Benjamin Cardin

Mr. CARDIN

Mr. CARDIN. Mr. Speaker, I yield 2 minutes to a senior Member of the Committee on Ways and Means, the gentleman from California (Mr. Stark). (Mr. STARK asked and was given permission to revise and extend his remarks.)

Mr. CARDIN. Mr. Speaker, I yield myself such time as I may consume. Let me just remind my friend from Ohio, Mr. Speaker, that only 3 percent of the taxable estates have family-owned businesses or farm assets of any significance. That is less than .06 percent of all of the estates, and the Democratic substitute will deal with that problem in a far less costly way. Mr. Speaker, I yield 2 minutes to the gentleman from Maine (Mr. Baldacci), a member of the Committee on Agriculture. (Mr. BALDACCI asked and was given permission to revise and extend his remarks.)

Mr. CARDIN. Mr. Speaker, I yield 2 minutes to the gentleman from Massachusetts (Mr. Frank).

Mr. CARDIN. Mr. Speaker, I yield 2 minutes to the gentleman from California (Mr. Becerra), another distinguished member of the Committee on Ways and Means (Mr. Becerra).

Mr. CARDIN. Mr. Speaker, I thank the gentleman from New York (Mr. Rangel) for yielding me this time. Mr. Speaker, when we started the debate an hour ago, the gentleman from Texas (Mr. Archer), my good friend, pointed out with pride that we have balanced the Federal budget and that was one of his objectives during his career. This is going to be his last year in this body and we certainly, all of us, appreciate his service to our country. But, Mr. Speaker, I would say to the gentleman that we want to make sure that we continue to balance the budget in the future. That is why I urge the gentleman to vote for the substitute. See, 10 years from now we want to also make sure that we also have a balanced Federal budget. Yet under the underlining bill, we will be losing $50 billion a year at that point. And I want to make sure that we have an affordable bill. During general debate, it was interesting that there was a lot of talk about the family-owned business and the family farm. As pointed out, only 2 percent of the estates are subject to the estate tax, and only 3 percent of that 2 percent have family farms or family-owned businesses. Well, the substitute deals with that by immediately, now, increasing the floor on those family assets to $4 million, taking almost all of the taxable farms and almost all of the taxable family- owned businesses out of the estate tax. The underlying bill phases in over 10 years providing very low relief in the next few years. As we pointed out, if we look at an estate worth $1.5 million, under the substitute, because we immediately reduce the estate tax by 20 percent and we immediately increase the unified credit from $675,000 to $1.1 million, in that estate that is $1.5 million under the Archer bill, they would still pay $277,000 in estate tax next year. But under the Rangel substitute, that tax would be only 135 percent, 17 percent reduction versus a 60 percent reduction. We can do better, and the Democratic substitute does better. We also provide this in a fiscally responsible way. The Archer bill spends $105 billion over 10 years and then balloons to $50 billion a year. The Democratic substitute spends $22 billion over 10 years and does not balloon at all. The reason is that we close some loopholes in the estate tax. We not only provide relief, but we reform the estate tax. For those estates over $17 million who are receiving the benefit of a drafting error, we correct that. For those minority-owned stock that are currently getting unreasonable discounts, we correct that. So we provide a fiscally responsible approach that deals with the problem. Yes, we have family farms that are suffering, suffering under some of our existing laws. But let us not help the .001 percent of the multimillionaires. Let us take care of those who really need it. Mr. Speaker, what concerns me is that if this bill became law, we are going to have the scandalous avoidance of tax by billionaires. At the same time, we are going to be jeopardizing our ability to pay Social Security and Medicare. I do not think any of us want to be in that position. Let us not create a scandal; let us do what is responsible. Let us deal with the problem; let us support the Democratic substitute.

Mr. CARDIN. Mr. Speaker, I yield the balance of our time to the gentleman from Georgia (Mr. Lewis), a distinguished member of the Committee on Ways and Means.

Mr. CARDIN. Mr. Speaker, I yield 2 minutes to the gentleman from Massachusetts (Mr. Olver).

Mr. CARDIN. Mr. Speaker, I yield 2 minutes to a distinguished member of the Committee on Ways and Means, the gentleman from Texas (Mr. Doggett).

Mr. CARDIN

Mr. CARDIN. Mr. Speaker, the problem with the underlying bill that repeals the estate tax is that it is back-loaded. It provides the relief in the outyears and explodes in costs and is fiscally irresponsible. The substitute provides relief now and does it in a fiscally responsible way. Let me just give my colleagues one example. Under current law, if one has a net estate of $1 million, one pays $125,000 in estate tax. Under the underlying bill, if one dies in 2001, it will be reduced to $93,000. Under the Democratic substitute, one would pay zero estate taxes in 2001. If one's estate is $1.5 million under current law one would pay $335,000 in taxes. Under the underlying bill, the repeal bill, one would still pay $277,000, a 17 percent reduction. But under the Democratic substitute, one would only pay $135,000, or a 60 percent reduction. The problem is that we are trying to deal with family-owned businesses and family farms, which represents 3 percent of the 2 percent of the estates that are subject to the estate tax, .06 percent of the estates. We spend a lot of money to do it. The substitute deals with it directly by raising that to $4 million before it is subject to estate tax.

Mr. CARDIN

Mr. CARDIN. Mr. Speaker, today I pay special tribute to the Make-A- Wish Foundation, which is celebrating the 20th anniversary of its founding. A non-profit organization that has 82 chapters nationwide, the Foundation is the oldest, largest and most-respected wish-granting organization in the world. Since its founding, it has fulfilled the wishes of 60,000 children between the ages of 2 and 18 who suffer from life-threatening illnesses. The Mid-Atlantic chapter was established in 1983 by concerned Maryland citizens who had heard about how the Foundation began with the granting of a wish of a 7-year-old boy with leukemia in Arizona. Since then, the Mid-Atlantic chapter has fulfilled the wishes of more than 3,000 children from Maryland, Delaware, Northern Virginia and Washington, D.C. Now one of the four largest chapters based on the number of wishes granted, the Mid-Atlantic chapter has grown from granting only three wishes its first year, to more than 300 in the fiscal year 1998. Deeply committed to granting the wishes of each approved child, the Foundation depends on not only the service of more than 13,000 volunteers, but also the support of individual and group donations, corporate and small business contributions, foundation grants, community events, and Wish Friends Inc., a non-profit organization that produces events and other developmental programs to benefit the Foundation. I hope that my colleagues will join me in saluting the Make-A-Wish Foundation for its efforts and success on the behalf of children over the past 20 years, and congratulating Ralph A. Nappi, Jr., President of the Mid-Atlantic chapter of the Foundation, and the entire chapter for their tireless work in ensuring the fulfillment of each child's wish.

Mr. CARDIN

Mr. CARDIN. Mr. Speaker, let me thank the gentleman from New York for yielding me this time. During the last several months, it has become clear to me that the action we are taking today is not just the annual review of whether China should be given normal trade relations, but a major policy initiative by the Clinton administration. I am concerned that the rejection of this agreement could have serious national security ramifications. However, that does not mean that this body should just automatically approve permanent normal trade relations with China. It was important to me, and I think to many Members of this body, that in order for us to support this change, there needed to be an adequate package of related issues incorporated in the vote. That has happened. First, we have incorporated the provisions concerning human rights. I do not think any of us believe that we would now reject the annual review of normal trade relations with China. That has been an ineffective way to review human rights progress within China. The new mechanism which institutionalizes that review will be a more effective way to review human rights. Second, the provisions provide for enforcement of our trade laws against China. Third, we have codified the new surge provisions which provide a more liberal standard to be able to take action against China for illegally imported products. Fourth, the President has made it clear that environment and labor will be our priorities in the new rounds of WTO discussions. Lastly, let me say that I applaud the administration in its commitment to use all the resources of its office to enforce our existing trade laws. It is important that we not only protect U.S. industries against illegally imported products from China, but from all of our trading partners. I believe that if we look at the total package, plus the statements that have been made by the administration, we now have a package that is worth supporting. Mr. Speaker, if the sole issue before us today is whether Congress will approve the administration's initiative to normalize trade with China, subject China to the standards of the rule of law within WTO, based upon the package that is being presented and the commitments of the administration, I believe it is in our national interests to approve this legislation. Mr. Speaker, I rise today in support of H.R. 4444, and urge the House to adopt this important measure. I am pleased that the Rules Committee has incorporated the bipartisan Levin-Bereuter provisions into the underlying bill which authorizes the accession of China into the WTO. My support for this legislation was and is contingent on the Levin-Bereuter provisions on human rights, workers' rights, and anti-surge safeguards. In addition, I am pleased that the legislation provides for strict monitoring and enforcement of China's compliance with its WTO obligations by the United States. During the past several months, I have received a great deal of information from the opponents and proponents of PNTR. The information that I have received has been very helpful in my consideration of this difficult issue. It has been increasingly clear that this vote on PNTR is not just another trade vote, but a major foreign policy initiative by our government. Traditionally Congress has delegated this responsibility to the President. Regardless of how one feels about trade with China, I am convinced that the rejection of this agreement by Congress will have serious ramifications for the natural security interests of the United States and our friends in Asia. The failure of this legislation will strengthen the hand of the hard-liners in Beijing who want to keep China out of the community of nations. With respect to the economic issues that underlie this agreement, we must recognize that China already has access to our markets. The bilateral agreement concluded between the United States and China as part of China's accession to the WTO will only help US manufacturers, producers and farmers gain access to the China market. With respect to human rights, I have always believed that trade could be an effective tool in achieving human rights goals. Human rights considerations have led me to consistently oppose the annual extension of most favored nation for China. Yet I acknowledge that the annual review of NTR has not been effective in advancing human rights in China. Most human rights advocates have now concluded that it is unrealistic to expect that the US would ever revoke NTR for China. Mr. Speaker, let me briefly review the important provisions of the legislation that have led me to my decision to support this proposal. The key provisions address my concerns regarding human rights, oversight and enforcement of China's WTO obligations, workers' rights, and anti-surge provisions. They impose conditions that are much stronger than have ever been presented during the consideration of the annual extension of trade with China. Most important, the legislation would establish a Congressional- Executive Commission on China. This Commission is modeled on the Commission on Security and Cooperation in Europe (CSCE), of which I am proud to serve as a member and a Commissioner. The China Commission will: 1) monitor human rights and religious freedom in China; (2) monitor overall aspects of labor market issues in China; and (3) monitor and encourage the development of rule-of-law and democracy- building in China. The Commission will submit annual reports to Congress and the President, including appropriate WTO-consistent recommendations for legislative and/or executive action. It will maintain a list of victims of human rights abuses in China, and it will provide Members of Congress with information on the issues within its purview. I expect that the Commission will institutionalize Congressional examination of measures by the Chinese Government that affect US interests. It will serve to identify needed reforms in China's policies and call attention to any troubling activities of the Chinese government. Nobody supposes that passage of PNTR will bring an immediate end to the abusive practices of the Chinese government. PNTR will, however, bring the pressure of international economic activity to bear on the repressive practices of the Chinese. At the same time, the Commission will provide an important conduit between Chinese citizens, on the one hand, and the U.S. Government and public, on the other hand. I firmly believe that increased exposure to U.S. values will accelerate progress in China on human rights and economic freedom. Finally, the Commission will be a strong, effective, an unique point of contact on China issues between Congress and the Administration. The legislation also requires the U.S. Trade Representative to issue an annual report on China's compliance with WTO obligations. The report will cover compliance by China with commitments made in connection with its accession to the WTO, including both multilateral commitments and any bilateral commitments made to the U.S. The report will be a guide to where and how to commit the enforcement resources of the US Government. The Administration has also agreed to press for a mechanism for reviewing China's compliance with WTO obligations on an annual basis. Such a mechanism will be especially valuable as we proceed through the early stages of development of a free market and the rule of law in China. The legislation also calls for additional resources to be allocated to the U.S. Trade Representative as well as other Cabinet agencies to strengthen the ability of the United States to monitor and enforce Chinese compliance with trade agreements. We are all aware that China has engaged in abusive and horrendous practices of employing forced and prison labor in the production of goods. Our efforts to highlight these practices and pressure the Chinese to end them have had little success to this point. This legislation instructs the President to establish an interagency task force to monitor and promote effective enforcement of the prohibition on the importation of goods made by forced or prison labor into the United States. The legislation before us also calls for the allocation of resources to the Departments of Commerce, State, and Labor to provide training and technical assistance in China for purposes of developing the rule of law with respect to commercial and labor market standards. The departments will establish programs to assist China in bringing its laws into compliance with international requirements, including WTO rules, and in developing processes to enforce the rule of law. One of the strongest features of the bilateral agreement negotiated by the Clinton Administration is product-specific safeguard which will be included in China's protocol of accession to the WTO. This special anti-surge safeguard will apply to China for a period of 12 years following China's accession to the WTO. These provisions are more reasonable, and more favorable for U.S. industry and workers, than the comparable provisions that apply in general U.S. trade law to our other trading partners. The China safeguard contains lower causation and injury standards than ordinarily would apply between WTO members under section 201 of the Trade Act of 1974. The codification of this provision by the Levin-Bereuter package is a vital feature of today's legislation. Mr. Speaker, I also believe that we should amend our trade laws to apply the China standards on dumping to all countries. Such Congressional action would be consistent with our WTO obligations. I have prepared and offered such a bipartisan amendment, with my colleague Mr. English of Pennsylvania, in both the Ways & Means Committee and in the Rules Committee. The amendment contains several provisions from HR 1505, the bipartisan Fair Trade Law Enhancement Act of 1999, introduced by Representative English and myself in the first session of this Congress. In 1999, we witnessed a surge of subsidized imported steel into the U.S. While some of that import surge came from China, it also came from Russia, Japan, Brazil, and South Korea. Our existing anti-dumping and countervailing duty laws and relief under Section 201 of the Trade Act of 1974 were not able to help U.S. industries from these illegal imports. The new surge provisions negotiated with China will help in regards to future China imports. However, they will do nothing to help in regards to our other trading partners. Under WTO, we should use the more realistic China causation standards for all countries rather than using the causation standards included, for example, currently in Section 201. My amendment would have corrected this inconsistency. Unfortunately, my amendment was not made in order for consideration by the full House. I am hopeful that, after we act today to codify the trade laws applying to China, the next logical step will be to extend these standards to all of our trading partners. In addition, the Administration has given me assurances that it will vigorously use the full resources of its authority to enforce existing trade laws and that the Administration will not tolerate any illegal dumping. The Commerce Department is currently preparing a detailed report and analysis on last year's steel dumping. I plan to work closely with the Administration and concerned members from both sides of the aisle and workers and management in affected industries to make sure that we adopt measures to prevent future occurrences similar to what happened in 1999. There has been much discussion as to how to advance international standards for labor and environment in our trade negotiations. Progress in that regard has been made in the China agreement. It is also important to note that President Clinton made it clear to our trading partners in Seattle that any future trade rounds under the World Trade Organization must include the discussion of international labor and environmental standards. I wholeheartedly support the President in insisting that international labor and environmental standards be included among our nation's priorities in negotiations with our trading partners. The sole issue before us today is whether Congress will approve the Administration's initiative to normalize trade with China and subject China to the standards and rule of law within the World Trade Organization. We all understand that China is far from a model citizen in the world community of nations. The question is how to move the world's largest country, a country which, in our lifetimes, will become the world's largest economy, in the direction of democracy, openness, and economic freedom. Based on the full package that is being presented and the steps taken by the Administration to enforce our existing trade laws, I believe that Congress's ratification of the President's ratification of the President's initiative is in the best interest of our country.

Mr. CARDIN

Mr. CARDIN. Mr. Chairman, let me thank the gentleman for yielding me this time. Mr. Chairman, let me just make a couple points, if I might. First, I want to compliment my friend, the gentleman from Iowa (Mr. Nussle), for the manner in which we developed this proposal. It was done in a bipartisan way, an honest effort to try to improve the process around here. Let me make three points, if I might, first in regards to the joint resolution. In response to my friend from North Carolina, there is no opportunity to add, other than the budget requirements in the budget resolution. And if we do not enact the budget resolution, we report back to the current process. So there is really no danger there. But the key here is to try to get the White House and the Congress engaged on the same page on the budget document of this country. Why is that important? In the last 10 years, we have only passed a budget on time twice, once under Democrats, once under Republicans. In the last 10 years, we have only passed the appropriation bills on time once. We have had summit after summit, we have had violations of the rules after violations of the rules, and what this all means is that the Congress is not as strong as it needs to be. None of us like a summit. We are all neutered in that process except for a few of us. This empowers each one of the Members in this body as well as the institution itself to be stronger. Number two, emergency spending. Look what we have done with emergency spending in this body. Through the 1990s, we had 18 supplemental appropriation bills and 21 regular appropriation bills that included emergency spending. Much of this was not even emergency spending. It is time to reform this process and this legislation does it. And number three, it is time for us to start moving towards accrual accounting. Members should try explaining to their business leaders why we are still on a cash basis accounting system. That allows us to play gimmicks with the budget, which is wrong. This is a good first step. I urge the Members to please read what is in this document, because there are statements being made that are just not true. We do not sunset any of the entitlement programs under this bill, but it sets up a way in which we can start reviewing government spending in a more responsible way. I urge my colleagues to support the underlying reform bill. It will make us stronger as an institution.

Mr. CARDIN

Mr. CARDIN. Madam Chairman, yesterday I received a fax in my office from an organization supporting this bill. I expect each member of the House received the same fax. Across the top of the page, in big, bold letters, the fax read, ``NO MORE TAXES! VOTE ``YES'' ON H.R. 3709.'' The text of the message says that the bill is needed because it will ``allow Americans to continue to make purchases without overreaching taxes.'' The problem with the message is that it adds to the confusion and misinformation that surrounds this issue. Anyone who reads the message would reasonably conclude that the purchases of goods over the Internet are currently exempt from State sales and use taxes, and that the moratorium will prevent the imposition of any taxes on these transactions. The problem is that all but five states already have taxes on the books that legally apply to purchases made over the Internet. For reasons arising under the 1992 Supreme Court decision in the case Quill v. North Dakota, those taxes are not usually paid or collected. The most important issue considered--but not resolved--by the Advisory Commission on Electronic Commerce, was the question of how to continue the tremendous growth of the Internet as an economic force while assuring a level playing field between different forms of retailers. With more than 6,500 state and local sales and use tax regimes across the country, there is no question that simplification and uniformity are desperately needed. The massive complexity and inefficiency of the current system imposes an unreasonable burden on the retailers who are required, because they have ``physical nexus'' in jurisdictions across the country. At the same time, it presents an absurd challenge to on- line or mail order retailers who compete with ``brick and mortar'' retailers. There is a growing consensus that the states must develop a simplified tax system, along the lines of the Uniform Commercial Code, that will make compliance feasible. I had the benefit of hearing a full discussion of these issues at a meeting two weeks ago with business leaders, state tax officials, and the chairs of the tax-writing committees in Maryland's State Legislature. Coming out of that meeting, I am convinced that it is in the interest of fairness to all retailers, as well as of the state and local governments which depend on the revenues generated by sales taxes for education and law enforcement, for us to resolve this problem. The amendment that I have offered with the gentleman from Oklahoma, Mr. Istook, expresses the sense of Congress that the States should develop a streamlined, non-multiple and non-discriminatory tax system. This amendment is a needed expression of our understanding of the need both to protect the crucial revenue sources of the states, as well as to move toward a level playing field between all retailers, regardless of whether they are on-line or in the neighborhood. We had hoped to include in the amendment language expressing the sense of the Congress that once the states develop such a non-multiple, non-discriminatory tax system, the bar against fair application of the sales taxes presented by the Quill decision would be removed. The language we had hoped to propose would have expressed Congress's finding ``that if states adopt the streamlined system . . ., such a system does not place an undue burden on interstate commerce or burden the growth of electronic commerce and related technologies in any material way.'' Unfortunately, to comply with the germaneness requirements of the House rules, we were forced to drop that language. I urge support for the amendment as a necessary step in the continuing effort to adjust the existing tax system to reflect the new reality of the Internet economy.

Mr. CARDIN

Mr. CARDIN. Let me thank my friend from New York for yielding me this time. Mr. Speaker, we should not be talking about a sunset today. We should be talking about a sunrise, a sunrise for tax reform. I am very disappointed that we do not have legislation on the floor that would talk about tax reform because we do need tax reform. What this legislation represents is a failure, a failure by this body to take up tax reform, a signal that we will not deal with it in this Congress, the third consecutive Congress under the control of the Republicans in which they have not brought tax reform to the floor of this House. If my colleagues are looking for agreement on both sides of the aisle, we agree that the current income tax code is too complicated. So what do we do about it during these past 3 terms? Add another 100 sections and make it more complicated? Make it more difficult for our constituents to understand how to file their tax returns? That is not tax reform. Those actions became law. If my colleagues want agreement on both sides of the aisle that we should have less income taxes, they will get that agreement. Let us bring forward bills that do it. I strongly support the expansion of the earned income tax credit. That has helped many taxpayers get the relief that they need. But we sometimes find that on the other side of the aisle, they fight us on that type of legislation. Or targeted relief that would let less people need to file income tax returns in our country. But no, they do not seem to want to do it that way. So why not work together on tax reform so that we can really get something done in this Congress rather than having a tool that is just basically used for the 30-second commercial. That does not befit this body. And the tragedy is that if this legislation were to become law, what would be the consequences? The first thing is, we would not know what the tax revenue system of this country would be. What advice would my colleagues give to their constituents, their young married couple who wants to purchase a home but needs to know the tax consequences of that home purchase in order to make sure that their budget makes sense to buy that home? What will they tell them when there is no Tax Code in place and we have not quite figured out what the revenue code will be for our country? The uncertainty will be very damaging to American families. That is not what we should be doing. And then what Tax Code will we put into effect? I know there has been a lot of debate about this. Quite frankly I have a good tax plan that I would like to be able to talk about, and if we bring a bill to the floor, I will certainly be offering an alternative or amendments to that tax bill. But the reason why we use the retail sales tax is because that is the one I think our constituents understand the best, to allow us some ability to compare between one tax code and the other. If we translate what the repeal of all income taxes is on a retail sales tax, that is 59.5 percent added to the price of all goods, all services. That is not my estimate, that is the Joint Tax Committee's estimate. I do not want to be responsible for increasing prescription drugs and increasing Internet service and increasing clothing and increasing food by that type of price. That is not good for our economy. Let us think about what we are doing, let us work together, let us work on tax reform and not on a bill that will have no impact on real tax reform.

Mr. CARDIN

Mr. CARDIN. I want to thank the gentleman for those kind words and also thank my friend again from Minnesota for yielding.

Mr. CARDIN. Mr. Chairman, let me thank the gentleman from Minnesota for yielding me this time, but more importantly let me thank the leadership on both sides of the aisle for bringing forward this very, very important bill. I think we all can be very proud of what we have been able to do in the Chesapeake Bay, the Federal Government being one of the major partners. I particularly want to acknowledge the work that the gentleman from Virginia (Mr. Bateman) has done over his entire congressional career on the Chesapeake Bay. The constituents of my district and in Maryland, indeed the entire Nation, are very much gratified by what we have been able to accomplish through the leadership here in Congress. I see the gentleman from Maryland (Mr. Gilchrest) who has been another one of the real leaders on the Chesapeake Bay issues. This has been one of the largest voluntary multijurisdictional water quality and living resource restoration programs in the history of our Nation, and it has been a model program that we can now use in many other multijurisdictional bodies of water. I was Speaker of the House in Maryland in 1983 when Governor Hughes on behalf of the State of Maryland joined with the governors of Virginia and Pennsylvania and the mayor of Washington and the administrator of EPA and signed a one-page 1983 agreement that started the Chesapeake Bay Restoration program with a Federal partnership. It has been a partnership of government, the Federal, State and local; it has been a partnership between government and the private sector; and it has worked. We set one of the most ambitious goals for reducing pollutants in nitrogen and in phosphorus by 40 percent by this year. Mr. Chairman, we have come very close to meeting those goals in a watershed the size of 64,000 square miles. We have never attempted such a broad program in the past. I think we all can be proud. This reauthorization bill not only reauthorizes but expands it, increases the Federal Government's partnership in this effort, which gives us great hope for the future.

Mr. CARDIN. Mr. Chairman, will the gentleman yield?

Mr. CARDIN. Mr. Chairman, I had intended to offer an amendment requiring the administrator to commence a 3-year study to develop model water quality and living resource improvement strategies for areas impacted by development using work currently under way in the Patapsco/ Back River tributary in the Baltimore, Maryland, metropolitan area. My amendment would have specified that the administrator's study, conducted with the full participation of local governments, watershed organizations, and interested groups, develop a coordinated mechanism and make various determinations and recommendations to achieve water quality and living resource goals in areas impacted by development with particular reference to Gwynn Falls, Jones Falls, and Herring Run watersheds. Am I correct that the gentleman's intent is to encourage EPA, the Chesapeake Executive Council, and interested governmental and nongovernmental entities to work together on studies and strategies relating to water quality and living resources in areas impacted by development?

Mr. CARDIN

Mr. CARDIN. Mr. Chairman, I rise in support of HR 1776 however, I speak to you today to encourage deliberate caution with concern to FHA and HUD legislation. Homeownership is a critical building block of strong families and healthy communities. It has helped many households accumulate wealth, and a home owned free of mortgage debt is considered an important part of retirement security. While the current homeownership rate is at a record high of 66.8%, the purchase of a first home remains difficult or out of reach for many young people and low to moderate income families, particularly single- parent households and minorities. As the Secretary of Housing and Urban Development said on March 30th: ``The economic boom which has produced the highest homeownership rate in history has a downside and that is predatory lending.'' Unfortunately, we are now just learning the full meaning of that statement. FHA has in some areas, inadvertently fueled a downward spiral created by purchasing homes, selling to buyers with limited resources or readiness for ownership, allowing foreclosure and leaving boarded up houses sitting and pulling a community even further into despair. While HUD has made a credible start, there is much more that this Congress must do to ensure that these issues are addressed. We must repair FHA/HUD lending programs Baltimore has the highest number of FHA foreclosures per capita in the nation. Baltimore has become one of the worst manifestations in the country of predatory lending. HUD, responding to complaints that federal housing policies have resulted in tremendous damage to Baltimore neighborhoods, told city nonprofit agencies last week that it would be willing to halt Federal Housing Administrations (FHA) foreclosures in some of Baltimore's hardest hit neighborhoods for eight weeks to have a task force study what is happening. I agree that we must find out what is happening and I propose that there must be the formation of a federally led task force that would find a solution to flipping, predatory lending and FHA disposal of houses the agency acquires through foreclosures. We Must Deal with Predatory Lending Practices and Institutions Just five years ago there were 1,900 loans that went into foreclosure for the entire year of 1995. In the first 3 months of this year 1,700 loans in Baltimore City have gone into foreclosure. Some say that HUD has fueled these problems. The agency has relaxed its control over the issuance of mortgages insured by one of its agencies, the Federal Housing Administration (FHA) allowing lenders to make questionable loans that often end up in foreclosure. HUD must have better oversight to make sure that the would-be home buyer is ready as well as the appraisal process needs to be closely monitored. HUD contracts out for the appraisal process which has led to unrealistically high appraisals, which then creates bad loans given by these ``lenders of last resort.'' As you can see this process continues on a vicious downward spiral. The buyers of these home loans often are single mothers with low-wage jobs who end up defaulting on the mortgages. In cases where FHA insures the loans, the agency pays off the lender and takes title to the house. Once HUD pays off the lender and acquires title to a property after foreclosure, the house often sits vacant for months--depreciating the value not just of that property but of the neighborhood. HUD then sells the house on an ``as-is'' basis. Often they are in poor shape and unattractive to potential homeowners. Which, as a result leads to yet another phenomenon--they frequently are sold to unscrupulous speculators who quickly ``flip'' them for a huge markup--sometimes marking the homes up to 100% of what they were originally purchased for. We Must Repair the Damage To These Neighborhoods I hope that a HUD Task Force on Predatory Lending will find solutions to this problem. However, we now must also identify, fund and implement programs to repair the damage done to these communities and hold the speculators accountable for their illegal actions. HUD, local governments, and non profit housing organizations must begin working together now!

Mr. CARDIN

Mr. CARDIN. Mr. Chairman, this amendment would increase Social Security's limitation on administrative expenses for fiscal year 2000 by $336 million, bringing it to the level requested by the Social Security Commissioner. Quite simply this funding is necessary if SSA is to maintain vital services that are being threatened by the agency's inadequate administrative budget. Mr. Chairman, I might point out that the Subcommittee on Social Security of the Committee on Ways and Means recently held a hearing when the Commissioner was there and some of the concerns on the administrative budget was expressed at that hearing. Every day over 100,000 individuals visit SSA's field offices and over 240,000 individuals call SSA's 800 number. Every month SSA pays benefits to approximately 50 million individuals. In this coming year it expects to issue 16 million new and replacement Social Security cards and take more than 5 million new claims for benefits. Last year, Social Security also began sending benefit statements to workers over the age of 25, enabling 126 million American workers to better plan their financial future. There is just no way around it. Providing efficient service on this vast scale takes more than good management, it takes resources. Yet Congress has funded SSA's administrative budget below levels requested by the President and by the Social Security Commissioner every year since the agency became independent in 1994. Despite these funding constraints, the Social Security Administration last year received an overall grade of A on the Government Performance Project's report card and 88 percent of SSA's customers rate the agency's service as being excellent, very good, or good. SSA's administrative budget represents less than 2 percent of the value of the benefits it provides each year and the OASI program enjoys a payment accuracy of over 99 percent. SSA has a history of a solid and reliable customer service and this must be maintained. Yet over the next decade the number of OASI beneficiaries will increase by 16 percent and the number of DI beneficiaries by 47 percent. At the same time the agency estimates that almost 3 percent of its workforce will retire in 2001 and that these losses will continue and peak around 2009. SSA must be prepared now for both the expected spike in its workload due to the baby boomers' retirement and the retirement of its own aging workforce. These challenges are already placing an unprecedented strain on SSA as the agency tries to prepare for the future using a persistently underfunded administrative budget. SSA's workforce has declined by 26 percent between 1982 and 1998, much more quickly than the rest of the Federal workforce. At the same time it is trying to flatten its retirement wave by offering early retirement to some employees while hiring and training new individuals to ensure an adequate supply of trained personnel within the next several years. For fiscal year 2000, Congress provided $6.57 billion for SSA's administrative budget, a level $336 million below the Commissioner's request. As a result, SSA will process a quarter of a million fewer disability, retirement and survivors claims than projected and will be unable to conduct over 200,000 SSI redeterminations. In addition, the agency projects declines in its telephone service. Congress is simply not providing SSA with the resources necessary to prepare for the future. We expect SSA to develop service delivery plans, to provide timely and accurate benefits to the elderly and disabled, to use current information technology and to maintain the integrity of its program. But for SSA to continue meeting these expectations this year and in future years Congress must provide the agency with necessary administrative resources. That is why my amendment is necessary and should be included in this bill. These funds do not come out of the general fund but rather are financed almost entirely out of the OASDI trust funds. At a time when the trust funds are running surpluses it makes little sense to restrict Social Security's ability to administer its own programs. Without this increase, your district offices will begin to receive calls from constituents whose expectation of SSA customers are out of step with the levels of service Congress is supporting through the LAE allocation. Mr. Chairman, the programs administered by the SSA touch the lives of almost every American. I understand that the chairman of the Committee on Appropriations has raised a point of order and the amendment is subject to a point of order. But I would hope during the appropriation process this year, we would be mindful of the need of SSA to have adequate administrative resources in order to carry out this increased responsibility. I know that the chairman has been sensitive to this in the past. I would be glad to yield to the chairman, but I will withdraw the amendment.

Mr. CARDIN. Mr. Chairman, I offer an amendment.

Mr. CARDIN. I will be glad to withdraw the amendment.

Mr. CARDIN

Mr. CARDIN. Madam Speaker, let me thank the gentleman from California (Mr. Matsui) for yielding me this time and for his work on bringing this legislation forward and the gentleman from Florida (Mr. Shaw), the chairman of the Subcommittee on Social Security. This is a very important piece of legislation. It will be enacted, I think, very shortly once we complete our action and it is forwarded to the President. It will affect 800,000 seniors who have had their Social Security checks reduced just because they decided to continue to work. That makes no sense at all. We need more workers in the workforce, not less. In today's economy and with the shrinking workforce that we have of more people retiring and less people working, it makes common economic sense to allow those 65 years of age who want to work to be able to work. Without this legislation, the marginal tax rate is 33 percent. That is unacceptable. That is why we are changing it. It is interesting that this particular legislation will have no impact on the long-term solvency of the Social Security system, for it is a plus in having people work and contributing to the system. It also benefits women more than men, because women's work history is not as strong, generally, as men. This will allow women to be able to continue to work without being penalized under the Social Security system. Madam Speaker, this legislation becomes effective January 1. It is retroactive to the current year, as it should be, so that individuals in this current year will be able to get their full Social Security benefits without the reduction for their work. As the gentleman from Florida (Mr. Shaw), Chair of the Subcommittee on Social Security, pointed out, we are able to do this even though we cannot bring forward at this point comprehensive Social Security reform. I think we would all like to do that. We know that we need to deal with the Social Security system in a broader context, but we have an agreement on this very important piece of legislation, so we are bringing that forward. We are doing it in a bipartisan way. Madam Speaker, as the gentleman from New York (Mr. Rangel), the ranking member of the Committee on Ways and Means, said, we should use this as a model to work together, Democrats and Republicans, to bring other legislation forward. I think about the need for seniors for prescription drugs. We may not be able to agree on Medicare reform; but we can agree, I would hope, on prescription drugs. Let us in a bipartisan way bring that forward, which will also help our seniors. This is a good day for seniors. It is a good day for our Nation. I congratulate all involved.

Mr. CARDIN

Mr. CARDIN. Mr. Speaker, I rise today to praise the work and life of the Rev. Dr. Herbert D. Valentine, who next month will be retiring as the Executive Presbyter of the Presbytery of Baltimore. Dr. Valentine has held the position of Executive Presbyter for 23 years, serving his faith and his convictions. Dr. Valentine has been instrumental in working for better human rights policy, for better treatment of children and families and policies that speak to the better side of our nature. His work in Baltimore has spoken to the needs and aspirations of all peoples, near and far. Dr. Valentine's commitment to strengthening ecumenical and interfaith relationships was recognized by the Central Maryland Ecumenical Council in 1995 with their Bryce Shoemaker Ecumenical Leadership Award. Prior to that, Dr. Valentine was honored by the Presbytery when he was elected to serve as moderator of their 203rd General Assembly in 1991-1992. In this capacity, Dr. Valentine traveled around the world representing Presbyterians and sharing his faith. Throughout his lifetime, Dr. Valentine has demonstrated deep concern for all victims of oppression and injustice, not only in Baltimore but throughout the global community, especially in Central America. A visit from Dr. Valentine and other members of the Baltimore Presbytery, always meant that I would get educated as to the needs of people in distress or despair. We agreed more often than not as to the action our country had to take to assist these efforts to elevate the condition of all peoples. Dr. Valentine's strong faith and advocacy will be missed, but I am sure he would not be leaving without a well trained and compassionate replacement--I know his coworkers are well prepared to continue his work. I ask my colleagues to join me in thanking Dr. Valentine for his service to his faith and his community and to wish him fair winds and a following sea as he enjoys his retirement.

Mr. CARDIN

Mr. CARDIN. Mr. Speaker, I rise today to congratulate Baltimore Hebrew University, a valuable educational institution in my district, on their 80th anniversary. Following World War I, in response to a community need for Jewish education and teacher training, Baltimore Hebrew University opened its doors as an institution of higher learning devoted solely to Jewish studies. Today, Baltimore Hebrew University has more graduate and credit students than any other Hebrew college in the nation. The University has the fourth largest Master of Arts program in Jewish Studies in the country with only Yeshiva University, Hebrew Union College and the Jewish Theological Seminary having larger programs. In addition to teaching Jewish Studies on their Baltimore City campus, Baltimore Hebrew University professors provide Jewish Studies curriculum in other Maryland colleges, including Groucher College, Towson University, and University of Maryland Baltimore County. Next year, BHU professors will begin a new program at John Hopkins University. In addition, Baltimore Hebrew University has begun to offer in conjunction with The Baltimore Jewish Times courses ``on line'' to provide educational opportunities to students in communities lacking Jewish Studies programs. Baltimore Hebrew University brings together Jews and non-Jews of all religious backgrounds, providing a diverse, open and community- responsive environment in which students gain an understanding of Jewish literary and historical tradition. Baltimore Hebrew University graduates making contributions in many of my colleagues' communities include: Stephen Hoffman, president of the Jewish Community Federation of Cleveland: Brain Schreiber, Executive Director of the Jewish Community Center of Greater Pittsburgh; Lesley Weiss, Association Director of the Anti-Defamation League in Washington, D.C; Gail Naron Chalew, editor of the Journal of Jewish Community Service and Larry S. Moses, President of the Wexner Foundation, to name a few. I ask my colleagues to join me in congratulating Dr. Robert O. Freedman, president of Baltimore Hebrew University, and the members of the Board of Trustees and the Baltimore Jewish community for their fortitude and foresight in establishing and maintaining Baltimore Hebrew University as a premier institution of higher education.