current budget or the planned defense budgets. This would not be affordable, and it is not likely that it is cost effective against the limited emerging ballistic missile threat. The current program is designed to handle any foreseeable limited ballistic missile attack from a rogue nation. The Department of Defense has recently doubled the cost estimate for the development program, as I mentioned, and there is no plan to deploy even that ground-based missile interceptor system today unless and until a real threat emerges. If such a deployment is warranted, obviously we will have to spend substantially more. But none of the deployment funds are planned in any future defense budget even for the ground-based missile defense system, the missile interceptor system that I described. DOD has no plans to fund the space-based laser program at the much higher levels that are proposed in this defense bill. DOD clearly has higher priorities. We need to protect those higher priorities and not pass a bill here which commits us or which starts us down the road toward spending money on programs that the Department of Defense has not requested. The bottom line is that we are nowhere near deploying a space-based laser. There is no need for us to do so. The administration already has a very expensive National Missile Defense Development Program underway. And unless this amendment that we are offering here this evening is adopted, the Senate will be putting five times as much money into the space-based laser program as the administration has requested in 1998, and we will be starting down the road to developing a demonstrator and eventually a space-based laser program that will be hugely expensive and of very marginal value to our national security. So I urge my colleagues to support the amendment. At this point, I yield the floor. I suggest the absence of a quorum, if there is nobody else wishing to speak at this point.

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

Mr. BINGAMAN. Mr. President, I thank the Chair. I understand we are going to have some votes at 6 o'clock. So I will take a few minutes here to explain the amendment that I am offering. Senator Dorgan also wishes to speak in favor of the amendment. I believe the Senator from New Hampshire, Senator Smith, wishes to speak in opposition to it and maybe some others on both sides. Let me start by describing what the issue is. The administration has requested $29 million in this next fiscal year for the space-based laser program which is operated under the Ballistic Missile Defense Office. This is the same funding request level as we have had for the past 2 years. It is the same level that is planned for each of the next several years. This essentially is money to continue the research and development part of this program, which the administration supports, which I support. But the bill which has come to the Senate floor, which the committee has passed out, adds an additional $118 million in this next fiscal year for a total of about $148 million. The amendment that we are offering here will bring the funding level back to what the administration requested. That is $29 million. It shifts the $118 million that the committee added to this space-based laser program to increase the flying hours for the Air Force and the Navy both, $59 million for the Air Force and $59 million for the Navy. Mr. President, with that short description, let me send this amendment to the desk and ask for its immediate consideration.

Mr. BINGAMAN

Mr. BINGAMAN. Mr. President, since there is no other Senator wishing to speak right now, let me say a word about the procedure that we seem to be agreed upon of having a cloture vote this afternoon at 3 o'clock. I know the majority leader has requested unanimous consent to do that and has been granted unanimous consent to do that. I certainly did not object. But I have to say, Mr. President, that the procedures in the Senate, as is said in Alice in Wonderland, get curiouser and curiouser. Having a cloture vote at this stage in our deliberations on this Defense authorization bill seems to me the most curious of any procedure I can recall. We are, as I understand it, being advised by the leadership, the majority leadership, Senator Lott, that we do not want any votes on this bill until at least 6 o'clock tomorrow evening when the absent Members who are in Madrid with the President attending the meeting on NATO return. I understand that is a very important meeting, and I certainly commend them for being there to attend that. I do not object to postponing votes on this important defense authorization bill until they return. But for us to be, on one hand, being told that we should not vote because Members are absent and, on the other hand, being told that we should invoke cloture because someone is delaying the Senate in concluding action on this bill, the only people delaying the Senate in concluding action are the absent Senators or the leadership in trying to protect them from votes. So I have great difficulty understanding why we are having this cloture vote today. Obviously, if that is the majority leader's will or desire, he has that right under Senate rules. But for people who try to understand the proceedings around the Senate, I think they need to understand that invoking cloture does cut off debate. That is the purpose of it. It limits the number of amendments each Senator can offer. It limits the length of time each Senator can speak. It prevents us from seriously considering legitimate proposals that may be made to improve or alter this bill. So I think it would be a big mistake for us to invoke cloture. As I said in my early comment, I think it is really very confusing to this Senator to understand why we are having the vote at all. I hope that the majority leader will reconsider and vitiate the yeas and nays and put off any votes on cloture until such time as there is some evidence at least that some Senator is trying to delay action on the bill. I see no evidence of that at the present time. I think all of the Senators who have come to the floor this morning to offer amendments have had those amendments set aside because of their agreement with the majority leader's position that we should postpone votes until tomorrow evening after our colleagues return from Madrid. Mr. President, I wanted to make that statement because I have great difficulty understanding myself the procedure that is being followed. I yield the floor, and I suggest the absence of a quorum.

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

Mr. BINGAMAN

Mr. BINGAMAN. Mr. President, 6 years ago, the Congress voted to take some dramatic steps to reduce the threat of nuclear terrorism when it approved the Nunn-Lugar Cooperative Threat Reduction Program--CTR. Since that time, as a result of work being done by CTR programs, over 1,400 nuclear warheads that were aimed at the United States or our allies have been removed; 64 submarine ballistic missile launchers have been eliminated; 54 intercontinental ballistic missile silos, 61 SS-18 ICBM's, and 23 strategic bombers have been eliminated. Today, Ukraine, Belarus, and Kazakhstan no longer have any nuclear weapons with which to threaten the United States or our allies. Support for the Cooperative Threat Reduction Program has run high and enjoys bipartisan support. Last year in the Senate, in a 96-to-0 vote, we enacted the Nunn-Lugar-Domenici Defense Against Weapons of Mass Destruction. This program and its companion programs in the Department of Energy have repeatedly withstood attempts to undo the progress that has been made in reducing the threat of nuclear terror. Legislators from both sides of the aisle are able to see the important benefits to the United States, and to understand the need to move beyond cold war attitudes that prevent us from meeting today's national security needs to prevent nuclear terrorism. This year, the Senate Armed Services Committee voted along partisan lines to cut $135 million from the CTR Program, the Materials Protection Control and Accounting Program, and the International Nuclear Safety Program. The benefits gained from those programs are so important that I must appeal to my colleagues on the floor of the Senate to restore those funds so we can continue the valuable work being done to minimize the possibility that some person or some rogue country could threaten the United States or any other nation with nuclear weapons. I've already mentioned some of the benefits gained through the CTR Program. Much more work remains to be done to dismantle Russian missile launchers, silos, and aircraft. I urge my colleagues to continue to support this program which reduces the threat to the United States in such a direct manner. The $60 million cut by partisan vote in the committee should be restored in order to continue work that is essential to our national security interests. The Materials Protection Control and Accounting--MPC&A--Program in the Department of Energy--DOE--is intended to prevent theft of smuggling of nuclear materials that could be used in nuclear weapons or for other forms of terrorism. DOE has put security equipment in place at 18 sites to safeguard those nuclear materials, and agreements are in place to expand security procedures and equipment at 30 additional sites. I recently observed the work being done by this program first hand during a visit to Russia's nuclear research facilities. I felt relieved to know that the Russians are now better able to control and monitor their own nuclear materials than ever before. I am also aware, however, that the Russians have hundreds of nuclear sites needing additional security measures to prevent theft and unauthorized use. A great deal of work needs to be done, and it is important that the Congress continue to fully fund the MPC&A Program in our own national security interest. I ask my colleagues in the Senate to support our amendment to restore $25 million to the MPC&A Program so that this valuable work can continue without pause. The committee also voted on partisan lines to cut all of the funding requested for the International Nuclear Safety Program--INSP. This program began in the wake of international concerns over the damage done by the Chernobyl nuclear reactor disaster. The Russians continue to operate reactors that are similar in design to the one at Chernobyl, and that pose a similar risk of a catastrophic accident. The INSP Program, managed by the Department of Energy, is designed to reduce those risks for Russia's older reactors and to help Russia and Newly Independent States to establish self-sustaining nuclear safety programs that enable them to reach international nuclear reactor safety standards. It is in our national and international interest to do what we can to ensure that those reactors are safe. I urge my colleagues to vote to restore this important program. As I suggested earlier, the Congress has repeatedly demonstrated its conviction that CTR, MPC&A, INSP, and related programs serve our national security interests. To those who say these programs are a form of foreign aid to the Russians, I concur that ultimately the Russians must assume full responsibility for these programs. Until they are financially and technologically capable of doing so, it is essential to our own interests that we assist them in putting effective security programs into place. We know how expensive it is to support the strategic offensive and defensive weapons systems designed to ensure our security against nuclear weapons. We also know how dangerous and vulnerable this country could be to nuclear terrorism which, in some cases, we may not be able to effectively protect ourselves from. For those modest expenditures for CTR, MPC&A, and INSP, we buy ourselves a significant measure of security worth many times the funds invested. I urge my colleagues in the Senate to continue their bipartisan support for these programs and vote to restore their funding. Mr. President, I yield the floor. Mr. LUGAR addressed the Chair.

Mr. BINGAMAN. Mr. President, I want to speak briefly in support of this amendment that Senator Lugar has offered and commend him for his leadership on this very important issue. Senator Lugar and Senator Nunn established this program, promoted this program, and have led the Senate in gaining support for this program over these last several years. I see it as one of the few shining examples that we can point to to indicate that we are aware of the new reality, the new post-cold-war reality that we face with Russia and with other former Soviet Union countries. Let me briefly describe, as Senator Lugar has and Senator Levin has, what the amendment does. It would add or restore to the bill before us amounts that were cut at the subcommittee level to get it back to the level of funding that the administration requested in three different areas. One is what is referred to as MPC&A funds--that stands for materials protection control and accounting funds--for the Department of Energy. The second is $50 million being restored for the International Nuclear Safety Program, again, in the Department of Energy. And the third item is $60 million that is being restored in the cooperative threat reduction programs which are operated and administered by the Department of Defense. Mr. President, the legislative provisions that accompany this provide greater flexibility in administering the CTR Program. They allow fiscal year 1997 funds for international border security to be available for obligation for 3 years and allow the Customs Service to use fiscal year 1997 funds that were provided to purchase new equipment to also be used to provide assistance to employees to allow that new equipment to be fully integrated into the operations of the Customs Service. This amendment and the funds that these programs contain are intended to reduce the danger of so-called loose nukes, or nuclear weapons that might fall into the hands of terrorists, might fall into the hands of people not authorized to have those weapons; also, to help reduce the danger that fissile material, material that is essential to making of new nuclear weapons, not fall into those same hands. The funds are intended to help destroy ICBM silos and launchers in the former Soviet Union and to generally help reduce the risk in the near term from the operation of Soviet-designed nuclear powerplants. Mr. President, the arguments have been well laid out by Senator Lugar and Senator Levin, as well. This is a program that has accomplished a tremendous amount already in reducing the risk of nuclear weapons. I had the good fortune earlier this year, about 2 months ago, to travel to Russia and to visit some of the facilities that we are spending funds at to work on these cooperative programs with the Russians. I traveled there with Mr. Paul Robinson, who is head of Sandia National Laboratory, and with others who work with him at Sandia National Laboratory on these cooperative threat reduction programs and Department of Energy programs. I also traveled there with others from the Department of Energy Los Alamos National Laboratory. The general impression I received in visiting Chelyabinsk-70, which is one of the closed cities that the Russians established in order to develop and promote their nuclear weapons activity, the general impression was that these funds are being extremely well used and are, in fact, increasing the security that surrounds fissile materials and other materials that could be used in connection with nuclear weapons. We met with Minister Mikhaylov who is head of the Ministry of Atomic Energy, MINATOM, and, again, I was impressed with the willingness to continue the cooperation to work with our own Department of Energy in making progress on these programs. We met with admirals from the Russian Navy. They have a very significant problem of fresh uranium that can be used as fuel in their nuclear reactors, how to secure that, how to protect it from possible seizure by terrorists. They clearly wanted our help. They are obtaining our help. They need substantially more help in the years ahead. I felt good about the level of cooperation that is occurring there. My general conclusion from the trip was the same as the one stated by Senator Lugar in his statement earlier, and that is that there is a long list of useful projects that funds in these programs can be put to. We are not short of useful activities to work on. The contrary is the case. There are a great many things that the Russians need to do to protect and to reduce the risk of theft of nuclear materials. We are just now beginning to make serious progress on that. The funds that will be restored by this amendment are essential to making that progress. I very much believe that when you look at the entire U.S. defense budget and say, which of the funds are the most cost-effective, where are we getting the most national security return for the dollars spent, the funds being spent in these programs are clearly very high on that list. So I urge my colleagues to support this amendment, and I hope that we can get a unanimous vote. This is a program that needs bipartisan support. This is not a program that should become the subject of partisan dispute in the U.S. Senate. It is too important to our safety and to our future and to the future of the world for us to find ourselves in some kind of partisan dispute over funds like this or programs like these. Mr. President, in concluding, I ask unanimous consent that a letter to me from the Secretary of Energy, Federico Pena, dated June 19, expressing his strong support for this amendment be printed in the Record.

Mr. BINGAMAN

Mr. BINGAMAN. Mr. President, this amendment is being offered on behalf of myself and Senator Conrad. Mr. President, we all understand what regular IRA's are about and how those work where a person can put up to $2,000 into an IRA. It accumulates earnings over a career, and then when you retire you go ahead and pay tax on it. What we have in this bill is something different than a regular IRA. We have an IRA Plus. The IRA Plus differs in a very important way. What this chart shows is it essentially says if you agree to pay the tax that is due on your existing IRA up through the end of next year, the 1st of January 1998, it will give you the time that this budget agreement covers to pay all of that tax in. And then the earnings from that money in that IRA Plus account are never going to be taxed the rest of your life. That is what the provision is. It is a back-loaded IRA which means it is specifically for people who are not eligible for the other types of IRA's. So if you have over $100,000 and you already have a retirement account, then you can have an IRA Plus. The earnings from the funds in that IRA Plus will never be taxed. I urge the Senate to adopt our amendment.

Mr. BINGAMAN. Mr. President, I call up amendment No. 541 which is at the desk.

Mr. BINGAMAN. Mr. President, I rise today to comment on the tax bill we are debating, S. 949, the Revenue Reconciliation Act of 1997. This bill is not the bill I would have preferred if I had written all of the details, but it has many redeeming sections which I think do benefit New Mexico and the Nation as a whole. I want very much for New Mexicans to get needed tax relief. We have a strong economy and are within reach of a balanced budget. It does seem to me that the tax burden of many New Mexicans and others is higher than it needs to be--and while this is not structured the way I would have preferred it--I will support final passage of S. 949 because it does move us further in a positive direction, than it does negative. This bill expands IRA's in a way in which nearly 90 percent of our working population will be eligible for these accounts, in contrast to just 70 percent today. Also, this bill provides both capital gains and estate tax relief, phased in in incremental steps, but nonetheless important to the overall investment climate of the Nation. I hope that a great portion of that investment and economic activity gets directed toward and takes place in New Mexico. This bill contains about $32 billion in education provisions which will be of benefit to many New Mexicans, particularly those who need support for college tuition. In addition, over 45 percent of New Mexico's families paying taxes of $1,500 or more will be eligible to take advantage of the HOPE scholarship. And while I would have preferred that this figure be far higher, approximately 51 percent of dependent children in New Mexico will be eligible for some portion of the per child tax credit. Another important accomplishment in this bill is that it provides resources to help cover child health insurance for the 10.5 million uninsured kids in America by raising the tobacco tax by 20 cents per pack. There are other provisions in S. 949 that are worthy of support including permanent extension of the tax credit for employer provided educational assistance which many New Mexican workers and firms have very much wanted. This bill also provides for an exemption from the 2 percent miscellaneous work provision of the Tax Code for hard-working, dedicated teachers who spend their own money on education technology materials and who should be able to fully expense these costs on their tax returns. However, this bill is far from perfect. S. 949, which provides for an $85 billion net tax decrease, does not provide for the kind of distribution of benefits across our society that I would have preferred. Although the Finance Committee did a far better job of making the tax cuts fairer than did the House Ways and Means Committee, I would have preferred the Democratic alternative which was offered yesterday by Senator Daschle. The bill we are passing today--and which I plan to support on final passage--still hands the lion's share of tax relief to the wealthiest 1 percent of Americans, more than the combined lower 60 percent will receive. By contrast, if we had passed the Daschle bill, working families would have received almost twice the tax relief provided in the Finance Committee plan. Furthermore, the Democratic proposal had many targeted tax relief measures which would have done much more for small businesses and small farms than the Republican bill achieves. In education, the Democratic amendment would have provided working families more opportunities to help educate their children, rebuild schools and send their children to college. Perhaps most importantly, the Democratic bill was the more fiscally responsible of the two alternatives. One of my major concerns about S. 949 is that the backloading of estate tax provisions, capital gains provisions, and particularly IRA provisions will balloon the budget deficit enormously just after we finally achieve the discipline to bring the Nation's spending and income into balance. Let me explain a bit about my concern about the IRA provisions. I completely support the notion that the Nation needs more savings. This will help generate more capital for long-term investment and growth. But I object to allowing only the wealthiest in our society to have the tax incentives and tax havens to save. We should provide incentives across the board--and make sure that all sectors of our society are getting some degree of retirement savings in place. This bill does not do this. In fact, this legislation is a radical departure from our current retirement savings policy which at least purports to establish a level playing field for both high income and low income workers. Unfortunately, the Finance Committee tax proposal contains two IRA provisions which are at fundamental odds with each other and represent the Cain and Abel of retirement savings policy. On one hand, the bill makes an important contribution to strengthening the national savings system by doubling the income eligibility for deductible IRA's. The proposal makes deductible IRA eligibility available for 90 percent of the population instead of the 70 percent now eligible. Under this better side of the S. 949, deductible IRA's will be available to everyone with less than $100,000, joint filers, of income. And as is the case with current law, even those with incomes above $100,000 can still make deductible IRA contributions, as long as they have no other employer-sponsored pension plan. It is also important to understand that under current law, people who have employer-sponsored retirement plans can still make nondeductible contributions to IRA accounts. These people can put an extra $2,000 a year away so that this money can accrue and compound tax-free until retirement. This tax-advantaged savings opportunity provides significant benefits to those who make after tax IRA contributions. So far so good. But Senator Roth's IRA Plus proposal, in contrast to the IRA expansion provisions, is a bad step for us to take. A radical departure from past retirement savings policy, IRA Plus overwhelmingly benefits the rich. It also creates a slippery slope towards tax-free havens for other retirement programs and blows a very large hole in the Federal budget deficit in future years. The fact is that because tax advantages in the other Roth provisions are available to both those under $100,000 income levels as well as those at any income level who don't have an employer-sponsored pension plan, only those above $100,000 income levels and who actually have employer-sponsored plans benefit from IRA Plus. Because all distributions from these IRA Plus accounts are tax free, they provide a certain group of wealthy savers a home grown version of a Swiss bank tax haven. If these IRA Plus accounts are established, there is no doubt that they will be a terrific deal for those who participate. But it's not fair and not good policy to provide a tax windfall to the rich and do nothing for those who are struggling to save smaller sums; those less wealthy taxpayers will continue to pay tax on any distributions. Furthermore, IRA Plus accounts create a troublesome benchmark vis a vis other savings vehicles. It is reasonable to ask that if IRA Plus accounts are tax free, then why not 401(k)'s or regular IRA's or the Simple Plan or corporate defined benefit programs? It would be terrific if all savings vehicles were tax free, but the fact is that the IRA Plus program alone--given the tremendous backloading in it--will blow a huge hole in the budget deficit in future years. While the IRA provisions in the Finance Committee tax bill start out costing just $3.3 billion in the first five years, the cost surges to $20.5 billion in the next five years and then to an estimated $88.5 billion in the following ten years. Most of this backloading comes from the establishment of IRA Plus accounts. Furthermore, the irreversibility of this backloading will tie the Nation's hands just as the crush of retiring baby boomers forces very real costs on the Federal Government. We should think very carefully about the consequences of setting up these IRA Plus accounts. I very much hope that when this bill goes to conference, the conferees will tread carefully and will reconsider this very troublesome provision. I have other concerns including the signals that I think are being sent to hard-working New Mexican families that you have to have a high level of income and children to fully qualify for the child tax credit we are providing in this bill; 70 percent of New Mexico tax filers report less than $30,000 in annual income, 45 percent have less than $15,000 income. It is obvious that many, many New Mexico children will not be able to benefit significantly from the child tax credit. Many here attempted to offer amendments which I supported and which would have made the $500 per child tax credit refundable against payroll taxes; or in a different approach, would have allowed tax filers to get their full EITC credit and then figure the per child credit. Either of these would have ensured that millions more children around the Nation and more than 250,000 New Mexico children would have benefited from this provision. Overall, S. 949 delivers a better package of education, health, and child care spending initiatives and various tax relief provisions than the House bill. I wish we had done better and hope that the conferees will struggle to produce an even better bill than this, rather than dumbing this down to many of the worst provisions in the House companion bill. I yield the floor.

Mr. BINGAMAN

Mr. BINGAMAN. Mr. President, I yield myself up to 10 minutes.

Mr. BINGAMAN. Mr. President, I want to change the subject just slightly in this debate and talk about a different aspect of why I believe the Democratic alternative being proposed here is preferable to the bill which was reported by the Finance Committee. That is because, as I see it, the Finance Committee bill has in it what have been referred to as fiscal ``time bombs,'' which would explode the size of the revenue loss as we move into the next century. Our bill, our alternative, the Democratic alternative, tries to eliminate those fiscal time bombs, and in doing so is more fiscally responsible for the long-term future of the country. Let me talk about that aspect of it slightly. I do so first with this chart that I have here. This chart shows tax cuts--the Senate bill; this is the bill we are debating and getting ready to vote on here either late tonight or tomorrow--shows that the tax cuts in this Senate bill are heavily backloaded. What that means is that, although the budget agreement calls for $85 billion in tax cuts in the next 5 years, through the year 2002, it calls for $250 billion in tax cuts up through the following 5 years, up to 2007, and if you take the next 10 years and look at what happens in that period so that you have the full 20-year period in mind, it goes to $830 billion in tax cuts and lost revenue to the Treasury. That is what we mean by backloaded. You say, why are we losing that much revenue? What is there in this tax bill that is costing that much revenue? Here are three of the main reasons why we are losing that revenue. Of course, this chart only goes through the year 2007, but it shows that the alternative minimum tax, of course, the change there is losing $15 billion, the change in the capital gains is losing $24 billion in this second 5-year period, and the change in the IRA's is losing $45 billion. I want to talk a moment about the provisions in this bill related to IRA's and how we are going about losing that much money. We are losing it primarily because of a provision in this bill that is called the IRA Plus--the IRA Plus. People need to understand a little bit about the IRA Plus. Mr. President, there are two kinds of IRA's that are available to any of us today in America. One is a deductible IRA where you are able to deposit into your individual retirement account money before you pay tax on it. That is deductible money, deductible from your tax return. The other, of course, is a nondeductible IRA. You can deposit up to $2,000. If you do not use the deductible IRA, you can deposit up to $2,000 in a nondeductible IRA. That is money that you have already paid tax on. You can have either under current law. Let me just talk a moment about the deductible IRA. Under current law, all taxpayers with incomes below $50,000--that is joint filers--so a family that earns less than $50,000 or reports income of $50,000 may make a deductible contribution to an IRA. They can put up to $2,000 in an IRA every year without paying tax on that money. That can be saved by them for their retirement into the future. They do not have to take it out, do not have to begin taking it out until they are over 70 years old. That is a very good benefit. All ratepayers who are not covered by an employer-sponsored plan may make deductible contributions regardless of their income level. So we are saying that if you are not covered by any kind of employer- sponsored plan, you can go ahead and deposit your $2,000, take the tax deduction under current law, and you are not penalized. This covers over 70 percent of all of those who are eligible, so that 70 percent of the people filing tax returns today can take this $2,000 deductible contribution if they so choose. Under the proposals in this bill on deductible IRA's, all taxpayers then with incomes below $100,000--we are essentially doubling or increasing by twice the income level for joint filers--and any family with an income up to $100,000 can make a deductible contribution to an IRA. All taxpayers who are not covered by an employer-sponsored plan may make deductible contributions regardless of the income level. The estimate here is that we are now talking, under the proposed bill, of 90 percent of all taxpayers, 90 percent of all families will be eligible to make deductible contributions. We are going next, Mr. President, to the real clincher in this so- called IRA Plus. An IRA Plus is a nondeductible IRA. It is not a deductible IRA. It is not the kind of IRA that is available to people who have $100,000 or less in income or who are covered by an employer-sponsored retirement plan. This is aimed primarily at those who earn over $100,000 in income and who have employer-sponsored retirement plans already. Current law says that you can go ahead and deposit your $2,000 each year. That money compounds, that money gains interest or capital gains of whatever kind until such time as you start drawing the money out, at which time you pay tax on it. The proposal in here, IRA Plus, says that not only can you have this, you can have it in a particularly attractive way. First of all, we are going to let you take any IRA you have now and convert it into an IRA Plus if you want to and pay the tax that is due up to January 1, 1999. You have to pay it during the 5 years that it is covered by this budget plan so we can take full credit of those funds in deciding whether we have balanced the budget, but you can pay that, and then once you have set that up, the nondeductible IRA is no longer taxable. There is no tax owed when you realize a gain. There is no tax owed when you distribute money out of that IRA. There is no tax owed when you spend the money. We are setting up essentially, Mr. President, our own version of a Swiss savings account or a Swiss bank account. We have all read about people with lots of money who go to Switzerland and set up a bank account so they can avoid taxes that way. They will not have to do that anymore. They can just set up an IRA Plus, put money in there, and then any gain they realize on that for the rest of their life is not taxable. This is the only place in our tax law, as far as I know--I am not an expert on tax law--but as far as I know there is no place else in our tax law where we set up this kind of a provision, where we say if you put money in one of these accounts we will no longer charge you any tax on that or on the gains from that money for the rest of your life. This is what the IRA Plus is. This is why this bill is so heavily backloaded. Clearly, this is a fiscal time bomb. There is no other way to look at it. There is no justification, in my view, for us putting this kind of a benefit in for individuals who have over $100,000 in income and who are also covered by another employer-sponsored retirement plan. This is a provision which is not, as I understand it, in the House bill that is being considered on the House side. I hope very much later in the debate today I can offer an amendment to try to strike this provision from our own bill. If we do strike this provision, we will deal with a great deal of the problem that exists in the Finance Committee bill in the backloading of this provision. It will be much more fiscally responsible to eliminate this provision, and clearly it will be fair to working Americans at all income levels. I still want all Americans to have the right to deposit the $2,000 after tax into an IRA, just as they can under present law. That is entirely appropriate. But they ought to have to pay tax on the earnings from that as they do today. Mr. President, I hope this amendment is seriously considered when I do get a chance to offer it later in the evening. I also believe that the fact that we are eliminating this IRA Plus in the alternative that the Democrats are offering today is a major reason why I am planning to support that alternative. I commend Senator Daschle for putting it forward today, and I yield the floor.

Mr. BINGAMAN

Mr. BINGAMAN. Mr. President, the problem of retirement security is an ever mounting challenge to the future welfare of our Nation. More than 51 million Americans are not covered by any kind of pension plan. The aging of the baby boom generation will dramatically increase the retired population in proportion to the working population early in the next century. By the year 2029, when the youngest baby boomers reach age 65, more than 68 million persons will be older than 65--accounting for more than 20 percent of the U.S. population, compared to just 12 percent today. In my own State of New Mexico just 29 percent of our work force has some kind of pension plan. As this chart shows, New Mexico has the worst ranking in the nation in terms of workers covered by pensions. Just a few states have private sector working populations with over 50 percent covered by pensions. Our Nation is facing certain crisis if we fail to take steps to correct this problem of people working until retirement--and finding that their Social Security benefits fail to maintain adequate and acceptable living standards. Despite the proliferation of retirement products in various forms of IRA's and 401(K) plans, patterns clearly show that those who earn enough to save probably do. Our problem is that over the last 18 years, we have had no increase in the percentage of our work force that is participating in a qualified pension program. Those who are well off and can look forward to retirement security cannot afford to just abandon those who are not. We have a market failure that we must address, particularly as the Nation's traditional safety net is being rolled back because of budget cuts on so many other fronts. I am not opposed to improving and even expanding the pension plans of those who have them now. My concerns, however, are focused on the reality that we are improving existing pension plans, expanding IRA opportunities and creating new forms of individual retirement accounts, but we are still doing absolutely nothing to get a large portion of our uncovered work force covered by some degree of retirement savings. The costs of doing what we need to do will be large. But let's think for a moment about the IRA provisions in the tax bill we are discussing today. The IRA expansion provisions in the Senate version of the bill cost approximately $3.3 billion during the first 5 years and $20.5 billion in the following 5 years. These costs may be appropriate and necessary--but at the same time, we need to confront the revenue impact of covering the parts of our society that currently have no retirement savings at all. I think that it is poor public policy to expand only one-half of the equation like we have been doing. Mr. President, in order to ensure that this Congress does face the issue of retirement security for all working Americans and not just the fortunate minority who are saving, I am here to introduce the ``Retirement Security for All Americans Pension Pro-Save Act.'' The bill I am introducing outlines a concept for pension expansion and portability that has been discussed in this Chamber several times over the last several decades but which has not evolved until now as legislation. The Pension ProSave System, a clearinghouse for individual pension accounts, would improve the retirement income security of millions of working Americans by encouraging employees to make contributions on their behalf, by facilitating pension portability, by preserving and significantly increasing retirement savings and by simplifying pension law. Mr. President, this plan is not aimed at the existing pension and savings structures in this country. This proposal targets those who are working their way towards retirement--and will have little or nothing to supplement their Social Security benefits. Despite 18 years of availability of simplified pension plans, pension coverage remains low in the small business sector. Even when covered by a tax-advantaged pension plan, workers do not always continue to save their pension assets when they can receive them when moving from one place of employment to another. Tax penalties unfortunately have not been very successful in discouraging the spending of these mid-career retirement savings disbursements. Of the $47.9 billion in pre-retirement distributions made in 1990, less than 20% of recipients reported putting the entire distribution into another tax-qualified retirement plan. The Pension ProSave Clearinghouse is modeled after the highly successful Teachers Insurance and Annuity Association-College Retirement Equity Fund [TIAA-CREF], the largest private pension system in the world with assets over $136 billion and about 1.7 million participants at about 5,500 institutions. Not replacing existing pension programs, Pension ProSave is designed to supplement these other programs and will increase pension coverage to millions of Americans. The benefits of Pension ProSave are first, that this plan would provide an incentive and a simple, hassle free way for employers to provide portable pension benefits to their workers. Employees could also make matching contributions to their accounts on a 2:1 basis to a maximum of $6,000. The employer's contributions also would not exceed $6,000. Mr. President, I want to emphasize that these are the employee's accounts--not the government's and not the employer's. These accounts will remain with those workers the duration of their lives. Second, Pension ProSave would stop the leakage of retirement savings by furnishing employer's pension contributions into a privately managed, pension portability clearinghouse. Worker's account balances would be invested and managed by private sector firms in diversified portfolios. Let me explain how Pension ProSave would work. Any employer wishing to take advantage of the Pension ProSave Program would furnish the names of all employees, employed for at least 6 months and over 21 years of age, to the ProSave Portability Clearinghouse established in this Act. The employer will indicate each employee's salary and the uniform percentage of all salaries which the employer will contribute to employee ProSave accounts. The employer will have the option of changing its percentage contribution each year, as long as that contribution equals at least 1 percent. This can help business owners--who want to provide pension benefits to their employees--avoid getting locked into a rate that remains fixed while the economic performance of their small businesses may be volatile. Once a ProSave account is established for an employee, the employer will forward contributions to the account at the time of each paycheck or at least prior to the end of that year. With the agreement of the employee, an employer who has another defined benefit or defined contribution plan for its employees and who does not choose to establish ProSave accounts will still be able to use the portability clearinghouse as a repository for retirement funds of an employee who is leaving its employ. When a worker leaves one job where retirement benefits have accrued, the employee may request the employer to deposit the cash value of those retirement benefits--or any portion of them--in the Pro Save account of the employee at the portability clearinghouse. Mr. President, the funds contributed by an employer to the retirement security of his or her employees by way of a ProSave account will remain there and be invested at the direction of the employee until retirement. The portability clearinghouse will contract with investment firms to manage funds through the clearinghouse. Investment options would include a fixed income fund, an equity fund, a government securities fund, small business capitalization fund, an international fund, and an infrastructure fund. Accounts would be valued on a daily basis, and participants could transfer funds among investment accounts at intervals determined by an oversight board, perhaps at monthly or quarterly intervals. Employers will have no responsibility for administering a pension fund or managing funds for employees who have left their employment. This should be very attractive to businesses that do not desire to carry long-term responsibilities for workers who have moved on. While employer contributions are locked into the Pension ProSave accounts until retirement, funds contributed by the employee are available to be loaned for certain purposes and under terms established by the Portability Clearinghouse Board. At retirement, account balances would be paid out either in the form of an annuity--with survivor benefits--or a lump sum retirement. Spousal consent would be required. Mr. President, I have no doubt that some who oppose this plan will rattle the cages and make claims that this act is nothing but more big Government, another bureaucratic institution that spreads the Government further into our lives. These claims will be wrong--and will only serve to help maintain an economic reality that permits those best off in our society to save up to $30,000 a year on a tax-advantaged basis. Others in simple 401(k) plans can save up to $9,500 a year. It is unacceptable that workers who don't have an available pension plan-- can only save $2,000 a year in IRA accounts. We have a responsibility not only to create a more equitable savings structure for those Americans who have the desire and wherewithal to save--but also to the many Americans who are low-income workers who move from job to job eventually to retirement, finding then that nothing has accrued to help them in their retirement years. Government had a role in establishing IRA's and 401(k)'s. Now we must do what we can to provide incentives to employers to provide modest retirement security for more employees. This plan is an enabler--it creates a structure, similar in many ways to the TIAA-CREF model established at the beginning of this century by Andrew Carnegie to provide pension portability for professors and university employees moving between one higher education institution and another. This is an issue in which the Government does have an important role to play because the market has failed to provide the extension of pension coverage to 51 million Americans. Pension ProSave promotes savings, helps more people reach retirement with pensions, helps buffer against the turbulence of the economy, and provides many employers with a good vehicle for profit-sharing. All of these are benefits for our Nation as a whole. For the employer, Pension ProSave provides a hassle-free, no red-tape way to make contributions to a pension--and frees employers from the responsibility and requirement of administering a pension plan. The plan also increases the amount of the tax-deferred savings permitted for the employer and each employee. It gives the employer a vehicle for profit-sharing, and the employer escapes any and all responsibility for the employee's pension. Funds contributed to Pension ProSave will be exempt from other savings limits under current law for other pension products. This should provide a powerful incentive to owners of small businesses who can save more themselves if they make equivalent commitments to their employees. For the employee, the benefits are most importantly that millions of pension-uncovered workers in this country will get coverage. This plan increases the amount of tax-deferred savings permitted to each employee, provides immediate vesting, and removes the concern that employees might have about the solvency of pension plans or their previous employers. Among other benefits, Pension ProSave eliminates political corruption in the administration of pension funds and provides one account that can be permanently maintained and in which funds can continually accrue no matter the number of job changes in a worker's career. By having national visibility, Pension ProSave would make the concept of saving for retirement more attractive and appealing to employees. This plan would increase employer pension contributions on behalf of their workers without existing pension plans, rather than relying on 401(k) plans that are funded largely by employees' voluntary saving decisions. Employers would be able to make voluntary, tax-deductible contributions on behalf of their workers and would have flexibility in the amount they contribute each year. Vesting would be immediate. Plan sponsors would be relieved of the expense and responsibility of providing financial education to their employees and the legal implications of providing investment options. Mr. President, I think that one cause of the extraordinary economic anxiety in our Nation is related to the eroding sense of financial security at retirement. A recent study of workers' views of their present and future economic circumstances found that most people believe that despite the twists, turns, and pitfalls in our rapidly changing economy, they can chart a successful course to retirement. But their anxiety levels were extremely high when concerns about the solvency of Social Security and about the great number of Americans without pension benefits were mentioned. Americans include retirement security in their personal strategies for economic success. I believe that America is calling for a credible proposal that will get more of our citizens covered by some kind of pensions. There is no doubt that the costs will be high and will impact the Nation's short term tax revenue. However, it is also clear that increasing retirement savings will help bolster national savings, which will help spur more long-term investment and economic growth. The high cost of this plan would be true of any plan that succeeds in establishing more retirement security for our working population. We seem to be willing to sustain high costs for expanding retirement opportunities for some; I just think we need to make sure that we are doing whatever we can to provide retirement savings coverage to the rest of society. These are costs that we must consider and should bear--for the long term benefit of our Nation in whole. Establishing Pension Pro-Save accounts is an investment that will help our Nation better able to cope with the retirement savings crisis that we will certainly face in the future.

Mr. BINGAMAN

Mr. BINGAMAN. Mr. President, the problem of retirement security is an ever mounting challenge to the future welfare of our Nation. More than 51 million Americans are not covered by any kind of pension plan. The aging of the baby boom generation will dramatically increase the retired population in proportion to the working population early in the next century. By the year 2029, when the youngest baby boomers reach age 65, more than 68 million persons will be older than 65--accounting for more than 20 percent of the U.S. population, compared to just 12 percent today. In my own State of New Mexico just 29 percent of our work force has some kind of pension plan. As this chart shows, New Mexico has the worst ranking in the nation in terms of workers covered by pensions. Just a few states have private sector working populations with over 50 percent covered by pensions. Our Nation is facing certain crisis if we fail to take steps to correct this problem of people working until retirement--and finding that their Social Security benefits fail to maintain adequate and acceptable living standards. Despite the proliferation of retirement products in various forms of IRA's and 401(K) plans, patterns clearly show that those who earn enough to save probably do. Our problem is that over the last 18 years, we have had no increase in the percentage of our work force that is participating in a qualified pension program. Those who are well off and can look forward to retirement security cannot afford to just abandon those who are not. We have a market failure that we must address, particularly as the Nation's traditional safety net is being rolled back because of budget cuts on so many other fronts. I am not opposed to improving and even expanding the pension plans of those who have them now. My concerns, however, are focused on the reality that we are improving existing pension plans, expanding IRA opportunities and creating new forms of individual retirement accounts, but we are still doing absolutely nothing to get a large portion of our uncovered work force covered by some degree of retirement savings. The costs of doing what we need to do will be large. But let's think for a moment about the IRA provisions in the tax bill we are discussing today. The IRA expansion provisions in the Senate version of the bill cost approximately $3.3 billion during the first 5 years and $20.5 billion in the following 5 years. These costs may be appropriate and necessary--but at the same time, we need to confront the revenue impact of covering the parts of our society that currently have no retirement savings at all. I think that it is poor public policy to expand only one-half of the equation like we have been doing. Mr. President, in order to ensure that this Congress does face the issue of retirement security for all working Americans and not just the fortunate minority who are saving, I am here to introduce the ``Retirement Security for All Americans Pension Pro-Save Act.'' The bill I am introducing outlines a concept for pension expansion and portability that has been discussed in this Chamber several times over the last several decades but which has not evolved until now as legislation. The Pension ProSave System, a clearinghouse for individual pension accounts, would improve the retirement income security of millions of working Americans by encouraging employees to make contributions on their behalf, by facilitating pension portability, by preserving and significantly increasing retirement savings and by simplifying pension law. Mr. President, this plan is not aimed at the existing pension and savings structures in this country. This proposal targets those who are working their way towards retirement--and will have little or nothing to supplement their Social Security benefits. Despite 18 years of availability of simplified pension plans, pension coverage remains low in the small business sector. Even when covered by a tax-advantaged pension plan, workers do not always continue to save their pension assets when they can receive them when moving from one place of employment to another. Tax penalties unfortunately have not been very successful in discouraging the spending of these mid-career retirement savings disbursements. Of the $47.9 billion in pre-retirement distributions made in 1990, less than 20% of recipients reported putting the entire distribution into another tax-qualified retirement plan. The Pension ProSave Clearinghouse is modeled after the highly successful Teachers Insurance and Annuity Association-College Retirement Equity Fund [TIAA-CREF], the largest private pension system in the world with assets over $136 billion and about 1.7 million participants at about 5,500 institutions. Not replacing existing pension programs, Pension ProSave is designed to supplement these other programs and will increase pension coverage to millions of Americans. The benefits of Pension ProSave are first, that this plan would provide an incentive and a simple, hassle free way for employers to provide portable pension benefits to their workers. Employees could also make matching contributions to their accounts on a 2:1 basis to a maximum of $6,000. The employer's contributions also would not exceed $6,000. Mr. President, I want to emphasize that these are the employee's accounts--not the government's and not the employer's. These accounts will remain with those workers the duration of their lives. Second, Pension ProSave would stop the leakage of retirement savings by furnishing employer's pension contributions into a privately managed, pension portability clearinghouse. Worker's account balances would be invested and managed by private sector firms in diversified portfolios. Let me explain how Pension ProSave would work. Any employer wishing to take advantage of the Pension ProSave Program would furnish the names of all employees, employed for at least 6 months and over 21 years of age, to the ProSave Portability Clearinghouse established in this Act. The employer will indicate each employee's salary and the uniform percentage of all salaries which the employer will contribute to employee ProSave accounts. The employer will have the option of changing its percentage contribution each year, as long as that contribution equals at least 1 percent. This can help business owners--who want to provide pension benefits to their employees--avoid getting locked into a rate that remains fixed while the economic performance of their small businesses may be volatile. Once a ProSave account is established for an employee, the employer will forward contributions to the account at the time of each paycheck or at least prior to the end of that year. With the agreement of the employee, an employer who has another defined benefit or defined contribution plan for its employees and who does not choose to establish ProSave accounts will still be able to use the portability clearinghouse as a repository for retirement funds of an employee who is leaving its employ. When a worker leaves one job where retirement benefits have accrued, the employee may request the employer to deposit the cash value of those retirement benefits--or any portion of them--in the Pro Save account of the employee at the portability clearinghouse. Mr. President, the funds contributed by an employer to the retirement security of his or her employees by way of a ProSave account will remain there and be invested at the direction of the employee until retirement. The portability clearinghouse will contract with investment firms to manage funds through the clearinghouse. Investment options would include a fixed income fund, an equity fund, a government securities fund, small business capitalization fund, an international fund, and an infrastructure fund. Accounts would be valued on a daily basis, and participants could transfer funds among investment accounts at intervals determined by an oversight board, perhaps at monthly or quarterly intervals. Employers will have no responsibility for administering a pension fund or managing funds for employees who have left their employment. This should be very attractive to businesses that do not desire to carry long-term responsibilities for workers who have moved on. While employer contributions are locked into the Pension ProSave accounts until retirement, funds contributed by the employee are available to be loaned for certain purposes and under terms established by the Portability Clearinghouse Board. At retirement, account balances would be paid out either in the form of an annuity--with survivor benefits--or a lump sum retirement. Spousal consent would be required. Mr. President, I have no doubt that some who oppose this plan will rattle the cages and make claims that this act is nothing but more big Government, another bureaucratic institution that spreads the Government further into our lives. These claims will be wrong--and will only serve to help maintain an economic reality that permits those best off in our society to save up to $30,000 a year on a tax-advantaged basis. Others in simple 401(k) plans can save up to $9,500 a year. It is unacceptable that workers who don't have an available pension plan-- can only save $2,000 a year in IRA accounts. We have a responsibility not only to create a more equitable savings structure for those Americans who have the desire and wherewithal to save--but also to the many Americans who are low-income workers who move from job to job eventually to retirement, finding then that nothing has accrued to help them in their retirement years. Government had a role in establishing IRA's and 401(k)'s. Now we must do what we can to provide incentives to employers to provide modest retirement security for more employees. This plan is an enabler--it creates a structure, similar in many ways to the TIAA-CREF model established at the beginning of this century by Andrew Carnegie to provide pension portability for professors and university employees moving between one higher education institution and another. This is an issue in which the Government does have an important role to play because the market has failed to provide the extension of pension coverage to 51 million Americans. Pension ProSave promotes savings, helps more people reach retirement with pensions, helps buffer against the turbulence of the economy, and provides many employers with a good vehicle for profit-sharing. All of these are benefits for our Nation as a whole. For the employer, Pension ProSave provides a hassle-free, no red-tape way to make contributions to a pension--and frees employers from the responsibility and requirement of administering a pension plan. The plan also increases the amount of the tax-deferred savings permitted for the employer and each employee. It gives the employer a vehicle for profit-sharing, and the employer escapes any and all responsibility for the employee's pension. Funds contributed to Pension ProSave will be exempt from other savings limits under current law for other pension products. This should provide a powerful incentive to owners of small businesses who can save more themselves if they make equivalent commitments to their employees. For the employee, the benefits are most importantly that millions of pension-uncovered workers in this country will get coverage. This plan increases the amount of tax-deferred savings permitted to each employee, provides immediate vesting, and removes the concern that employees might have about the solvency of pension plans or their previous employers. Among other benefits, Pension ProSave eliminates political corruption in the administration of pension funds and provides one account that can be permanently maintained and in which funds can continually accrue no matter the number of job changes in a worker's career. By having national visibility, Pension ProSave would make the concept of saving for retirement more attractive and appealing to employees. This plan would increase employer pension contributions on behalf of their workers without existing pension plans, rather than relying on 401(k) plans that are funded largely by employees' voluntary saving decisions. Employers would be able to make voluntary, tax-deductible contributions on behalf of their workers and would have flexibility in the amount they contribute each year. Vesting would be immediate. Plan sponsors would be relieved of the expense and responsibility of providing financial education to their employees and the legal implications of providing investment options. Mr. President, I think that one cause of the extraordinary economic anxiety in our Nation is related to the eroding sense of financial security at retirement. A recent study of workers' views of their present and future economic circumstances found that most people believe that despite the twists, turns, and pitfalls in our rapidly changing economy, they can chart a successful course to retirement. But their anxiety levels were extremely high when concerns about the solvency of Social Security and about the great number of Americans without pension benefits were mentioned. Americans include retirement security in their personal strategies for economic success. I believe that America is calling for a credible proposal that will get more of our citizens covered by some kind of pensions. There is no doubt that the costs will be high and will impact the Nation's short term tax revenue. However, it is also clear that increasing retirement savings will help bolster national savings, which will help spur more long-term investment and economic growth. The high cost of this plan would be true of any plan that succeeds in establishing more retirement security for our working population. We seem to be willing to sustain high costs for expanding retirement opportunities for some; I just think we need to make sure that we are doing whatever we can to provide retirement savings coverage to the rest of society. These are costs that we must consider and should bear--for the long term benefit of our Nation in whole. Establishing Pension Pro-Save accounts is an investment that will help our Nation better able to cope with the retirement savings crisis that we will certainly face in the future.

Mr. BINGAMAN

Mr. BINGAMAN. I yield the floor and I suggest the absence of a quorum. I request the time be charged equally to both sides.

Mr. BINGAMAN. Mr. President, I thank the Senator from New Jersey for his courtesy, as always. Let me speak for a few moments on a motion, or amendment, that is going to be offered by the Senator from Illinois, Senator Durbin, the Senator from Rhode Island, Senator Reed, and myself. This is a motion to strike one provision that is in this reconciliation bill which would change the age at which senior citizens become eligible for Medicare. It raises that age from 65 to 67. Our amendment would propose to strike that provision from the reconciliation bill. In my view this is an unacceptable provision, it is very misguided, and one that we should not continue to keep in this legislation if we send this legislation on through the legislative process. Mr. President, there are no budgetary savings that would accrue as a result of this provision until the year 2003, after the target date for reaching the balanced budget. I am informed that this section would fall under the Byrd rule, and for that reason a vote of 60 Senators or more will be required to keep this provision in the bill, so I hope that a substantial majority of the Senate will agree with us that this provision should be stricken from the legislation. Raising the eligibility age for Medicare, first of all, is not necessary in order to balance the budget. The extra budget savings that this provision might generate are not necessary to meet any of the targets set by the budget negotiators in the earlier negotiation. While this change is described as being something that was done in order to bring Medicare into line with Social Security changes that were earlier made, there are obviously very real differences between Medicare and Social Security. Social Security allows an individual to receive early retirement benefits at age 62. Unlike Social Security, Medicare does not provide any other option for the retiree who wants to retire at age 65. Either the person has insurance or they do not. To make this change in Medicare, I believe, would visit a real hardship on many seniors who have planned for their entire careers to be able to retire at age 65 and to have Medicare available to them at that time. For us to make this kind of change, even though there is a long period for the phase- in of the change, I think will be breaking faith with many of those Americans and many of the people in my State. Raising the eligibility age creates, also, the specter of a new group of uninsured Americans. We have spent much time in the previous Congress and in this Congress debating how we can cover more Americans with health care insurance. We have too many Americans today--in my State we have way too many Americans--who do not have health care coverage. We have talked about how to cover more children, how to cover more working families, how to cover more seniors before they are eligible for Medicare. This provision that we are going to propose to strike from the reconciliation bill adds to that pool of uninsured Americans who would be without health insurance at a very critical time in their careers. Essentially, it says to them that between the age of 65, when they would normally expect to retire, and the age of 67, the responsibility for health care will be theirs. There are different groups of Americans and people have different circumstances. There is a large group that has no health care coverage in their employment. This would provide that there is an additional 2- year period in which they continue to have no health care coverage as they approach their senior years. There is another group that has health care coverage but that health care coverage terminates at the time they quit their jobs. That group, of course, would have the financial responsibility. They would have the choice to either go out and buy private health care coverage, which would be very expensive, to cover that interim period of 2 years, or they would have the choice, of course, of trying to get through that period without health care coverage, either depending upon Medicaid or hoping against hope that they do not get sick and do not need medical attention. Of course there are others, I should point out, who have health care coverage and whose employers have agreed to maintain that health care coverage until they reach the eligible age for Medicare. Those individuals, of course, would continue to have health care coverage under their employer but the provision we are trying to strike here would visit a hardship on the employers in that case. The provision would have an immediate impact on employers right now, who provide health benefits to individuals until they reach the age for Medicare. Companies are required today, under Financial Accounting Standard 106, to estimate their liabilities for all future retiree health benefits. Companies determine the present value of their future liabilities for those health benefits and have to report that. These figures are reported as part of the financial statements the companies make. All of those liabilities would have to be rolled into those financial statements immediately upon the adoption of this provision, if this provision were to remain part of the reconciliation bill. So the change that we are proposing here not only would visit a hardship on the employees, the senior citizens who are ready to retire or who have retired, it also visits a financial hardship on employers and constitutes, in many ways, an unfunded mandate on the private sector. I am sure that issue will be discussed to a great extent by the other sponsors of this legislation. A higher Medicare eligibility age would actually create a disincentive for employers to hire or retain older workers, and it would also create an additional incentive, perhaps, for them to cut back on health care benefits at an earlier time. Mr. President, we are in the period where employers are cutting back on additional benefits that go with employment. That trend has continued, now, for some time. I do not think there is any doubt that it is a lower percentage. I have one figure here that the American Association for Retired Persons put out that in 1973, 71 percent of large employers covered early retirees with health care coverage. By last year, that proportion was no longer 71 percent, it was down to 63 percent. Of course, that only applies to large employers. Most of the small employers in my State do not provide that coverage and most of the employees in my State, accordingly, do not have that benefit. Mr. President, I believe very strongly that we need to make necessary changes in the structure of Medicare in order to keep it solvent as we go forward. I support efforts to do that. I do not, though, believe it would be appropriate for us to try to improve the solvency of Medicare by reducing the number of individuals who are eligible to receive Medicare, reducing the pool of individuals who are eligible to receive those health benefits. This provision which we are trying to strike from the reconciliation bill has that exact effect. I hope very much the Senate will agree with us on this proposed amendment to strike this provision. I think this would substantially improve the legislation if we did strike this provision. I urge my colleagues to support the amendment when the vote is taken on the amendment. As I understand that will be tomorrow morning. Mr. President, I ask unanimous consent that five letters and a report on this subject be printed in the Record.

Mr. BINGAMAN

Mr. BINGAMAN. Mr. President, I rise to express my concern about the passage of S. 903, the Foreign Affairs Reform and Restructuring Act of 1997. Some of my distinguished colleagues have cited this legislation as historic in scope and worthy of support because of the consolidation of the U.S. Information Agency, the Arms Control and Disarmament Agency, and parts of the Agency for International Development into the Department of State. I do not object to this consolidation, but I am concerned that the Senate is yet again infringing too much on the Presidential prerogative to be the primary architect of U.S. foreign policy. This bill gives microlevel direction on how consolidation should occur, and I feel that this is not appropriate for the Senate to be trying to micromanage the performance of our State Department agencies, offices, and employees. Mr. President, I have other concerns as well with S. 903. As Senators Lugar and Sarbanes have articulated, I feel that we have established inappropriate benchmarks for the United Nations in this legislation so that moneys obligated by the United States to the United Nations can be released. I feel that it is important for the United States to communicate its concerns to the United Nations about its management problems. But I also feel it is important for the United States to honor its already incurred obligations and pay our debts. Furthermore, some of the tests that we impose on the United Nations are very inappropriate. For instance, during the first year, only $100 million of the $819 million in arrears payments after a sovereignty test, which states that efforts must be taken to ensure that no U.S. law be over- ridden or changed by any action of the United Nations. I don't believe that there are many legislators in this Congress who believe for a moment that any U.N. law would purport to have such authority, nor would the United States allow such authority to be vested in the United Nations. However, the inclusion of this in S. 903 sends a signal to our constituents that this is a serious problem. I was sent to the Senate to try and address real problems, not to stir up fake ones. On another front, it seems to me strange that we would be abolishing two agencies and preparing for the absorption of a third into the Department of State and at the same time creating a brand-new stand- alone agency to oversee the broadcasting functions that were traditionally part of the U.S. Information Agency and under the auspices of the Board for International Broadcasting, which was abolished by the International Broadcasting Act of 1994. We should be basing our current institutional consolidations on the basis that the cold war has ended and that we need to reorganize to meet the challenges of a new and different international system. This legislation however, which sets up a structure virtually identical to the Board for International Broadcasting will cover, among other activities, our broadcasting to Cuba activities. I think that it is not wise to build new institutions, which this bill does, which will keep our Nation mired in a cold war mode. For these and other reasons, Mr. President, I am registering my objection to this State Department authorization bill, S. 903. I realize that this bill will pass with overwhelming support from this Chamber, but I believe that sometimes we can give away too much on the commonsense front to strike a deal.

Mr. BINGAMAN

Mr. BINGAMAN. Mr. President, the bill is entitled the Technology for Teachers Act. Its purpose is to increase the ability of millions of new and current teachers to use technology in the classroom. Every school day in my home State of New Mexico and across the country, computers are being purchased, are being unpacked and are being delivered to classrooms in the hope that the teachers there will do wonderful things with those computers to assist the educational process. Sometimes that happens, but most of the time, the computer that is delivered and unpacked is just one more challenge to that teacher, one more demand on that teacher's time and one more drain on the energy of that teacher, because no one has given the teacher the training necessary to be able to do wonderful things with the computer. Most of the teachers in our public schools today started teaching before the era of personal computers really began and was established. The problem begins with low standards for the preparation of teachers to use this new technology and for the licensing of new teachers. This is reflected in a chart I have, Mr. President, that I would like to call attention to. This chart demonstrates the following. On the left- hand side, we have the States that now require one course in education technology. You can see that the red area indicates that 32 States now require a course in education technology. Eighteen of our States require no instruction in education technology today. But the more problematic part of this chart is the right-hand side, where we try to depict the new teachers who feel prepared to use technology in the classroom. You can see that the green area indicates that 90 percent of our new teachers do not feel prepared to use technology in the classroom. That means 90 percent have not had adequate training, including the 90 percent who have had that one course that is required in those 32 States. So there is a serious problem. We also have a disturbing imbalance between the high investment we are making in equipment on the one hand and our inadequate investment in teachers on the other. Let me show a couple of other charts to make that point. This chart tries to make the distinction between the high availability of computers in our schools versus the low amount of teacher training to use them. Ninety-eight percent of our schools today are equipped with some computers. So, clearly, that is a major step forward from where we were, for example, 5 or 10 years ago. But if you look at the teachers who took more than 1 day of training in a single school year on how to use those computers, it is 15 percent of our teachers. Clearly, that imbalance exists. We are investing in the hardware; we are not investing in training the teachers to use that hardware effectively. Let me show one other chart to make the same point. This is connections to the Internet. This shows a 1997 estimate of the percent of schools that are connected to the Internet. About 65 percent of our schools have at least some connection to the Internet. When you look, though, down at the classroom level, you see that only 14 percent of our classrooms actually have a connection to the Internet. Only 13 percent of schools require some kind of advanced training for teachers so that they would know how to take advantage of that hookup to the Internet. And teachers who are actually using the Internet to help with their instruction is only 20 percent. So, again, we have a major imbalance between the investment in the equipment on the one hand, and the inadequate investment in training our teachers on the other. The experts say that 30 percent of the total investment we make in education technology should be used to train teachers, but right now we spend only 9 percent on teacher training. In my own State of New Mexico, only 4 percent of the $33 million spent on education technology goes for training teachers. That's less than half the national average and less than one seventh what we should be spending on teacher training. I am not saying that the Federal Government has not invested in teacher training as a part of school reform. There is a lot of money which is available for this, but also for a great many other needs. Clearly, this chart shows that. When we talk about general reform of education, there are four large programs that the Federal Government has. Of course, Title I is by far the largest, Title VI, Goals 2000, the Eisenhower Professional Development Program--all of those programs have funds that arguably can be used for training of teachers in this respect but, in fact, there are other great demands on those funds. When you look at technology for education, we now have the Technology Literacy Program that is funded at $257 million. The request from the President and the agreement in this year's Budget Resolution is to substantially increase that in the coming years. But when you look at technology training for teachers, there is absolutely nothing planned for that or required to be spent on that. This legislation tries to correct that deficiency. There are no Federal programs today devoted exclusively to technology training for teachers--either technology training for new teachers that are being trained, or technology training for current teachers in the work force. Let me briefly describe what our bill would do, Mr. President. This bill has two parts. One would improve the technology training that 2 million new teachers will get while they are in college during the next decade to try to ensure that as they begin their teaching careers, they have had this instruction. The other part involves the technology training that millions of our current teachers will need throughout their teaching careers. For both parts, our legislation provides that the Department of Education would make competitive grants to the States, to the States' departments of education that are responsible for the licensing of teachers and for maintaining high teaching standards. Those States' departments would then set up competitive grant programs, one to go to colleges of education for innovative programs to train new teachers to use technology; the other set of grants would go to local school districts for innovative professional development of current teachers. The bill would require that the States' departments of education, the colleges of education, the local school districts, and the education technology private sector all work together to create these innovative teacher training programs. This bill would be a major step forward in providing the necessary training to our teachers so that they can benefit from new technologies and integrate those new technologies into their instruction. There are some very good examples, happening in a few places, of what should be happening all over the country. For example, the University of Missouri has a program that issues a laptop computer to incoming freshmen in their College of Education. It has built telecommunications links to K-through-12 schools throughout the State of Missouri. This bill would also support some innovative programs similar to the program we have in New Mexico called the Regional Education Technology Assistance Program; it trains five teachers from each of the school districts in my State. In fact, we have only reached out now and gotten the involvement of 52 of our 89 school districts. But the idea here is to get a cadre of teachers who are comfortable with the use of technology who can then work in their school district to train other teachers so that they, too, can be comfortable with the use of that technology and not have the technology just be a frill which is put over in the corner of their classroom for people to use when they don't have other more important activities to pursue. Mr. President, I think this legislation is particularly important because it tries to deal with the very real resource constraints that some of our school districts face. In my home State, we have a school district in Cuba, NM, where they have had to give up their music instruction, they have had to give up their home economics program, in order to acquire technology to try to enrich their curriculum. This would provide some additional sources of funds for them so that they could get that technology, they could get the training for the use of that technology. That is the great need that we have at this particular time. I hope very much that we can get a hearing on this bill this summer, move ahead with it, and enact this legislation before the conclusion of this session of the Congress. I think this is a step forward. We have seen significant progress over the last few years in Federal support for technology and the use of technology in education. The one great deficiency today is that we do not put enough into training teachers so that that technology can be used effectively. This legislation will help to correct that problem. I thank Senator Murray for cosponsoring the legislation. I hope other colleagues will do so as well.