Byron Dorgan

Mr. DORGAN

Mr. DORGAN. I will be pleased to yield, of course.

Mr. DORGAN. Mr. President, let me make a few comments about the amendment that has just been offered to the Senate. The sponsor of the amendment asked the question: How long? How long, he asks, will it take to get rid of the current Tax Code? The answer to that is simply a long, long time, if the Senator who offers this amendment, and others, suggest to us that we should, for example, have a national sales tax of 30 percent or more. If the folks who have gotten rid of this Tax Code have implemented a 30 percent national sales tax--and, yes, that is what would be required to be implemented to replace it--if you buy a house, they will say, ``Yes, that house is $120,000, but then there is a 30 percent sales tax on top of that.'' A fellow named William Gale from the Brookings Institution wrote a policy brief on this: ``Don't Buy the Sales Tax.'' The reason I am discussing this is, the Senator does not tell us with what he would replace the Tax Code. He simply says, ``Let's get rid of the current Tax Code.'' There is plenty wrong with the current Tax Code. Count me among those who would like to change the things that are wrong, but count me among those who ask the question of the Senator who offers this amendment, What do you propose to replace it with? My understanding is, the Senator who offers this amendment at one point was a cosponsor of a sense-of-the-Senate resolution calling for a national sales tax. My understanding is, he took his name off of that bill. Am I mistaken about that? Did the Senator add his name?

Mr. DORGAN. Let me reclaim my time. I appreciated the Senator's response. My understanding was--and we can determine this--but my understanding was that early in this Congress, the Senator added his name as a cosponsor to a resolution here in the Senate calling for a national sales tax. My understanding is he subsequently withdrew his name from that, but we can discuss that, I guess, with respect to the people who have the records. My point is this, Mr. Gale, who writes about the sales tax down at the Brookings Institution, says that if you had a national sales tax and are going to include all of the things that you need to include to make up the revenue, that you have to have a sales tax of 30 percent or more. The only reason I am raising this question is, What do you intend to replace the current Tax Code with? A value-added tax? A national sales tax? Or any one of a half dozen other iterations? I do not know. Then I ask the following question: With whatever you replace the current tax with, do you intend to provide for a deduction for home mortgage interest paid by someone who has just purchased a home and is banking in the coming years on being able to deduct that home mortgage interest? Is that part of some future plan or not? Does one intend, for example, to provide for a deduction for health insurance costs? Our current tax program in this country largely provides for that as a business deduction. I am told that if that deduction is eliminated, studies show that anywhere from 6 to 14 million more Americans will no longer have health insurance coverage. Or what about charitable giving? Would what is proposed to replace this with--whatever that is; we don't know what that is--would it provide for a deduction for charitable giving? Some 1.4 million tax- exempt organizations worry about that. At least one study suggests that perhaps charitable giving could be reduced by some $33 billion. So I ask the question, What does one propose to replace this with? I say to my friend from Arkansas, I certainly do not mean to misrepresent your record. I had been told that the Senator had at one point added his name to a sales tax resolution. It is not my intention to misrepresent that. If that is not the case, then I do not intend to assert that. But whatever the case is about the Senator from Arkansas and what he harbors to replace this tax with, whatever that is, at some point someone is going to have to say, ``By the way, here is what I feel this should be replaced with. And here is how it is going to affect you.'' So I ask the Senator from Arkansas, since he is proposing that we eliminate the current Tax Code by a certain date, could he tell us--and I would be glad to yield for an answer--could he tell us what he proposes to replace it with? Mr. HUTCHINSON addressed the Chair.

Mr. DORGAN. Reclaiming my time, I do understand what the Senator is saying. Let us force a solution. But he does not have a logical solution. Let us tell the person on A Street or B Street or 10th Street or 12th Street that we want to get rid of the current Tax Code--but he has no idea how he wants to replace it. There is a very big difference between those who would tax someone's income at 14 percent and those who would impose a national sales tax at 30 percent and those who would impose a value-added tax at 17 percent. There is a very big difference in how it impacts people. The Senator wants to suggest, ``Gee, this is some innocent little proposal of mine. Let's just get rid of the entire Tax Code'' which, by the way, violates the Budget Act. And he knows that. ``Let's get rid of the entire Tax Code and leave for some future debate the ability to cogitate the kind of Tax Code we might consider for tomorrow.'' Count me as among those who want to make changes in our Tax Code. I mean, do not count me as part of the target that the Senator was aiming at when he was talking about all of these ``they, they, they'' and ``fear, fear, fear.'' Just count me as part of the group who says, ``Yes, let's make some changes in our Tax Code.'' But also count me as part of a group who believes that if you are going to propose something to force solutions, you ought to have some notion in hand about what those solutions ought to be and how much is necessary to be collected in our revenue system in this country to pay for the needed social services? We build roads to go to market because we do not want to each build a road separately. That would not make much sense. We build schools together so we can send our kids to public schools. We do not need each of us to have a school in our own home. So we do things together. We provide for common defense. We have a Pentagon. We pay the men and women of the military to provide for the common defense of this country. That costs money. We, therefore, must raise that money. And the question is, How? We have an income tax system that isn't a very good system. You will not find disagreement here about that. But you will find profound disagreement about a proposal that says, let us simply scrap the current tax system with no notion in mind about what you might replace it with. Precisely for this reason, I have watched some people trot around this Capitol Building, and on a good day they even gallop and canter, alive and interested in their notion about how the Tax Code ought to be changed. Some of them very much want to go to a national sales tax and the Senator knows that. They want to go to a national sales tax. That will have a substantial impact on a lot of families; some good, some bad. Some of them want to go to a value-added tax . Some of them want to go to other forms of taxation. All of them will have significant consequences. But the Senator from Arkansas says let's not debate the ideas, consequences or the solutions. He says let's debate some mechanism to force the problem, which also probably violates the Budget Act. I don't understand that. I guess we will have a vote up or down on a proposal that sunsets the entire Tax Code, with the author telling me that he doesn't know what it ought to be replaced with and that we ought to just figure out some way to get from here to there by some protracted debate. I don't think that is a particularly good way to legislate. I think the Senator from Delaware, the chairman of the Senate Finance Committee, a man for whom the Senator from Arkansas has great affection, as he says, as do I, I think he has it exactly right. This is not a good way to make tax policy. There would be an opportunity for the Senator from Arkansas to bring to the floor his best idea about exactly how the Tax Code ought to be changed. He can do that at 7 o'clock tonight; the best idea he has or anybody has about how to change the Tax Code in this country. And then let people gnaw on it, chew on it and see what they think, and have a vote on it. But that is not what he and some others choose to do. They choose to bring some shapeless package to sunset the current Tax Code, and to replace it with nothing except some hope in the future that someone will do something to provide the revenue in some undescribed way. Again I don't believe that is a good way to legislate. Neither does the chairman of the Senate Finance Committee, a Republican. Neither does the National Association of Manufacturers. Neither does the Tax Executive Institute, and many others.

Mr. DORGAN. I would be happy to yield.

Mr. DORGAN. I think what the Senator is saying, in response to my question, however, is he does not know what he would replace the Tax Code with. He does not know how it would affect the American people, does not know its impact on the economy. That represents a fear by a lot of people. For example, it represents a fear by the group of folks who represent the largest corporations in this country who work on the tax policies for--I could read the list of corporations, but it is virtually a who's who--Hewlett Packard, BellSouth, Alcan Aluminum, so on and so forth. Here is what they say. Listen to what they say: We're writing to express the institute's serious concern about proposals to sunset the IRS Code on a designated date without specifying a replacement tax system. In our view, these proposals reflect either a misapprehension of the importance of certainty and predictability to business enterprises and individuals or a disregard for the consequences of terminating the tax system. They illustrate the folly of making tax policy by sound bite, and it ought to be rejected. I know these are the folks who run America's businesses who say we need some certainty and predictability. They are not against reform. That is not what they are saying. But they are saying that they need to understand what it is you want to do. You want to sunset the Tax Code on the one hand, and then I ask the question, ``But what do you want to do on the other hand?'' You say that just as the Sun sets in the evening, it is going to come up in the morning. That is true. Just as you sunset the Tax Code now, you are going to replace it with something. That is true. The question is, With what? And you do not have an answer. So is it reasonable for us to ask the question, Is part of the answer a national sales tax or not? If it is not, let us decide it is not. Is part of it a value-added tax or not? If it is not, let us say it is not. If it is, let us decide who it impacts and how it impacts in the American economy.

Mr. DORGAN. The Senator obviously misunderstood what I said. I was responding to a policy brief prepared by William Gale at the Brookings Institution that says ``Don't Buy the Sales Tax.'' I have yielded. Let me have the floor. I was talking about comparing the income tax to the sales tax. As the Senator would know, I think there is a substantially different base. Dr. Gale talked about this. I would like the opportunity to send it to the Senator's office for his perusal. On page 4 of the 10-page report documenting a study he had done, he says a 30-percent tax rate would be needed on the more familiar tax- exclusive approach on a national sales tax. He is one of the preeminent authorities on this issue in the country. I have met with him, talked to him, and enjoyed his work a great deal. I think he has done a lot of good work on the question, What would a national sales tax have to be? What would it look like? Who would it impact? One of the things I find most interesting, whether it is on the sales tax or the VAT tax, is that those in both the House and the Senate with specific tax plans to replace the current Tax Code always come up a couple hundred billion short in revenue. What they say is, I want to sunset the current Tax Code, and here is my substitute for it, and my substitute is a couple hundred billion dollars short. They won't say that, but that is the way they are evaluated when done fairly. Count me in on that. Gee, if you don't have to come up with something that responds to the same revenue base, we now have to meet the needs we have, then, gosh, maybe we should come up with something that raises only 50 percent of the revenue. Or how about 10 percent of the revenue. That is a wonderful way to do business. I see the people walking around with plans that would, A, increase the Federal deficit substantially; and B, impose substantial dislocations on a lot of folks and raise questions about whether you would have the opportunity to deduct your home mortgage interest or deduct your gifts to charities. Some of them, incidentally, say to people, we have decided to have a new form of taxation. I bet the Senator doesn't support another proposed new form of taxation, though. We will divide Americans into two groups: One group that works, and they get their money by going to work every day, and we will tax them because we have decided to tax work just like the current income tax does; and one who gets their money from investments, and we will exempt them. Tax work; zero tax on investments. I think that is the sort of thing that would be interesting to debate on the floor of the Senate. The quicker we get to that debate the better. Those who offer this amendment say we don't want to have that debate; we want to simply sunset the Tax Code, and we don't want to debate the sweet by-and-by. We don't want to debate the prospect of what we might propose. Just asking the Senator from Arkansas what he proposes, it occurs to me at this point we don't have a proposal. All we have is a suggestion, get rid of the current Tax Code and maybe tomorrow, maybe the day after tomorrow, we will come up with an idea so you can then debate that on the floor of the Senate. I have taken enough time. I hope when a point of order is made, as I expect it will be made because this does violate the Budget Act, that a good number of Members of the Senate will agree with the National Association of Manufacturers, Tax Executive Institute, with the chairman of the Finance Committee and others who say if we are going to sunset the Tax Code, first propose exactly to the American people what we would replace it with so they would have some knowledge and some certainty about what this debate is all about. I yield the floor.

Mr. DORGAN. I am happy to yield for a question.

Mr. DORGAN. Mr. President, let me ask a more specific question. I think the Senator said: I don't know what we should replace this with. I think that was the answer. Let me ask a more specific question. If, in fact, one of the alternatives would be a national sales tax--and certainly that is one of the alternatives--and if it would require about a 30-percent tax rate, as it would according to studies, would the Senator believe that that is an inappropriate replacement for the current Tax Code?

Mr. DORGAN

Mr. DORGAN. Mr. President, our health care system is in a state of crisis--a crisis of confidence. Many Americans no longer believe that their insurance companies can provide them with the access to care or quality of service they need. Today I continue our series of stories describing how some managed care plans seem to have put cost saving before life-saving. The experience of Clara Davis is just one more example of the pressing need for Congress to act now to protect the rights of patients. Clara Davis is a retired grocer from Bolivar, Tennessee. In 1995, her doctor placed her on the prescription drug Prilosec to control a bleeding ulcer. But her health provider changed from a traditional fee- for-service plan to an HMO, and they told her she would no longer be covered for that medication. The HMO would only cover cimetidine, the generic equivalent of Tagamet, a different prescription drug. Clara's doctor fought vigorously to keep her on Prilosec, which had greatly improved her condition, but to no avail. While on the generic alternative, Clara's ulcer worsened. At one point, her doctor removed her from that medication and began giving her office samples of Prilosec whenever possible. But it wasn't enough. The ulcer would not go away and required surgery. Thirty-five percent of Clara's stomach was removed. During recovery, she suffered a stroke that left her partially paralyzed on her left side. What happened to Clara Davis should not happen in America. HMOs should not dictate which medications a patient should receive when their doctors say otherwise. Patients should not have to face surgery when a simple switch in medication can remedy the situation. Whatever we do will not alleviate the stress that Clara Davis has endured. But we can ensure that a doctor's decision will not be overruled by an HMO bent on saving money. All medications are not the same, and health-care providers should be able to say what is most effective to treat their patients. Mr. President, we must take up and pass meaningful patient protections now. Experiences like Clara's can be prevented if we enact legislation such as our Patients' Bill of Rights which protects the doctor-patient relationship from interference by HMOs. Insurers should have to make available to patients all information on which drugs the insurer will be willing to cover, the possible interactions of those drugs, and the procedures available for appealing an HMO's coverage decisions.

Mr. DORGAN

Mr. DORGAN. Mr. President, today, I am introducing a bill to correct problems with the Federal ``Son of Sam'' law, as those problems were perceived by the United States Supreme Court. The New York statute analyzed by the Supreme Court, as well as the Federal statute which I seek to amend, forfeited the proceeds from any expressive work of a criminal, and dedicated those proceeds to the victims of the perpetrator's crime. Because of constitutional deficiencies cited by the Court, the Federal statute has never been applied, and without changes, it is highly unlikely that it ever will be. Without this bill, criminals can become wealthy from the fruits of their crimes, while victims and their families are exploited. The bill I now introduce attempts to correct constitutional deficiencies cited by the Supreme Court in striking down New York's Son of Sam law. In its decision striking down New York's law, the Court found the statute to be both over inclusive and under inclusive: Over inclusive because the statute included all expressive works, no matter how tangentially related to the crime; under inclusive because the statute only included expressive works, not other forms of property. To correct the deficiencies perceived by the Court, this bill changes significantly the concepts of the Federal statute. Because the Court criticized the statute for singling out speech, this bill is all encompassing: It includes various types of property related to the crime from which a criminal might profit. Because the Court criticized the statute for being over inclusive, including the proceeds from all works, no matter how remotely connected to the crime, this bill limits the property to be forfeited to the enhanced value of property attributable to the offense. Because the Court found fault with the statute for not requiring a conviction, this bill requires a conviction. The bill also attempts to take advantage of the long legal history of forfeiture. Pirate ships and their contents were once forfeited to the government. More recent case law addresses the concept of forfeiting any property used in the commission of drug related crimes, or proceeds from those crimes. Hopefully, courts interpreting this statute will look to this legal history and find it binding or persuasive. The bill utilizes the Commerce Clause authority of Congress to forfeit property associated with State crimes. This means that if funds are transferred through banking channels, if UPS or FedEx are used, if the airwaves are utilized, or if the telephone is used to transfer the property, to transfer funds, or to make a profit, the property can be forfeited. In State cases, this bill allows the State attorney general to proceed first. We do not seek to preempt State law, only to see that there is a law in place which will ensure that criminals do not profit at the expense of their victims and the families of victims. One last improvement which this bill makes over the former statutes: The old statute included only crimes which resulted in physical harm to another; this bill includes other crimes. Examples of crimes probably not included under the old statute, but included here are terrorizing, kidnaping, bank robbery, and embezzlement. Mr. President, our Federal statute, enacted to ensure that criminals not profit at the expense of their victims and victim's families, is not used today because it is perceived to be unconstitutional. I believe victims of crime deserve quick action on this bill, drafted to ensure that they are not the source of profits to those who committed crimes against them. I ask for your support.

Mr. DORGAN

Mr. DORGAN. Mr. President, today, I am introducing a bill to correct problems with the Federal ``Son of Sam'' law, as those problems were perceived by the United States Supreme Court. The New York statute analyzed by the Supreme Court, as well as the Federal statute which I seek to amend, forfeited the proceeds from any expressive work of a criminal, and dedicated those proceeds to the victims of the perpetrator's crime. Because of constitutional deficiencies cited by the Court, the Federal statute has never been applied, and without changes, it is highly unlikely that it ever will be. Without this bill, criminals can become wealthy from the fruits of their crimes, while victims and their families are exploited. The bill I now introduce attempts to correct constitutional deficiencies cited by the Supreme Court in striking down New York's Son of Sam law. In its decision striking down New York's law, the Court found the statute to be both over inclusive and under inclusive: Over inclusive because the statute included all expressive works, no matter how tangentially related to the crime; under inclusive because the statute only included expressive works, not other forms of property. To correct the deficiencies perceived by the Court, this bill changes significantly the concepts of the Federal statute. Because the Court criticized the statute for singling out speech, this bill is all encompassing: It includes various types of property related to the crime from which a criminal might profit. Because the Court criticized the statute for being over inclusive, including the proceeds from all works, no matter how remotely connected to the crime, this bill limits the property to be forfeited to the enhanced value of property attributable to the offense. Because the Court found fault with the statute for not requiring a conviction, this bill requires a conviction. The bill also attempts to take advantage of the long legal history of forfeiture. Pirate ships and their contents were once forfeited to the government. More recent case law addresses the concept of forfeiting any property used in the commission of drug related crimes, or proceeds from those crimes. Hopefully, courts interpreting this statute will look to this legal history and find it binding or persuasive. The bill utilizes the Commerce Clause authority of Congress to forfeit property associated with State crimes. This means that if funds are transferred through banking channels, if UPS or FedEx are used, if the airwaves are utilized, or if the telephone is used to transfer the property, to transfer funds, or to make a profit, the property can be forfeited. In State cases, this bill allows the State attorney general to proceed first. We do not seek to preempt State law, only to see that there is a law in place which will ensure that criminals do not profit at the expense of their victims and the families of victims. One last improvement which this bill makes over the former statutes: The old statute included only crimes which resulted in physical harm to another; this bill includes other crimes. Examples of crimes probably not included under the old statute, but included here are terrorizing, kidnaping, bank robbery, and embezzlement. Mr. President, our Federal statute, enacted to ensure that criminals not profit at the expense of their victims and victim's families, is not used today because it is perceived to be unconstitutional. I believe victims of crime deserve quick action on this bill, drafted to ensure that they are not the source of profits to those who committed crimes against them. I ask for your support.

Mr. DORGAN

Mr. DORGAN. Might it be the case that those who say, ``Yes, let's save Social Security first,'' don't really mean that? They want to protect the trust funds because the same people who are talking about additional tax cuts right now can only get it by taking the Social Security trust funds. Could it be they don't understand the language of saving Social Security first, which means protecting the Social Security trust funds?

Mr. DORGAN. Mr. President, I have been interested in seeing the responses of some who come to the floor and say we support this ``save Social Security first'' notion, and we want to add to it and make it better. I bet when this vote is over, within 24 hours we will have them or their cousins or their kin or their friends talking about how big the surplus is and how much of a tax cut they want to give. The question is, Where do you think they can provide the money to fund a tax cut if they are not to dip into the Social Security trust funds, and to go back on exactly what they are now proposing in the Gregg amendment, which is to save Social Security first?

Mr. DORGAN. Will the Senator yield?

Mr. DORGAN. Mr. President, this ought not to be a controversial amendment. The question is, simply, Is there an opportunity for someone to say, either in the Senate or the House of Representatives, that they are going to provide hundreds of billions of dollars, or a trillion dollars, of tax cuts under the current fiscal policy? Is there an opportunity to do that without using the Social Security trust funds? I can't see that that opportunity exists. While I would like to see some additional tax cuts, I happen to think that saving Social Security first and reducing the Federal debt would be much more meritorious for the future of this country. In any event, we ought not to be talking about tax cuts before there is money to give them. That money available for tax cuts does not include--I ask the Senator--and that money should never include, the Social Security trust fund money; am I correct?

Mr. DORGAN. If the Senator will yield for one additional question, and then I shall not inquire further. Will the Senator yield for that purpose?

Mr. DORGAN. Mr. President, I understand Senator Gregg has the right to the floor when the Senator from South Carolina completes his statement. I have been listening to the Senator from South Carolina, who has offered an amendment that we have discussed before on the Senate floor. We are reacting to recent press reports that cite one prominent member of the majority party as saying that Congress should enact $1 trillion in tax cuts over 10 years. Isn t the Senator's point that those who propose massive tax cuts would be taking the money, in effect, from the Social Security trust funds in order to fund a tax cut; would that not be the case?

Mr. DORGAN. I have listened to the Senator from South Carolina.

Mr. DORGAN. Will the Senator yield?

Mr. DORGAN. I understand it would be in my interest to provide tax cuts all the time, I suppose, if we could afford to do that.

Mr. DORGAN. If the Senator will continue to yield, if we are collecting more money than is necessary for the Government, it ought to go back to the folks who send it in, no question about that. But the question is, we have a debt of nearly $6 trillion and we have a problem in Social Security, as the Senator from South Carolina has pointed out. Just after World War II there were a lot of warm feelings around this country and we had the biggest baby crop ever produced in American history. People liked each other a lot and we had a lot of babies. Those babies are fixing to retire soon, and when they hit the retirement rolls it will be a maximum strain on the Social Security system. We have accrued surpluses year after year to meet that test for the baby boomers' retirement and those surpluses are invested in government bonds. When the folks over here say well, gee, now we have the Congressional Budget Office that tells us there is a surplus, they are taking one page of the CBO report. They are forgetting the other page. The other page says if you include the Social Security fund in your budget totals, there is a surplus. But if you don't count the Social Security fund--which you shouldn't be able to do, because that money is paid into a trust fund for only one purpose--if you don't count the Social Security trust fund, there is no surplus. Those folks are going to the second page, taking the number they want, and saying not only is there a surplus--which there isn't--but with the surplus we want to provide a big tax cut. When? The month before the election. Gee, that is Politics 101, I suppose, but it is not good government. That is the purpose of the amendment that is offered by the Senator from South Carolina. It says, let us do with the Social Security trust funds what we promised the American people we would do--that is, save them for Social Security needs when the baby boomers retire.

Mr. DORGAN. Parliamentary inquiry. I believe regular order is for the Senator from South Carolina to be allowed to yield for a question; is that correct?

Mr. DORGAN

Mr. DORGAN. Within our state, John's achievements are well recognized. The North Dakota State Board of Higher Education has honored John by placing his name on the aviation college at the University of North Dakota. The Odegard School of Aerospace Sciences is one of our state's flagship programs and draws students from every state in the nation as well as many foreign countries. Airlines from around the world send its pilots to be trained at UND. Its size and number of employees means it is also a significant economic asset and has served to help draw the aerospace industry to North Dakota. Again, I want to offer my congratulations to John and all his faculty and staff at the Odegard School. We look forward to their continued contributions to the aerospace industry, not only in North Dakota but throughout the world.

Mr. DORGAN. Mr. President, I rise today to congratulate the John D. Odegard School of Aerospace Sciences at the University of North Dakota, and its dean and founder, John Odegard who have been selected by the Federal Aviation Administration to receive its 1998 Excellence in Aviation award. In addition to being one of North Dakota's most outstanding entrepreneurs, John is also a personal friend of mine and I can attest to the fact that this honor is truly deserved. It accurately reflects the contributions that John and the college have made to aviation education and research to make flying safer in our country. Announcing the award, FAA Administrator Jane Garvey noted, The FAA formally recognizes significant aviation research accomplishments each year through the Excellence in Aviation award. This research plays a prominent role in ensuring that the nation's airspace system remains the safest in the world. ``Aviation weather research conducted at the John D. Odegard School of Aerospace Sciences contributed to the development of the Terminal Doppler Weather Radar, which is used to detect wind shear near airports. The aerospace school, which has conducted aviation research, education and training programs for over 30 years, participates in a FAA- sponsored research project to chart wind conditions at the Juneau, Alaska, airport.