Peter DeFazio

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, proponents of the so-called free trade agreements like the North American Free Trade Agreement, which I opposed, have long promised endless riches for U.S. workers, farmers, businesses and the economy. Of course, they have been wrong on all counts. But they are not to be deterred. They want another bite of the apple here. They think that the American people and Members of Congress who represent them, those who have lost their jobs, seen their jobs threatened, their standard of living diminished as we have gone into massive trade deficits and exported industries overseas in pursuit of cheaper labor and lower environmental standards, that they can fool us again. The President finished secret negotiations a year ago the end of this month for what is called the Central American Free Trade Agreement. And they are promising all the same things. I went before the Committee on Ways and Means which reluctantly, begrudgingly, allowed some of us to testify in opposition to this pending agreement. Now, there is no legislative process. They mark up what is called a mock bill or a pretend bill or a play bill in Ways and Means. They are not allowed to amend it or change it. The President secretly negotiated it, and it will be brought to this floor for an up-or-down vote, no amendments allowed. Congress has given up all its rights as a legislative body and its constitutional rights as relate to trade agreements between the U.S. and foreign countries. If this were in the best interests of the United States or an urgent priority, it might make sense; but what it does is perpetuate a failed and failing trade policy. The United States of America, the Bush administration, is setting a record every month this year. Congratulations to the Bush administration. They have us on track for beating last year's trade deficit of $620 billion to $720 billion, $2 billion a day borrowed from foreign interests representing tens of thousands, hundreds of thousands of U.S. jobs that have moved to China, India, Central America, Latin America, Mexico and other countries chasing the cheapest labor they can find, the most exploited labor they can find, the most environmental depredations they can find around the world. They think that this is just working great. The President thinks that it just shows our economy is really strong. That is why we are running these huge trade deficits. So they want to replicate it closer to home so U.S. companies do not have to go all the way to China to exploit cheap labor; they could move a little closer to home in Central America. When they offered NAFTA, the U.S. Chamber of Commerce predicted it would create 170,000 jobs in the United States. Many on that side of the aisle are still talking about all the great jobs that will come from NAFTA. Of course, and now CAFTA, it actually cost the United States 880,000 jobs. So they were off by a million jobs. That is a pretty big miss. CAFTA is likely to accelerate that trend. They tell us, Oh, it's just that we want to sell things to Central America. Think of the massive buying power of those people in Central America. They earn $2 a day. If they devoted all of the economies to all of the countries that would be included in CAFTA, if every penny in those countries was spent on buying U.S. goods, it would equal 5 days' production in the United States of America. No, it is not about selling U.S. goods there any more than it was about selling goods to Mexico or selling goods to China. It is creating an export platform for U.S. companies who want to move overseas and have cheaper labor and avoid environmental laws and protections in this country. The only problem with this theory is what happens to the middle class? What happens to the working people of this country? We are larding them down with a huge foreign debt, $2 billion a day, and they are losing their jobs. How is this model sustainable? It also undermines our sovereignty. As we borrow more and more money from overseas, China, Japan and other countries, they get more and more capable of squeezing our country economically. And it will hurt farmers. For the first time in our history, the United States of America is going to run a trade deficit in agriculture. That was going to be one of the big winners under the WTO, CAFTA, NAFTA. Oh, it's going to be great for ag. I remember having all these farmers come in, Oh, this is going to help us so much, the wheat farmers in Oregon. They were back the next year saying, You were right. The Chinese bought one shipload and that was it. Now, they are talking about shipping wheat to the United States of America. We are going to run a trade deficit in agriculture. We are going to become not only dependent upon foreign countries to borrow money and build things that we use every day but to feed us, and we are going to ask them to lend us the money to buy the food to feed ourselves. This is not a policy that is sustainable and in the national economic interest or the national economic security or defense interest. We need a new model for trade, not replicating the old failed model. I am pleased to see that more and more and more of my colleagues are coming around to this conclusion. Defeat CAFTA.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, today and pretty much every day for most Americans of this year, they will see 6.2 percent taken out of their paycheck to pay for their Social Security retirement. If they are self- employed, they will see 12.4 percent taken out. That is everyone who earns up to $90,000 every paycheck, day in day out they are paying that tax. And in paying that tax, they will create a $170 billion surplus to pay for future retirement benefits for themselves. But, now, the President has revealed his true agenda. After talking about privatization for months, something which would, in fact, worsen the financial condition of Social Security, he has now changed the debate to talking about how he is going to reduce the retirement benefits of middle-class Americans. Now, things are a little bit different from the President. I mean, we will disregard all of his unearned income and all of the things that he has been given and all of those earnings. Let us just talk about his salary, $400,000 as President of the United States. So that means that the President of the United States pays Social Security tax until 3 a.m. on March 24. Now, that does not seem quite fair. Other working Americans are going to pay that tax all year long. But, let us look at some of Mr. Bush's friends. Tom Freston and Les Moonves of Viacom. They stop paying Social Security tax at 4 a.m. on January 2, because they earn $77,000 a day. Now, it really is not going to matter or even be noticed by George Bush when they are reduced or Mr. Freston or Mr. Moonves at Viacom, you know, not even their accountants will notice it, but it is certainly going to be noticed by those middle-class Americans. The President's cuts, which he cast as being fair and progressive, will fall most heavily on middle-income working families in this country. You know, a median, what they call a median earner, $36,000, say a public school teacher, will see, if they retired 40 years from now, a young teacher, they will see a reduction of 16 percent in their Social Security benefits, from $19,000 down to $16,000. I think they are going to notice that; it is going to hurt a lot. What the President's folk call a high earner, $58,400 a year, well they will see a 25 percent reduction. In fact, the reduction for people who earn $58,000 a year will be equal to or worse than if Congress did nothing about Social Security, because it is not going to be bankrupt like the President says. Social Security will never be bankrupt. Stop saying that. It will have to, if nothing is done and we have a very bad economy, reduce benefits by, say, 20 percent according to the Republican Congressional Budget Office or 25 percent, so they can pay benefits into the indefinite future, starting 40 or 50 years from now. That is not a crisis. That is not bankruptcy. But the President would guarantee reductions, at least that big, for many working families to save the program. But that is not all. That is not all the President has in mind. Because, he said, this is based on the Pozen plan, some financial guru out there who he says is a Democrat. Who cares if he is a Democrat or Republican. He is some rich guy, financial guy. And what Mr. Pozen proposed is you not only reduce retirement benefits, you reduce survivor's benefits, and you reduce disability benefits. That is what the President said he endorses last week during his speech. He is going to reduce middle-income retirees' Social Security benefits 25 percent. And if they should be so unlucky as to become totally disabled, incapable of working, he is going to reduce their disability benefits by 25 percent; or should they have even more misfortune and die, their survivors will get a reduced benefit of 25 percent to, quote, save the program. The President is not done there, though. He is not only reducing survivors benefits, retirement benefits, disability benefits. He wants to push these people into so-called voluntarily private plans after he has reduced their benefits; and the so-called private plans, the President's privatization has a little something called a claw-back, which is the government is allowing you to divert your Social Security money, but it is considered to be a loan, which will be repaid at the time of your retirement, death, or disability at the rate of 3 percent plus inflation. Now, if your investments did not do too well, your survivors are going to be writing the government a check; or if you get to retirement and you did not do too well, well, you are going to see your Social Security benefits reduce up to 97 percent under the President's privatization plan. There are better ways to secure the financial future of Social Security, which I will talk about on another evening.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, well, last week the President finally revealed a few more specifics about the direction he wants to take to deal with the potential, possible, future funding shortfalls in Social Security. He used some unfortunate verbiage. He said Social Security will be bankrupt in 2041. It will not be bankrupt; it will pay 75 percent of promised benefits under very conservative economic assumptions into the indefinite future, or 2053 if we use the estimates of the Republican Congressional Budget Office. So it would not be bankrupt in any sense. But he did talk about the possibility there could be a shortfall in Social Security starting 40 or 50 years from today. That is progress that he is beginning to talk about that problem. He actually offered a solution, for once. His privatization plan he has admitted would in fact make Social Security's finances worse, has nothing to do with dealing with the future possible potential shortfalls in the Social Security trust fund, the program as we know it today. He said, finally, let us talk about how we might get there. He cloaked benefit cuts in a veneer in high-falutin rhetoric. He called it progressive indexing of wages. What he is talking about is benefit cuts. Who would pay the benefit cuts? Let us take someone who is 22 years old, graduated from college last year. They are a public schoolteacher. They are going to work the next 40 years as a public schoolteacher and hope to retire in their 60s with a Social Security benefit. If they earn $36,000 average over their lifetime, their benefits would be cut by 16 percent, $3,000 a year. Their proposed benefit would go from $19,800 down to $16,500. These are calculations of the Social Security actuaries of the President's proposed cuts. Now let us say that young person graduating from college is going to become an entrepreneur, small business person and do pretty well with a truly small business, and they average $58,000 a year throughout their lifetime. What would the President do to them? He would cut their Social Security benefit from $26,000 to $19,800 which would be a 25- percent cut which they could get if Social Security went, under the President's words, bankrupt. That is if Congress did nothing and Social Security had a shortfall starting 40 or 50 years from today. Under the worst-case scenario, that person would get the same. But the President wants to guarantee a cut in that person's benefits. Remember, this does not have anything to do with the President's privatization plan which would further undermine the finances of Social Security and accelerate the date of what the President calls bankruptcy, others call trust fund exhaustion, I call benefit reductions. The funny thing is that half of the American people pay more in taxes to Social Security than Federal income taxes. They have a lot invested in this program, and they would like to see the benefits when they retire. Now, it is a little different for rich people. Let us take the President on his modest $400,000 which is a lot less than he earns from his private investments. Let us just take his salary and pretend that is all he has. He stopped paying Social Security taxes on the morning of March 24. That American that earns $36,000 or $58,000 or even $90,000 pays Social Security tax every day of the year, this year, with the expectation they will get a benefit; but not so for people who earn more, $90,000, including Members of Congress. When income hits $90,000, the tax goes away. The President stopped paying on March 24, and he wants to cut the benefits of people who pay that tax every day this year, many of them a bigger tax than they pay to the Federal Government under income taxes, particularly low-income people. Let us take some other friends of the President. The heads of Viacom, Tom Freston and Les Moonves, they stopped paying the Social Security tax at 4 a.m. on January 2 because they earn $77,000 a day. So at 4 a.m. on January 2, their obligations to Social Security went away. Despite their huge $20 million salary, they will pay one one-thousandth of 1 percent of their salary to Social Security, but working Americans are going to pay 6.2 percent of every paycheck and self-employed will pay 12.4 percent of every paycheck, and the President wants to cut their benefits. But he does not want to cut the tax cuts for Mr. Moonves or Mr. Freston, and he does not want to cut the tax cuts for himself. There is a better way to solve the Social Security problem, and I will talk about that another day.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, well, America has a serious problem with energy prices. If you just peruse today's Wall Street Journal and New York Times, you will see the airlines are reporting record losses in great part despite efficiencies, despite concessions by labor because of an increase in fuel prices. You see that General Motors has had a huge drop-off in the purchase of their lucrative SUVs and other larger vehicles that consume more gas, Ford similarly. We find this in small businesses across America; it has been embedded in everything. And now we are beginning to hear that there are stirrings of inflation beyond the price of oil and gas. This is a serious problem; and, unfortunately, this body, the House of Representatives, to its discredit did not adopt a serious or effective proposal to begin to address this problem in either the short or the long term. Short term, American consumers need relief from high gas prices. They are being gouged at the pump by Big Oil and the OPEC cartel. Now, I have asked President Bush numerous times, written to him and asked him, he is a big fan of rule of law, international trade agreements, the WTO, all of those things. I am not a big fan. But he says he believes in rules-based trade. Well, the OPEC cartel is violating the rules of the World Trade Organization. Seven of the OPEC nations are members. They are clearly colluding to restrict production and drive up the price of oil to make a profit. That is clearly prohibited by the WTO. But the President and his trade representative have failed to take any action against the OPEC companies. Then we have price gouging by Big Oil. Last quarter saw record profits for most of the industry, $8 billion in one quarter for Exxon Mobile. Their cash reserves have doubled to over $20 billion in 1 year, money extracted from Americans 5 cents a gallon at a time or more at the pump by piggybacking on the cartel activities of OPEC, and Big Oil is getting away with it. This administration is not doing anything to rein in Big Oil. They merge, close refineries, and then blame a shortage of refineries on environmental laws when they have been closed because of mergers to drive up the profits of the oil industry. We should reinstate a windfall profit tax on the industry. We should break up a number of these huge companies and begin to get some true competition again in that industry. We cannot continue to bleed this much money. Every day, Americans are bleeding money at the pump, which is ultimately going to spill over into a tremendous problem for our economy, especially if we look at the failing trade policies of this administration. Then there is energy efficiency, new technologies, energy independence. These are things that seem very foreign to my colleagues on the other side of the aisle and to the old oil men who are running this country down at the White House and at an undisclosed location. Energy efficiency, this bill makes sort of a passing chuckle and nod at energy efficiency. It spends 20 times as much money subsidizing the oil, coal and gas industry. Wait a minute, were we not just talking about the fact they had record profits last quarter? Yes, they do have record profits and they are extracting that from American consumers, but they want their hands in both pockets. They do not want to just take money out of your wallet, they want to take money from taxpayers, too. So there is $8 billion in this bill, supposedly to help with energy problems. Unfortunately, 95 percent of it is subsidies to the wildly profitable oil, coal and gas industry, which will provide no help to American consumers; and a mere 5 percent is a nod toward the idea perhaps America could develop new sources of energy, perhaps America could become more efficient, perhaps America could become energy independent, but that is only worth 5 percent of what they are putting into the bill. Just think what it would be like to have an energy-independent America relying upon homegrown sources of energy and new technologies and new efficiencies, and how that would insulate us from these problems around the world. But that is not a vision that is shared by my colleagues on the other side of the aisle. They have delivered us today something that would not have been a very enlightened energy policy in 1955, but is just pathetic in the 21st century, considering the threats to our economy and to our national security. Unfortunately, they prevailed today, but hopefully, in the future, we can do better by the American people.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, I ask unanimous consent to claim the time of the gentleman from Maryland (Mr. Cummings).

Mr. DeFAZIO

Mr. DeFAZIO. Madam Chairman, over the past couple of years I have corresponded with the Department of Energy on an issue of particular concern to me. The Department of Energy continues to spend millions of dollars, over $60 million so far, to defend private contractors who caused injury to citizens downwind of the Hanford nuclear reservation despite provisions of the Price Anderson Act to the contrary. The American taxpayers should no longer have to bear the burden of defending private contractors who have harmed citizens. I would like to submit my most recent letter to the Department of Energy and asked that it be made part of the Record. March 4, 2005. Hon. Samuel Bodman, U.S. Department of Energy, Washington DC. Dear Mr. Secretary: Thank you for your September 2003 response to my questions about the Hanford Nuclear Reservation case. However, I have ongoing concerns about the Department of Energy's (DOE) willingness to represent DuPont and General Electric at a cost of millions of taxpayer dollars. I believe that the Department's financial support is not only ill conceived, but that it violates the intent of Congress in passing the Price Anderson Act (PAA). Regarding question numbered ``2'' of the 2003 letter, we have been informed that while the district judge accepted the defendants' standard of proof for injuries, that decision was soundly reversed by the Ninth Circuit on the merits. I am concerned that DOE continues to fund, at considerable taxpayer expense, an ongoing series of technical motions by the contractors. It was the intent of the Congress of the United States when it enacted the Price Anderson Act, to encourage the development of nuclear energy and at the same time to provide ``full compensation to the victims of nuclear incidents,'' including the people who were exposed to radiation from nuclear facilities such as Hanford. The actions of the Department of Energy in spending large sums of taxpayer dollars to forestall compensation to citizens who were exposed to radiation releases from Hanford, represents action by a federal agency that is directly contrary to the intent of Congress. I recently learned that federal Judge Nielsen, on March 30, 2004, rejected the motion of DuPont and General Electric that they be dismissed from the case because they contracted with the government to run Hanford. In underwriting such a motion with taxpayer funds the Department violated the intent of Congress in passing the Price Anderson Act. The fact that the PAA reimburses the companies when people are injured from a nuclear incident precluded the necessity for a ``contractor immunity'' defense as Judge Neilsen held. I have now learned that you intend to financially support an appeal of that Order. Any further attempts to evade the intent of the PAA by the DOE we believe to be a serious concern for the Congress. Your letter notes that the DOE does not ``disagree with the proposition that low doses of radiation can cause some forms of cancer.'' In addition, there are government studies that show exposure to radiation contributed to the onset of the claimants' illnesses. Yet the DOE continues to defend the contractors. It would appear that contrary to the fact that workers can be compensated for thyroid cancer, non workers who were exposed to more Iodine 131 than many workers would be denied similar treatment. I do not understand this logic. What policy consideration drives this inconsistent behavior? I also learned that the motions of DuPont and General Electric to have all cases dismissed as being filed too late based upon the Statute of Limitations has been dismissed. More than $60 million of taxpayer funds have been spent by DuPont and General Electric for 15 years of loosing motions and adverse rulings. Again, I do not understand why the Department of Energy continues to spend millions of dollars paying lawyers to attempt to defeat claims that the Congress of the United States determined should be compensated. I further note that the Hanford plaintiffs were just successful in filing a motion declaring that the operations at Hanford were an ``ultra hazardous activity.'' This holding is consistent with Congress' findings regarding the operations of nuclear facilities. We note again that the Department of Energy spent thousands upon thousands of dollars defending this untenable defense (Energy Employees Occupational Illness Compensation Act of 2000, 42 U.S.C. Sec. 7384 et seq). I understand that a trial date has been set, and that General Electric and DuPont are taking the position that Iodine 131, which was released in enormous quantities from Hanford, does not cause thyroid cancer. Is that the position of the Department of Energy? If not, please explain if the Department is taking the position that the Price Anderson Act does not apply to a person exposed to radiation below a certain dose, and if so what that dose is. I understand that several million dollars more could be spent in the next year or two continuing to defend this action. That would result in taxpayers' money approaching the $100,000,000 being paid to lawyers to prevent compensation to victims of radiation exposure from Hanford. All of the defenses you have previously supported have been rejected by a federal court. Has the Department of Energy authorized any amount of money for settlement of this case? It would appear that more money may well be spent to thwart the intent of the Price Anderson Act than would be spent in victims' compensation. Please provide me with a detailed justification for any continued payment by the Department of Energy for the defense of this litigation, including specific justifications for any motions currently or intending to be filed or appealed seeking to dismiss most or all of the cases and why such action does not violate Congress' intent in enacting the PAA. Sincerely, Peter DeFazio, Member of Congress.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, I have nothing against classics. I drove a 1968 Barracuda to work today. But I am looking at hybrids because of the high cost of gas and to get a little more efficient. The Republicans are offering us a classic energy bill today, firmly rooted in the 1950s: no improvements in efficiency, no investment in energy-efficient technologies, no breakthroughs. Even worse, $8 billion of subsidies to the oil and gas industry. Well, heck, they need it. That was only the quarterly profit of ExxonMobil gouging people at the pump last quarter. They want to give us more of the same. The President's own energy information administration says this bill will, quote, have only negligible impact on production, consumption and imports of oil. In fact, they said it will probably increase the price of gasoline by 3 cents per gallon. I guess that is to pay for the new subsidies to the suffering oil and gas industry. That is an energy policy for the 21st century?

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, well, congratulations to the Bush-Cheney administration. They set another record yesterday, but it is one I am certain they will soon eclipse. The United States of America ran the largest 1-month trade deficit in our history, $61 billion. Tens of thousands of jobs were lost in order to achieve that record. Whole industries were exported to China and other cheap wage countries in order to set that record. Congratulations to the administration. Their trade policy is a tremendous success for those few multinational corporations who are profiting hand-over-fist with these policies, while tens of thousands of Americans lose their job and we lose our industrial base here at home. In the first 2 months of the year, a $29 billion trade deficit with Communist China. We are on a par, the Bush administration is on a path, to beat their record trade deficit with Communist China that they set just last year, a $162 billion trade deficit with Communist China last year; a country which pirates products from small businesses across America, including a number in my district, both hi-tech, furniture and others; a country that does not observe international laws; a country that the Bush-Cheney administration told us, ``Oh, please, give us permanent most-favored- nation status for those Chinese, and then they will clean up their act. Put them in the World Trade Organization and we will use the force of law against them.'' Well, they have only chosen to file one complaints against the tens of billions of dollars of products pirated by the Chinese from American firms, and that was for one of the drug companies, of course. Who else would they go to bat for? Not the small businesses, not the hi-tech business in my district, not the furniture business in my district, not the other businesses across America. Yet their trade policy is working just great. Now they say two things. Well, if the dollar just drops a little bit, everything will be fine. Well, the dollar has dropped a lot, and everything is not fine, and the dollar is on the verge of dropping one whole heck of a lot more. Even when it gets down to the value of an Indian rupee, it still is not going to solve the trade problem. Because the classic economic theory is, well, if your currency is devalued, then your manufacturers will crank things up and your goods will be bought overseas. That will not happen for two reasons: One, we do not make things anymore, and many of our companies have moved their industrial base to China and many more are contemplating doing that or being forced to do that, or to Mexico or to other countries where they can exploit labor better. So, for that reason, it is not going to happen. Second, because the Chinese will not allow our goods in, and they have illegally pegged their currency to ours, so their currency is artificially cheap. It falls with the dollar, so we can never catch up with the Chinese. And the Bush administration has refused to do anything about those illegal actions by the Chinese, the illegal pirating of U.S. goods, theft of jobs, illegal currency manipulations by the Chinese. The Bush administration will not do anything because a few big companies and contributors are doing very well over there. It is just to the detriment of the majority of the workers and people here at home in the United States of America. They say there is another reason why the trade deficit is so big, because our economy is growing so fast, faster than other economies. That is why we got a big trade deficit. Well, that is an interesting argument. So we are borrowing a bunch of money from the Chinese, they are now our second largest international creditor, soon to be our largest, the Japanese are number one, and we use that money which we borrow from them to buy goods that used to be produced in the United States of America. And since those are produced nominally by American corporations, that shows growth here at home. In the meantime, here at home people are unemployed, running up their credit cards, they have lost their jobs to unfair Chinese competition, and that shows what a robust and growing economy we have. What a disaster this is for the working people of this country. What a disaster this is for the future industrial might of the United States of America, for our productive capacity. What a disaster it is going to be when the dollar tanks and oil goes up even more because the dollar will have been devalued so much. There are so many things wrong with this laissez faire trade policy it is hard to know where to start, but the Bush administration thinks it is working just fine because they set a new record yesterday, the largest 1-month trade deficit in the history of the United States of America, and they are hoping they beat it every month this year and beat last year's record trade deficit, because that means jobs are exported, and, in the words of the President's former economic adviser, that is a good thing when we export jobs. It makes the country more efficient.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, this year, the United States Government will collect $170 billion more in social security taxes than it needs to pay current benefits. That is $300,000 a minute from the working men and women and small businesses of America. And that money is being used to buy Treasury bonds. It is being put away under the premise that we are creating a trust fund. The full faith and credit of the United States Government backs those bonds. Now, the President is questioning the full faith and credit, and he is saying there is no trust fund. Now, if the President is right and there is no trust fund, then we should stop taking $170 billion from the working men and women under a false premise. That would be fraud. We have to do either one of two things: lower the tax on working men and women in this country and small businesses, or honor the trust fund and the debt of the United States of America. I think there is only one choice, and that is to honor the debt of the country. But we have a President who is saying he might not. Who is he going to pay first? The Chinese, the Japanese? Is he going to pay off his Treasury bonds first and then default on the savings of the working people of this country? Mr. Speaker, it is an outrageous and reckless statement of the President of the United States to make, and if the bond markets believed the President, there would be an economic catastrophe today.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, well, the President was on the road again today with yet another tightly controlled scripted, so-called town hall, before a carefully screened, invitation audience to tout to his plan to privatize Social Security. Now, that is not unusual; in fact, the scripted town halls are all so similar that they can save the taxpayers a lot of money if he just stayed at Camp David or Crawford, Texas, and they just replayed the recordings of his earlier scripted, rehearsed town halls. But the President did say today something extraordinary, in Parkersburg, West Virginia, and suggested something unconscionable. The President said, ``There is no trust fund.'' And then he went on to suggest that our Nation might not honor its debt to Social Security. This is what the President said does not exist. Let me read from this. This is a Social Security Trust Fund bond, considered the best investments in the world, U.S. Treasury Bond. This is the most privileged of Treasury bonds issued to Social Security, redeemable at any time at full face value, unlike any other bond that they issue. These are the most privileged of their bonds. The President says it is nothing but an IOU. Well, here is what it says: This bond is incontestable in the hands of the Federal Old Age and Survivors Insurance Trust Fund. The bond is supported by the full faith and credit of the United States. And the United States is pledged to the payment of the bond with respect to both principal and interest. The President questions that? He is questioning whether we are going to repay our most privileged debt to Social Security. We have $7.9 trillion of debt. He is adding to it at a record rate, borrowing $1.3 million a minute. Who is he saying we are going to repay and not repay? Are we going to repay the Chinese but not the Social Security Trust Fund? Are we going to repay President Bush, he happens to have some U.S. Treasury Bonds in his personal portfolio, but not the Social Security Trust Fund? Are we going to repay other wealthy investors around the world and in the U.S., but not the Social Security Trust Fund? We are going to selectively default on our debt. Suggesting something like that, if the bond markets believed the President, the dollar would drop to near zero tomorrow, and there would be an economic catastrophe, but they do not believe him. They know this is just politics and rhetoric on his part. There is no intention of the Government of the United States defaulting on its debt. This year Social Security will collect $170 billion more than it needs to pay Social Security benefits, and they are invested in the trust fund. If what the President said is true, there is no trust fund, and we are not going to honor it, then Congress and the President are perpetrating a fraud of extraordinary magnitude on the working people of America, extorting through taxes $170 billion more than they need to pay current benefits that this President has no intention of repaying. That is unbelievable. Every minute, every minute, this President and this Congress are borrowing $320,000 of Social Security taxes and spending it on something else. And the President says he is replacing it with worthless IOUs; they are not bonds, they are not investments. He questions whether they will be repaid. He questions the full faith and credit of the Government of the United States of America and its willingness, our willingness, to meet our obligations and our debt. If what the President says is true, then we ought to give the working people of America, instead of the rich people of America, the biggest tax cut in history. Reduce the Social Security tax, which falls more heavily on working people. More working Americans pay more in Social Security taxes than they do income taxes to the Federal Government. If he has no intention of repaying that $170 billion that he is borrowing this year of excess Social Security taxes, then we should not collect it under false pretenses. We should give people a big tax break. That would stimulate small business, employment, and put a lot of money in the pockets of working people. I am not advocating that. But if he does not repay it, he should be advocating it, and instead of trying to switch the game and having an irrelevant debate over a so- called privatization plan which actually makes the funding problems of Social Security worse and would require another few trillion dollars of borrowing, in which I guess people would get these worthless bonds that the President questions. Now, who is going to buy those worthless bonds? How is he going to continue to run the Government of the United States borrowing $1.3 million a minute if the bonds of this country are worthless? This is an extraordinary and reckless statement for the elected President of the United States to make.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, I ask unanimous consent to claim the time of the gentlewoman from New York (Mrs. Maloney).

Mr. DeFAZIO

Mr. DeFAZIO. Madam Speaker, the United States set a new record officially, and that is something, unfortunately, which will haunt us for decades to come, a new record trade deficit of $665.9 billion. We have two growing categories of exports as the leading industrialized nation in the world, and one is waste. We are exporting more waste paper, bottles, cans and things to the world's fastest growing industrial giant, China, which they turn into high value added goods and ship back to us. Our second greatest export, or actually the greatest export is U.S. dollars. We are borrowing $665.9 billion from overseas producers to bring goods into this country without adding to the economic industrial base, in fact to the detriment of the economic industrial base of the United States. Japan today holds $820 billion, China $610 billion. China will soon eclipse Japan. Within 3 years, China will have a trillion dollars of IOUs from the United States Government. They will have not only a stranglehold over the production of goods, because we are buying so many things from them and so many U.S. companies have put capital into China instead of jobs here, but they will have a stranglehold over the dollar. Let us image a confrontation over Taiwan, and the Chinese say we are not going to take you on militarily yet, it is 10 or 15 years until we have eclipsed you militarily, although we have eclipsed you industrially, but we are going to dump dollars tomorrow. We are going to take the dollar down to the value of a rupee or even less. They could threaten to dump that trillion dollars onto the world market, cause an economic catastrophe here at home and around the world. They would not have to fire a single shot. This administration thinks it is just peachy. They say the U.S. is growing so fast, that is why we have these huge trade deficits. Yes, we are growing so fast on borrowed money and purchasing products made overseas. That is not exactly my idea of adding to the economic industrial base might of the United States of America and putting our own people into productive work. Members wonder why wages are dropping in the U.S. and people are not doing so well, because the good jobs, the manufacturing jobs, the high-paying jobs, the jobs with benefits, are going to China and other unfair trading nations. And this administration, and to give them some due, the last administration was afraid to take on China on their unfair trade practices. They can steal products, like they have from companies in my own district, clone them in China, including translating the U.S. patents into Chinese, and this administration and the last will not lift a finger to stop that. This administration said bring them to the WTO, rules-based trade, and then we will go after them. They have only filed one complaint against China. The billions that they are pirating from our companies, one complaint and who was it for, Pfizer, the big drug company, the only company that this administration would file a complaint at the WTO on behalf of, not the electronics company in my district, not the wood products company in my district, not other companies all across America who are being pirated by the Chinese, just Pfizer who could probably take care of themselves, but these other little guys cannot. We have a failed trade policy in this country. We cannot continue to borrow here at home, $1.3 million a minute with our current account deficit to run the government, and borrowing $2 billion a day from overseas from countries that are potential future enemies, or at least competitors, like China. It is crazy. It is not sustainable. Even the great guru, Alan Greenspan, the head political economic hack in this town, has said it is not sustainable. When will this administration wake up?

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Chairman, I yield the balance of my time to the gentleman from Minnesota (Mr. Oberstar), the ranking member.

Mr. DeFAZIO. Mr. Chairman, I yield myself 2 minutes. Again, I want to thank the chairman of the full committee, chairman of the subcommittee, ranking member, the gentleman from Minnesota (Mr. Oberstar), the staff members, the leadership in the House, everyone who has contributed to what I think is an extraordinary product in this bill. This bill is going to make vital investment in the crumbling infrastructure of the country to refurbish it, maintain it, improve it. It is going to anticipate growth needs and congestion. It is going to contribute to the growth of our economy. It is going to put tens of thousands, hundreds of thousands of people to work, and we do all this without borrowing any money, creating anymore deficit or debt. That is the most extraordinary thing about this bill and the most notable achievement. We, unlike many other Federal programs, have an investment that is totally paid for by the taxpayers and will be of tremendous benefit to those same taxpayers. The money will be spent in the manner in which it was intended when it was collected from individuals and from commercial drivers at the pump, and this will be, I believe, the signature domestic legislation of this Congress in terms of the positive impact on the economy of our country. Mr. Chairman, I reserve the balance of my time.

Mr. DeFAZIO. Mr. Chairman, like the gentleman from Alaska (Chairman Young), the gentleman from Minnesota (Mr. Oberstar) and I believe strongly in the importance of regional transit authorities and will work with the gentlemen from South Carolina (Mr. Clyburn) and (Mr. Spratt) to find an agreeable solution to this issue in conference.

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

Mr. DeFAZIO. Mr. Chairman, I claim the time on behalf of the gentleman from Minnesota (Mr. Oberstar) as the subcommittee ranking member.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Chairman, I believe this would become the lawyers' full employment act, and the other side of the aisle is not usually avidly supporting the lawyers, because this is so vague, a description of the weight of scientific evidence. How would we weigh it? Do we weigh it physically? Do we weigh it on a molecular basis? What is the weight? I expect that this would lead to lengthy and contentious litigation at great expense to the taxpayers and basically inhibit government agencies from using the best available science. It is too vague. It should be defeated.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, I read from a story today in The Washington Post, page A8, ``Senator Lindsey Graham, Republican, South Carolina, who has spent weeks attempting to recruit Democratic support for a plan to restructure Social Security, said yesterday that Republicans `made a strategic mistake' by initially focusing on a proposal to create individual investment accounts,'' and, as he says, ``We've now got this huge fight over a sideshow. It's always been a sideshow, but we sold it as the main event.'' What he is talking about is that, as the President himself has admitted, the privatization of Social Security is and has nothing to do with fixing potential future financing problems in Social Security. It is a battle, in fact, if it was won under the President's terms, that would divert income from Social Security and, in fact, accelerate its financial problems from 40 years in the future to a mere 10 or 20 years in the future. Senator Graham, Republican from South Carolina, has come to the conclusion that, as many of us have been saying on this side of the aisle, we should fix Social Security first, then engage in a debate over how best to encourage or assist Americans in having more private resources through IRAs, 401(k)s or other sorts of devices for their retirement. The basic vision of the founders of Social Security still holds: President Roosevelt said that he wanted to have a program that was not a dole; that had its own source of funding that would be guaranteed, and it would be earned. Earned. And that is what Social Security is, an earned guaranteed benefit that not only covers people in retirement as long as they might live, unlike many other plans and programs out there, like the privatized accounts, but it also provides for survivor benefits in case of untimely death to a spouse and/or surviving children. It also provides for a disability benefit. The proponents of privatization, in addition to not fixing potential financing problems for Social Security, have not dealt with the issues of survivor benefits or disability benefits. They cannot. There is no way to do it under privatized accounts. You opt into a private, so-called opt, because people would be coerced into these because otherwise they would see dramatically reduced benefits and they would try to bet money to win back under this plan, but they would, say, at age 18, you opt in and you do really well for 6 years. You are working as hard as you can. You put away the maximum amount per year. Then you become totally disabled at age 24, and you have $12,000, if you did really, really, really well in your investments in your privatized account. There it is, $12,000, you are totally disabled, have a good life. That is not going to work. So they have not dealt with that issue. They say, oh, those people would still get their regular benefits. Well, if they are still going to get their regular benefits, but you are diverting all this money from the program, then the problems of Social Security become yet worse again. So Senator Graham has finally hit on something, and hopefully other Republicans will come to the same realization. We have not just been saying, no, we do not want to improve the lot of people in their retirement years; and, no, we do not want to help facilitate people to save more toward their retirement. Because FDR envisioned the one guaranteed leg, the earned benefit of Social Security in addition to private pensions in a different savings. Private pensions are going away, so we need to help people save more, invest more and have more to supplement a guaranteed earned benefit of Social Security that is secure. That is what this debate has been about. Finally, there is some realization on that side of the aisle that private accounts, in addition to taking the future financing of Social Security and putting it more in jeopardy, are a sideshow, as Senator Graham, Republican from South Carolina, has said, to the real issue of, are we going to take steps to guarantee that Social Security will be there not only for this generation and the near generation of retirees, as the President would do, but for all future generations. We can do that easily. There are a number of ways to get there, one which I have proposed in past Congresses is to lift the cap on earnings. We say, look, if someone earns $25 million a year, they should pay the same percent of their income into Social Security as someone who earns $40,000 a year. If a person earns $40,000 a year, who works for wages and salary, pays 6.2 percent into Social Security; the person who earns $25,000 a year pays about a thousandth of one percent of their income into Social Security; they finish paying social security taxes on the second or third day of the year at that wage rate. That is not fair. It is not right. If they paid on all of their earnings, and their employer, some big multinational corporation paid on all their earnings, Social Security would be secure forever. In fact, we could lower the tax rate on everybody who earns less than $94,000 a year.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, again the gentleman did not answer my question. Rent a car in a 10/20 State, drive it into a 100/300 State, that car is essentially not insured for the purposes of that State. Mr. Chairman, I yield the balance of my time to the gentleman from New York (Mr. Nadler).

Mr. DeFAZIO. Mr. Chairman, I yield 2 minutes to the gentleman from Minnesota (Mr. Oberstar).

Mr. DeFAZIO. Mr. Chairman, I yield myself 15 seconds. Mr. Chairman, I would just address a question to the gentleman. You say they are already covered. Well, if someone rents a car in a State that has 10/20 insurance, $10,000/$20,000, and they drive next door to a State that has $100,000/$300,000 and they have an accident, I guess you only get 10/20. So you are saying it only affects these States. It would affect all States, if you remove this liability as they cross State lines. Mr. Chairman, I would yield on the gentleman's own time to answer that question, if he would.

Mr. DeFAZIO. Mr. Chairman, I yield myself 30 seconds. The gentleman would preempt States' rights which is, I do not believe, a position that Congress should be taking, but he said, don't worry, those States require some sort of minimum of insurance and people would be covered. If people would be covered, then why is the potential liability or the actual liability as according to the previous speaker so large to those companies? It must mean that the levels of insurance are pretty inadequate. If they had adequate insurance or if they were required to carry adequate insurance, then this might be a supportable position, but to defer to the States who might have inadequate insurance and then leave potential injured persons hanging out there and preempt the States, I think, is unconscionable for this Congress. Mr. Chairman, I yield 2 minutes to the gentleman from Michigan (Mr. Conyers), the ranking member on the Committee on the Judiciary.

Mr. DeFAZIO. Mr. Chairman, I yield such time as he may consume to the gentleman from New York (Mr. Nadler).

Mr. DeFAZIO. Mr. Chairman, I yield back the balance of my time.