Pete Domenici

Mr. DOMENICI

Mr. DOMENICI. Mr. President, I rise today to discuss some efforts in defense conversion that are reaping great gains. In the book, ``The Idea of National Interest'', Charles Beard wrote: Government might legitimately take the initiative and pursue some interests aggressively. Furthermore, it might make use of its own citizens and their interests to advance the national interest. Early on U.S. foreign policy for the Former Soviet Union, FSU, was designed to do just that: make use of U.S. citizens' interest to advance our national security objectives. Today, I would like to briefly underscore some successes, specifically in the realm of defense conversion. Before doing so, however, I wanted to offer some insights regarding the scope of the problem. First, the legacies of a command economy were prevalent in all nations behind the Iron Curtain. Such legacies included: a structure of production dominated by heavy industry, distorted factor and product prices, antiquated or obsolescent capital stock, inadequate skills to compete in a modern economy; a neglected infrastructure, severe environmental degradation, trade oriented towards other uncompetitive markets, and large volumes of non-performing loans and heavy foreign debt. The FSU was no exception with respect to inheritance of these burdens and impediments. And despite all these similarities with other eastern European states, the FSU, especially Russia, was unique in one very important way. For Russia, Ukraine, Belarus, and Kazakhstan ``heavy industry'' was that of defense. Fifty-two percent of Russia's industry was involved in military-related research, design and manufacturing. In Ukraine, Belarus, and Kazakhstan, the defense industry comprised about fifteen percent of their heavy industry. This distinction made the Soviet industry not merely an economic concern, but rather a central threat to international security. As Soviet central authority deteriorated, control over its massive military complex also crumbled. As such international security concerns are not limited to issues of control over nuclear weapons and material, but include attaining a degree of economic stability to offer stable employment to a vast number of persons in military and military-related occupations, especially scientists and engineers in that sector. The threat was apparent; the risk of inadequate action has been readily apparent. The national interest, indeed, the global interest, is in securing stability in the region. Stability in the region equates with global stability, especially in light of the potential leakage of knowhow from weapons complex. Our approach has come in fits and starts. We have not offered a integrated, comprehensive plan for U.S. economic assistance or nonproliferation programs. Increasingly, however, we are coming to recognize the interrelationship between these two elements of our Russia policy, even if we still haven't achieved a semblance of a strategy. I did, however, want to discuss some efforts that have succeeded. They are not sufficient in breadth, depth or financial means. Nonetheless, the are an exception to the rule in our efforts to provide meaningful, stable employment to former Soviet scientists and engineers. I begin with the efforts of the Cooperative Research and Development Foundation, CRDF. CRDF was created pursuant to Section 511 of the Freedom Support Act of 1992 in 1995. Its mission is to conduct innovative activities of mutual benefit with the countries of the FSU. Further, CRDF was to offer opportunities to former weapons scientists to achieve transition to productive civilian research. They have been remarkably successful. Since its inception, CRDF has expended $16 million of U.S. Government funds and $1 million from private foundations. The FSU, in turn, has committed $4.8 million to these activities. These funds have backed 597 projects that supported a total of 4300 scientists and engineers. In addition, with major contracts from the DOE, DoD, NIH, and EPA as well as industry, CRDF is helping U.S. participants address issues of financial integrity in their dealings with the FSU. Over $30 million for over 500 projects has been managed by CRDF through these contracts. The Foundation has committed an additional $11.8 million to projects in five program areas. CRDF's industry programs reduce the risk for U.S. companies to engage FSU scientists. These grants have leveraged 300 percent of U.S. Government funds through in cash and in-kind contributions from U.S. industry. I would also note that more than 95 percent of the collaborations formed in CRDF awards will continue, whether with CRDF support or not. Over 100 U.S.-FSU teams are seeking commercial applications for the products of their collaborative research. Twenty-two teams have filed for patents, fourteen of which are joint. For over a year now CRDF has ensured financial integrity for Department of Energy projects under the Initiatives for Proliferation Prevention, IPP, program. The United States Industry Coalition, USIC, the industry-arm of the IPP program, now boasts 96 members throughout the U.S. and several substantial commercial successes with FSU partners. Through its cooperation with CRDF, USIC and the IPP program now can ensure that funding for FSU scientists involved in these research efforts avoids taxation by Russian or other officials. This aspect is critical for maximizing the impact of U.S. Government or industry investments to provide stable employment and a steady income to FSU scientists. Since 1994, the IPP program has engaged over 6,200 former weapons of mass destruction scientists. Importantly, USIC members usually surpass cost-sharing arrangements with DOE expenditures totaling $39.3 million versus the $63.4 million invested by U.S. industry. Currently, 75 of USIC's members are engaged in 120 cost-shared projects. I would like to briefly highlight a recent success story in my home state of New Mexico. On January 15, I participated in a technology demonstration and press conference to announce a $20 million international investment in technologies jointly developed by a small U.S. engineering company, a Russian nuclear weapons plant, and two of the Department of Energy's facilities. An entrepreneurial American company, Stolar Horizon of Raton, NM, a long-standing member of USIC, identified a Russian technology with market potential, then staked over $5 Million of its own money to develop it. Stolar Horizon worked in tandem with Sandia National Laboratories and the Kansas City Plant through the IPP program to test and refine the technology for commercial, peaceful applications. The result: Credit Suisse First Boston has committed $20 million in financing to take the product to the global market. An estimated 350 new jobs will be created in New Mexico, and over 600 jobs await Russian nuclear scientists and technicians in Nizhny Novgorod at the Institute for Measuring Systems Research, NIIIS, are planned. I would remind everyone that U.S. appropriations in FY2001 for the IPP program is only $24.5 million. In this one example, Credit Suisse will provide an investment equal to 80 percent of our own in this fiscal year. The Stolar Horizon/NIIIS success is a concrete example of the original IPP vision: making the world a safer place through cooperative commercial efforts leading to long-term, well-paying jobs in both nations. The cooperative efforts of USIC members, DOE-IPP, other U.S. government agencies, and the scientific institutes of the NIS are revolutionizing the post-Cold War world, creating new opportunities for weapons scientists and engineers, and making our world more safe and secure. I return to the thoughts of Charles Beard. In pursuit of its interests, Government might make use of citizens' interests to advance the national interest. This is the foremost objective of nonproliferation programs that seek to create commercial opportunities in the FSU. The statistics and examples I've offered above underscore the successes we've achieved. Obviously, our attempts have frequently stumbled sometimes as a result of our own false starts and other times due to circumstances beyond our control. However, at the same time, we have never faced a situation similar to the collapse of the Soviet Union. We had never before legislated or formulated programs with the express intent of preventing proliferation through promotion of commercial opportunities. We had never confronted providing economic development aid to countries burdened by legacies of a command economy. From this perspective, we've made remarkable progress. Mr. President, I would conclude on the following note: each concrete successful commercial venture will have exponential benefits. I am convinced that these ventures will pay off--by mitigating immediate potential proliferation threats, contributing to a stable economy in the region, and advancing U.S. citizens' own monetary interests.

Mr. DOMENICI

Mr. DOMENICI. I say to the Senator from Illinois, I thank the Senator for his cooperation and help. Obviously, the Senator came on board with the idea encapsulated in the Domenici amendment yesterday, and as we progressed through it, it appeared that a number of Senators wanted some changes. So we set about yesterday evening--and well into the evening--to try to arrive at changes necessary to accommodate a wide variety of Senators and still make it effective. There is no question, anytime you work on something as complicated as this, although we think we have done a good job, it may very well be in due course, as this bill evolves further, that there may have to be other amendments as people analyze and find other problems that might be inherent in this situation. I thank in a very special way Senator DeWine from the State of Ohio. From the beginning, we had hoped that yesterday we would introduce a Domenici-DeWine amendment. I introduced the amendment which was debated yesterday. Many people at least understand what we are trying to do and what the problem is. To the extent we are trying to figure out a solution, Senator DeWine has been a marvelous partner and an excellent leader. Today I will briefly explain what we are trying to do and some of the basic fundamentals, and then I will yield to Senator DeWine. The way we will determine the trigger for the nonwealthy candidate-- that is, the candidate confronted with an opponent who will spend a lot of their own money--will vary in States depending on the voting age population. That is Senator DeWine's idea. In essence, it says to a Senator in a State such as Idaho, if somebody decides to run and spends their own money in large quantities, that Senator is going to be able to raise money somewhat easier than he or she would have if they were bound by the 26-year-old law which has $1,000 individual contribution limits per election and $5,000 in money that can come from PACs. Essentially, once you hit the formula amount, this is what will happen. When you reach the first level, the individual limits are raised to $3,000 under current law. That means you can raise $3,000 in the primary and $3,000 in the general. When you hit the next level, which Senator DeWine will talk about, the contribution limits for the non-wealthy person are raised six times in the primary, $6,000 in the primary, $6,000 in the general. Then something new was brought into the discussion yesterday evening, principally based upon Senator Feinstein's discussion, after having faced what one might call a superspender. We have a superspender defined, and Senator DeWine will define what that is when he speaks. We eliminate the party coordinated expenditure limits, all hard dollars--until the poor candidate raises up to an amount equal to the self-financing of the superspender. I assume during that period of time they can continue to raise the $6,000 from individuals. The way it is done, it requires a bit of bookkeeping, but everybody keeps a lot of books now. Everybody has records galore. Obviously, there are floating triggers that will come about based upon when the wealthy candidate, or superspender, starts putting their money into the campaign. There is one other provision that has been in both vehicles for Senators who spend their own money and get elected, a requirement that they cannot change their mind about how to finance that campaign and start raising money to pay back their debt after they are elected. We passed that around yesterday, and everyone seems to understand it. If you incur debt from a personal loan and then you get elected as Senator, and then you go around and say, now I am the Senator, I want you to get me money so I can pay back what I used of my own money to run for election. It is clear in this amendment that you cannot do that in the future. All that is future, prospective. Senator DeWine will now explain the triggering mechanisms and how this will apply to each State. We will have a chart so every Senator can see how it applies. I thank Senator DeWine, who has been a real help. To the other Senators on the floor, particularly Senator McCain, thank you for your help. Senator McCain clearly said if we did not win the other one, we would put this together and it would be bipartisan, and he joined. There are a few things in this amendment we both know have to be ironed out in the future, but I think it is an excellent amendment. For the first time in history, we think we are legally addressing the issue of a person who asserts their constitutional rights--which the Court said is constitutional--to spend their own money, but they do it in inordinate amounts as compared to what a candidate on the other side could be expected to raise under current restrictive laws, which are 26 years old and ought to be fixed. I yield the floor.

Mr. DOMENICI. If I could explain.

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

Mr. DOMENICI

Mr. DOMENICI. I say to my friend, I am not choosing to amend my amendment. My amendment stands as it was understood by the distinguished Senator from Arizona. I am merely stating that I am asking, and I now ask unanimous consent that I be permitted to modify it.

Mr. DOMENICI. I ask that Senators not vote to table this amendment. Give me an opportunity tomorrow to work with people to modify it. It will be an opportunity for me, as the principal sponsor, to get a modification that I can offer. It will be recognized as the next order of business. I ask that in fairness. I yield back my time.

Mr. DOMENICI. Mr. President, I ask for 30 seconds.

Mr. DOMENICI. Mr. President, I thank the Senator from Arizona. However, I would just like to reiterate for the Senators present, my amendment was caught in a parliamentary bind where there was no way for me to amend it, other than to not let this table occur. That is rather unfair treatment. Had I figured that out in the unanimous consent agreement, I would have never agreed to it because most Senators can modify their amendments. I thank those who agreed to grant me that privilege. For those who want to work with us to try to get an amendment, we will do that. I can't do that tonight. We have other things to do around here also. But I thank the distinguished Senator from Arizona for his welcoming a compromise. There will be one, I assure you.

Mr. DOMENICI. Will the Senator permit me to answer?

Mr. DOMENICI. Mr. President, I suggest the absence of a quorum.

Mr. DOMENICI. I say to my good friend from Arizona, it is not a question of whether there is a procedure like this or not. We have established the procedure by the unanimous consent agreement we had entered into. We entered into a unanimous consent agreement that said that this amendment can't be modified unless we vote on a motion to table it and it is not tabled. We established that rule. I am asking that since that was the rule, we go ahead and not table it and let me offer an amendment with my good friend from Ohio and that will be thoroughly debated and modified.

Mr. DOMENICI. All I am saying is, if you don't table the Domenici amendment, standing there, I will offer an amendment on behalf of myself, Senator DeWine, and others which will do what I described a while ago, and you can have all the time you want to look at that amendment, debate it, and even modify it, if you would like. I ask that we leave the amendment standing so I can modify it. Has the motion to table been lodged against the amendment?

Mr. DOMENICI. Surely.

Mr. DOMENICI. Eleven. I am not sure I will use all of it. I am aware that a Senator desires to get out of here quickly, and I will do my very best to accommodate the Senator. But what I want to say to the Senate is, I have been working with Senator DeWine and others on a modification to my amendment. Frankly, I cannot modify it unless there is a consent that I be permitted to modify it. If we move to table it, and the tabling motion fails, then I can amend it. So I would hope you would not table the Domenici amendment. Because if it is not tabled, Senator DeWine and I, and others, will offer an amendment, which we will then be permitted to do, which will, essentially, greatly simplify it. It will essentially be that if somebody under this new law indicates they are going to spend $500,000 or more of their own money, then only the individual contributions are increased to three times what they are now--$3,000 instead of $1,000--that if you are going to spend more than $1 million, it is 10 times, which is $10,000 contributions. So if somebody was going to spend $20- or $30 million, then the $1,000 cap would be $10,000. That is the extent of the changes except we have a loan payback provision which we have discussed on the floor that says, if you use your own money, then after you are in office, you cannot pay yourself back by raising money as a sitting Senator. Mr. President, I think that amendment I am going to offer with Senator DeWine, which he would speak to at a later date, is a compromise amendment. I wanted to go a little further. But now what we are going to do in a few minutes is vote on whether or not to table the Domenici amendment. If we do not table it, then we will offer this amendment. I am sure everybody is listening and at least these increases in caps would pass in the Senate. Only the individual limits, the individual contributions would be changed if we are permitted to offer the Domenici-DeWine amendment, which would be a substitute after the tabling motion. So there is no misunderstanding, the Domenici amendment has no soft money in it. The Domenici amendment is all hard money. Essentially, it says, if you are going to spend a half million dollars of your money, then you get to raise money in return for the candidate who was bound by the old laws, the 26-year-old laws. You can raise $3,000 in individual money and PACs are increased threefold. If you are going to spend $750,000 or more, it is five times. And $1 million or more, it is 10 times, as I have just indicated. In addition, we have the loan payback provisions in the bill that I have just described, and we have a provision that the hard money that can come from campaigns is limited as it is under the McCain-Feingold. Having said that, I would ask Senators who think the time has come to send not a signal but to change the law so that the multimillionaire cannot essentially put the opponent at such odds that the opponent has no chance of raising sufficient money to run a campaign--we have seen many examples of that of late. I think it is as serious a problem as the underlying issues that are before us on McCain-Feingold. I choose to fix them. I ask Senators not to vote to table my amendment, thus giving me a chance to present a modified one that has broader support than the original Domenici amendment.

Mr. DOMENICI. How much time do I have remaining?

Mr. DOMENICI. Madam President, I ask unanimous consent the reading of the amendment be dispensed with.

Mr. DOMENICI. I am pleased to yield.

Mr. DOMENICI. I yield 5 minutes to the distinguished Senator from Ohio, Mr. DeWine.

Mr. DOMENICI. I will be delighted. You cannot have it both ways. You are going to put up your own money and say to the electorate: Don't worry about special interests on this candidate's part; I'm not bothering anybody for any money; it's my own. So you spend $5 million or borrow $5 million. Isn't it interesting, for the most part, you are not in office 1 month and you are interested in the special interests. Why? Because you want to pay the loan off. So now you are out raising money. You advocated: Nobody will touch me; it is my own money; I am entitled to spend it; I am entitled to borrow it. That is all well and good, but my amendment says if that is the case, when you get elected, you cannot go asking people to contribute money to pay off your debt. That is a very simple and forthright proposal. Incidentally, it does not apply retroactively. I am not trying to get anybody. I am saying in the future you put the money up and you know it is not coming back after you get elected. That is what the Senator is talking about. I think that is very fair. In fact, it should be a condition to your putting up your own money, knowing right up front you are not going to get it back from your constituents under fundraising events that you would hold and then ask them: How would you like me to vote now that I am a Senator? That is what we are talking about. I think you are absolutely right on that.

Mr. DOMENICI. I agree 100 percent. I failed to mention that I have this in the amendment. We take a lot of the caps off so the nonwealthy candidate, the mere mortal, can have a chance at raising significant money to run against a multimillionaire candidate. But we say if that candidate who had the caps raised so they can accommodate--if they have money left over from their campaign, they have to return it to the people from whence they got it. In other words, they cannot raise more than they need and hold it for another campaign. Whatever they use in that campaign, fine; what they don't, they have to return. The Senator from Illinois has just stated it as well as anyone. I have told some people I had this amendment, and they said, ``Why are you doing that? Senators don't have those caps on them, do they?'' See, they don't know that for 26 years, since post-Watergate, we have been limited--you in your campaign and the New Mexico Senator in his campaign--to $1,000 per each individual from wherever, your State or my State. Then $1,000 in the primary and general. That is all--$2,000. Along comes a wealthy candidate and plunks down $10 million. I should have figured it up and put on a chart how much time it probably took to raise the equivalent of this $1,000 and $2,000 bracket.

Mr. DOMENICI. Madam President, I say to the distinguished Senator from California, I greatly appreciate her comments. The amendment may be negotiable in terms of how we better balance the playing field, but there is no question that she has hit the nail right on the head. One of the brand new problems of the last decade or so is the growing propensity on the part of men and women--great people--who have decided to pay for their campaigns with their own money and use the privilege, the right that the Supreme Court has said they have, that that money cannot be limited. So we have more and more candidates spending up to $5-, $10-, $20-, $30-, even $40 million-plus of their own money. That is fine with this Senator. I am not here trying to do anything about that. The Supreme Court has spoken. I have heard from a Senator saying she would support the Domenici amendment based upon having experienced an opponent who contributed in multiples of $10 million for their campaign out of their own coffers, to which she had to respond under ancient laws that limited her to $1,000 per contributor, per primary and per general, and $5,000 per primary and general from a collection of people who call themselves a PAC. That kind of limitation must have had her spending more than half her time raising money while her opponent didn't win but the opponent had all of his time to run and had none of the rigid rules and regulations that engulfed her campaign. Sooner or later, we have to fix that. As I said, I wanted to fix it in a big way. My first draft of this amendment was to take everything off the opponent, no limits. They could do whatever they would like, just as they used to years ago, so long as they listed it. Others have said, no, leave some limitations. So we are in the process-- mine having left some limitations--we are in the process of working with other Senators who would like to refine the Domenici amendment. I am willing to do that. I thank the Senator from California. I, too, hope if we have a motion to table, we don't table it, so if we want to modify it to get a better product, we can, if that is what Senators would like to do. I thank the Senator and yield the floor.

Mr. DOMENICI. Madam President, I was going to say the time should be charged to me. I don't object to that. I wonder if Senator Jeffords would let me have 3 minutes before he speaks to thank the Senator from California for her support.

Mr. DOMENICI. I didn't hear the request.

Mr. DOMENICI. I thank Senator Thompson very much.

Mr. DOMENICI. Sure.