Kent Conrad

Mr. CONRAD

Mr. CONRAD. Mr. President, there is no objection on this side.

Mr. CONRAD. I yield time to the Senator from Iowa.

Mr. CONRAD. Mr. President, I ask for the yeas and nays.

Mr. CONRAD. I thank the Chair. Mr. President, this amendment moves to keep the promise on IDEA. When the Federal Government enacted this program, it promised the States and the local jurisdictions that it would fund 40 percent of the expense. We have never done that. We are at about half that amount. As a result, we have forced property tax increases all across America. This amendment says let's keep the promise on IDEA. We phase it in over 10 years. It costs $73 billion in outlays. It is paid for by the nonreconciled tax cuts. Let me emphasize to my colleagues, the nonreconciled tax cuts. I hope my colleagues will give serious consideration to this amendment. Let's keep the promise on IDEA. Let's help those local jurisdictions at a time of enormous financial stress meet the need.

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

Mr. CONRAD. Mr. President, I send an amendment to the desk and ask for its immediate consideration.

Mr. CONRAD. Mr. President, I, too, thank our colleagues. Maybe this serves as a good example of how we might proceed. Amendment No. 376

Mr. CONRAD. Mr. President, so we can alert colleagues to what we are faced with today, we have over 100 amendments that have been noticed to the managers. At three amendments an hour, maybe a little more than that, four amendments an hour would be 25 hours; three amendments an hour, 35 hours. So we will ask colleagues to call us and let us know if their amendments are that important to them or that they could wait for another day. I urge colleagues to talk with their staffs and alert us as to amendments that do not need to be offered today. That is No. 1. No. 2, when we get into this, we will need to do these votes 10 minutes apiece, as the chairman has indicated. We will have to be very disciplined to do that. That is the only way we can get through these amendments in a way that will allow us to complete business on any reasonable schedule. We need to put colleagues on notice that that is the way the day will have to go if we are going to get done. I yield the floor.

Mr. CONRAD

Mr. CONRAD. Mr. President, let me thank my colleague, the chairman of the committee. He has been gracious throughout this process and a gentleman. I have very much enjoyed working with him. The fact is, now we have over 90 amendments pending at the desk--I think 93. At 10 minutes apiece, that is over 15 hours of voting, and that is if we voted every 10 minutes. We all know that won't occur. So we would be talking about a very long day tomorrow. I will just send a message out to any of our colleagues or any of their staffs who are listening, to those who have amendments pending: If this is something that you think is a good idea but you really don't need to do now, that you could offer on an appropriations bill or some other vehicle, we encourage you to do that. This is a very difficult process. I think the record is 34 votes in a day. I remember that day. I think the chairman remembers that day. It was not pretty. I don't look forward to a replication. But that is what the rules are. That is where we are. The only way it is going to be better is if we use restraint. I just hope colleagues and staffs are listening and that tomorrow restraint is demonstrated. We don't need to vote on every one of these 93 amendments. The chairman and I will work diligently to try to clear amendments, to get agreement on amendments, to work through amendments that could be accepted. We ask our colleagues, we implore them to work with us tomorrow, to avoid this being an unpleasant and unproductive experience. Again, I thank the chairman and our colleagues who have worked cooperatively today to make progress.

Mr. CONRAD. No objection.

Mr. CONRAD. Mr. President, I yield back our time.

Mr. CONRAD. I yield 10 minutes to the Senator from Delaware.

Mr. CONRAD. Well, I respect my colleague's view. Let me just say, this is how OECD does the scorekeeping on effective tax rate comparisons, what people are actually paying. This is their conclusion about where the United States fits in. Let me continue because the Senator raises an important point. There is an implication that we have a competitive problem because our tax rate is so high. The fact is, as this chart shows, over 40 years, corporate taxes have fallen as a share of our economy but risen for other industrial economies. This line shows the United States. We have gone from an effective rate as a percentage of GDP of 4 percent, which is a way of giving an accurate comparison between countries with different levels of GDP. Ours has gone down dramatically. Other OECD countries have gone up over the 40 years. The Senator from Oklahoma's chart and the arguments he made suggest that all corporate income is taxed at the maximum corporate and individual tax rates. This goes to the Senator's question. I hope the chairman will listen to this. At least a quarter of corporate profits are not taxed at all because of various tax preferences. That translates into a zero-percent effective tax rate. Another half of corporate income is taxed once at the corporate level, but not taxed again because it goes to pension funds and other stockholders who do not pay individual income taxes. That again lowers it. The Senator is showing nominal tax rates, not effective tax rates. Finally, the chart being used assumes that all corporate income goes to individuals in the top individual tax bracket at the Federal, State, and local level. In recent years, corporations have used stock buybacks to convert their profits into individual capital gains which have an effective tax rate of less than 10 percent. How can it be at 10 percent when the capital gains rate we all know is double that? The reason for that is the deferral that is inherent in capital gains which gives you a much lower effective tax rate than the nominal tax rate. I say this because it is important to have in the Record that this notion that we have a 70-percent rate on corporate profits is not accurate. That is not the effective tax rate. It is nowhere near that. And if one compares corporate taxes in this country to other countries on a fair comparison basis, we are not a high tax jurisdiction. We just are not. I offer that for the Record. The Senator from Delaware has been extraordinarily patient. How much time would he like?

Mr. CONRAD. I will.

Mr. CONRAD. Mr. President, I will take a couple of minutes. I apologize for this, but it is important for the Record that we address the famous chart my colleague has shown over and over on the comparison of corporate tax rates. We have seen several references to this chart that is entitled ``United States, Second Highest in the World Combined Corporate and Dividend Taxes.'' The chart says that the U.S. has a tax rate of 70 percent, second only to Japan. My colleague and my friend, the Senator from Oklahoma, has referred to this chart so often that I decided to go off and do a little independent research on that chart. Let me tell you what I found. First, let's look at corporate taxes alone. When we look at corporate taxes alone this is for 2000 as a percentage of GDP, which Senator Bennett said is the appropriate way of looking at it--a much different picture emerges about where we fit in. This is from OECD, the international scorekeeper. What they have found is the United States ranks 22nd out of 29 in effective corporate tax rates. The Senator from Oklahoma shows nominal tax rates, the tax rate that appears in the Tax Code. We all know that is not what people actually pay. When you look at what they actually pay, you see a much different picture: 22nd out of 29 in effective corporate tax rates as a percentage of gross domestic product. We are down here, 22nd out of 29.

Mr. CONRAD. I yield time.

Mr. CONRAD. Will the Senator yield for a moment so I can thank the Senator for his courtesy in doing that? That is a gracious act, especially at this time of night. I appreciate it very much.

Mr. CONRAD. I don't think it makes much difference. Does it make a difference to you, Mr. Chairman? I took Senator Bond's time off the resolution. I am not sure it makes much difference, whichever one is top on your list there.

Mr. CONRAD. The Bond amendment.

Mr. CONRAD. Mr. President, the Senator from Vermont is seeking time. I propose that he take 15 minutes off the amendment of the Senator from Missouri.

Mr. CONRAD. I thank the Senator. Amendment No. 358

Mr. CONRAD. I yield 20 minutes to the distinguished Senator from Missouri.

Mr. CONRAD. I have enjoyed this debate. Let me just say to my colleague, I wish I had--I am asking my staff to get it, but I do not want to interrupt the discussion any further. Let me just say the text of the analysis from Macroeconomic Advisers makes clear they believe the long-term impact is negative. Because of the crowding-out effect, because it is borrowed money, it is because that reduces the pool of societal savings. I have loads of other economic analysis that concludes the same thing. It is what I believe. I think it is a mistake. That is where we differ. I am not going to interfere any further in this other discussion we promised people they could have. How much time is the Senator seeking?

Mr. CONRAD. Could I just say on that point, you have to read very carefully what Chairman Greenspan said. He said the dividend proposal, as long as it is revenue neutral--not financed by borrowing--is good for the economy. If it is financed by borrowing, it is not good for the economy.

Mr. CONRAD. Yes.