Jon Corzine

Mr. CORZINE

Mr. CORZINE. Madam President, this morning I would like to take a few moments to talk about one of my favorite subjects: Social Security and the privatization plans that have been developed by President Bush's Social Security Commission. As I have discussed in the past, I, like many Members, have serious concerns about these privatization plans, primarily because they involve deep cuts in guaranteed benefits. Those cuts would exceed 25 percent for many current workers and would exceed 45 percent for seniors in the future. The cuts would apply even to those who choose not to participate in these privatized accounts. In effect, they would force many Americans to delay their retirement. Over the past few weeks, I have engaged in an ongoing dialogue with privatization supporters, including the Cato Institute and a few of the members of the Bush Commission. The Cato Institute criticized the national radio address I gave on April 27 describing the privatization program the Bush Commission proposed. I then responded with a critique of their critique. And then, most recently, I received a letter from 6 of the 16 members of the President's Commission with a critique of my critique of the Cato critique. Unfortunately, their critique also is flawed, as I have outlined in a letter back to the six Commissioners, and as I want to discuss today. The most fundamental disagreement I have with the six Commissioners concerns the deep cuts in guaranteed benefits included in the Commission's report. The Commissioners state: The Commission proposals do not ``cut benefits'' for anyone. I am troubled by this statement, which, at best, is highly misleading. Essentially, the Commissioners are arguing that reductions in benefit levels, relative to those proposed under current law, should not be considered cuts. That is just wrong on its face. The Commissioners reach this conclusion by assuming that the assets in the Social Security trust fund will be deleted in the future and Congress will refuse to take the steps necessary to honor the promises made to workers who now are paying into the system. They make this assumption even though they also assume that massive amounts of general revenue will be available to subsidize privatized accounts. In effect, the Commissioners are arguing that Congress, having used Social Security funds for other purposes, now should be able to break its promise to retirees because there is not enough money in the trust fund. To me, this is tantamount to a borrower telling a lender: I haven't saved enough, and therefore I have a right to default on your loan. And, moreover, the reduction in my payments to you should not be considered a cut or a loss to your income. I do not think that adds up. Surely the lender in such a situation would experience the loss and view it as a real cut--just as seniors would experience a reduction in their promised benefits as a cut. In my view, it is a distortion of the English language to claim that changing the law in order to reduce benefit levels, as the Commission has proposed, should not be considered a cut. This claim is especially problematic because the Commission's proposed cuts would be so deep for many beneficiaries--exceeding 25 percent for many current workers, and exceeding 45 percent in the future. By the way, these numbers are confirmed by the nonpartisan Social Security actuaries. The Commission should be open and honest about this. The numbers are in the report. It also is important to emphasize, as I noted earlier, that the benefit cuts proposed by the Commission apply even to those who choose not to participate in privatized accounts. This belies claims that the Commission's plan is based on voluntary choice. It's not. Even those who do not choose to use privatized accounts will get cuts. Supporters of privatization may believe that income from privatized accounts will offset the cuts in guaranteed benefits. That is the argument they make. However, this is problematic for at least two reasons. First, the combination of reduced guaranteed benefits and income from private accounts in many cases would be less than the benefits under current law, even under the assumptions used in the Commission's report. That is certainly one of the possibilities. And that is particularly true if one takes into account the administrative costs which are going to accompany these private accounts. In Great Britain up to 40 percent of the returns in private accounts are used just to pay for administering the accounts. This takes away from income and really does undermine the ability to maintain the same levels of benefits. Second, relying on the whims of the market is inconsistent with the principal goal of Social Security--guaranteeing a basic level of security, even when private investments fail. As one who worked personally as a trader and as the head of a major financial firm, I understand that stocks can move down, or sideways, for extended periods. While all workers should save on their own in private accounts, the purpose of Social Security is to establish a floor below which they will not be allowed to fall. The Commission's proposals would drastically lower that floor. This would be a mistake, especially when one considers that average benefit levels are now only about $10,000 a year--hardly enough to live on in many parts of the country. As I pointed out to the Chair on a number of occasions, the average benefit for women is closer to $9,000. That is not sufficient to provide a secure retirement in most parts of the country--certainly not in New Jersey and I suspect not in Michigan. Another argument in the letter I received from the six Commissioners focused on what some people have referred to as the ``clawback'' provisions in their proposals. The Commissioners don't like the term ``clawback,'' and I am not going to get into a semantic debate with them about it. But my main point here is undisputed: each of the Commission's plans--there are three of them--would reduce guaranteed benefits based on amounts workers contribute to privatized accounts. These cuts would be in addition to the direct cuts in guaranteed benefits that would apply to all seniors, even those who do not contribute to privatized accounts. I think many Americans would see this as political sleight of hand-- giving with one hand, and taking away with another. Another issue addressed in the Commissioner's letter is whether this automatic benefit cut proposal would apply to ``near retirees.'' The six Commissioners argued that the Commission's plans ban persons older than 55 from participating in privatized accounts. However, this actually isn't clear from the text of the report. Nor have the Commissioners explained why older Americans should be banned from participating in privatized accounts if that is such a great idea. Why are they being left out of such a wonderful opportunity to reduce their guaranteed benefit? Next, the Commissioners dispute my point that the Commission's plans would force many Americans to delay their retirement. On this point, I acknowledge that their proposal does not explicitly raise the legal retirement age. And I have never claimed otherwise. But my point is that their proposals cut benefits so drastically that the effect is the same. Many people would be forced to work longer to build up more assets, in order to maintain the same level of retirement security. In fact, one of the Commission's plans would directly target benefit cuts at those who retire at 62. It seems clear that, as a practical matter, this will force many seniors to delay their retirement. Another point in the letter from the six Commissioners is that their proposals would reduce the amount of general revenues that would be required to maintain the solvency of the Social Security trust fund. To the extent that they are calling for deep cuts in guaranteed benefits, that's right. But, by that logic, we could eliminate the need for any general revenues by eliminating guaranteed benefits altogether. To me, this just isn't a good argument for the deep cuts in benefits. I will not go into each and every argument raised by the six Commission members. But I ask unanimous consent that a copy of my written response to the Commissioners be printed in the Record at the end of my statement.

Mr. CORZINE. Yes.

Mr. CORZINE. Mr. President, I very much appreciate the comments of my colleague from Michigan, whom I know has been so vocal about the need for a prescription drug benefit and the cost containment issue. Actually, we need a whole list of approaches to make sure our seniors in America have access to the American promise, and we need to work to make that happen. Prescription drugs must be part of that. Protecting Social Security must be, as well. As it relates to the disability benefits, the proposals in the Commission's report would be even more devastating to disabled individuals than to retirees. Disabled people would not be able to build up assets in a privatized account if they are unable to work. And to the extent that they have assets in such an account, they would not be available until an individual retires. Even the Commission expressed discomfort with their own cuts in disability benefits, though in the end they relied on the savings from such cuts. I very much appreciate the distinguished Senator from Michigan speaking out on this aspect of the Bush Commission's cuts. Because, as she suggests, these cuts do go beyond retirees, and also jeopardize the disabled and those young people who lose a parent. That needs to be understood by the American people. Mr. President, privatized accounts can provide some benefits, if trees grow to the sky and the market never goes down or sideways. But if history is any guide, that is not really how the world works. In the real world, privatization would put at serious risk Social Security's floor level of support for the disabled, children, and our retirees. Again, I thank the Senator for her question and for her support. I hope she will also see that same kind of support with regard to her efforts to contain the costs of prescription drugs, and to provide prescription drug benefits, both of which are serious and important issues for our country.

Mr. CORZINE. Madam President, I have been very critical of the letter written by the six Commissioners, as I have been critical of materials prepared by the CATO Institute in the past. But I know they reflect deeply held beliefs, and I sincerely want to thank them for engaging in the debate. In my view, the debate that has begun here with the CATO Institute and the six Commissioners is a good thing because it highlights our differences for the American people. Every American has a stake in the future of Social Security. It is disappointing that the Bush administration is trying to push this matter under the rug, and seems to want to defer the debate until after the November election. That would be wrong. The American people have a right to be part of this process. Let me close and again emphasize the important points that Americans need to understand. The Bush Commission's privatization plans involve cuts in guaranteed benefits for many current workers of 25 percent, and future benefits for seniors could be cut as much as 45 percent. These cuts would apply even to those who choose not to invest in privatized accounts. And they would have the effect of forcing Americans to delay their retirement. For these reasons, I strongly oppose these proposals, and I look forward to continuing this dialogue with those who are supporters of privatization. The future of Social Security is too important to be left out of the limelight and negotiated behind closed doors. We need to have an open discussion. I thank the Presiding Officer for this opportunity to speak about privatization. Exhibit I U.S. Senate, Washington, DC, June 6, 2002. Ms. Leanne Abdnor, et al., Boulder, CO. Dear Ms. Abdnor, Mr. Penny, Mr. Saving, Mr. Vargas, Mr. Cogan and Ms. Mitchell: Thank you for your letter of May 23. I appreciate your apparent willingness to engage in a dialogue with respect to the report of the President's Social Security commission, and trust you agree that the future of Social Security deserves nothing less than a full public debate. Although we obviously disagree strongly about the merits of privatizing the program, I look forward to hearing more from you as we seek to educate the public about the plans you helped produce last December, along with the 10 other members of the Commission who did not sign your letter. Having said that, I was disappointed by your letter and believe it presents several arguments about the Commission's report and my reactions to it that are, at best, misleading. Perhaps our most fundamental disagreement concerns the deep cuts in guaranteed benefits included in the Commission's proposals. You attempt to obscure these cuts by arguing that reductions in benefit levels, relative to those promised under current law, should not be considered cuts. Instead, you begin by assuming that the trust fund's assets will be depleted and Congress will refuse to take the steps necessary to honor these promises in the future (even though you also assume that massive amounts of general revenue will be available to subsidize privatized accounts). You then use this assumption to claim that if Congress affirmatively reduces benefits through a change in current law, this should not be considered a ``cut.'' To me, this is tantamount to a borrower telling a lender: I haven't saved enough, and therefore I have a right to default on your loan--and, moreover, the reduction in my payments to you should not be considered a ``cut'' in your income. Surely the lender in such a situation would experience the loss of income as a real cut--just as seniors would experience a reduction in their promised benefits as a cut. In my view, it is a distortion of the English language to claim that a change in the law that intentionally reduces benefit levels, as the Commission has proposed, should not be considered a cut. This claim is especially problematic because the Commission's proposed cuts would be so deep for many beneficiaries--exceeding 25 percent for many current workers, and exceeding 45 percent in the future. The Commission should be open and honest about this. Furthermore, it is important to emphasize that cuts proposed by the Commission apply even to those who choose not to participate in the option of privatized accounts. This belies claims that the Commission's plan is based on voluntary choice. The Commission's report also includes proposals for deep cuts in benefits for disabled individuals. These Americans would not be able to save in privatized accounts when they were disabled and not working. In any case, under the Commission's proposals, such disabled individuals would not have access to the privatized accounts until they reached retirement age. The treatment of the disabled again belies claims that the Commission's plan is based on voluntary choice. While I understand that the Commission expressed concern about the impact of its own proposals on the disabled, it nevertheless relied on savings from these cuts to make its numbers add up. Without these savings, the Commission's plans would not restore the Trust Fund to long- term solvency. I recognize that you believe that privatized accounts will offset the cuts in guaranteed benefits. However, this is wrong for at least two reasons. First, the combination of reduced guaranteed benefits and income from private accounts in many cases would be less than the benefits under current law, even under the assumptions used in the Commission's report. Second, relying on the whims of the market is inconsistent with the principal goal of Social Security-- guaranteeing a basic level of security, even when private investments fail. As one who worked personally as a trader and as the head of a major financial firm, I understand that stocks can move down, or sideways, for extended periods. While all workers should save on their own in private accounts, such as 401(k) plans and IRAs, the purpose of Social Security is to establish a floor below which they will not be allowed to fall. The Commission's proposals would drastically lower that floor. This would be a mistake, especially when one considers that average benefit levels are now only about $10,000 a year--hardly enough to live on in many parts of the country. You also argue that I wrongly accuse the Commission of adopting a ``clawback'' proposal. But yours is a semantic argument that rests on a very narrow and arguably incorrect interpretation of this colloquial term. Your claim is that this term applies only to reductions in privatized accounts, not to reductions in guaranteed benefits. However, even if one accepts this narrow definition, my basic point remains undisputed. Each of the Commission's plans would reduce guaranteed benefits based on amounts contributed to privatized accounts. These cuts would be in addition to the direct cuts in guaranteed benefits that would apply to all seniors, even those who do not contribute to privatized accounts. To many Americans, this will seem like giving with one hand, but taking away with another. To defend your proposal for automatic cuts, you cite a quote from page 99 of the Commission's report that is highly misleading as presented. That quote states that ``no adjustments to traditional Social Security benefits would be made as a function of the accumulations in [privatized] accounts.'' This is technically true, but it obscures the more important point: traditional guaranteed Social Security benefits would be cut based on workers' contributions to privatized accounts. Thus, regardless of whether the market rises or falls, guaranteed benefits will be cut just as deeply, undermining the value of Social Security as a backstop against possible destitution. Next, you argue that I was wrong to conclude that this automatic benefit cut proposal would apply to ``near retirees.'' More specifically, you argue that the Commission's plans ban persons older than 55 from participating in privatized accounts. However, while the descriptions of two of the plans in the Commission's report prominently include the ban, in the description of Model 1, the ban is conspicuously absent. You may want to check pages 110, 119, and 131 in the Commission's report to see this clear difference in the descriptions of the three plans. If one were to apply basic principles of statutory construction to the text of the Commission's report, the obvious conclusion would be that Model 1 does not contain the same age limitation as do the other models. I understand your claim that it was not the intent of the signers of your letter to apply the automatic cuts to those who contribute to privatized accounts under Model 1. However, given the language of the Commission's report, this still seems a reasonable interpretation of the intent of the Commission as a whole. You may want to raise this with the other members of the Commission and have the entire Commission submit a modification of its report to the Congress, if they share your intent. Such a submission might include an explanation of why older Americans are banned from participating in privatized accounts if, as you seem to suggest in your letter, such accounts do not put the guaranteed benefits of participants at risk. You also dispute my point that the Commission's plans would force many Americans to delay their retirement. To clarify, I never said, nor did I mean to imply, that your proposal explicitly raises the legal retirement age. My point is that cutting the level of guaranteed benefits so drastically could have the same effect. This is because individuals would be forced to work longer to build up more assets, in order to maintain the same level of retirement security. Note that one of the Commission's plans would target benefit cuts at those who retire at 62. It seems clear that, as a practical matter, this will force many seniors to delay their retirement. Another point you make in your letter is that the Commission's proposals would reduce the amount of general revenues that would be required to maintain the solvency of the Social Security Trust Fund. To the extent that you are calling for deep cuts in guaranteed benefits, I acknowledge that your proposals would have this effect, and have never argued otherwise. In fact, the benefit cuts associated with the change in indexing are so substantial that, by themselves, they would restore long-term balance. However, the high cost of privatized accounts then forced the Commission to rely on massive general revenue subsidies to achieve long-term solvency. Your letter also complains about critiques that ``count `current law benefits' but not the taxes required to pay them''. This complaint seems disingenuous, considering that the Commission itself depends on substantial transfers from the rest of the budget without making clear how those would be financed. Under the Commission's plans, these transfers would be necessary to fully fund privatized accounts and partially address trust fund solvency. Yet given projections of deficits outside of Social Security for the foreseeable future, one might have expected the Commission to explain whose taxes would be raised and whose services would be cut to generate the need savings. The Commission's report includes no such explanation. However, one way to reduce the need for such taxes is to not subsidize privatized accounts in the first place. I do accept your point that investing in broadly diversified funds reduces risks. That is true and, again, I have never argued otherwise. However, while diversification reduces risks, significant risks remain. The value of even a diversified account can decline significantly at any time, and can stay depressed for years. If this were to happen when an individual is retiring, the consequences could be catastrophic without Social Security's basic level of guaranteed benefits. Finally, it is hard to argue that the Commission represented a balanced forum for the open consideration of differing points of view. After all, the membership of the Commission was stacked from the beginning with those who support a shift to privatized accounts, and the Commission was specifically directed to promote such accounts. That is not your fault, and I do not blame you for holding policy beliefs in good faith. But it seems to many observers that the basic recommendations of the Commission were largely predetermined by President Bush when he selected such a one- sided group of members and then limited the scope of options they were allowed to consider. In sum, I stand by my critique of the Commission's report and believe that the benefit cuts it proposes would be a serious mistake for our nation, and the millions of Americans who will depend on Social Security in the future. I look forward to continuing our dialogue in the months ahead, and hope you will be able to convince the White House and the Republican congressional leadership to join in the discussion before this fall's elections. Best regards, Jon S. Corzine, U.S. Senator. (Mr. NELSON of Nebraska assumed the chair.)

Mr. CORZINE

Mr. CORZINE. I would be pleased to yield to the minority leader.

Mr. CORZINE

Mr. CORZINE. Mr. President, providing steady and reliable transportation for workers into and out of New York City is vital to the economic recovery of the region. We are pleased that the Committee has provided $1.8 billion that will be dedicated solely to rebuilding the infrastructure connecting New York and New Jersey residents with Lower Manhattan.

Mr. CORZINE. I, too, thank the Senator from North Dakota for his assistance on this matter that is so important to New Jersey health care providers. Foreign Assistance Spending

Mr. CORZINE. As my colleague, Senator Torricelli, has noted, last fall health care providers in New Jersey responded quickly, effectively and responsibly to the anthrax crisis in New Jersey, yet they have not been reimbursed for the care they provided. Failure to reimburse these very real costs places a significant burden on these providers. Failure to reimburse is troubling because in many cases the Postal Service directed its employees to these hospitals for care. For example, the Postal Service instructed employees to report to the Robert Wood Johnson University Hospital at Hamilton for anthrax testing. As a result, Robert Wood Johnson Hospital ultimately incurred $651,500 in costs for treating 1,400 postal service employees and dispensing over 3,500 prescriptions for antibiotics. Seven months later, the Postal Service has not reimbursed Robert Wood Johnson for the lifesaving health care it provided. Mr. Chairman, it is my understanding that the committee believes that the Postal Service has received adequate funding to address the anthrax crisis and that the Postal Service is encouraged to meet its obligations to New Jersey health care providers.

Mr. CORZINE

Mr. CORZINE. Mr. President, I rise today along with Senator Hillary Rodham Clinton to change the way the Veteran's Administration defines low-income veterans by taking into account variations in the cost of living in different parts of the country. The Corzine-Clinton legislation would make the Veteran's Equitable Resource Allocation just that: Equitable. More specifically, this bill would replace the national income threshold for consideration in Priority Group 5, currently $24,000 for all parts of the country, with regional thresholds defined by the Department of Housing and Urban Development. This simple but far- reaching proposal would help low income veterans across the country afford quality health care and ensure that Veterans Integrated Service Networks or VISNs receive adequate funding to care for their distinct veterans populations. Our Nation's veterans have made great sacrifices in defense of American freedom and values, and we owe them a tremendous debt of gratitude. The United States Congress must ensure that all American veterans, veterans who have sweated in the trenches to defend liberty, have access to quality health care. In 1997, Congress implemented the Veterans Equitable Resource Allocation system, or VERA, to distribute medical care funding provided by the VA. The funding formula was established to better take into account the costs associated with various veteran populations. Unfortunately, the VERA formula that was created fails to take into account regional differences in the cost of living, a significant metric in determining veteran healthcare costs. This oversight in the VERA formula dangerously shortchanges veterans living in regions with high costs of living and elevated health expenses. To allocate money to the Veterans' Integrated Service Networks, VISNs, VERA divides veterans into seven priority groups. Veterans who have no service-connected disability and whose incomes fall below $24,000 are considered low income and placed in Priority Group 5, while veterans whose incomes exceed this national threshold and qualify for no other special priorities are placed in Priority Group 7c. Using a national threshold for determining eligibility as a low- income veteran puts veterans living in high cost areas at a decided disadvantage. In New Jersey, HUD's fiscal year 2002 standards for classification as ``low-income'' exceed $24,000 per year in every single county. And some areas exceed the VA baseline by more than 50 percent. Similarly, HUD's ``low-income'' classification for New York City is set at $35,150 and for Nassau and Suffolk Counties, at $40,150. As a result, regions that have a high cost of living, like VISN 3, which encompasses substantial portions of New Jersey and New York, tend to have a reduced population of Priority Group 5 veterans and an inflated population of Priority Group 7c veterans. The fundamental inequity of the VERA formula is apparent when you consider that VERA allocations do not take into account the number of veterans classified in Priority Group 7c. With the costs associated with veterans in Priority Group 7c not considered as part of the VERA allocation, and with high cost of living areas possessing inflated populations of Priority Group 7c vets, high cost regions must provide care to thousands of veterans without adequate funding. This additional financial burden on VISNs with large populations of veterans in Priority Group 7c has had a tremendous impact on VISN 3. Since FY 1996, VISN 3 has experienced a decline in revenue of 10 percent. As a result of the tremendous shortfall in the VISN 3 budget, the VA cannot move forward with plans to open clinics in various locations, including prospective clinics in Monmouth and Passaic Counties. Consequently, veterans in VISN 3 are forced to wait for unreasonably long periods to receive medical care and travel long distances to existing clinics. Furthermore, miscategorizing which vets qualify as Priority Group 5 unjustifiably reduces access to medical care for thousands of veterans. Under existing rules, veterans placed in Priority Group 7c must provide a copayment to receive medical care at a VA medical facility; Veterans placed in Priority Group 5 receive medical care free of charge. Under the existing framework, low-income vets in high cost areas are often inappropriately placed in Priority Group 7c, and are forced to provide a copayment. Recent studies by both the Rand Institute and the General Accounting Office identify this flaw in the VERA formula and recommend a geographic means test like the one provided in our legislation to improve the allocation of resources under VERA. Such a test would ensure that the VERA formula allocation better reflects the true costs of VA healthcare in the various VISNs in the United States. Our legislation would make a simple adjustment to the VERA formula to account for variations in the cost of living in different regions. The bill would help veterans in high cost areas afford VA health care and guarantee that VISNs across the country receive adequate compensation for the care they provide. I hope my colleagues will join Senator Clinton and me in supporting this important bill, and I ask unanimous consent that the text of the legislation be printed in the Record.

Mr. CORZINE

Mr. CORZINE. I thank the Senator from Kansas for his work on this important issue.

Mr. CORZINE. I believe the intent of the amendment in this regard is that the Department of Commerce would primarily be involved in developing measurement standards for monitoring of emissions, as well as verification technologies and methods to ensure the maintenance of a consistent and technically accurate record or emissions, emission reductions and atmospheric concentrations of greenhouse gases for the database. This is clearly stated in Sections 1103(b)(2) and 1106(a)(2)(D) of the bill. Within the Department of Commerce, it is my intent that these functions would primarily be carried out by the National Institute of Standards and Technology, or NIST. Is this also the intent of the Senator from Kansas?

Mr. CORZINE

Mr. CORZINE. Mr. President, I rise today along with Senator Hillary Rodham Clinton to change the way the Veteran's Administration defines low-income veterans by taking into account variations in the cost of living in different parts of the country. The Corzine-Clinton legislation would make the Veteran's Equitable Resource Allocation just that: Equitable. More specifically, this bill would replace the national income threshold for consideration in Priority Group 5, currently $24,000 for all parts of the country, with regional thresholds defined by the Department of Housing and Urban Development. This simple but far- reaching proposal would help low income veterans across the country afford quality health care and ensure that Veterans Integrated Service Networks or VISNs receive adequate funding to care for their distinct veterans populations. Our Nation's veterans have made great sacrifices in defense of American freedom and values, and we owe them a tremendous debt of gratitude. The United States Congress must ensure that all American veterans, veterans who have sweated in the trenches to defend liberty, have access to quality health care. In 1997, Congress implemented the Veterans Equitable Resource Allocation system, or VERA, to distribute medical care funding provided by the VA. The funding formula was established to better take into account the costs associated with various veteran populations. Unfortunately, the VERA formula that was created fails to take into account regional differences in the cost of living, a significant metric in determining veteran healthcare costs. This oversight in the VERA formula dangerously shortchanges veterans living in regions with high costs of living and elevated health expenses. To allocate money to the Veterans' Integrated Service Networks, VISNs, VERA divides veterans into seven priority groups. Veterans who have no service-connected disability and whose incomes fall below $24,000 are considered low income and placed in Priority Group 5, while veterans whose incomes exceed this national threshold and qualify for no other special priorities are placed in Priority Group 7c. Using a national threshold for determining eligibility as a low- income veteran puts veterans living in high cost areas at a decided disadvantage. In New Jersey, HUD's fiscal year 2002 standards for classification as ``low-income'' exceed $24,000 per year in every single county. And some areas exceed the VA baseline by more than 50 percent. Similarly, HUD's ``low-income'' classification for New York City is set at $35,150 and for Nassau and Suffolk Counties, at $40,150. As a result, regions that have a high cost of living, like VISN 3, which encompasses substantial portions of New Jersey and New York, tend to have a reduced population of Priority Group 5 veterans and an inflated population of Priority Group 7c veterans. The fundamental inequity of the VERA formula is apparent when you consider that VERA allocations do not take into account the number of veterans classified in Priority Group 7c. With the costs associated with veterans in Priority Group 7c not considered as part of the VERA allocation, and with high cost of living areas possessing inflated populations of Priority Group 7c vets, high cost regions must provide care to thousands of veterans without adequate funding. This additional financial burden on VISNs with large populations of veterans in Priority Group 7c has had a tremendous impact on VISN 3. Since FY 1996, VISN 3 has experienced a decline in revenue of 10 percent. As a result of the tremendous shortfall in the VISN 3 budget, the VA cannot move forward with plans to open clinics in various locations, including prospective clinics in Monmouth and Passaic Counties. Consequently, veterans in VISN 3 are forced to wait for unreasonably long periods to receive medical care and travel long distances to existing clinics. Furthermore, miscategorizing which vets qualify as Priority Group 5 unjustifiably reduces access to medical care for thousands of veterans. Under existing rules, veterans placed in Priority Group 7c must provide a copayment to receive medical care at a VA medical facility; Veterans placed in Priority Group 5 receive medical care free of charge. Under the existing framework, low-income vets in high cost areas are often inappropriately placed in Priority Group 7c, and are forced to provide a copayment. Recent studies by both the Rand Institute and the General Accounting Office identify this flaw in the VERA formula and recommend a geographic means test like the one provided in our legislation to improve the allocation of resources under VERA. Such a test would ensure that the VERA formula allocation better reflects the true costs of VA healthcare in the various VISNs in the United States. Our legislation would make a simple adjustment to the VERA formula to account for variations in the cost of living in different regions. The bill would help veterans in high cost areas afford VA health care and guarantee that VISNs across the country receive adequate compensation for the care they provide. I hope my colleagues will join Senator Clinton and me in supporting this important bill, and I ask unanimous consent that the text of the legislation be printed in the Record.

Mr. CORZINE

Mr. CORZINE. I thank the Chair. Madam President, I rise to discuss amendment No. 3461 which was offered on my behalf, and on behalf of Senator Dodd, Senator Stabenow, and others by Senator Reid on Monday and set aside. It is my expectation this amendment will be voted on at the expiration of the 30 hours, as required by cloture. But I wanted to make sure I had an opportunity to discuss the merits of this and the importance of this, which I consider quite significant. I offer this amendment to protect the role of Congress and elected State and local officials in determining the nature and scope of significant public services. It is one thing for Congress to sacrifice its own prerogatives in the development of trade policy, as we will likely do today with the passage of trade promotion authority; however, in my view, it goes much too far to delegate constitutional responsibilities of elected officials when it comes to determining what are public services and what significant public services should be managed in the public sector. My amendment stands for the simple proposition that trade agreements should not be used to privatize public services--public services duly directed by constitutionally authorized actors of our Nation's democratic processes. Specifically, the amendment would establish as a principal negotiating objective that trade agreements should not include a commitment by the United States to privatize significant public services such as national security, Social Security, public health and safety, and education. It is very simple. Before I discuss the details of my amendment, let me say that I agree with the objectives of the sponsors of the underlying bill that we should seek ways to expand trade in services. I know firsthand that this objective can create jobs and economic benefit. In fact, I spent the better part of 30 years of my life building an international service business in banking and understand the need for barriers to be broken down. There are many that limit the expansion of American enterprise abroad. It is also true that the American service sector is and will continue to be a vital part of our economy. It is one that is growing substantially. It is a substantial part of our international activity. In my view, we need to aggressively foster and promote that growth. It promises long-term benefits for all Americans. That means we should be looking for ways to open accounts. I commend those efforts as a part of this bill. Having said that, while there are many potential benefits to forging trade agreements designed to increase trade and services, there are also risks. That is what my amendment is about. One of the risks is that those agreements will be misused, either directly or through unintended implementation requirements. My amendment is designed to reduce that risk so that trade agreements will do what they are supposed to do and won't be used in a particular way: the risk that they will commit the United States to privatizing key public services outside of legally constituted constitutional processes. Some of my colleagues may well be unaware that such a risk exists. After all, trade agreements are supposed to be about promoting economic activity. They weren't conceived to overrule democratic processes and decisions about the provision of essential public services--things such as protecting our airports and airline security, things that we have chosen in the democratic process to move forward in the public arena. Yet trade agreements can do just that. There is ample reason to be concerned that privatization of significant public services could well be on the table in future negotiations. In fact, right now negotiations are already underway in the process of establishing new agreements with respect to trade and services. Those negotiations may well lead to agreements under which services traditionally administered by Federal, State, and local governments would be on the chopping block. Under such agreements, foreign investors might be able to challenge public policies that provide certain services through government entities. Such foreign interests could argue that these policies discriminate against them and represent an unlawful trade barrier. In fact, some international agreements are already being interpreted that way, and others are being designed for that purpose. Consider what is happening in bilateral negotiations between the United States and Chile. In 1981, Chile decided to privatize its public pension system; that is, its equivalent of Social Security. Under the privatized system, Chilean workers are now required to invest their pension dollars with private financial institutions. Unfortunately, Chile's experience with the privatization of Social Security has, in many respects, proved problematic. Many Chilean workers have seen the value of their investments collapse. And many Chilean political leaders now believe the only way to protect the retirement security of Chilean families is to return to the earlier public system based on guaranteed benefits-- more like we have in the United States. U.S. negotiators are encouraging Chile to keep their system privatized. As a result, the financial security of Chilean retirees and their national retirement policy may depend on international trade negotiations rather than the political democratic processes reflecting the wishes of the Chilean people. Think about that for a moment and consider how Americans would feel if trade negotiations ended up deciding the fate of Social Security in America. Imagine trade negotiators setting that investment policy for the Social Security Administration. What if foreign interests were demanding that the United States open up our Social Security system to foreign financial firms or mandate privatization outside the democratic process? Imagine that Chilean, Russian, or German negotiators argued that it was a restraint of trade for Social Security to limit its investments to U.S Government securities rather than opening up the system to privatized accounts. I speak as one who strongly opposes that move with the American system privatizing Social Security. It would lead to a deep cut in guaranteed benefits and reduce the financial security of American seniors. But I think the most important issue as it relates to this debate, regardless of your views on privatization, is that Americans would be outraged if that were accomplished through trade negotiations as opposed to a debate on the floor of the Senate and the House of Representatives and a discussion with the American people. The future of Social Security is too important to be decided by anyone other than the American people. Social Security is not the only area of public service provision that concerns me. Let's take a look at another example a little less dramatic. The European Union has now proposed that the United States make new commitments under the General Agreement on Trade in Services to allow foreign firms to gain greater access to the U.S. water services market. Many municipalities across the United States have long felt that the provision of water services is an important governmental responsibility. Some of the localities in New Jersey that I represent have chosen to have it administered by private companies. Others have chosen to retain the nature of a public provision of water services. The point is that the people have spoken. Should municipalities privatize their water supplies? I am not sure. I am certainly not convinced that one answer is appropriate for all situations. But one thing I am sure about is that these decisions should be made by local elected officials who understand local circumstances and local values, and who are accountable to the local taxpayers and local voters. These decisions to privatize should not be dictated by unelected, distant trade bureaucrats. Let me give another example. This involves a company that has been in the news lately, a company named Enron. The Government of Argentina contracted with a division of Enron to provide water and sewer services in Buenos Aires. Enron did not do such a good job, to put it mildly. For a while, the water provided was contaminated by toxic bacteria. As a result, some 500,000 people were told not to drink the water for well over a month. In the end, the Argentinian Government canceled its contract with Enron. Now Enron is suing, under trade agreements, that there is a basis for a $550 million settlement for them against the Argentinian people because they did a bad job. I am telling my colleagues, this is an important issue. The provision of public services is a decision which our democratic processes should be deciding. This matter should be decided by democratically elected governments, not unelected trade bureaucrats. There is a long list of public services that could well be privatized and put up for bid by foreign companies. These include everything from health services for veterans, to State colleges and universities, to immigration control, to afterschool programs, to police officers. All of these could be threatened by a trade agreement, and a lot of people are worried about that. That is why I want this amendment to be seriously considered by my colleagues on the Senate floor, really to establish a trade objective. Madam President, I ask, how much time is remaining?

Mr. CORZINE. I thank the Chair. The American Public Health Association is concerned about the privatization of some parts of the Medicare Program and medical services for the poor. The American Council on Education and the Council for Higher Education Accreditation have voiced deep concerns about the GATT negotiations. As they said in a statement, higher education is supposed to serve the public interest and should not be a commodity. Yet the threat posed to education by privatization through trade agreements is very real. Under some prospective trade rules, States could be barred from subsidizing State universities, using the argument that such subsidies put private universities at a competitive disadvantage. I do not think that is what the American people want trade negotiations to accomplish. They do not want unelected trade bureaucrats setting our policy with regard to public services. Let me return to the explanation of the amendment. The amendment is very simple and states: A principal negotiating objective of the United States is to ensure that trade agreements do not [do not] include a commitment by the United States to privatize significant public services, including services related to (i) national security; (ii) Social Security; (iii) public health and safety; and (iv) education. It then defines the term ``privatize'' to mean: . . . the transfer of responsibility for, or administration of, a government function from a government entity to a private entity. And that is it. That is the entire amendment. As it should be clear from its language, the premise of the amendment is that there are some types of public services that are so important that decisions about them should be made democratically and should not be delegated to an international body. Our amendment highlights, in particular, those four areas. There may well be others. There may be some who would argue we ought to privatize some parts of our national security system, such as those who objected when Congress recently federalized our airport security system. I disagree. But, again, we ought to have that argument here on the floor of the Senate-- democratically chosen processes, constitutionally established. You could say that about many other types of issues. Trade negotiators should not privatize and preempt the decisionmaking of Congress and the President. This amendment is less about privatization than it is about democracy. It is one thing to enter into international agreements, promote private investment, even if that means limiting our congressional prerogatives, but it is an entirely different matter to tie our own hands in deciding upon important public services, which go to the heart of what government is about in the first place. I appreciate this opportunity to speak on this important, relevant, and germane amendment. In my mind, this bill already delegates too much congressional responsibility and authority. I hope my colleagues will support this amendment and protect our right to make a democratic choice about what the public services are that are privatized and that as we move forward we make those decisions through the debate process and discussion with the American people, not through trade negotiations, not through bureaucrats, who are unelected officials. So that is what the amendment is about. I believe strongly that this is an amendment my colleagues should support, and I hope they will. I yield the floor.

Mr. CORZINE

Mr. CORZINE. Mr. President, I rise today to recognize Asian Pacific American Heritage Month. Every May we acknowledge the many accomplishments and profound contributions that people of Asian and Pacific Island descent have made to New Jersey and to our country. The celebration also affords us the opportunity to recognize the strength the United States draws from its diversity, especially those contributions made by Asian Pacific Americans. The formal recognition of Asian Pacific American Heritage began in 1979 with a weeklong celebration. In 1992, President George Herbert Walker Bush signed Public Law 102-450, devoting the entire month of May to acknowledge the history, concerns, and contributions of Asian Pacific and Americans. Today, Americans of Asian and Pacific Islander lineage total nearly 11 million people. The Census Bureau projects that the Asian Pacific Islander population will grow to nearly nine percent of the American population by the middle of the century. Americans of Asian and Pacific Islander heritage have been instrumental in the development and sustaining of both the national and New Jersey economies. Figures from the last economic census compiled in 1997 attribute more than 2.2 million jobs nationwide and over $306 billion dollars to Asian and Pacific Islander-owned businesses. New Jersey ranks fifth nationwide in the number of firms owned by Asian and Pacific Islanders with over 41,000 businesses generating sales and receipts totaling over $16.7 billion. Although some Asian Pacific Americans are beginning to enjoy success in the United States, Asian immigrants and Asian Americans have met roadblocks. From racist Chinese exclusion laws to being unjustly held hostage in internment camps, Asian Pacific Americans too often have been shunned as untrustworthy foreigners, not accepted as ``true Americans'' because of their appearance or their cultural and religious traditions. Unfortunately, racism against Asian American continues today. Hate crimes perpetrated against Asians and Asian Americans have increased in frequency and intensity in the wake of the terrorist attacks against the United States. All Americans should remember that we are a nation of immigrants and we should reaffirm our commitment to diversity, mutual respect and the American Dream. We must remember that although people we meet on the street, schools, stores or even airplanes may be of a different ethnic or religious background, they are still our co-workers, neighbors, and fellow Americans. I hope you will join me in recognizing the hard work and sacrifices made by Asian immigrants and Asian Americans for our country. Throughout our history, Asian immigrants and Asian Americans have contributed to our nation's growth and have fought to protect our nation. Today, Asian Americans continue to help make our country great through contributions as diverse as they different countries of origin. I applaud the efforts of Asian immigrants and Asian Americans who continue to work towards the American dream, and I thank them for their many contributions to our great Nation.

Mr. CORZINE

Mr. CORZINE. Mr. President, this amendment is offered by myself and Senator Dodd and others. It is an important and simple request for our trade negotiators to respect the role of Congress and elected State and local officials to determine the nature and scope of significant public services. Regardless of my colleagues' view on TPA, it is one thing to delegate congressional authority on trade negotiations, but it is a serious leap beyond that to delegate constitutional responsibilities of elected officials when it comes to determining what public services should be privatized. This amendment would establish as a principal negotiating objective that trade agreements should not include a commitment by the United States to privatize significant public services, such as Social Security, national security, public health and safety, and education. This is simple and straightforward. We should not be turning over, to the delegation of unelected trade negotiators, determinations about issues such as Social Security and national security. That should be determined here, with debate on the floor of the Senate and the House of Representatives, and by duly elected officials. Straightforward, simple. Mr. President, as I have explained, my amendment establishes as a negotiating objective that trade agreements exclude commitments by the Untied States to privatize significant public services. The amendment specifies four types of public services that represent core functions of Government and that are specifically protected. These include national security, Social Security, public health and safety, and education. I want to make clear for the record, however, that these four areas are not the only types of public services that would be protected by my amendment. Since this legislation establishes only broad negotiating objectives, not highly detailed requirements, I have not listed each and every affected public service with great specificity. However, it is my intention that the amendment would apply to a wide range of public services. These include, for example, public transportation, public utilities, the Untied States Postal Service, and law enforcement, as well as other significant public services provided at the federal, state and local levels. For a public service to be protected under the amendment, it would have to be ``significant.'' This is designed to ensure that the amendment not be interpreted too broadly to apply to even small and relatively marginal types of services. For example, if a local government decides to maintain a small snack bar at a local pool, I would not conclude that this is a significant public service that could not be opened to private competition. However, the provision of water or sewer services, which are provided on large scales by a substantial number of municipalities, and are important for the protection of public health, would be covered. In any case, again note that the amendment deals only with trade negotiating objectives. It would not completely tie negotiators' hands or trigger any lawsuits. It simply says that our objective should be to leave the provision of significant public services as a decision for elected officials, not distant, unelected trade bureaucrats.

Mr. CORZINE

Mr. CORZINE. If the Senator will yield for just a moment, I will make the observation this is not only for small communities. I think about towns such as Camden and Newark in the State of New Jersey, where class sizes average about 30. Many of these children who have special needs are mainstreamed, but they have special programs to try to lift those with learning disabilities. These towns and cities do not have the tax base to even raise the necessary money. So what happens is, in fact, we are forcing failure to comply with the law, failure to meet the needs of our children. And if we, as a nation, do not begin to prioritize these elements of our population in this educational process, we are going to recycle these problems because it just goes on and on, and it is extraordinarily dangerous in our small towns and cities for our urban kids, particularly where you combine the problem of large class size and special needs for kids who have been mainstreamed in classrooms because there are no other choices. I hope we can speak strongly about doing what we always argue: That we want to make sure we fully fund IDEA. It is not happening. I commend the Senator from Massachusetts for his effort.

Mr. CORZINE. Mr. President, the point the Senator from Massachusetts is making with regard to cutting the resources we have available for education and then not funding the mandates really bites in the State of New Jersey. We have a $6 billion budget deficit in the upcoming year. Educational funding is going to have to be cut just to balance the budget. We have serious conflicts going on between teachers and administrations across the State. If I have heard the Senator correctly, we are going to have virtually no increase in education spending at the Federal level this year at a time when we have decided we want to make permanent these tax cuts which really are going to people who are doing extraordinarily well in society.

Mr. CORZINE. Mr. President, will the Senator from Massachusetts yield for an observation?

Mr. CORZINE. The Senator from Massachusetts is exactly correct. It is extraordinarily disappointing that we have seen this kind of trend, particularly at our public universities, which were really designed to give every American access to higher education. I have not studied the numbers in the last couple months, but I think the average earnings of a college graduate relative to a high school graduate are almost double for someone who completes a 4-year college degree. If we do not understand that reflects productivity into our economy and into our society, we are making a huge mistake. This kind of underfunding of access to the American promise, the American dream, I find hard to conceive. I know it has been important in my life, and it has been for many of our colleagues.

Mr. CORZINE

Mr. CORZINE. Mr. President, today I am introducing legislation to prohibit the use of taxpayer funds to advocate a position on the meaning of the Second Amendment that is inconsistent with existing Supreme Court precedent, as expressed in the Supreme Court case of United States v. Miller. This legislation responds to the Bush Administration's recent filing of two unprecedented briefs to the United States Supreme Court, which argued that the Second Amendment establishes an individual right to possess firearms. In taking this position, the Justice Department directly contradicted the well-established precedents of the Supreme Court, as expressed in the seminal case of United States v. Miller. In that 1939 case, the Supreme Court found that the Second Amendment did not establish a private right of individuals to possess firearms, but rather was intended to ensure the effectiveness of groups of citizen- soldiers known at the time as the Militia. The Court in United States v. Miller explained the historical background to the Second Amendment and issued its ruling clearly and unambiguously. That ruling has never been reversed, and the Court has followed it in every subsequent related case. Similarly, the precedent in United States v. Miller has been followed by every Justice Department over the past several decades, including the Justice Departments of Presidents Ronald Reagan, Richard Nixon and George H.W. Bush. The meaning of the Second Amendment should not be a partisan issue. In fact, it should not be a political issue. It is a legal and constitutional issue. And the law on this question has been clearly established by the highest court in the land in case after case for a period of many decades. Unfortunately, instead of following the law, as Attorney General promised to do during his confirmation hearing, the Bush Administration and the Justice Department have used their authority to file briefs as a means of pursuing a partisan political agenda that flies in the face of established Supreme Court precedents. This is wrong. And, in my view, it is a misuse of taxpayer dollars. Congress should not have to pass a law to ensure that the Executive Branch follows the Constitution, as clearly interpreted by the Supreme Court. Unfortunately, in light of the Bush's Administration's latest actions, Congress must step in. After all, Congress's ultimate power is the power of the purse. And we have a responsibility to use that power, when necessary, to ensure that the Executive Branch complies with constitutional law. This responsibility flows from Congress's obligation to preserve, protect and defend the Constitution. It also flows from our obligation to ensure that taxpayer dollars are not misused. The American people should not be forced to pay taxes to support an unreasonable interpretation of the Second Amendment that is not only inconsistent with constitutional law, but that threatens to undermine legislation needed to reduce gun violence and to save lives. In 1998, more than 30,000 Americans died from firearm-related deaths. That is almost as many as the number of Americans who died in the entire Korean War. In my view, there is much that Congress needs to do to reduce these deaths, including enacting reasonable gun safety legislation. Yet if the Bush Administration prevails in its effort to radically revise the Second Amendment, such laws could well be undermined. The end result would be more death and more families losing loved ones to the scourge of gun violence. In fact, I would note that one week after the Bush Administration filed their briefs, lawyers for accused American Taliban terrorist John Walker Lindh used the Administration's arguments to urge dismissal of the gun charge filed against him. Now, I hope and trust that the courts will quickly reject this line of argument. But why would the Bush Administration want to strengthen the position of criminals and alleged terrorists like John Walker Lindh in the first place? I have asked the Congressional Research Service whether there are any constitutional precedents that would bar the Congress from adopting this legislation, and the answer was ``no.'' I also would note that there is precedent for Congress prohibiting the use of taxpayer dollars to advocate positions with which Congress disagrees. For example, Congress for many years prohibited the Justice Department from using appropriated money to overturn certain rules under our antitrust laws. This responded to the filing of a brief in the Supreme Court by the Justice Department urging a revision of its precedents on resale price maintenance, and the legislation effectively blocked the Department from filing similar briefs. In conclusion, we should not allow taxpayer dollars to be used to misrepresent the meaning of the Second Amendment on behalf of a partisan, political agenda. We should defend the Constitution against such ideological attacks. We should protect taxpayers from being forced to subsidize ideological gambits. And we should ensure that the Constitution is not misused to undermine gun safety legislation that could save the lives of many innocent Americans. I hope my colleagues will support the bill, and I ask unanimous consent that the text of the legislation be printed in the Record, along with some related materials about this matter.

Mr. CORZINE

Mr. CORZINE. Mr. President, today I am introducing legislation to prohibit the use of taxpayer funds to advocate a position on the meaning of the Second Amendment that is inconsistent with existing Supreme Court precedent, as expressed in the Supreme Court case of United States v. Miller. This legislation responds to the Bush Administration's recent filing of two unprecedented briefs to the United States Supreme Court, which argued that the Second Amendment establishes an individual right to possess firearms. In taking this position, the Justice Department directly contradicted the well-established precedents of the Supreme Court, as expressed in the seminal case of United States v. Miller. In that 1939 case, the Supreme Court found that the Second Amendment did not establish a private right of individuals to possess firearms, but rather was intended to ensure the effectiveness of groups of citizen- soldiers known at the time as the Militia. The Court in United States v. Miller explained the historical background to the Second Amendment and issued its ruling clearly and unambiguously. That ruling has never been reversed, and the Court has followed it in every subsequent related case. Similarly, the precedent in United States v. Miller has been followed by every Justice Department over the past several decades, including the Justice Departments of Presidents Ronald Reagan, Richard Nixon and George H.W. Bush. The meaning of the Second Amendment should not be a partisan issue. In fact, it should not be a political issue. It is a legal and constitutional issue. And the law on this question has been clearly established by the highest court in the land in case after case for a period of many decades. Unfortunately, instead of following the law, as Attorney General promised to do during his confirmation hearing, the Bush Administration and the Justice Department have used their authority to file briefs as a means of pursuing a partisan political agenda that flies in the face of established Supreme Court precedents. This is wrong. And, in my view, it is a misuse of taxpayer dollars. Congress should not have to pass a law to ensure that the Executive Branch follows the Constitution, as clearly interpreted by the Supreme Court. Unfortunately, in light of the Bush's Administration's latest actions, Congress must step in. After all, Congress's ultimate power is the power of the purse. And we have a responsibility to use that power, when necessary, to ensure that the Executive Branch complies with constitutional law. This responsibility flows from Congress's obligation to preserve, protect and defend the Constitution. It also flows from our obligation to ensure that taxpayer dollars are not misused. The American people should not be forced to pay taxes to support an unreasonable interpretation of the Second Amendment that is not only inconsistent with constitutional law, but that threatens to undermine legislation needed to reduce gun violence and to save lives. In 1998, more than 30,000 Americans died from firearm-related deaths. That is almost as many as the number of Americans who died in the entire Korean War. In my view, there is much that Congress needs to do to reduce these deaths, including enacting reasonable gun safety legislation. Yet if the Bush Administration prevails in its effort to radically revise the Second Amendment, such laws could well be undermined. The end result would be more death and more families losing loved ones to the scourge of gun violence. In fact, I would note that one week after the Bush Administration filed their briefs, lawyers for accused American Taliban terrorist John Walker Lindh used the Administration's arguments to urge dismissal of the gun charge filed against him. Now, I hope and trust that the courts will quickly reject this line of argument. But why would the Bush Administration want to strengthen the position of criminals and alleged terrorists like John Walker Lindh in the first place? I have asked the Congressional Research Service whether there are any constitutional precedents that would bar the Congress from adopting this legislation, and the answer was ``no.'' I also would note that there is precedent for Congress prohibiting the use of taxpayer dollars to advocate positions with which Congress disagrees. For example, Congress for many years prohibited the Justice Department from using appropriated money to overturn certain rules under our antitrust laws. This responded to the filing of a brief in the Supreme Court by the Justice Department urging a revision of its precedents on resale price maintenance, and the legislation effectively blocked the Department from filing similar briefs. In conclusion, we should not allow taxpayer dollars to be used to misrepresent the meaning of the Second Amendment on behalf of a partisan, political agenda. We should defend the Constitution against such ideological attacks. We should protect taxpayers from being forced to subsidize ideological gambits. And we should ensure that the Constitution is not misused to undermine gun safety legislation that could save the lives of many innocent Americans. I hope my colleagues will support the bill, and I ask unanimous consent that the text of the legislation be printed in the Record, along with some related materials about this matter.

Mr. CORZINE

Mr. CORZINE. Thank you, Mr. President.

Mr. CORZINE

Mr. CORZINE. Mr. President, I rise to lend my support to Senator Torricelli's amendment which would require prospective trading partners to ensure that their domestic laws provide adequate labor protections. The amendment calls on countries interested in trading with the United States to conform their labor protection regime to the labor standards of the International Labor Organization's Declaration. The amendment would further require that the worker rights protections including in the underlying legislation be subjected to the same dispute resolution mechanism as other areas. For far too long American businesses have been operating at a comparative disadvantage. Through years of improvements, the United States today provides its workers with a market basket of protections: the 40-hour workweek, the minimum wage, OSHA standards. But, as the business community has long pointed out, each of those protections comes with a cost as well as a benefit. It costs more to provide workers with a fair wage. It costs more to provide a safe workplace and allow workers to associate freely. It costs more to treat workers with dignity. It is a cost of doing business in a democratic society. Other countries take advantage of lax worker protections to attract manufacturing companies away from pro-worker regulatory regimes. Developing countries desperate for economic improvement are in a regulatory race to the bottom, putting downward pressure on international wages and working conditions. Sacrificing decent working conditions and base salaries may give these countries an edge in industry, but it puts their workers at risk. The Baucus-Grassley bill was correct to put worker rights on the agenda of U.S. trade negotiators, but it did not go far enough. This amendment would guarantee that the worker protections included in the bill can be enforced through the dispute resolution process. If it makes sense to enforce the investment protections included in international agreements, it makes as much sense to enforce labor protections. We must establish a level playing field for all countries. No country should feel pressured to exploit children or undermine worker safety in an effort to attract development dollars. And no country should be put at a competitive disadvantage for providing its workers with basic protections or with basic dignity. I urge my colleagues to support Senator Torricelli's amendment, which seeks to ensure that the United States puts its national values into practice and considers the rights of workers throughout the world when it frames international trade agreements.

Mr. CORZINE

Mr. CORZINE. Mr. President, I rise today to talk about an issue that I have spoken about a number of times in this Chamber--one that is of great importance to the people of the State of New Jersey, but, even more importantly, to the people of the country; that is, Social Security, and the arguments that will be made about the privatization of Social Security, and those proposals developed by the Bush Social Security Commission. As I have repeatedly explained when I talked about this issue, those proposals include deep cuts in guaranteed Social Security benefits, and that would force many Americans to extend the period of time before they retire. Again, as I have repeatedly said, I think this is an issue that needs to be debated in front of the American people before we go to the polls this November. It is not one of those issues that should be decided by discussions between policy wonks and politicians. It needs to be understood by the American people, and they should have the right to express their opinions by those they have chosen to represent them. Three weeks ago, I had the honor of representing the Democrats on our Saturday morning radio address, and I tried to make the case that benefit cuts proposed by the Bush Commission was a serious mistake in policy direction. Afterwards, the Cato Institute--one of the leading organizations pushing for privatization--issued a long treatise criticizing my statement. Today, the Cato Institute is going to have another policy forum on privatization, particularly as it impacts minorities, and specifically Hispanics. So I thought it would be appropriate for me to deal with some of the arguments that have been made in response to my radio address. That is what I would like to do this morning. In that radio address, I pointed out that President Bush's Social Security Commission developed privatization plans that would require drastic cuts in Social Security benefits that could exceed 25 percent for many people working today and more than 45 percent in the longer term. Cato responded by claiming: Charges of ``cuts'' are simply false. In fact, it is the Cato Institute claim that is false. The truth is that the cuts I cited are based on the estimates of the independent, nonpartisan Social Security actuaries and are published in the Bush Commission's own report. I invite my colleagues, and certainly the academics at Cato, to take a look at page 75 in the report where those specific numbers are cited. These cuts apply to all Social Security beneficiaries, including retirees, the disabled, and survivors. Moreover--this is an important point--the cuts would apply even to those who choose not to contribute to private accounts. Those people who choose to contribute to private accounts would get more serious cuts, but even those who continue to choose to be in Social Security would experience serious cuts as well. Having argued the Bush Commission is not cutting benefits, the Cato Institute at another point backed off and said only that benefit cuts would not affect ``current and near-retirees.'' That is one of those discussions we will definitely have in the political debate this fall. But even this narrower claim is also false. Cato refers to the Bush Commission's ``Plan 2,'' which explicitly calls for cuts in guaranteed benefits for all beneficiaries who retire beginning in 2009. This may create the impression that those who retire in the next 7 years are protected from benefit cuts. But, frankly, that is just not true. First, to the extent that individuals contribute to private accounts, these contributions would trigger cuts in guaranteed benefits under the Commission's so-called ``clawback'' provisions. In other words, on the one hand the Bush Commission is offering up the promise of private accounts, with another they are cutting Social Security benefits for every dollar contributed to those accounts. That is what the clawback is all about; that amounts to playing, as far as I am concerned, bait and switch with America's retirees, and particularly the ones who are in near-term progress towards retirement. I note that the cuts in guaranteed benefits would apply even if the value of a private account collapsed. Markets do go up and down. We have seen the value of the stock market decline as much as 30 or 50 percent in periods of time. Some may believe that the stock market only goes up. I am here to tell you, from my experiences in life, that is just not true. I certainly know that people are empathetic with what Enron employees have experienced. The fact is, markets move around, up and down. If the Bush Commission's proposals are adopted, those unlucky enough to lose money in their private accounts would have fewer Social Security benefits on which to fall back. Keep in mind the average level of Social Security benefits today, for the average retiree, is less than $10,000--about $9,000 on average. And it is about $7,500 for women, which is an issue we talked about last week. That is before the ``clawback.'' And I promise you, $7,500 or $10,000 is not enough in my home State of New Jersey to have a satisfactory and safe environment in your retirement. It is just inadequate to support even a basic standard of living in most parts of the country. It is also important to emphasize that the Bush Commission avoids calling directly for deeper and more immediate cuts in guaranteed benefits only--only--by assuming general revenue subsidies of the Social Security trust fund worth up to $6.5 trillion in today's dollars. Yet now that the Bush tax cut has been enacted--and we have had a recession, and some other events have impacted Government--we are again running very serious deficits. Just yesterday, the Treasury announced we are at $66 billion in deficit this fiscal year. It is highly unlikely, in a period of serious fiscal deficit that we are going to be able to come up with $6.5 trillion to subsidize the general account of Social Security. Without those subsidies, the Bush Commission would force the Social Security trust fund into a negative cashflow by 2010--not 2017, 2010-- and the trust fund would be insolvent in 2025--not the 2041 that is now projected by the actuaries of the Social Security trust fund. At that time, many of today's middle-aged and older Americans will be retired, and many of those people will be dependent on Social Security. In other words, current and near-term retirees are not protected under the Bush plan, notwithstanding the Cato claims to the contrary. Even the deep cuts proposed by the Bush Commission for all beneficiaries assume general fund subsidies that are unlikely to materialize. In fact, actual cuts are likely to be even greater. Mr. President, let me turn to another related claim by the Cato Institute. As I explained in my radio address, plans to privatize Social Security would take trillions of dollars from the Social Security trust fund. But Cato disputes that. They argue that personal accounts should be considered as part of Social Security. Taking the money out, giving it to the individual to manage, they are going to call that a part of the Social Security fund. They would go even further and say that is going to build the assets of the fund because they are going to presume that markets always go up. It is ironic to hear advocates of privatization argue that private accounts should be considered a part of Social Security, considering that the arguments they make repeatedly emphasize such accounts would be owned and controlled by individuals. There is a failure of logic involved. Beyond this apparent inconsistency, the more fundamental point is that private accounts would not guarantee the basic benefits that Social Security is designed to provide. It would only provide those benefits they would be able to purchase with the provision of those accounts. So those guaranteed benefits that are funded from the Social Security trust fund today would be challenged because that money is withdrawn. The Bush Commission undeniably would drain the trust fund of trillions of dollars that are needed to pay those guaranteed benefits. The trust fund already has a $3.7 trillion shortfall, according to the actuaries, over its adjusted life. Taking money out of the trust fund only makes that shortfall worse. I think it is highly misleading to argue that general fund subsidies will ``build the system's assets.'' It just does not jibe with common sense. These general revenues are not budgeted for and may never materialize. We have to do that each year as we go along. If they do, they can be used to avoid the deep cuts, of course, but there is no guarantee that is going to happen, and there is no certainty that the level of Social Security benefits will be maintained the same if those revenues are not appropriated. I will not take the time of my colleagues to respond to each of Cato's claims--I am putting out a written statement today that deals with each of the points they have made in a sort of 15-, 16-page report--which they put out in a 5-minute morning radio address. When you cut through all the misleading arguments, there are a few simple truths to keep in mind about the privatization of Social Security as proposed by the Bush Commission. It would cut guaranteed benefits by 25 percent for current workers and up to 45 percent for many workers in the future. Those cuts would apply to everyone, even those who choose not to take on the responsibility of private accounts. And the cuts would force many Americans to delay their retirement to make sure they had adequate resources in their retirement years. For these reasons, I believe the Bush Commission's plans to privatize Social Security would be a mistake for our country. Notwithstanding attacks from folks at the Cato Institute and other privatization advocates, I intend to continue to make this argument over and over so that we can raise this issue and have a real debate about the direction for Social Security before this year's election. We really need to have that. This is a fundamental shift in American policy. We Democrats, and most Americans, are very secure with the idea that Social Security provides one of those three legs to the retirement of every individual. It is one of those initiatives that has worked. Americans feel very comfortable knowing that there is a baseline to their retirement security. I hope we can have a real debate demonstrating that changing its nature, therefore, would undermine people's retirement security in the years ahead. So that is why it is important to speak on this issue over and over, to engage this as a debate the American people need to hear. Mr. President, I yield the floor and suggest the absence of a quorum.