J. Cleland

Mr. CLELAND

Mr. CLELAND. Mr. President, our side supports the amendment. We think it is a good compromise. We think the staff and the committee did an excellent job of putting this together. It was a difficult choice. But we support the amendment. I urge its adoption.

Mr. CLELAND. I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. CLELAND

Mr. CLELAND. Mr. President, I rise today to express my reservations about the merits of S. 1260. I served as Georgia's Secretary of State and Commissioner of Securities for many years. I was responsible for administering Georgia's securities laws and providing investor protection for Georgia residents. We are all aware that the securities markets are an integral part of our nation's economy and that we have experienced tremendous growth in these markets. Nearly half of all American households now invest in the stock market either directly or through mutual funds. These are not just rich people trying to become richer. These are primarily middle class Americans seeking to fund their children's education, to save up for a down payment on a home, and to provide a decent standard of living for themselves in retirement. In 1990, only 17.8 percent of all Americans invested in equities but that figure has grown dramatically, and one in three households now own securities. Unfortunately, these successes have led to a tremendous increase in fraud and abuse. Recently, top securities watchdogs in the United States have warned that the explosion in the stock market has led to a sharp rise in securities sales fraud and stock price manipulation. Several studies have shown that many Americans lack the financial sophistication to protect themselves from fraud. At a town meeting in Los Angeles, SEC Chairman Levitt cautioned that investors are ``more vulnerable than ever to fraud.'' This concern has been echoed by others who point to a disturbing rise in the level of securities fraud and there are many allegations that organized crime is seeking a foothold in certain sectors of the securities marketplace. It is unclear whether there is any means for defrauded investors to recover stolen money under federal law following the passage of the 1995 PSLRA, which severely limits the rights of defrauded investors. Preemption of state remedies under S. 1260 could lead investors with no ability to protect themselves against fraud. Several federal district courts have issued rulings on the 1995 law that are so restrictive that they threaten almost all private enforcement--including holding that reckless wrongdoers are no longer liable to their victims under the PSLRA. I strongly disagree with this interpretation because Congress, when it crafted the PSLRA, it did not intend to eliminate recklessness as a standard of liability. On the contrary, it is my understanding that the PSLRA did not, in any way, alter the scienter standard in federal securities fraud suits. Let us be clear about who suffers in the cases of securities fraud-- it is retirees living on fixed incomes, young families struggling to make ends meet and save for their children's education, teachers, and factory workers. Each day, devastating cases are brought to the attention of securities regulators and law enforcement officers. Indeed, financial fraud is a serious and growing problem. No discussion about securities litigation reform is complete without serious consideration of the potential impact on small investors across the country. The elimination of state remedies against fraud could be catastrophic for millions of Americans. The fundamental purpose of securities law is to protect investors, something that S. 1260 does not adequately address. In fact, S. 1260 is designed merely to protect big business. The confidence in our securities markets results, in part, because of the cooperative enforcement system that has served the United States exceptionally well since the Depression. Substantive securities regulation in this country began at the state level. In 1911, the State of Kansas enacted the nation's first Blue Sky Law. Other states quickly adopted their own version of such legislation. Congress passed federal securities laws in 1933 and 1934 to complement--not replace--state laws and to stop abuses that caused the 1929 crash. Many states have chosen to provide more expansive investor protections than federal law currently provides--through accountability for aiders and abettors, realistic time limits for filing a fraud claim, and the ability of investors to recover fully from professionals who help perpetrate frauds when the primary wrongdoer is bankrupt, in jail, or has fled the country. In the late 1980s as Secretary of State, I conducted a series of public hearings to focus on securities fraud taking place in Georgia. This led me to recommend a number of changes to strengthen Georgia's securities laws. These changes established significant disclosure requirements for those dealers offering and selling certain stocks within or from the state of Georgia. These recommendations were unanimously enacted as amendments to the Georgia Securities Act, and gave my staff more tools to effectively deal with securities fraud. The Georgia legislature also installed securities fraud as a predicate offense for purposes of liability under the RICO statute. I am pleased to report that the efforts of the Georgia General Assembly are the rule rather than the exception. According to the SEC, 49 of the 50 states provide liability for aiders and abettors now unavailable under federal law, and 33 states provide longer statutes of limitations for securities fraud actions than current federal law. Mr. President, S. 1260 would undermine these important state remedies. Simply put, S. 1260 is an affront to the efforts of state governments across the country to locally protect their public investors from fraudulent securities transactions. For example, this bill reinforces the unduly short statute of limitations in federal law. In effect, federal law rewards those perpetrators of fraud who successfully conceal the fraud for more than three years. A majority of states have statutes of limitations that are longer than the federal statute. As currently written, S. 1260 would preempt those state laws. Furthermore, the definition of ``class action'' contained in this bill is overly broad. I have been informed that the definition of ``class action'' in S. 1260 would allow single suits filed in the same or different state courts to be rolled into a larger federal class action, and this was never contemplated or desired by individual plaintiffs. Another cause for concern is that under S. 1260, defrauded state and local pension funds are barred from recovering from corporate wrongdoers in state court. Since many remedies have already been foreclosed in federal court, the state or local government and its taxpayers may be required to make up losses in the pension fund resulting from fraudulent securities transactions. If state and local governments are creatures of state law, shouldn't they be entitled to pursue state remedies? State and local government representatives are unequivocal in their opposition to S. 1260. The National League of Cities, the U.S. Conference of Mayors, the Government Finance Officers Association, and the National Association of State Retirement Administrators all reject the bill in its current form. Mr. President, I am not convinced that the federal preemption of state anti-fraud protections is a necessary step. Preemption supporters emphasize an ``explosion'' of state suits filed to circumvent the PSLRA in the two years since its enactment. Yet the number of state securities class actions filed in 1997--only 44 nationwide--represents a 33 percent decrease since 1996 and is lower than the number filed in any of the three years before the PSLRA was passed. In addition, most of the state court cases have been filed in California. No state other than California has had more than seven securities class actions filed in the two years since the enactment of the PSLRA. Mr. President, if a problem exists, then it should be addressed in Sacramento, not Washington, and I understand that California has already established a legislative commission to study its laws and make changes if necessary. Other states should be free to decide how to protect their own citizens from fraud. Mr. President, I support the right of investors to seek legal remedies against those persons selling fraudulent securities. I have supported an investor's right to seek redress through mediation, arbitration, and civil litigation. While I worked to streamline the regulatory process in Georgia, I opposed amendments to federal regulations that would have impaired the ability of a state to protect its investors. Here in the Senate, my focus remains the same. For this reason, I oppose S. 1260. Thank you Mr. President. I yield the floor. Mr. D'AMATO addressed the Chair.

Mr. CLELAND

Mr. CLELAND. Mr. President, I rise today to congratulate the Gulfstream Aerospace Corporation and the Gulfstream V industry team on winning the coveted Robert J. Collier Trophy for 1997. The Gulfstream V is the world's first ultra-long range large cabin business jet. Both the Gulfstream V and the Gulfstream IV SP are manufactured in Savannah, Georgia. The Collier trophy is aviation's most prestigious award. It is given annually by the National Aeronautics Association to recognize the top aeronautical achievement in the United States. Gulfstream and the G-V Industry team were presented the trophy at a ceremony on April 29 hosted by the National Aeronautical Association and the National Aviation Club in Arlington, Virginia. Gulfstream and the Gulfstream V industry team were recognized specifically ``for successful application of advanced design and efficient manufacturing techniques, together with innovative international business partnerships, to place into service the Gulfstream V--the world's first ultra-long range business jet.'' Past winners of this prestigious award include Orville Wright, Neil Armstrong and the Apollo 11 flight crew, Charles E. ``Chuck'' Yeager and my colleague from Ohio, Senator and astronaut John Glenn. Certified by the Federal Aviation Administration (FAA) in April, 1997, the Gulfstream V business jet is the first aircraft of its kind in the world. With unmatched performance, comfort and speed, the Gulfstream V has a range that is 50% greater than any other business jet currently in service. The Gulfstream V can carry eight passengers and a crew of four for nonstop distances of up to 6,500 nautical miles at speeds of up to Mach .88. It is designed to cruise routinely at an altitude of 51,000 feet. Last year, in the first eleven months of service, the Gulfstream V set 47 world and national records, consisting of 22 city pair speed records and 25 performance records. The Gulfstream V has made nonstop travel between cities such as Tokyo and Washington, London and Beijing, and Los Angeles and Moscow routine business. The Gulfstream V was recognized as one of the ``Ten Most Memorable Flights in 1997'' by the National Aeronautic Association for a flight from Washington, DC to Dubai, United Arab Emirates. The flight was 6,330 nautical miles and took 12 hours and 40 minutes. It flew nonstop. Mr. President, I want to salute and congratulate the 6,000 men and women of the Gulfstream Aerospace Corporation on their outstanding work and this extraordinary achievement.

Mr. CLELAND

Mr. CLELAND. Mr. President, one of my proudest honors as a United States Senator is to serve as the Ranking Member on the Personnel Subcommittee of the Senate Armed Services Committee. It is in this capacity that I feel I can contribute to supporting the men and women in our Armed Forces. Last week I introduced a military health care proposal which I referred to as KP Duty, as in ``Keeping Promises Duty.'' In the military, KP stands for ``kitchen police'' which is a term for messhall clean up which recruits are tasked to do when they go through basic training. This KP duty I am proposing is for all of us to clean up a commitment--the promises made to our servicemen and women. The Fiscal Year 1998 National Defense Authorization Act (P.L. 105-85) included a Sense of the Congress Resolution which provided a finding that ``many retired military personnel believe that they were promised lifetime health care in exchange for 20 or more years of service.'' Furthermore, it expressed the sense of Congress that ``the United States has incurred a moral obligation'' to provide health care to members and retired members of the Armed Services and that Congress and the President should take steps to address ``the problems associated with the availability of health care for such retirees within two years.'' I authored that resolution, and today in year one of this two- year challenge, my friend and colleague, Senator Kempthorne, Chairman of the Personnel Subcommittee of the Senate Armed Services Committee, and I are ready to take the initial steps in fulfilling this obligation to our retirees. In March, I hosted a military health care roundtable at Fort Gordon, Georgia. The positive and supportive working relationship between the Eisenhower Army Medical Center and the Veterans Administration Medical Center in Augusta, Georgia was highlighted by the panel speakers and audience members. These facilities have established a sharing agreement which allows each to provide certain health care services to the beneficiaries of the other. This type of joint approach has the potential to alleviate a significant portion of the accessibility problem faced by military retirees, especially given the reduction in DoD medical treatment facilities. In spite of these benchmarked efforts in cooperative care, beneficiaries who were in the audience still attested to insufficient accessibility to resources to meet their needs. One of the audience participants who was commenting on a health problem stated, ``my life isn't the same as it was a year ago, and all I got was shuttled from one thing to another''. In a statement I submitted last week, I discussed a legislative initiative which would require the Department of Defense (DoD) and Department of Veterans Affairs (VA) to work toward enhancing their cooperative efforts in the delivery of health care to the beneficiaries of these systems. This initiative includes several elements to enhance health care efficiencies. It provides for a study which would determine the demographics, geographic distribution and health care preferences and an assessment of the overall capacity of both systems to treat beneficiaries. The second provision would examine existing statutory, regulatory and cultural impediments that are currently precluding the optimal cooperation of DoD and VA in health care delivery. Finally, this initiative provides for the acceleration of several ongoing efforts such as the Electronic Transfer of Patient Information and the DoD/VA Federal Pharmaceutical Steering Committee. This legislative initiative was included in the Fiscal Year 1999 National Defense Authorization Act. The legislation I wish to discuss today addresses the retirees who are aged 65 and older. The Government Accounting Office reports that of the population eligible for military health care, approximately 52% are retirees and dependents. Seventy one percent of military retirees are under the age of 65, while 29% of military retirees are aged 65 and older. As we consider options for improving the DoD and VA health care systems, we need to be mindful of some basic facts. About 60% of retirees under the age of 65 live near a military treatment facility while only about 52% the retirees aged 65 and older live near such a facility. About two thirds of retirees under the age of 65 use the military health system. In comparison, only about a quarter of the retirees aged 65 and older use military medical facilities, and then only on a space available basis and primarily for pharmacy services. According to a 1994-95 survey of DoD beneficiaries, just over 40 percent of military retirees, regardless of age, had private health insurance coverage. About a third of retirees aged 65 and older also reported having additional insurance to supplement their Medicare benefits. This is in part, due to their belief that the military health care system would take care of their needs throughout their lifetime. The Military Health System has changed dramatically in recent years. The collapse of the Soviet Union and the end of the Warsaw Pact led to a major reassessment of U.S. defense policy. The DoD health care system changes have included the establishment of a managed care program, numerous facility closures, and significant downsizing of military medical staff. In the last decade, the number of military medical personnel has declined by 15 percent and the number of military hospitals has been reduced by one-third. The Fiscal Year 1994 National Defense Authorization Act directed DoD to prescribe and implement a nationwide managed health care benefit program modeled on health maintenance organization plans and in 1995, beneficiaries began enrolling in this new program called TRICARE. With over 8 million beneficiaries, it is the largest health maintenance organization plan in the Nation. One of the problems with TRICARE is what happens to retirees when they reach the age of 65. At that point, they are no longer eligible to participate in any TRICARE option. The law currently provides for transition from military health care to Medicare for these beneficiaries. Mr. President, this is not the right solution, especially given the fact that Medicare does not currently reimburse the DoD for health care services, although Congress recently authorized a test of this concept, nor does Medicare include a pharmacy benefit. In addition, as the military begins to close and downsize military treatment facilities, retirees aged 65 and older are unable to obtain treatment on a space available basis. These retirees are, in effect, being shut out of the medical facilities promised to them. The Medicare Subvention demonstration project that is scheduled to begin enrollment in the near future will only benefit retirees who live near military treatment facilities--which is only about half of all retirees. Those retirees living outside catchment areas won't even benefit from subvention. Additionally, there are ongoing efforts to initiate a Veterans Affairs Subvention test. The limiting criteria of these tests is that they require beneficiaries to live near the respective treatment facilities. To accommodate those beneficiaries who do not live near treatment facilities or within a catchment area, we must explore other alternatives, including, the Federal Employees Health Benefits Program (FEHBP) option that has received so much attention recently. There has been an overwhelming outpouring of support for offering FEHBP to military retirees. Although this program has achieved a successful reputation among federal employees, it is a very costly alternative which deserves close scrutiny, along with other health care options. I appreciate the fact that there are many advantages to FEHBP. Furthermore, I share the view that health care for military retirees should be at least as good as the health care we in the Congress afford ourselves. However, there may be other options, or a combination of options that will allow us to keep our promises with our older retirees in a fiscally responsible manner. The option I am about to discuss is included in the Fiscal Year 1999 National Defense Authorization Act. Senator Dirk Kempthorne, Chairman of the Personnel Subcommittee of the Senate Armed Services Committee, and I have worked closely on this issue over the past several months. Under his leadership, the Personnel Subcommittee held hearings on this issue which included testimony by the service Surgeons Generals, the Acting Assistant Secretary of Defense for Health Affairs, and representatives from military associations. Together, we have developed a plan to assist the Nation in meeting our obligation to the military retirees. This legislation requires demonstrations to be conducted of three health care options: the Federal Employees Health Benefits Program (FEHBP), TRICARE Standard (which replaced the Civilian Health and Medical Program of the Uniformed Services or CHAMPUS), and Mail Order Pharmacy. Two different sites will be selected for each of the respective demonstrations. Through FEHBP, military retirees could choose from different plan options. As with active and retired federal employees, military retirees who enrolled would be required to pay a premium. The amount of the premium would vary depending on which plan was chosen and the government and beneficiary share in the cost of the selected plan. The TRICARE Standard option would be to extend the current coverage beyond age 64. Under this extension, the TRICARE Standard would serve as a supplemental policy to Medicare, covering most out-of-pocket costs not covered by Medicare. Even though this proposal would require retirees to enroll in Medicare part B, retirees should experience lower out-of-pocket costs. Because TRICARE Standard is an established program within DoD, the existing infrastructure could be used without significant increase in administrative costs. Finally, the Medicare program does not provide coverage for outpatient prescriptions, a major expense for older people, who tend to use more prescription drugs. Military retirees can get prescriptions filled at military treatment facility pharmacies, but these facilities are not readily accessible to all older retirees. Expanding this mail order benefit to those who do not live near military facilities and do not currently have a mail order benefit would fill an important health care coverage gap. This would be the third demonstration. The demonstrations will be scheduled to conclude within the same time frame as the ongoing Medicare Subvention test, approximately January 1, 2001, so all the test results can be simultaneously compared in determining the best option or combination of options to accommodate the retirees aged 65 and older. Mr. President, as you know, S. 1334, a bill to provide for a test of FEHBP has 60 cosponsors. We agree that FEHBP warrants further examination which is why we have included it in the Committee's legislative proposal. We are very committed to finding the right solution to this shortcoming which is why we feel that evaluating several options is critical in this decision process. The proposal included in the Defense Authorization Act is far more comprehensive than S. 1334. At the end of these demonstrations, we would have extensive data upon which we could base an informed decision regarding the best way for our Nation to provide health care to those who have earned it through the sacrifices inherent in military service.

Mr. CLELAND

Mr. CLELAND. Mr. President, I am particularly honored to serve as the ranking Democratic member of the Senate Armed Services Personnel Subcommittee, a charge I have embraced to its fullest. In the first session of the 105th Congress, I pledged my commitment to improving military health care. Today, I am here to discuss proposals to offer both immediate assistance and a time phased legislative strategy to fulfill this commitment. The Fiscal Year 1998 Defense Authorization Act (P.L. 105-85) included a Sense of the Congress Resolution which provided a finding that ``many retired military personnel believe that they were promised lifetime health care in exchange for 20 or more years of service,'' and expresses the sense of Congress that ``the United States has incurred a moral obligation'' to provide health care to members and retired members of the Armed Services and that Congress and the President should take steps to address ``the problems associated with the availability of health care for such retirees within two years.'' I authored that resolution, and today in year one of my two-year challenge, I stand ready to take the first of many necessary steps to fulfill this obligation. I call this obligation ``K-P Duty''--K-P as in KEEPING PROMISES. As a disabled veteran and retiree, as former head of the Veterans Administration, and as the Ranking Member on the Personnel Subcommittee, I am seeking to draft Congress and the entire nation and put us all on K-P Duty. Back when I was in the Army, some saw K-P or ``kitchen police'' as punishment. If a soldier was derelict in his duties, or if he broke the rules, he went on KP, where he served his fellow soldiers by working in the messhall. The K-P Duty I'm talking about is not about punishment, however. Yes, we as a nation have been derelict in our duties to our military personnel, active duty and retired. Yes, we have broken our promises. But the K-P Duty I'm talking about is a sacred honor. It is about a grateful nation paying respect to those soldiers who made tremendous sacrifices for our Country. The soldiers who won World War II, who won the Cold War--the soldiers that have made it possible for the United States to be the world's only super power. It is our time, indeed it is past time, to serve these soldiers and fulfill our obligation. As with any draft in an army, the first order of business is bootcamp. As long as I have taken the liberty of drafting the entire Congress, I might as well serve as drill instructor. Let me take this time to ``drill'' the Senate on the basics of this challenge. Not only do we have to fulfill our promise, we also have to reconsider the way in which the military and veterans health care systems work. It is the change in the demographics of military health care beneficiaries that necessitates a change in the way that we administer health care. When I went on active duty, the military was made up of mostly single male soldiers. Looking at the all-volunteer, totally-recruited force today, the picture is much different. Now, 57 percent of all enlisted members and 73 percent of all officers are married. Not surprisingly, the number of young dependents has also risen. In terms of recruitment, quality health care is cited as a major incentive for young men and women who join the military. It is that same health care for soldiers and their families that helps retain these soldiers in the military. Recently, I heard the adage, ``the military recruits a soldier, but retains a family.'' Since the time I was a U.S. Army Captain 30 years ago, the number of active duty personnel has undergone a 58 percent reduction. Concurrently, the number of retirees has more than doubled. The Government Accounting Office reports that approximately 48 percent of the beneficiaries of the Department of Defense Military Health System are active duty members and dependents. The remaining 52 % are retirees and dependents. 71% of military retirees are under the age of 65, while 29% of military retirees are over the age of 65. As we consider options for improving the DoD and VA health care systems, we need to be mindful of some basic facts. About 60% of retirees under the age 65 live near a military treatment facility but only about 52% the retirees aged 65 and older live near such a facility. About two thirds of retirees under age 65 used the military health system. In comparison, only about a quarter of the retirees aged 65 and older used military medical facilities on a space available basis primarily for pharmacy services. According to a 1994-95 survey of DoD beneficiaries, over 40 percent of military retirees, regardless of age, had private health insurance coverage. About a third of retirees aged 65 and older also reported having additional insurance to supplement their Medicare benefits. Approximately 14% of retirees under age 65 had insurance to supplement their CHAMPUS coverage. In this same dynamic environment of the past 30 years, the medical portion of the DoD budget has increased dramatically from approximately two percent to six percent. In part, this can be attributed to cost growth from technology and intensity of treatment in the private and public sectors. It is interesting to note the converse relationship between the increase in health care dollars as the number of active duty personnel decreases and the number of retirees increases. The Military Health System (MHS) and the Veterans Health Administration are well established institutions that collectively manage over 1500 hospitals, clinics, and health care facilities world- wide, providing services to over 11 million beneficiaries. Overseeing these systems requires a well-planned and executed effort. The Veterans Health Administration is a system in transition. In the past two years, the VA has replaced its structure of four regions, 33 networks, and hundreds of clinics with a new system geared to decentralizing authority into 22 Veterans Integrated Service Networks. The purpose of the reorganization was to improve the access, quality and efficiency of care provided to the Nation's veterans. The hallmark of the network structure is that the field has been given control over functions which were previously located in Washington. The majority of quality-related activities were transferred closer to the site of patient care. The Military Health System has also changed. During the Cold War, that system was designed to support full-scale, extremely violent war with the Soviet Union and its allies in Europe. The collapse of the Soviet Union and the end of the Warsaw Pact led to a major reassessment of the U.S. defense policy. The overall size of the active duty force has been reduced by one-third since the mid-1980s. The DoD health care system changes have included the establishment of a managed care program, numerous facility closures, and significant downsizing of military medical staff. In the last decade, the number of military medical personnel has declined by 15 percent and the number of military hospitals has been reduced by one-third. The National Defense Authorization Act for Fiscal Year 1994 directed DoD to prescribe and implement a nationwide managed health care benefit program modeled on health maintenance organization plans and in 1995, beneficiaries began enrolling in this new program called TRICARE. With over 8 million beneficiaries, it is the largest health maintenance organization plan in the Nation. One of the problems with TRICARE is what happens to retirees when they reach the age of 65. They are ineligible to participate in TRICARE. The law currently provides for transition from military health care to Medicare for these beneficiaries. This is not the right solution, especially given the fact that Medicare does not currently reimburse the DoD for health care services, although Congress recently authorized a test of this concept. In addition, as the military begins to close and downsize military treatment facilities, retirees over 65 are unable to seek and obtain treatment on a space available basis. The retirees over 65 are, in effect, being shut out of the medical facilities promised to them. The changing health care environment has created its own set of unique challenges. To assess these varied and special requirements, I formed a Military Health Care Reform Working Group of senior officials in government and the private sector to explore innovative solutions to improve the military and veterans health care systems. During the past few months this group analyzed the array of military and veterans health care issues and recently provided a comprehensive report of their findings and recommendations to me. In March, I hosted a military health care roundtable at Fort Gordon, Georgia. The positive and supportive working relationship between the Eisenhower Army Medical Center and the Veterans Administration Medical Center in Augusta, Georgia was highlighted by the panel speakers and audience members. These facilities have established a sharing agreement which allows each to provide certain health care services to the beneficiaries of the other. This type of joint approach has the potential to alleviate a significant portion of the accessibility problem faced by military retirees, especially given the reduction in DoD medical treatment facilities. In spite of these benchmarked efforts in cooperative care, beneficiaries who were in the audience still attested to insufficient accessibility to resources to meet their needs. Public Law 97-174, ``The Veterans Administration and Department of Defense Health Resources Sharing and Emergency Operations Act,'' was enacted in 1982 specifically to promote cost-effective use of federal health care resources by minimizing duplication and underuse of health care resources while benefitting both VA and DoD beneficiaries. Under this law, VA and DoD pursue programs of cooperation ranging from shared services to joint venture operations of medical facilities. Sharing agreements are developed on a local basis, whereas, joint ventures are developed at the highest levels within an organization or command. In 1984, there were a combined total of 102 VA and DoD facilities with sharing agreements. By 1997, that number had grown to 420. In five years, between FY 1992 and FY 1997, shared services increased from slightly over 3,000 to more than 6,000 services ranging from major medical and surgical services, laundry, blood, and laboratory services to unusual speciality care services. VA and DoD currently have four joint ventures in operation in New Mexico, Nevada, Texas, Oklahoma, and four more in planning for Alaska, Florida, Hawaii, California. In my opening remarks, I suggested that there are things that we can do immediately and others that can be accomplished through a near term time phased legislative strategy to fulfill our moral obligation to active duty and retired service personnel. Let me first discuss some of the options. There has been an overwhelming outpouring of support for offering Federal Employee Health Benefits Program (FEHBP) to military retirees. Although this program has achieved a successful reputation among federal employees, it is a costly alternative which necessitates close scrutiny, along with other health care options. I appreciate the fact that there are many advantages to FEHBP. Furthermore, I share the view that health care for military retirees should be at least as good as the health care we in the Congress afford ourselves. I am committed to working closely on the FEHBP option. The Medicare Subvention demonstration project that is scheduled to begin enrollment in the near future involves TRICARE Prime. Unfortunately, it will only benefit retirees who live near military treatment facilities--which is only about half of all retirees. Those retirees living outside catchment areas won't benefit from subvention. Additionally, there are ongoing efforts to initiate a Veterans Affairs Subvention test. The limiting criteria of these tests is that they require beneficiaries to live near the respective treatment facilities. To accommodate those beneficiaries that do not live near treatment facilities or within the catchment area, we must explore other alternatives, including, as I mentioned, the FEHBP option. Today, I am announcing two initiatives. The first is a bill to require the Department of Defense and the Department of Veterans Affairs to significantly enhance their cooperative efforts in the delivery of health care to their respective beneficiaries. Several measures to enhance military health care efficiencies are already being explored, and the initiative I am proposing would complement these efforts without any direct impact on current spending. Let me just highlight some of the elements of my plan. The first element directs DoD and the VA to conduct a comprehensive survey to determine the demographics of their beneficiaries, their geographic distribution, and their preferences for health care. A second survey would review the range of existing DoD and VA facilities and resources and the capacity available for cooperative efforts. The purpose of these reviews is simple. We need to accurately determine who we are serving, what they want, and what resources we currently have to provide to them. The second element directs DoD and the VA to provide to the Congress a report on any and all impediments which preclude optimal cooperation and/or integration between DoD and VA in the area of health care delivery. We need to know what statutory restrictions, regulatory constraints, and cultural issues stand in the way of full and complete cooperation between the two departments. They would be directed to recommend to the Congress what changes should be made in the law. Furthermore, they would be directed to eliminate any regulatory and cultural impediments. The third element addresses several projects that have been undertaken by the Departments of Defense and Veterans Affairs that can be accelerated for near term implementation. The Electronic Transfer of Patient Information, a collaborative effort by DoD and VA which would provide for immediate transfer of and access to patient records at the time of treatment is a project which merits Congressional support. The DoD and VA have also established the DoD/VA Federal Pharmaceutical Steering Committee. I believe this committee should perform a comprehensive examination of existing pharmaceutical benefits and programs, including current management and utilization of mail order pharmaceuticals. Finally, the initiative directs DoD to review the extent of VA participation in TRICARE networks and to take steps to ensure optimal participation by the VA. The second initiative I am announcing today is legislation which is being crafted to respond to the tremendous outcry to provide health care for military retirees over 65. Mr. President, as you know, S. 1334, a bill to provide for a test of the FEHBP plan has 60 cosponsors. It is my plan to work with my friend and colleague Senator Kempthorne in the Senate Armed Services Committee to include in the National Defense Authorization bill a proposal that addresses this matter this year. I recognize that there is a perception that our military benefits are eroding but I am here today to say that we can change this perception if we all do our share on K-P Duty. Greater cooperation among the DoD and VA will yield greater choices for the beneficiaries of these systems. Developing a viable health care alternative for our retirees over 65, a group that has been largely disenfranchised, will ensure that now all beneficiaries have access to the health care to which they are entitled because of their service to this Nation. We made a promise, now let's keep it. It is as simple as that. Mr. President, I ask unanimous consent that the full text of the bill be printed in the Record.

Mr. CLELAND

Mr. CLELAND. Mr. President, I am particularly honored to serve as the ranking Democratic member of the Senate Armed Services Personnel Subcommittee, a charge I have embraced to its fullest. In the first session of the 105th Congress, I pledged my commitment to improving military health care. Today, I am here to discuss proposals to offer both immediate assistance and a time phased legislative strategy to fulfill this commitment. The Fiscal Year 1998 Defense Authorization Act (P.L. 105-85) included a Sense of the Congress Resolution which provided a finding that ``many retired military personnel believe that they were promised lifetime health care in exchange for 20 or more years of service,'' and expresses the sense of Congress that ``the United States has incurred a moral obligation'' to provide health care to members and retired members of the Armed Services and that Congress and the President should take steps to address ``the problems associated with the availability of health care for such retirees within two years.'' I authored that resolution, and today in year one of my two-year challenge, I stand ready to take the first of many necessary steps to fulfill this obligation. I call this obligation ``K-P Duty''--K-P as in KEEPING PROMISES. As a disabled veteran and retiree, as former head of the Veterans Administration, and as the Ranking Member on the Personnel Subcommittee, I am seeking to draft Congress and the entire nation and put us all on K-P Duty. Back when I was in the Army, some saw K-P or ``kitchen police'' as punishment. If a soldier was derelict in his duties, or if he broke the rules, he went on KP, where he served his fellow soldiers by working in the messhall. The K-P Duty I'm talking about is not about punishment, however. Yes, we as a nation have been derelict in our duties to our military personnel, active duty and retired. Yes, we have broken our promises. But the K-P Duty I'm talking about is a sacred honor. It is about a grateful nation paying respect to those soldiers who made tremendous sacrifices for our Country. The soldiers who won World War II, who won the Cold War--the soldiers that have made it possible for the United States to be the world's only super power. It is our time, indeed it is past time, to serve these soldiers and fulfill our obligation. As with any draft in an army, the first order of business is bootcamp. As long as I have taken the liberty of drafting the entire Congress, I might as well serve as drill instructor. Let me take this time to ``drill'' the Senate on the basics of this challenge. Not only do we have to fulfill our promise, we also have to reconsider the way in which the military and veterans health care systems work. It is the change in the demographics of military health care beneficiaries that necessitates a change in the way that we administer health care. When I went on active duty, the military was made up of mostly single male soldiers. Looking at the all-volunteer, totally-recruited force today, the picture is much different. Now, 57 percent of all enlisted members and 73 percent of all officers are married. Not surprisingly, the number of young dependents has also risen. In terms of recruitment, quality health care is cited as a major incentive for young men and women who join the military. It is that same health care for soldiers and their families that helps retain these soldiers in the military. Recently, I heard the adage, ``the military recruits a soldier, but retains a family.'' Since the time I was a U.S. Army Captain 30 years ago, the number of active duty personnel has undergone a 58 percent reduction. Concurrently, the number of retirees has more than doubled. The Government Accounting Office reports that approximately 48 percent of the beneficiaries of the Department of Defense Military Health System are active duty members and dependents. The remaining 52 % are retirees and dependents. 71% of military retirees are under the age of 65, while 29% of military retirees are over the age of 65. As we consider options for improving the DoD and VA health care systems, we need to be mindful of some basic facts. About 60% of retirees under the age 65 live near a military treatment facility but only about 52% the retirees aged 65 and older live near such a facility. About two thirds of retirees under age 65 used the military health system. In comparison, only about a quarter of the retirees aged 65 and older used military medical facilities on a space available basis primarily for pharmacy services. According to a 1994-95 survey of DoD beneficiaries, over 40 percent of military retirees, regardless of age, had private health insurance coverage. About a third of retirees aged 65 and older also reported having additional insurance to supplement their Medicare benefits. Approximately 14% of retirees under age 65 had insurance to supplement their CHAMPUS coverage. In this same dynamic environment of the past 30 years, the medical portion of the DoD budget has increased dramatically from approximately two percent to six percent. In part, this can be attributed to cost growth from technology and intensity of treatment in the private and public sectors. It is interesting to note the converse relationship between the increase in health care dollars as the number of active duty personnel decreases and the number of retirees increases. The Military Health System (MHS) and the Veterans Health Administration are well established institutions that collectively manage over 1500 hospitals, clinics, and health care facilities world- wide, providing services to over 11 million beneficiaries. Overseeing these systems requires a well-planned and executed effort. The Veterans Health Administration is a system in transition. In the past two years, the VA has replaced its structure of four regions, 33 networks, and hundreds of clinics with a new system geared to decentralizing authority into 22 Veterans Integrated Service Networks. The purpose of the reorganization was to improve the access, quality and efficiency of care provided to the Nation's veterans. The hallmark of the network structure is that the field has been given control over functions which were previously located in Washington. The majority of quality-related activities were transferred closer to the site of patient care. The Military Health System has also changed. During the Cold War, that system was designed to support full-scale, extremely violent war with the Soviet Union and its allies in Europe. The collapse of the Soviet Union and the end of the Warsaw Pact led to a major reassessment of the U.S. defense policy. The overall size of the active duty force has been reduced by one-third since the mid-1980s. The DoD health care system changes have included the establishment of a managed care program, numerous facility closures, and significant downsizing of military medical staff. In the last decade, the number of military medical personnel has declined by 15 percent and the number of military hospitals has been reduced by one-third. The National Defense Authorization Act for Fiscal Year 1994 directed DoD to prescribe and implement a nationwide managed health care benefit program modeled on health maintenance organization plans and in 1995, beneficiaries began enrolling in this new program called TRICARE. With over 8 million beneficiaries, it is the largest health maintenance organization plan in the Nation. One of the problems with TRICARE is what happens to retirees when they reach the age of 65. They are ineligible to participate in TRICARE. The law currently provides for transition from military health care to Medicare for these beneficiaries. This is not the right solution, especially given the fact that Medicare does not currently reimburse the DoD for health care services, although Congress recently authorized a test of this concept. In addition, as the military begins to close and downsize military treatment facilities, retirees over 65 are unable to seek and obtain treatment on a space available basis. The retirees over 65 are, in effect, being shut out of the medical facilities promised to them. The changing health care environment has created its own set of unique challenges. To assess these varied and special requirements, I formed a Military Health Care Reform Working Group of senior officials in government and the private sector to explore innovative solutions to improve the military and veterans health care systems. During the past few months this group analyzed the array of military and veterans health care issues and recently provided a comprehensive report of their findings and recommendations to me. In March, I hosted a military health care roundtable at Fort Gordon, Georgia. The positive and supportive working relationship between the Eisenhower Army Medical Center and the Veterans Administration Medical Center in Augusta, Georgia was highlighted by the panel speakers and audience members. These facilities have established a sharing agreement which allows each to provide certain health care services to the beneficiaries of the other. This type of joint approach has the potential to alleviate a significant portion of the accessibility problem faced by military retirees, especially given the reduction in DoD medical treatment facilities. In spite of these benchmarked efforts in cooperative care, beneficiaries who were in the audience still attested to insufficient accessibility to resources to meet their needs. Public Law 97-174, ``The Veterans Administration and Department of Defense Health Resources Sharing and Emergency Operations Act,'' was enacted in 1982 specifically to promote cost-effective use of federal health care resources by minimizing duplication and underuse of health care resources while benefitting both VA and DoD beneficiaries. Under this law, VA and DoD pursue programs of cooperation ranging from shared services to joint venture operations of medical facilities. Sharing agreements are developed on a local basis, whereas, joint ventures are developed at the highest levels within an organization or command. In 1984, there were a combined total of 102 VA and DoD facilities with sharing agreements. By 1997, that number had grown to 420. In five years, between FY 1992 and FY 1997, shared services increased from slightly over 3,000 to more than 6,000 services ranging from major medical and surgical services, laundry, blood, and laboratory services to unusual speciality care services. VA and DoD currently have four joint ventures in operation in New Mexico, Nevada, Texas, Oklahoma, and four more in planning for Alaska, Florida, Hawaii, California. In my opening remarks, I suggested that there are things that we can do immediately and others that can be accomplished through a near term time phased legislative strategy to fulfill our moral obligation to active duty and retired service personnel. Let me first discuss some of the options. There has been an overwhelming outpouring of support for offering Federal Employee Health Benefits Program (FEHBP) to military retirees. Although this program has achieved a successful reputation among federal employees, it is a costly alternative which necessitates close scrutiny, along with other health care options. I appreciate the fact that there are many advantages to FEHBP. Furthermore, I share the view that health care for military retirees should be at least as good as the health care we in the Congress afford ourselves. I am committed to working closely on the FEHBP option. The Medicare Subvention demonstration project that is scheduled to begin enrollment in the near future involves TRICARE Prime. Unfortunately, it will only benefit retirees who live near military treatment facilities--which is only about half of all retirees. Those retirees living outside catchment areas won't benefit from subvention. Additionally, there are ongoing efforts to initiate a Veterans Affairs Subvention test. The limiting criteria of these tests is that they require beneficiaries to live near the respective treatment facilities. To accommodate those beneficiaries that do not live near treatment facilities or within the catchment area, we must explore other alternatives, including, as I mentioned, the FEHBP option. Today, I am announcing two initiatives. The first is a bill to require the Department of Defense and the Department of Veterans Affairs to significantly enhance their cooperative efforts in the delivery of health care to their respective beneficiaries. Several measures to enhance military health care efficiencies are already being explored, and the initiative I am proposing would complement these efforts without any direct impact on current spending. Let me just highlight some of the elements of my plan. The first element directs DoD and the VA to conduct a comprehensive survey to determine the demographics of their beneficiaries, their geographic distribution, and their preferences for health care. A second survey would review the range of existing DoD and VA facilities and resources and the capacity available for cooperative efforts. The purpose of these reviews is simple. We need to accurately determine who we are serving, what they want, and what resources we currently have to provide to them. The second element directs DoD and the VA to provide to the Congress a report on any and all impediments which preclude optimal cooperation and/or integration between DoD and VA in the area of health care delivery. We need to know what statutory restrictions, regulatory constraints, and cultural issues stand in the way of full and complete cooperation between the two departments. They would be directed to recommend to the Congress what changes should be made in the law. Furthermore, they would be directed to eliminate any regulatory and cultural impediments. The third element addresses several projects that have been undertaken by the Departments of Defense and Veterans Affairs that can be accelerated for near term implementation. The Electronic Transfer of Patient Information, a collaborative effort by DoD and VA which would provide for immediate transfer of and access to patient records at the time of treatment is a project which merits Congressional support. The DoD and VA have also established the DoD/VA Federal Pharmaceutical Steering Committee. I believe this committee should perform a comprehensive examination of existing pharmaceutical benefits and programs, including current management and utilization of mail order pharmaceuticals. Finally, the initiative directs DoD to review the extent of VA participation in TRICARE networks and to take steps to ensure optimal participation by the VA. The second initiative I am announcing today is legislation which is being crafted to respond to the tremendous outcry to provide health care for military retirees over 65. Mr. President, as you know, S. 1334, a bill to provide for a test of the FEHBP plan has 60 cosponsors. It is my plan to work with my friend and colleague Senator Kempthorne in the Senate Armed Services Committee to include in the National Defense Authorization bill a proposal that addresses this matter this year. I recognize that there is a perception that our military benefits are eroding but I am here today to say that we can change this perception if we all do our share on K-P Duty. Greater cooperation among the DoD and VA will yield greater choices for the beneficiaries of these systems. Developing a viable health care alternative for our retirees over 65, a group that has been largely disenfranchised, will ensure that now all beneficiaries have access to the health care to which they are entitled because of their service to this Nation. We made a promise, now let's keep it. It is as simple as that. Mr. President, I ask unanimous consent that the full text of the bill be printed in the Record.

Mr. CLELAND

Mr. CLELAND. I thank the Senator from Minnesota.

Mr. CLELAND

Mr. CLELAND. Mr. President, I am honored to have the opportunity to engage in this debate over the proposed expansion of the NATO treaty. It is an important occasion for this body, for our country, and for the shape of the post-cold war world. To quote Emerson, who had in turn been quoted by the great American statesman Dean Acheson about the dawning of the post-World War II era, ``we are present at the sowing of the seed of creation.'' It is a debate which has properly engaged the best minds in American foreign and national security policy. George Kennan, the architect of the successful ``containment'' strategy with which NATO won the cold war, has said, Expanding NATO would be the most fateful error of American policy in the entire post-Cold War era. Such a decision may be expected to inflame the nationalistic, anti-Western and militaristic tendencies in Russian opinion; to have an adverse effect on the development of Russian democracy; to restore the atmosphere of the Cold War to East-West relations; and to impel Russian foreign policy in directions decidedly not to our liking. That is the quote of Mr. Kennan. My predecessor, and someone whose views on national security matters I most value, former Senator Sam Nunn, has said, ``NATO expansion makes our security problems more difficult,'' and Senator Nunn cowrote a recent magazine article with former Senator Howard Baker, Alton Frye and Brent Scowcroft which states that, ``by premature action on new members, the Senate could condemn a vital alliance to creeping impotence.'' On the other hand, the architect of America's detente strategy, Henry Kissinger, testified to our Senate Armed Services Committee that, Failure to expand NATO is likely to prove irrevocable. Russian opposition is bound to grow as its economy gains strength; the nations of Central Europe may drift out of their association with Europe. The end result would be the vacuum between Germany and Russia that has tempted so many previous conflicts. When NATO recoils from defining the only limits that make strategic sense, it is opting for progressive irrelevance. And Zbigniew Brzezinski, with whom I served in the Carter Administration, has testified that, NATO enlargement has global significance--it is central to the step-by-step construction of a secure international system in which the Euroatlantic alliance plays the major role in ensuring that a peaceful and democratic Europe is America's principal partner. Mr. President, these are strong and important words from some of our country's premier experts on international relations, and of course they point the Senate in diametrically opposite directions in the current debate. However, and I will return to this point later, in my view they all raise the right questions and ultimately can help point us in the right direction as we take up the critical questions of whether NATO and whether Europe will remain with us regardless of what we do on the pending resolution of ratification. Though I certainly acknowledge the importance of the impending decision, I would counsel that we not engage in exaggeration or hyperbole about the consequences of this single choice. It is but the first, and in my opinion probably not the most important, question we must answer as we feel our way in this unknown ``new world order,'' and no one, and certainly not this Senator, knows for certain how the future will unfold in Russia, or in the rest of Europe, for that matter. So I welcome and I appreciate the thoughtful commentary which has been submitted on both sides of this issue. I have benefited from it, and I certainly believe that neither side has a corner on wisdom or concern for our future security. In this same spirit, I would like to thank the distinguished Majority Leader for responding to two requests I made, one in a letter I co-signed with a number of other Senators on March 3, and the other in a personal note I sent to him on March 25, that he delay final Senate action on the resolution of ratification to allow for more debate, and for more information to be obtained on several important policy questions. While I thought, and think, that for a variety of reasons, it would be better to delay this vote until the beginning of June, I appreciate the postponement he did arrange because it allowed me to make my own ``inspection tour'' of Europe to assess the situation there in person on the ground. I have just completed a twelve day, 12,000 mile tour of Europe. My travels took me to London, Camp Robertson, V Corps Headquarters and Ramstein Air Force Base in Germany, and NATO Headquarters in Belgium. They also took me to Eagle Base in Bosnia-Herzegovina. On my trip, I tried to get a realistic look at our Western alliance as we approach the end of the 20th Century. Our relations with our European allies, particularly through NATO, are of special importance to the United States. As I have already indicated, the issue of NATO expansion to nations formerly a part of the Warsaw Pact, especially the pending proposal to include Poland, Hungary and the Czech Republic in NATO, is of paramount importance as we consider the crucial matter of the future of the Western alliance in this body. During my journey, I also attempted to get a feel for the disposition and readiness of our military forces in Europe, and the attitude and morale of our troops deployed on our expeditionary mission to Bosnia. Any attempt at gaging the temperature of our NATO alliance must begin with a sense of European history. President Kennedy once said that the thing that he cherished most in the White House was ``a sense of history,'' and the thing he feared most was ``human miscalculation.'' I had the same feeling as I toured Europe. In order for us to not miscalculate in terms of our diplomatic and military policy in these areas, we must have a sense of history of the region. Winston Churchill once observed about the value of history that, ``One can not know where one is going unless one knows where one has been.'' This is certainly true in Europe. To illustrate the lessons of history, I have in mind a trip I took to the Waterloo battlefield in Belgium made famous by Napoleon's encounter with the Duke of Wellington there in 1815. In addition to some fascinating lessons regarding battlefield tactics which created 48,000 casualties in one afternoon, I gained some other valuable insights which I think are instructive as we approach the NATO expansion debate. One lesson that I learned was that although Napoleon had great loyalty from his band of seasoned veterans who had marched with him through the various Napoleonic wars which had plagued Europe until 1815, by the time of Waterloo he was actually outnumbered 3 to 1. Europe had finally coalesced against him. At a crucial moment in the battle, it was a Prussian commander who brought his forces from as far away as Austria and Germany to come decisively to the aid of Wellington. The Prussian commander massed his forces to help Wellington defeat Napoleon's Grand Armee and the Napoleonic Guards. The lesson for me is clear. Europe has been swept over by one conqueror or another ever since Roman Times. But, when European nations form a strong alliance, they can defeat any enemy. I think this is an important lesson in history to apply to our present day understanding of Europe, particularly in terms of our NATO alliance. In this century from time to time, Germany, then Russia, has tried to dominate Western and Eastern Europe. Each time, alliances were formed against the hostile force. NATO, the most successful European alliance in history, will celebrate its fiftieth anniversary next year. It is not surprising to me that Western Europe, primarily because of NATO, has seen its longest extended peace in centuries. Another lesson of history I learned on this trip was the importance of American leadership in helping Europe form alliances that protect it from invasion without and turmoil within. It was after all a British leader across the channel, Wellington, who acted as a catalyst to lead the disparate nations of continental Europe to defeat Napoleon. That was in the last century. This century, it has been an ally across the Atlantic, America, who has led the disparate nations of Europe in an alliance to defeat those who would conquer it. Beginning in World War I, throughout World War II, during the Berlin Airlift, and, finally, through to the conclusion of the Cold War, America has been a catalyst in bringing European nations together to defend and protect our shared interests. American leadership and American guarantees of security with commitment of our forces on the ground in Europe has provided what one French diplomat called an ``insurance policy'' that if things go wrong on the continent ``America will come.'' As America approaches the close of this century and the dawn of the next, our nation finds itself fully engaged, committed and involved in the life of Europe. Our diplomats, politicians and military forces are stretched over the continent. They provide a level of diplomatic clout and military force projection second to none. America in this part of the world is looked upon as an honest broker in dealing with age-old European factional disputes. The security and stability in Europe since WWII principally guaranteed by NATO is the prime reason Europe is the number one trading and investment partner of the United States today. Increasingly, as the European Union develops, forms its own currency and expands its influence into Eastern European countries, it will become the largest economic trader and investment block on the planet. As America enters into the 21st Century, we will have an opportunity to expand our trans-Atlantic trading and investment partnerships to an extent hitherto unknown to us. Make no mistake about it, this opportunity for record economic growth, and the opportunity to spread the gospel of free market economics and the benefits of trade, travel and commerce, has come about because European states, and especially newly independent Eastern European nations, now perceive themselves at the dawn of a new era of peace and stability. They are, indeed, ``present at the sowing of the seed of creation.'' Russia has imploded. The Soviet Empire is no more. Where Russia goes from here is anybody's guess. Churchill once described Russia as ``a riddle wrapped in a mystery inside an enigma.'' The mystery of where Russia is headed is still with us. We in this country and our European allies wish our Russian friends well. Through the Partnership for Peace, the Founding Act and other entities, we as a matter of policy want to pursue a future based on cooperation rather than conflict. As a democracy ourselves, we in the United States wish the Democratic movements in Russia Godspeed. As a market economy, we believe our type of economic freedom, which brings with it the blessings of growth and opportunity, will sooner or later take hold in Russia as it has in other parts of the world. Democratic notions such as the rule of law, civilian control of the military and human rights now penetrate the thickest of barriers and the strongest of curtains. We know, too, it will take time for these principles to grow naturally in Russia. Many of us feel strongly that Russia will sooner or later make it through this very difficult transitional period. No one knows, however, how long that will take. Whatever the future of Russia, the future of Eastern Europe is more and more clear. One of the most powerful messages I received on my trip is that there is a new era of hope and opportunity dawning in Eastern Europe. Long denied by the Cold War, a host of Eastern European countries now see an opportunity for their moment in the sun. This is particularly the case for the states who have been invited to join NATO--Poland, Hungary and the Czech Republic. A short time ago, the Parliament in the Czech Republic overwhelmingly voted to join NATO. As the vote was declared, the entire body stood up and applauded. As the great 19th Century French writer Victor Hugo observed, ``An invasion of armies can be resisted, but not an idea whose time has come.'' The nations of Eastern Europe are emerging into the light after fifty years of the Cold War. The notion that they and their people can enjoy the stability and prosperity experienced by Western Europe is an idea whose time has come. Certainly, one of the great challenges currently facing NATO is the issue of Bosnia. On my recent trip, I had the marvelous opportunity to fly on a helicopter to an American outpost--Camp Bedrock--in Bosnia on Easter Sunday. It was near Tuzla in Northeast Bosnia. While flying over the countryside, it seemed I was watching a colorized version of a World War II documentary about war-torn Europe. I saw portions of villages burned to the ground. I had not seen such devastation since I was in Vietnam thirty years ago. On my visit, I got a chance to visit American forces in Bosnia. I found them surprisingly cheerful and confident in their mission of peace-keeping in that war-weary countryside. I'm very proud of our forces. They are paying a personal price every day in risking their lives on our behalf. When I returned from my trip, I received an e-mail from one of the servicemen I spent Easter Sunday with in Bosnia. He wrote: My name is First Lieutenant Brian Brandt. We met today and shook hands in the mess hall here on Eagle Base, Bosnia. I would like to thank you for visiting and sharing in our Easter Mass . . . The greatest burden on today's soldiers is being asked to do more with less and our frequent deployments away from home. I am an OCS graduate and have 14 years of service. In this time I have seen many good and bad things within our services. As we move into the next century I hope we don't find ourselves short. No amount of peace or technology can make up for an Army of over tasked and under trained soldiers. Please carry this message with you to Congress. A few days after I visited Camp Bedrock, I was in Brussels. An American businessman approached me and asked me if I had ``hope'' about Bosnia. I had to reply, ``Yes.'' I have hope because I believe Europe has learned some painful lessons over the last two centuries. One of those lessons is that alliances--whether against Napoleon, Hitler or Stalin--can win. Secondly, I have hope because Americans have learned some lessons about European history as well. Particularly, I think we've learned one of the lessons about American involvement on the European continent. The lesson is this: ``Pay me now, or pay me later.'' In other words, we as a nation are involved in Europe-- militarily, economically, culturally. Better to get in on the takeoff before it turns into a ``crash landing!'' Better to work through the European Alliance, in particular through NATO, to prevent a conflict than to risk that conflict turning into a greater confrontation or, even worse, war itself. The European community proved incapable of reaching the necessary consensus to act decisively in Bosnia. The U.N. tried to control the tensions but was neither trained nor equipped for the task, even though a limited number of European nations were supportive. Finally, under American leadership NATO stepped in. With its command and control systems well established, with its alliance relationships previously worked out over the years, it was able to field a stabilization force which has succeeded beyond the wildest expectations for it. In Bosnia, the NATO alliance now works with non NATO members, including Russia for a combined alliance of 37 nations. That's why the killing has stopped. That's why troops and tanks have been disarmed. That's why minefields are being dismantled. That's why refugees are returning. That's why elections are being held. That's why war criminals are being identified and hauled before an international tribunal. That's why further excesses of any warring party--as in Kosovo--bring immediate international outrage. That's why those who perpetrated war are now hunted down and discredited. That's why political moderates are coming to the fore and condemning the extremists. The effort in Bosnia involves the largest alliance of nations ever to coalesce against a common enemy on the continent of Europe. Maybe we've learned and acquired a sense of history after all. I applaud all the members of the alliance for their contributions to peace and stability in Bosnia, particularly the NATO members, and especially the Russians, for coming together in a unified effort to prevent further bloodshed, enhance stability and pave a pathway for peace. I hope it is a harbinger of good things to come in the next century in terms of enhanced cooperation and communications among our countries for the betterment of mankind. I especially want to applaud our American servicemen and women and their American military commanders who are working to bring peace and stability in Bosnia. They are working in a tasking and demanding environment filled with diplomatic and military minefields. Special thanks go to General Hugh Shelton, Chairman of the Joint Chiefs of Staff, who came with his wife and joined me for Easter Sunday services with the troops in Tuzla. He joined me and Congressman Patrick Kennedy, a respected member of the U.S. House National Security Committee, for a very special Easter Mass in a Catholic Chapel. A particular responsibility rests on the shoulders of U.S. General Wes Clark, the top NATO Commander. His diplomatic and military skills have been tested to the maximum, and have been put in full play to hold the NATO Alliance together militarily in a challenging environment in the Balkans. A dear friend and a great Georgian, LTG Jay Hendrix, commands the U.S. Army V Corps out of Germany. He faces the daunting challenge of deploying and replacing the troops in the Bosnian expedition. General Eric Shinseki is the overall commander of all military forces on the ground in Bosnia. He has a tough task in Sarajevo. Major General Larry Ellis is the ``muddy boots general'' on the ground in Tuzla who musters the morale of all of his forces, and is doing a great job in the American sector. All of the men and women involved in this effort are a credit to the United States, the European Alliance and the cause of human dignity and freedom in the Balkans. I am proud of them all. I will support continued funding of their efforts to bring peace and stability to this troubled part of our world. A proper consideration of the issue of NATO expansion requires consideration of American, as well as European, history. As I discussed earlier, the leading voices on American foreign policy currently offer divided counsel on this issue. It is obvious that no clear consensus has yet formed as to America's post-Cold War strategy. This lies in stark contrast to previous eras in our history when our approach to the world has generally been guided by a unifying vision. In our earliest days, we were galvanized by seeking to gain our independence. Then Manifest Destiny took hold as we boldly expanded westward into frontier country. During the same time, the Monroe Doctrine guided our relations with Europe and Latin America. This period was interrupted by the Civil War and the painful Reconstruction Era. As the United States entered the 20th Century and Americans turned toward commerce, the industrial revolution made its biggest impact on American economic development. This Gilded Age saw the rise of the Labor movement, the Depression and set the foundation for the New Deal. Throughout all of this time, it would be fair to sum up our general philosophy on foreign policy as an attempt to continue to follow President Washington's recommended approach, contained in his Farewell Address of September 17, 1796: Observe good faith and justice toward all nations. Cultivate peace and harmony with all . . . The Nation which indulges toward another an habitual hatred or an habitual fondness is in some degree a slave. It is a slave to its animosity or to its affection, either of which is sufficient to lead it astray from its duty and its interest . . . Steer clear of permanent alliances, with any portion of the foreign world . . . There can be no greater error than to expect or calculate upon real favors from nation to nation. That approach changed when, following the two great 20th Century world wars and alternating cycles of isolationism and engagement, America emerged as the major global economic and military power. We then became united around the fight against Communism which, in the form of the Soviet Union, posed the only grave threat to our physical survival we have ever faced. The Cold War guided our thinking, and NATO was the main military expression of that strategic vision. Now we are in a new era. No one has quite coined the term for it. Some call it the ``New World Order,'' but I prefer to call it The Age of Democracy. What I find different and indeed magical about this new era is the fact that while it brings with it the spread of democracy and democratic principles around the world to places that have been burdened by tyranny, it is doing so not through the threat of force, but through the promise of peace. However, thus far we are not in consensus on how we shape our national security policies to meet the challenges of the new era. I believe the critics of the proposed expansion of NATO are right when they focus on the need for policies which draw Russia into cooperation rather than confrontation with the United States and the West. From the control of nuclear, chemical and biological weapons proliferation to containment of Saddam Hussein, to the termination of the Cold War legacy of Mutual and Assured Destruction, the participation and cooperation of Russia is of vital importance in securing this peaceful Age of Democracy which we are entering. I also believe the critics are right that we are going to have to be extremely careful in when and how we approach consideration of inclusion of the Baltic states and former Soviet Republics in NATO or any other unified military command structure. And, over the long-term, I believe the critics are right that it is the expansion of the European Union, and its ultimate promise of what Churchill called a ``United States of Europe,'' which offers the strongest foundation for Eastern European economic and political development, and for Europe at long last being able to be fully responsible for its own security. However, after much reflection and after having seen the ``ground truth'' on my recent trip, I have concluded that supporters of NATO expansion are absolutely correct that other than NATO there is no entity at present which is able to step up to the plate and fill the security void that currently exists in Central Europe. The European Union is currently considering the proposed admission of six nations, including Poland, Hungary and the Czech Republic, plus Slovenia, Cyprus and Estonia, but that process is likely to take until 2003, at the earliest. Furthermore, the Union has a number of important questions, such as its decision-making process and the division of sovereignty between it and its component nations, which must be worked out before it can offer an effective voice on foreign and defense policies. As for Russia, I believe we must make every effort to seek cooperative and mutually beneficial relations. Regardless of how the Senate votes with respect to the pending treaty, I believe supporters of NATO enlargement are correct that we and the Russians will have the same set of mutual interests to work for; namely, the non-proliferation of weapons of mass destruction, and stability around Russia's borders in Europe, the Middle East and Asia. We should see what the future brings in Russia, with the European Union, and with all of the former members of the Warsaw Pact before we decide the next steps with respect to NATO, including both its membership and mission. It is in this context that I as a member of this body consider the issue before the Senate of expanding the NATO treaty to include the nations of Poland, Hungary and the Czech Republic. For a long time I have asked myself the question, ``Can we afford it?'' As a member of the Senate Armed Services Committee, I've heard witness after witness question the wisdom of expanding NATO, particularly at this time and especially in terms of the painful transition going on in Russia today. I have also heard NATO enlargement questioned from a budgetary point of view in terms of its cost to American taxpayers. In the wake of what I've learned on my trip, however, I now ask myself, ``Can we afford not to do it?'' I've concluded that Russia will do whatever it is going to do. We can encourage cooperation. We can support democratic principles and human rights. We can move forward with arms control agreements, especially Start II and move on to Start III. These are critical items on the American agenda, and critical items on the Russian agenda as well. We must move forcefully in expanding consultation and cooperation on all these fronts. But, we in this country must heed the call of the Eastern European nations for help in fulfilling their destiny. Their destiny is with the West, as is Russia's destiny one day. In my view, the expansion into the Eastern European community by the Western European community through the expansion of NATO, and a gesture of cooperation to the Russians through the Partnership for Peace and the Founding Act is a plus, not a minus, for our national security. The good news is that so many people in Eastern Europe and Russia want to identify with the West. They want the peace and prosperity offered by Western European ideas and values and Western European organizations. It is for this reason that I intend to vote for NATO expansion. I believe, as Prime Minister Tony Blair said in going to Northern Ireland after I had a brief meeting with him, ``I feel the hand of history on my shoulders. I have hope. I have faith. I don't know how it will work out, but I must try.'' No one can know for certain how NATO expansion will work out, and I certainly believe we must make our future decisions based on what experience teaches, but in this current decision I think the hand of history is on our shoulders. I think we must work in faith and hope. I think we must try. I don't know how the future of Russia will unfold, but I think it is important for the Western community of nations led by the United States, in the spirit of friendship and cooperation, to reach out in faith and hope to the Eastern European nations, and try to help them create a new future for themselves. On my recent trip, I visited an American battlefield cemetery. The place was the famous Flanders Fields Cemetery in Belgium. It was a Canadian, Colonel John McCrae, who wrote the famous poem about World War I, ``In Flanders Fields.'' Colonel McCrae was later killed in that War. But he challenged all of us for the rest of this century to live up to the hope that the soldiers in that war had that their sacrifice in bringing peace and stability in Europe would not be in vain. As I laid a wreath at the cemetery, I thought of all those in this century since World War I who have given their lives for peace and prosperity in Europe. I support the pending NATO enlargement as a further expansion of a peace process that began with American involvement in World War I at Flanders Fields, and continues until this day. Surely we have learned some lessons of history this century that will keep us from miscalculating. Surely we do not want to repeat the mistakes of this century in the next. Mr. President, I learned many lessons on this trip. The most important lesson I learned, however, is that American men and women deployed in Western Europe, Eastern Europe and the Balkans are making a positive difference in the lives of millions of people in those parts of the world. Our American diplomats, soldiers, sailors, marines, airmen, guardsmen are our greatest asset. They spread American values and ideals wherever they go because they treat people with dignity. They talk the talk. They also walk the walk. More than anything I learned on my trip, Mr. President, is that the legacy of American involvement in Western and Eastern Europe in this century has been a courageous and positive one. It is because of our people who have given their lives and risked their reputations this century in the cause of peace, stability, freedom, human rights, the rule of law, civilian control of the military, economic justice and democratic ideals that America plays such a strong hand in diplomatic and military missions throughout Europe. That story is not lost on nations further East, including Russia and the newly independent states of the former Soviet Union. I returned from my trip to Europe and Bosnia even more proud of my country and our ideals than when I left. As a new century dawns, I'm sure Americans will learn from history and not miscalculate. At this moment in history, we are the key players in the progress of a European Alliance, especially NATO, and we should be a key player when the Alliance expands into Poland, Hungary and the Czech Republic. While I believe we must constantly seek emerging answers on such key questions as the security situation in the Baltic States, the evolution of the European Union, the political situation in Russia, and the impact on the readiness of American military forces, and should be prepared to guide our future policy choices based on those answers, I support the proposed first round of NATO expansion. As the only currently available alternative, I also support funding for a follow- on-force in Bosnia. As our troops and diplomats do their duty, they can count on support from this Senator. Mr. President, I yield the floor. Mr. DURBIN addressed the Chair.

Mr. CLELAND

Mr. CLELAND. Mr. President, I rise today to congratulate and commend the National Order of Women Legislators and the Georgia Chapter of the National Order of Women Legislators as they celebrate today 60 years of accomplishments since the organization was founded in 1938. This year also marks the 150th Anniversary of the first Women's Rights Convention ever held to discuss the prohibitions then in force on women voting, holding public office, owning property, signing official documents, and receiving a formal education. The women who have served in the National Order of Women Legislators and the Georgia Chapter of that organization have overcome gender barriers and are true champions of the women's rights movement. I applaud these women for fighting for and delivering to the women of this nation the right to vote, and a vital voice in local, state and national government. The Declaration of Sentiments issued by the 1848 convention held in Seneca Falls, New York, launched a movement that unleashed and enhanced the myriad of talents and intellectual abilities already possessed by women throughout the United States. The resulting Women's Rights Movement has had a profound and undeniable impact on all aspects of American life, and has opened new and well deserved opportunities for women. I would especially like to commend the spirit and hard work of Rebecca Latimer Felton, the first Georgia woman elected to the United States Senate in 1992, two years after women gained the right to vote; Florence Reville Gibbs, the first Georgia woman to serve in the United States House of Representatives (1940-1941); Viola Ross Napier, the first woman to serve in the Georgia House of Representatives (1923- 1926); Susie Tilman Moore, the first woman to serve in the Georgia State Senate (1933-1934 and 1939-1940); and Grace Towns Hamilton, the first African American woman elected to the Georgia House of Representatives (1966-1984). I am honored to serve in the United States Senate with nine remarkable female Senators--Sens. Barbara Boxer (D-CA), Susan Collins (R-ME), Dianne Feinstein (D-CA), Kay Bailey Hutchison (R-TX), Mary Landrieu (D-LA), Barbara Mikulski (D-MD), Carol Moseley-Braun (D-IL), Patty Murray (D-WA), and Olympia Snowe (R-ME). I also commend the 55 female members of the U.S. House of Representatives and female members in the Georgia State Legislature. Members of National Order of Women Legislators serve as role models for women throughout this nation and the entire world. I ask my colleagues to join me today in saluting and congratulating the National Order of Women Legislators and the Georgia Chapter of the National Order of Women Legislators for setting a positive example to all Americans.

Mr. CLELAND

Mr. CLELAND. Thank you, very much. Mr. President, I would like to commend the senior Senator from Georgia, my dear colleague and friend, Senator Coverdell, for his stick-to-itiveness in bringing this issue to the floor of the U.S. Senate. He has worked hard on the Parent and Student Savings Account Act. This bill is the product of many long hours of hard work and compromise and collaboration, and Senator Torricelli and other members of the Finance Committee deserve praise for bringing this issue to the floor. I would like to state for the record that I had planned to support final passage of the Parent and Student Savings Account (PLUS) Act as reported out of Committee. In addition to the education savings account provision in the bill, H.R. 2646 contains a number of measures that further increase education opportunities for students, including the expansion of employer-provided education assistance to cover graduate courses, an allowance for individuals to make withdrawals from State tuition program accounts on a tax-free basis, and a provision providing an increase in the small issuer rebate exception for bonds used to finance school construction, all of which I strongly support. And I also support the education savings account provisions, especially the expansion of the credit for savings for college education, which have caused most of the controversy on the bill. While the Parent and Student Savings Account (PLUS) Act as reported by Committee was a modest and moderate bill and certainly was not the final answer to the education problems currently facing our country, I believe that by making additional resources available for education this bill represented a step forward and I had every intention of supporting it. Unfortunately, yesterday the Senate voted, by a one vote margin, to attach an amendment to this bill which I can not support, and which is neither modest nor moderate in impact. Senator Gorton's block grant amendment greatly concerns me and I believe that it is a risky experiment that will undermine the legitimate, but limited, federal role in support of public education. Senator Gorton's amendment would block grant funds for about one- third of the programs administered by the Education Department including those for bilingual education, Title I programs which are targeted to poor, disadvantaged school districts, Safe and Drug-free Schools, and education technology. Some of these programs date back to the Eisenhower Administration. We cannot turn back the clock on programs such as these. The Gorton amendment will undermine the federal commitment to improve the nation's schools and opens the doors for abandonment of national commitments to disadvantaged and disabled students and other priorities established over the years by a bipartisan consensus in Congress. In spite of the fact that this idea was first advanced many months ago when the Senate took up last year's education appropriations bill, no hearings have been held on this block grant proposal nor has there been any committee review of its impact. As I stated earlier, this amendment affects one- third of the federal education programs and would, in effect, radically restructure the administration of over $10 billion of federal education dollars. I believe that it is premature and irresponsible for this body to pass legislation that would make such sweeping changes to the federal role in education based on thirty minutes of debate. As a strong supporter of state and local decision-making I fully support our current educational system which vests most authority for education at the level of government closest to students and parents, usually local school boards, with the federal role largely limited to the provision of supplemental financial assistance. However, I also believe that federal involvement, while limited, is necessary and that the Department of Education provides an appropriate oversight function to ensure basic educational standards, civil rights protections, program quality safeguards as well as overall accountability. I realize that there are many problems with today's schools. Our schools and our children, unfortunately, mirror many of the problems of our times. Drugs, gangs and weapons have infiltrated many of our schools and are adversely affecting our children. Student educational attainment is too low in far too many of our school systems. Combating these problems will take the best efforts of parents, teachers, administrators and governments at the local, state and federal level. In addition to Senator Gorton's amendment I also am very concerned about Senator Ashcroft's amendment which will prohibit spending Federal education funds on national testing. I believe that voluntary national achievement tests will empower parents and local school districts to assess how well their students are performing. Such measures will give parents insight into how their children are doing and how well their children's school is doing. From the voluntary tests, we will be able to determine if a child needs help, if a class needs help and if a school needs help. In direct conflict with the bipartisan compromise on national testing so painstakingly crafted last year, the Ashcroft Amendment will deny states and localities the right to utilize voluntary national tests to measure student learning and improve education so that all students will meet high academic standards, particularly in math and reading. Again, I would like to reiterate that I would have voted for the Committee-approved version of H.R. 2646, which was a modest and moderate pro-education bill. However, due to the adoption of the block grant and national testing amendments, in my view the current version of this legislation does more harm than good and I cannot in good conscience vote for it. I say to Senator Coverdell, who has put in many, many hours on behalf of this legislation, if these objectionable amendments are removed in conference, and I hope they will be, I will be pleased to vote for the conference report. I thank the Chair.

Mr. CLELAND

Mr. CLELAND. Mr. President, it is an honor today to celebrate the 47th Wedding Anniversary of Dr. Lloyd John and Mary Jane Ogilvie. It gives me great pleasure to congratulate them on their momentous and joyful day. March 25, 1951, our Senate Chaplain and love of his life took their vows to become man and wife. This month marks 47 years of sharing their lives, dreams, work, struggles, laughs and tears, and commitment to each other. The Ogilvies were blessed with three children, Heather, Scott and Andrew, and are also the proud grandparents of four wonderful grandchildren, Erin, Airley, Bonnier and Scotter. In an era where marriages are too often short lived, it is wonderful to see a couple who has endured the trials and tribulations that plague so many of today's marriage. The love and commitment they have demonstrated over the years should serve as an inspiration to us all. Mr. President, I ask that you join me, our colleagues, and the entire Ogilvie family in recognizing the wonderful sense of achievement and happiness that marks the occasion of 47 years of marriage. I congratulate and offer best wishes on many more years of matrimonial bliss to my dear friends, the Ogilvies.

Mr. CLELAND

Mr. CLELAND. Mr. President, I rise today to honor President Franklin D. Roosevelt's Civilian Conservation Corps. In March 1933, there were approximately 13,689,000 Americans unemployed. Millions were standing in bread lines, or desperately pleading with community volunteer organizations for help. Thousands were making homes out of abandoned farm buildings, or just roaming around the land with no home at all. At this time, my home state of Georgia had already known ``depression'' for some time. An economic recession had begun in Georgia 10 years before the stock market crashed in 1929. Farmers had already faced a century of troubles including erosion problems, and a boll weevil epidemic that wiped out cotton crops across the state. Who would have thought that Georgians' great hope would come in the form of a New Yorker, stricken by polio, who had sought out the healing Warm Springs of Georgia nearly ten years earlier. It was the frequent Georgia visitor President Franklin D. Roosevelt who looked out on America and said he saw ``one third of a nation ill-clad, ill-housed and ill-nourished.'' In response, he offered the people of a suffering nation a sweeping bundle of proposals--a New Deal. A cornerstone of FDR's initiative was the Civilian Conservation Corps (CCC), which was signed into law on April 5, 1933. Conceived as an employment catalyst for young men, Roosevelt said his idea was ``to create a civilian conservation corps, to be used in simple work, not interfering with normal employment, but confining itself to forestry, the prevention of soil erosion, flood control and similar projects.'' By the summer of 1933, the CCC had more than 300,000 young men, ages 18 to 24, in camps across the country prepared to embark on what would be the largest public works and job creation project this country has ever known. In a radio address that summer, President Roosevelt called on the CCC to be the vanguard of the new spirit of the American future--a spirit of responsibility and opportunity. My father was one of the young men who heard that call. A year later, in the summer of 1934, my father was a ``CCC boy'' based in a Clayton County camp as a truck driver, running supplies to camps in North Georgia, North Carolina and Tennessee. The CCC boys earned $30 per month running supplies like my father, planting trees, building roads and trails, making dams and walls and shelters. Roosevelt's Corps was dedicated to several purposes. First, FDR created the CCC to relieve the massive unemployment problem our nation was facing. Second, FDR recognized the real work the CCC could do-- rebuilding the country's depleted resources of forest and soil--would be at least as vital a purpose as job creation. The third objective of the CCC, whose significance has perhaps become even more apparent as years have passed, was generally envisioned by FDR in his 1933 message to Congress: More important, however, than material gains, will be the moral and spiritual value of such work. We can take a vast army of the unemployed out into healthful surroundings. We can eliminate to some extent at least the threat that enforced idleness brings to spiritual and moral stability. In other words, in a nearly inadvertent way, the CCC had the effect of not only rebuilding roads, trees and dams, but also of rebuilding men. While the challenges our country faces today are vastly different than those of 1933, and the makeup of our corps of volunteers has become much more diverse than the young ``CCC boys,'' the spirit of national service remains strong. For example, the work of the more than 40,000 citizens now serving as part of the Corporation for National Service's AmeriCorps program is powerful proof that national service is as important now as it was for my father's generation. A group of Georgians who recognize FDR's legacy of hope, opportunity and spirit of service are working to erect a statue honoring the Civilian Conservation Corps in Warm Springs, GA. How appropriate such a recognition would be. Roosevelt's CCC is an important piece of our nation's and our state's history, and something that should serve as an example for generations to come.

Mr. CLELAND

Mr. CLELAND. Mr. President, I rise today to introduce important legislation which will remove a significant tax filing burden currently imposed on employers of domestic workers. In 1994, Congress adopted legislation reforming the imposition of Social Security and Medicare taxes on domestic employees. These new rules introduced more rationality into the tax system, and relieved reporting requirements of domestic employers. Unfortunately, the legislation did not go as far as needed. By not fully reforming the federal unemployment tax (FUTA), Congress left in place a significant burden on domestic employers which previously existed. Today I urge you to consider my legislation which would amend FUTA as well by removing the burden of filing quarterly state employment tax returns for employers of domestic workers. The Social Security Domestic Employment Reform Act of 1994, Public Law 103-387, changed the Social Security and Medicare tax rules. The new law provides that domestic employers (employing maids, gardeners, babysitters, and the like) no longer owe these taxes for any domestic employee who earned less than $1,000 per year from the employer. In addition, the Act aimed to ease reporting requirements. Under the act, domestic employers need no longer file quarterly returns regarding Social Security and Medicare taxes nor the annual FUTA return. Rather, all federal reporting is now consolidated on an annual Schedule H filed at the same time as the employer's personal income tax return. Nevertheless, the goal of the 1994 act--to substantially reduce reporting requirements for domestic employers--has not been fully accomplished for employers who endeavor to comply with all aspects of the law. Under FUTA, employers must make quarterly reports and payments to state unemployment agencies, then pay an additional sum of federal tax (now once a year, as part of schedule H). In addition, The Social Security Act continues to require that employers report wages quarterly to the states regarding all employees. In other words, despite the 1994 act, a domestic employer who abides by the law must still keep track of all domestic employees, and must still fill out forms and send tax payments on a quarterly basis to his or her state employment agency. Congress was not unaware of the relationship of FUTA to Social Security taxes at the time it passed the 1994 act. Besides eliminating the separate FUTA return for domestic employers, the act also added a provision which permits the Secretary of the Treasury to enter agreements with States to permit the federal government to collect unemployment taxes on behalf of the States, along with all other domestic employee taxes, once a year. That statute, if used, would eliminate the need for domestic employers to report to state unemployment agencies. However, to date no state has entered such an agreement. Undoubtedly, that is because the Social Security Act continues to require quarterly reports anyway. The primary justification cited for the quarterly reporting requirement is that it makes information more accessible to state agencies that investigate unemployment claims. However the burden of this provision far outweighs its benefit. The number of household employer tax filings is relatively small. Representatives from the Georgia Department of Labor and their counterparts in other states are confident that the investigation of unemployment claims will not be hindered by annual rather than quarterly reporting requirements. I suppose one could argue that the change this legislation proposes is unnecessary, since few people even bother to comply with the FUTA requirements for domestic employees. I believe that avoiding a change for that reason is an insult to citizens who endeavor to comply with all tax laws. For example, one Pennsylvania resident paid a 12 year old girl $4 per hour during one quarter for her babysitting services. This resident was then required by law to record, then pay eight cents in tax on her behalf. Needless to say, this is ridiculous. The young babysitter would never claim unemployment compensation. In short, the federal requirement of quarterly state employment tax reports for purely domestic employers should be eliminated. To ease the reporting burden on domestic employers, my legislation proposes that states be allowed to provide for annual filing of household employment taxes. Under my bill, any state which so chooses could retain quarterly reporting, but I believe few states would opt for such an unnecessary burden on its taxpayers. I urge my colleagues to join me in the effort to finish the job of rationalizing the taxpayer obligations for domestic employment taxes by supporting this bill. I ask unanimous consent that the text of my bill be inserted in the Record.

Mr. CLELAND

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

Mr. CLELAND. Thank you, Mr. President. I yield the floor. Mr. STEVENS addressed the Chair.

Mr. CLELAND. Thank you very much, Mr. President. I thank the distinguished Senator from Alaska for this opportunity to speak. Amendment No. 2158 (Purpose: To authorize the establishment of a disaster mitigation pilot program in the Small Business Administration)

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

Mr. CLELAND. Mr. President, this amendment would permit SBA to use up to $15 million of existing disaster funds to establish a pilot program to provide small businesses with low-interest, long-term disaster loans to finance preventive measures before a disaster hits. I just got back from Georgia where we had an incredible tornado that came through and killed 14 Georgians. It is obvious to me we need to prevent people from becoming disaster victims, especially small business people. We cannot prevent disasters, but we can prevent, in many ways, disaster victims. In response to the problem of the increasing costs and personal devastation caused by disasters, the administration has launched an approach to emergency management that moves away from the current reliance on response and recovery to one that emphasizes preparedness and prevention. The Federal Emergency Management Agency has established its Project Impact Program to assist disaster-prone communities in developing strategies to avoid the crippling effects of natural disasters. This amendment supports this approach by allowing the SBA to begin a pilot program that would be limited to small businesses within those communities that will be eligible to receive disaster loans after a disaster has been declared. Currently, SBA disaster loans may only be used to repair or replace existing protective devices that are destroyed or damaged by a disaster. This pilot program would allow funds to also be used to install new mitigation devices that will prevent future damage. New legislation is necessary to authorize the SBA to establish this pilot program. I believe that my legislation would address two areas of need for small businesses--reducing the costs of recovery from a disaster and reducing the costs of future disasters. Furthermore, by cutting those future costs, it presents an excellent investment for taxpayers by decreasing the Federal and State funding required to meet future disaster relief costs. The ability of the small business to borrow money through the Disaster Loan Program to help them make their facility disaster resistant could mean the difference as to whether that small business owner is able to reopen or forced to go out of business altogether after a disaster hits. I urge my colleagues to support this effort to facilitate disaster prevention measures so that when nature strikes in the future, the costs in terms of property and lives, and taxpayer dollars, will be reduced. However, in the interest of time, and with a commitment by the chairman of the Small Business Committee, the distinguished Senator from Missouri, to have our committee expeditiously consider this proposal, I ask unanimous consent to withdraw my amendment.

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

Mr. CLELAND

Mr. CLELAND. I thank my colleague for his assistance. The vital funds for disaster assistance provided in this bill will be a blessing for those farmers in Georgia who have been so devastated by the severe weather that they have endured for the past year. I also will be thankful to see that relief is provided to those in the Northeast and California as well as the many other Americans who have been victims of natural disaster. I thank Senator Bumpers for his leadership in this effort for the people of Georgia and all those affected.

Mr. CLELAND. I would like to follow up on the comments made yesterday by my colleagues, Senator Cochran and Senator Coverdell with a question to Senator Bumpers. I wanted to confirm the report that the $60 million from the Emergency Conservation Program along with the amendment providing an additional $50 million from the Emergency Watershed and Flood Prevention program provided in the 1998 Emergency Supplemental Appropriations Bill will be sufficient to fully cover the losses in Georgia resulting from the recent flooding and tornado?

Mr. CLELAND. Mr. President, I would first like to thank my distinguished colleagues, the Chairman, Senator Stevens and Ranking Member Senator Byrd for addressing the issue of providing relief for Georgia disaster victims in this bill. And, to my colleague, Senator Coverdell the Senior Senator from Georgia for his direct involvement and for offering his amendment to see that adequate relief is obtained for Georgia. I am proud to be a co-sponsor of his amendment. I would also like to thank my colleague Senator Bumpers, for his skillful work as the Ranking Member on the Agriculture Appropriations Subcommittee in his efforts to incorporate the valuable requests for disaster assistance into this bill.

Mr. CLELAND

Mr. CLELAND. Mr. President, I rise today to congratulate and commend the Stetson Model Senate program and the nearly one hundred college students who participated in this year's three-day session. Students from Stetson University, Goucher College, University of Central Florida, Clemson University, Lake Sumter Community College, Jacksonville University, The Citadel, and Longwood College conducted committee meetings, party caucuses, and sessions of the full Senate, portraying Senators of the 105th Congress. This year's program marked my second year attending and speaking at the Model Senate's annual dinner. I was very impressed both with the level of student awareness of public affairs, and with the number of students and schools which participate every year. I congratulate Stetson University, my alma mater, for encouraging these college students to learn more about this nation's political processes and history. Mr. President, I would like to especially honor and commend Dr. T. Wayne Bailey, professor of Political Science at Stetson University and organizer of the proceedings, and Kevin Kayes, Senate Parliamentarian, who guided the students during the sessions of the mock Senate. I truly enjoyed meeting these young men and women participating in the 1998 Stetson Model Senate and ask my colleagues to join me in saluting and congratulating these college students and the organizers of this inspirational program.

Mr. CLELAND

Mr. CLELAND. I associate myself, first of all, Mr. President, with the marvelous remarks from the Senator from Nebraska. He is a distinguished Vietnam veteran himself. It was a wonderful experience to be with Senator McCain, Senator Hagel and Senator Kerrey this morning-- all of us Vietnam veterans. It was a marvelous experience to be there with Senator John McCain as he celebrated his 25th homecoming ``back to the world'' as we used to call this country, when we were in Southeast Asia. Senator Hagel has spoken eloquently, and I associate my remarks with his. I hope that Senator McCain won't be ejected from the Senate for many, many years to come. Mr. President, I ask unanimous consent for 15 minutes of the time allocated to Senator Daschle.