Russell Feingold

Mr. FEINGOLD

Mr. FEINGOLD. I am suggesting in the situation where the budget is not balanced, where there is a problem with the entire balanced budget amendment and the balancing of the budget, that the courts are going to have a certain amount of inherent power to enforce the amendment. I do not deny Congress certainly has some power.

Mr. FEINGOLD. I am suggesting that simply barring those particular lawsuits, or attempting to, may not be consistent with the court's ruling of his inherent powers in this situation.

Mr. FEINGOLD. Surely there is a possibility we could try to pass that language and that would help. What I am suggesting here is, under the balanced budget amendment and under the inherent powers of the court to enforce the balanced budget amendment, that that may well be overridden by the power of the courts to take those suits and these folks would have standing.

Mr. FEINGOLD. I yield for a question.

Mr. FEINGOLD

Mr. FEINGOLD. Mr. President, I send a motion to refer to the desk and ask for its immediate consideration.

Mr. FEINGOLD

Mr. FEINGOLD. Madam President, how much time do we have remaining?

Mr. FEINGOLD. Mr. President, I think this is exactly what is wrong with this balanced budget amendment process. We saw this with regard to the so-called glidepath amendment, the so-called right to know. In the desperate desire to get enough votes to pass the balanced budget amendment, we are closing the door on honesty with the American people. This body has, unfortunately, refused to lay out that 5- or 7-year plan that would tell us where it is going to come from. That is bad enough. But when you close off an opportunity to make a clean statement that we cannot afford the tax cut and still have a balanced budget amendment, then you are even going farther because what you are doing with this tax cut is digging an even deeper hole. It is already hard enough to lay out exactly how we are going to put together the numbers under the current problem. But when you add another $60, $200, $700 billion, $1 trillion, as you claim to be solving the problem, that is where the real obfuscation, the real confusion, the real misleading of the American public comes. Mr. President, do you know what the American people think when they hear about the balanced budget amendment? I believe they think we are going to actually balance the budget when we do this. I do not think they really all realize that we are setting into motion here something that is going to take probably the better part of a decade, and in the meantime there will be no legal requirement that we balance the budget. So what is a more important and appropriate time than right now, as this amendment comes to a vote in the Chamber in the next few days or weeks, to tell the American people we understand that cutting taxes will make it virtually impossible either to meet the balanced budget requirement, if it is enacted, or that the human consequence and the pain that will be suffered by people in this country will be enormous if we suddenly cut $200 or $700 billion out of our Federal revenues at this point, leaving it even more impossible to balance the Federal budget in any kind of humane way? And for anyone who thinks this motion is either confusing or inappropriate, this is precisely the motion the distinguished majority leader used in order to put forward his motion on Social Security. Now, if this is confusing, why was that not confusing? Presumably we would not put anything on the bill if it is an issue of confusion. I think the source of confusion is clear. The effort to confuse is from those who do not want to tell the truth to the American people, which is that the Contract With America goes completely in two directions at the same time. Several Members on the other side of the aisle have publicly stated, in the Finance Committee and also in public statements and in statements in the Chamber, that they, too, do not support the tax cuts, knowing what it means for the budget. So I feel strongly that there is no reason not to pass a simple sense-of-the-Senate resolution at this time. It does not go out to the States, and it tells the truth. And that is that all these tax cut plans are the ultimate demonstration that many supporters of the balanced budget amendment are not as dedicated to balancing the budget as they pretend. I reserve the remainder of my time.

Mr. FEINGOLD. I am happy to yield.

Mr. FEINGOLD. Mr. President, we are not prepared to yield back our time. The senior Senator from Arkansas will speak in a minute. Let me just say briefly I am somewhat amused at the notion that the distinguished chairman of the Judiciary Committee brings up, the fact the deficit is going up every day as we speak, as if somehow it is the fault of this debate that the deficit is going up. But even under the terms of the balanced budget amendment, the notion is there would not be a balanced budget until the year 2002. I ask you, what is more damaging to the goal of balancing the Federal budget? Debating a subject as to how consistent it is to have tax cuts and balance the budget at the same time and debating that for a few days? Or to pretend that somehow after we dig this huge hole for the Federal deficit again that we will be able to solve it over the course of those next 7 years? It does not make sense. The notion that we are going to cut off debate on the basic budgetary choices that are involved in the context of the balanced budget amendment debate does not make any sense to me. I do not think it makes any sense to the American people. It would be one thing if we were all agreed that we were going to move in the same direction. If everybody in both Houses said of course we are going to make sure that everything we do brings down the deficit, that would be one thing. But what I and Senator Bumpers and others are trying to point out is that this particular notion of a tax cut flies in the face of any reasonable person's notion of what is supposed to happen here, which is reducing the Federal deficit, not increasing it by $200 or $750 billion. With that I am happy to yield to the senior Senator from Arkansas, who has been a leader on deficit reduction here and has been a great help on this amendment.

Mr. FEINGOLD. Madam President, first of all, I thank the Senator from Arkansas for his wonderful statement of common sense. That is all we are trying to do is to be a little bit direct with the American people and say that it is wholly impossible to balance the Federal budget at the same time you are talking about massive tax cuts. In a moment, the distinguished Senator from Minnesota will join with us. But let me just say that I think what the Senator was saying at the end is important to reiterate. A lot of folks here that are for the balanced budget amendment--and maybe some of them do not plan to be around here when we have to actually make these hard decisions; maybe some will retire; maybe some will be President; maybe some will be term limited; maybe they will be kicked out of here by their own vote for term limits. But this is an awfully sweet deal for a politician. If you vote for a balanced budget amendment, you get to hand out a giant tax cut to everybody, and you do not have to say what you are going to cut for many years. It is like a hat trick. That is about the best thing a politician could have. That is exactly the kind of concern I have here. I think many people are very sincere about balancing the Federal budget. But if we are not honest about this issue, that you cannot have it both ways, you cannot have a tax cut and balance the budget, then we are failing our responsibility to be direct with the American people. Madam President, I want to note one thing about the debate thus far. The hour and a half is coming to an end. I have not heard one single Senator say one good thing about the tax cut proposal. Not a single Senator has come out and said it is a good idea to cut taxes across the board or to have a middle-class tax cut. But I have heard at least four Members from the other side of the aisle--the distinguished Senator from Vermont, the distinguished Senator from Rhode Island, the distinguished Senator from Pennsylvania, and the distinguished Senator from Oregon, chairman of the Finance Committee--all publicly say that this might not make sense. They may not well be able to support this tax cut. Madam President, I guess what I am in search of now is, who is for this? Why do we not start building the foundation of a balanced budget by pointing out that there is nobody in the U.S. Senate who cares enough to come down here and defend the Contract With America's tax cut provision. There is not a single Senator that has come out and defended the President's notion of a middle-class tax cut. I am reading from today's debate that there is not a constituency--certainly not among the American public. Maybe the good news here is that we are not even going to try to do this. If that is what we get out of this process, I will be delighted. I await the day when a Senator comes out here and says, First, he is for a tax cut of this magnitude, $200 billion, and second, he can show us how to have a balanced budget while he does it. I am delighted to yield 5 minutes to the distinguished Senator from Minnesota.

Mr. FEINGOLD. Mr. President, I assume that comes off of their time.

Mr. FEINGOLD. Madam President, briefly, I appreciate the input of the Senator from Arizona. We want to find out what Senators are supporting so-called tax cuts, and we are interested to know how in the world it is going to be paid for while we go forward with increasing defense spending and balancing the Federal budget and all of the things provided for in the contract. I think this is exactly what we are concerned about. We are concerned that the contract's effect is not to balance the budget, but to undo the progress made in the last 2 years. The Senator just described one of the elements that led to the reduction of the Federal deficit for the first time in many, many years. He is on record that he is going to try to repeal it. We do not have on record how we are going to pay for that item, or how we are then going beyond that. Because the problem with repealing that is you have to come up with the money to pay for its repeal, and even then you still have not done one single penny of net deficit reduction. You have gone in the wrong direction. So that is what the debate has to be about. That is what the American people are entitled to. I now yield 5 minutes to the Senator from Minnesota.

Mr. FEINGOLD. Thank you, Madam President. I cannot think of any better allies on an issue like this than the Senator from Arkansas and the Senator from Minnesota, who I know are in this for the long haul. We are in this for the long haul on the balanced budget amendment, on the budget resolution, on reconciliation, you name it. We are going to continue to raise this issue of the irresponsibility of these tax cuts every chance we get with the goal of defeating it. I think the Senator from Minnesota just made a tremendous point when he pointed out what happened in the early 1980's. Naturally, when people were told we are going give you a tax cut, it will cause the economy to broom and everything will be great, they said, ``That sounds pretty good.'' Human nature. Nothing wrong it. It might have worked. But the amazing thing now is that in 1995, the American people are hearing that same line again, and what I am so impressed by and delighted by is that they simply are not being fooled twice. It is not going to work this time. Telling the American people, as President Reagan did, that he is going to balance the budget and give everybody a giant tax cut--he did not do it, the Congresses then did not do it, and neither will the 104th Congress, because it cannot be done. And so to conclude our argument on this, I would just like to return to those people from my State who just laid it on the line and who say they are not going to fall for this again, this idea that 2 plus 2 equal 6 when it comes to balancing the Federal budget. A couple from, for example, Eagle River, WI, wrote about the tax cut: What I need, and what the country needs, is to have the budget deficit paid off so that 20% of the national budget does not go to raising money lenders into the upper class, and so that in 20 years my children and grandchildren won't have to suffer having their entire taxes go to pay the interest and getting none of the services that government should properly provide. Folks from Cornucopia, WI, which is the northernmost point of Wisconsin, wrote and said: The thing is, I can't figure out why this is happening-- this race to cut taxes--when the majority of people, according to all I've seen, heard, and read, don't care. We want the deficit cut and we want our money spent more wisely. A gentleman from Madison, WI, wrote: I would like to pay less taxes. I have a family to feed and a mortgage to pay, but what is even more important to me is the yearly federal deficit and the expanding national debt. He says to us here in the Senate: Don't try to make me feel good and make some political points by giving me a tax cut that my children will have to pay for. I'm not that stupid. That doesn't impress me. Short- term, feel-good tax cuts may look good to the weak-minded voters, but frankly I'm extremely concerned about the national debt that we will be leaving our children to pay off long after you are out of office. Let's do what is right for the kids, (even though they are not voters yet, you politicians!). Let's make the spending cuts, leave the tax rates where they are, pay off the federal debt, and leave this country in a secure financial position that won't leave our children cursing on our graves! And finally, Madam President, from Birnamwood, WI: Dear Mr. Feingold: I am writing about the proposed tax cuts and write-offs being proposed lately. I am all for cutting spending and lowering taxes as my many letters to you prove. But throwing a few crusts of bread to the masses to keep them quiet is not the answer. By all means cut government spending. But use that savings to eliminate the deficit and pay down the debt that threatens to overwhelm us. Madam President, in conclusion, the American people are very clear on this. Why in the world can we not be clear with them and say that it is impossible to push for a balanced budget amendment in good faith and still believe we can have the giant tax cuts being proposed, in particular, by the Contract With America?

Mr. FEINGOLD. Mr. President, on behalf of myself, Senators Bumpers, Robb, Murray, Hollings, Moseley-Braun, Exon, and Wellstone, I send a motion to the desk to refer House Joint Resolution 1 to the Budget Committee with instructions to report back forthwith and ask that it be immediately considered.

Mr. FEINGOLD. Mr. President, I ask unanimous consent that reading of the motion be dispensed with.

Mr. FEINGOLD. Mr. President, this is a motion to refer House Joint Resolution 1 to the Budget Committee with instructions to report back forthwith in status quo and require the Budget Committee to issue a report at the earliest possible time which would include the text of a sense-of-the-Senate resolution and which, Mr. President, I had originally intended to offer directly to House Joint Resolution 1 at the appropriate time. The procedural situation before us makes it difficult to have a sense-of-the-Senate resolution considered directly because we are considering the language of a possible constitutional amendment. The instructions attached to the motion to refer that we have here have the effect, however, of allowing us to vote on the substance of what would have been a sense-of-the-Senate resolution if a regular legislative measure had been pending. Mr. President, the language of the instruction is intended to put the Senate on record for the first time with respect to the issue of whether an across-the-board tax cut or a middle-class tax cut is consistent with efforts to balance the Federal budget and reduce the Federal deficit. And the motion goes through some of the issues that all of us know to be involved in not having a balanced budget, issues having to do with the fact that the Federal deficit is still in excess of over $190 billion a year despite the efforts we have made in the past couple of years. The fact is that the Federal debt within the next couple of months will, for the first time in our country's history, exceed the astonishing figure of $5 trillion. This motion points out that the Federal budget deficits and the growing Federal debt have a strong tendency to reduce savings and capital formation in this country. We also point out that the Federal budget deficits contribute, very unfortunately, to a higher level of interest rates than would otherwise occur. This raises capital costs. It has the consequence of hurting our economy by curtailing the total investment that we have in the economy. Add to this, the failure to balance the Federal budget contributes to significant trade deficits and dependence on foreign capital. And worst of all, the point that is perhaps most often made on this floor having to do with the issue of balancing the budget and the balanced budget amendment, the failure to deal with the Federal deficit and the Federal debt is very likely to leave a potentially crushing burden on future generations that would make their living standards lower than they otherwise would have been. As we have pointed out frequently on this floor, Mr. President, during the 103d Congress, the annual Federal deficit actually declined. It declined for 2 years in a row for the first time in two decades. And now, under the current estimates, it is projected to decline for a third straight year in a row. This has not happened for many, many decades, I believe as far back as President Truman. Our concern in offering this motion is that the progress in reducing the Federal deficit achieved during the 103d Congress could be very quickly reversed if we do not have the will to say no to either an across-the-board tax cut or a middle-class tax cut. If we do not say no to these tax cuts--a difficult thing to do politically--the legacy of the 104th Congress will not be the passage of a balanced budget amendment. The legacy will be dropping the ball and forever making the Federal deficit and the Federal debt unsurmountable barriers. Quite simply, our motion says that enacting such tax cuts is inconsistent with and contrary to efforts being made to achieve further deficit reduction during the 104th Congress and that tax cuts are clearly, Mr. President, contrary to the goal of achieving a balanced budget. So, Mr. President, the motion concludes by saying it is the sense of the committee--this being the Budget Committee--that reducing the Federal deficit should be one of the Nation's highest priorities, and that enacting across-the-board or so-called middle-class tax cuts during the 104th Congress would hinder efforts to reduce the Federal deficit, and that enacting such tax cuts would be inconsistent with proposals to adopt a constitutional amendment to balance the budget. So that is our intent. I believe that this is an opportunity for both sides of the aisle, Republican and Democrat, to go on record for the first time on this very key issue. And the issue is whether or not the November 8 elections were really about tax cuts. People have a lot of theories about what was intended by the electorate in that election. One theory is that people wanted a tax cut, that was the driving force, and that is why the President, supposedly, offered a middle-class tax cut, and that is why the Republican contract offers an even more dramatic and surprisingly large tax cut at a time of major Federal deficits. I believe, based on my reading of this issue--and I think my cosponsors agree--that is not what the electorate meant at all. The people of this country were not calling for a tax cut, because they know the hard and difficult facts. They know who they are stealing from if we do not reduce the Federal deficit. They know that a tax cut today means a larger deficit and larger debt for tomorrow for their children and grandchildren. And the numbers bear it out very well. Mr. President, one of the charts I have here today describes the impact of the smaller tax cut proposal, the proposal by the President for a $63 billion tax cut over the next 5 years. As the chart shows, if we go through with the President's proposal, by fiscal year 2000 the deficit would still be hovering at almost $200 billion after we, under the leadership of that very same President, finally got the deficit below that figure for the first time in many years. What this chart suggests is that if we do not enact the President's tax cuts, and add to it the interest savings that accrue from not making the deficit worse, you net out about a $25 billion difference in the fifth year alone. In one year alone, not doing this tax cut could mean a $25 billion improvement in our deficit picture. And that is not something to sneeze at. Put together all those 5 years, again you are talking about just $63 billion saved, plus all the interest saved. What I believe the American people think is that if we have these cuts to be made--the President says he has them, he has identified them, he has put them on paper, he has put his name to them and taken the political heat--what the American people are saying is, ``Good. Do those cuts, but use them to bring down the Federal deficit,'' as this chart shows we could fairly easily do just using the President's own figures. Now a second illustration is even more dramatic. It suggests, as I certainly would, that compared to the President's proposal, which at least pays for all the tax cuts with spending cuts, that there is an even more extreme proposal in the Republican Contract With America. Over that same time period of 5 years, the Contract With America calls not for $63 billion in tax cuts, but the whopping sum of $196 billion in tax cuts by the year 2000. Now, this is from the same folks, largely, who say they are going to pass a balanced budget amendment, that they do not need to tell you where the money is going to come from, that we do not need a glidepath, and that we are going to be able to give out this tax cut and everything is going to be just fine. We are going to have a balanced budget amendment. But if we do what the Contract With America suggests over the next 5 years, we will not have this type of deficit reduction and we will miss a tremendous opportunity to enormously decrease the Federal deficit. This second chart shows that in the fiscal year 2000, if we do not do the Republican tax cut--which I do not think the American people want anyway--that instead of having an almost $200 billion deficit, we could finally be making real progress. We could take all those Republican cuts and the deficit would be down to $114 billion in fiscal year 2000. In other words, we would actually be within reach of our shared goal. And budget amendment or not, is that, at least by the year 2002, this figure would be zero, that we would have a balanced budget. How can the Contract With America talk about a balanced budget and a balanced budget amendment and then propose a tax cut that takes us just in the opposite direction? Two-hundred billion dollars in the wrong direction. So, Mr. President, I suppose those who support the Republican Contract With America's tax cuts are advocates of trickle down Reaganomics, if you will. They may argue that by doing these tax cuts the economy may do better than doing nothing; somehow the revenues will come in and these figures will then be reduced and our estimating will be wrong and we will wipe out the deficit that way. I sure hope that is true, if we go down that road. The way we got into this deficit in the first place was 12 years where tax cuts for all folks, including high-income folks, had just the opposite result, where the deficit went out of control. I suppose those on the other side of the aisle could say that President Clinton's proposal for a middle-class tax cut is, in effect, trickle up. Give middle-income people some money, they will spend it, and the economy will do better and that will bring in the revenues to solve our fiscal problems. I hope that is true. I like his idea better than the Republican contract. But the evidence is just not there that that will be the actual impact on our Federal budget. I would suggest just the opposite would occur. Putting that money in the economy at this point may actually drive up inflation, drive up interest rates, and lead to just the opposite conclusion. So whether you look at it from the point of view of the Contract With America or from the point of view of the President's proposal, which I know he offers in good faith, neither proposal is consistent with or makes any sense if people in this body are sincere when they talk about balancing the Federal budget over the next 7 years. We cannot have it both ways. And what I am most struck by is that the American people are, of course, ahead of us on this, as they so often are. They know better than we do. They are ahead of our rhetoric. They are ahead of the tax cut. In fact, it gets even worse if you look into the outyears. The 10- year cost of the President's tax cuts is not just $63 billion. The 10- year cost of the so called middle-class tax cut is $174 billion. That is a pretty high figure. Of course, it is not even as high as the entire amount of the Republicans' $196 billion for the first 5 years. So what is the 10-year impact if we go down the road of the Republican contract and their tax cut? Believe it or not, the Republican contract and its tax cut call for a $704 billion tax cut over the next 10 years, and they are going to balance the budget? Who in this country would even begin to believe that that was possible? That is the guaranteed route to the worst budget disaster we would ever have, and it is hard to believe we could do worse than in the 1980's. If we do that one in 10 years, that is exactly where we will be. Just in terms of interest costs, the interest we would save in the 10th year alone by not adopting the Republican contract tax cuts is $48.4 billion, just in the 10th year; $50 billion worth of interest. That is almost as much as the President's whole 5-year tax-cut plan. That is what the Contract With America calls for in the name of the balanced budget amendment. That is 30 percent more than the Federal Government will spend on transportation in fiscal year 1996 and more than we will spend this year on all of the Federal judiciary, the entire legislative branch and the programs and personnel of the Small Business Administration, the General Services Administration, the Commerce Department, the State Department, the Environmental Protection Agency, the Interior Department and the Justice Department combined. That is just the interest that we lose and that we have to pay out on just the 10th year of the Republican plan that includes as well the notion of a balanced budget amendment. Mr. President, this makes no sense on the facts. I would like to take a few minutes to point out that although some say it is very courageous to stand up here and make this motion to refer and, of course, that is nice for me and all the Senators, it does not take that much courage to go along with what your constituents are telling you to do. Since December 15, in my office we have received well over 400 letters and phone calls on the issue of whether the people of Wisconsin want us to do the middle-class tax cut. The figures are surprising perhaps to some but they do not surprise me, because I find almost no one in my State who wants this tax cut. Here are the figures: 356 people who have contacted me say they do not want the tax cut. They say they want the money used from the cuts on programs to reduce the Federal deficit. Only 73 people contacted us to say go ahead with the tax cut. I realize it goes against political conventional wisdom, but I guess I would be the first to say that even though the November 8 elections were clearly not about people wanting a tax cut. I do not think there is any evidence of that, but I do know what the November 8 elections were about is that people are tired of politics as usual. Even though politicians are taught in politics 101 or in their first campaign, do not ever go against a tax cut, the American people are smashing that conventional wisdom. They are saying that they know it is pandering. They are saying that they know we have a greater problem, a problem that affects not just them and the bills they have today, but a problem that could destroy the future of their children and grandchildren. That is the experience the other Senators who are cosponsoring this have had. They have come up to me, have done the town meetings in their States and have said, Senator Feingold, we are hearing the same thing you are. People are saying do the cuts, please take the fat out of the Federal Government, pare it down, but do not throw away that money on a meaningless tax cut that fails to deal with our national budgetary problems. So I have been pleased with the support in this body. I actually have not had a single conversation with any Member of the Senate who says he or she is very much for the tax cut. At best, they are ambivalent about it. I know in the House there is more support for a tax cut. After all, it is part of the Republican contract. There is a certain group looking to see what percentage of the items in the contract may pass. Is it going to be 100? I do not think so because I do not think term limits is going to pass. But some are shooting for 70, 80 percent, some magic number. These are numbers in the contract that the other body ought to take a look at because I do not think the people want that tax cut. That is what one of the Members of the other House discovered when he went out and decided to have a town meeting of his own, apparently, over the weekend. I ask unanimous consent that an article from the Washington Post of February 12, entitled ``Many Say They could Skip the Tax Cut,'' be printed in the Record.

Mr. FEINGOLD. Mr. President, let me just take a moment on what happened when Representative Kasich went out and asked the folks-- apparently he does not pretend it was otherwise--if they were for the tax cut. The article says, ``Who was so concerned about the Federal deficit that he or she would forego tax cuts promised by both Republicans and Democrats until after the budget is balanced?'' That is what he asked the crowd. How many people out there would give up their tax cut so that the budget would be balanced? The article says the question apparently was not hard at all, it was easy for everyone. In the packed meeting hall of the Veterans of Foreign Wars Center here in heavily Republican central New Jersey, hands went up everywhere. Kasich then asked how many people wanted their tax cuts up front before the budget is balanced. The newspaper reports only a few hands went up and they were booed. So the message is finally reaching the other House that the American people are ahead of the politicians, that the American people know that this problem cannot be solved if we are going to spend $60 or $200 or $700 billion on tax cuts at the same time we are pretending-- pretending--to do something about the problem of the balanced budget amendment. I am also pleased to say, Mr. President, that the Concord Coalition, which has done a fine job of marshaling this issue of the Federal deficit, has today endorsed our motion, writing that this is backed by the 150,000 members in all 50 States and saying that, of course--of course--it is inconsistent for somebody to support the balanced budget amendment and at the same time say they want a giant tax cut. No one buys that story. The same goes for the public opinion polls. On December 20, just 5 days after the President's speech when everyone assumed that everyone was for the tax cut, just 5 days later, a USA Today-CNN/Gallup Poll said 70 percent of the American people say that reducing the deficit is a higher priority than a tax cut. In the Washington Post, an ABC news poll on January 6, 1995, says the people favor deficit reduction over tax cuts by a three-to-two margin. So in every measure I can find, whether it be a man-on-the-street or woman-on-the-street poll, the words of economists, calls to my office, the letters to my office, I cannot find a constituency out there in the United States of America for this kind of fiscal recklessness. But perhaps my favorite indication of this always is a political cartoon. I have to say that being a Senator has to be about the best job in the world, but if I had the talent, I would also love to be a political cartoonist. I do not have the artistic talent nor do I have, perhaps, the ability to do this. But this cartoon from our Milwaukee Sentinel typifies this whole issue. It shows an enormous creature, sort of a Jabba the Hut entitled ``deficit.'' It just keeps eating and eating. And what it is eating is the catering provided by a caterer called ``Tax Cuts R Us, Catering and Pandering.'' Instead of putting this deficit monster on a diet, what this institution is on the verge of doing if we do not reverse course is to continue to feed this monster to the detriment of everyone today, tomorrow, and in the future. Mr. President, I think this is an opportunity for us to make a bipartisan statement. No matter what else you feel about the balanced budget amendment itself, we cannot have it both ways. The cosponsors of my amendment include those who oppose the balanced budget amendment, such as myself. It includes some who have stated they will vote for the balanced budget amendment, and it includes some who have said they are undecided. What we all agree upon is that it cannot be either a rational or honest process if we continue to feed this monster. A balanced budget amendment cannot work hand in hand with an irresponsible tax cut that is being advocated, the false belief that the November 8 elections had anything to do with it. So I urge my colleagues to support the motion. I reserve the remainder of my time. Mr. SIMON addressed the Chair.

Mr. FEINGOLD. Mr. President, I thank the Senator from Illinois, who was one of the very first persons who came up to me after the new year and said that, in fact, he was having the same experience in his State. Even though Wisconsin and Illinois are very close physically, they are certainly not identical States. But he was having the same experience. He was going around the State and people were saying do not take these cuts that you have identified and use them to do a tax cut. Take those opportunities to reduce the Federal deficit. I believe that is the conversation we had.

Mr. FEINGOLD. Mr. President, I do feel the need to address what the Senator just suggested, that it somehow confuses people for the Senate to go on record on this issue. How can this be confusing? This motion does not delay. I think no one disputes that. It is an automatic referral back from the Budget Committee. This is not an effort to slow down the balanced budget amendment. I have also pointed out to the body that this does not become part of the constitutional amendment itself. This does not go out to the States for purposes of their ratification process. That would not make a lot of sense, since it is up to us here to decide whether we are going to have a middle-class tax cut or an across-the-board tax cut, so I do not see how this could possibly confuse anyone, that the Senate would choose to go on record that we are going to be straight with the American people and not kid them that we can afford a tax cut at the same time we are passing a balanced budget amendment. I do not understand how anyone could be confused by that logic.

Mr. FEINGOLD

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

Mr. FEINGOLD. Mr. President, I ask unanimous consent to speak as in morning business.

Mr. FEINGOLD

Mr. FEINGOLD. Mr. President, yesterday, the chairman of the Senate Foreign Relations Committee, the Senator from North Carolina, introduced legislation on Cuba which, with all due respect to the chairman, I think is the wrong policy at the wrong time. In seeking to strengthen an already tight trade embargo, punish non-American investment in Cuba, and increase funding for TV Marti, this proposal puts United States policy toward Cuba on the wrong track. While I oppose strongly the totalitarian rule imposed by Cuban President Fidel Castro, I do not see any way that the island Nation of Cuba now poses a military or economic hostile policy. I have believed for some time that an expanded dialog with the Cuban Government is in the interest of the United States and Cuba. With the cold war over and little or no Soviet or Russian presence in Cuba, it simply does not make sense to completely ignore a country in our hemisphere because it is nondemocratic. Indeed, discussions and contacts on issues such as human rights, market economies, commercial relations, arms control, Caribbean affairs, the free flow of information, refugee affairs, and family visitation rights could actually help facilitate resolution of these complex problems and, I think, would do it, Mr. President, far better than nonengagement and isolation. We have ongoing discussions with other nondemocratic countries like Saudi Arabia, Indonesia, and North Korea, and we recently opened a liaison office in Vietnam. Mr. President, we have even granted most- favored-nation status to China, so it makes little sense to outlaw virtually any contact with Cuba. This proposal also threatens the United States effectiveness in international organizations by requiring the United States representatives to seek a United Nations embargo against Cuba and to oppose Cuban membership in international financial institutions. Mr. President, the United States has more important and pressing problems which require multilateral support and should not be required to pursue an outdated and misguided policy in an international forum. Finally, Mr. President, I am particularly amused by the support of the Senator from North Carolina for more money for TV Marti. This program has been documented time and time again as ineffective. Certainly in times of serious fiscal constraint TV Marti should be eliminated; it should not be enlarged. It is very ironic that during the debate on the balanced budget amendment, when we are all claiming we are going to identify more specific cuts and cut out the fat in Government, here is a proposal which exemplifies the waste that has helped jack up the Federal deficit in the first place. Mr. President, the chairman's proposal is provocative but it is unrealistic and shortsighted. I hope the administration will work with partners in the hemisphere to develop a multilateral strategy to promote democracy and human rights in Cuba and prepare for that day to which we all look forward, the transition of power in Cuba. I thank the Chair and I yield the floor. Mr. ROBB addressed the Chair.

Mr. FEINGOLD

Mr. FEINGOLD. Mr. President, Tuesday's business section of the Washington Post had an interesting article in it on the termination of the helium program, which is a target as elusive and difficult to rein in as the helium gas itself. The subheading of the article was entitled, ``Helium Bureaucracy Targeted by Clinton Has Survived Many Budget Cutters.'' The story in the Post went on to recount how termination of the helium program has been on the target list for elimination by those seeking to find ways to reduce the Federal bureaucracy. The story talks about how this helium program has been on the list for ways to reduce the Federal bureaucracy and the Federal deficit, but that it has survived many attempts under the Reagan, Bush, and Clinton administrations, precisely because of the usual constituencies and political horse trading that tends to keep these programs alive. Mr. President, I suggest that this helium program is exactly what this balanced budget amendment debate is all about, or maybe the better way to say it is, is what this balanced budget amendment debate should be about. It should be about how we are actually going to balance the budget. On January 4, the first day of this Congress, I introduced legislation, S. 45, which would terminate the Federal helium program and sell off the crude helium that the Federal Government has stockpiled to pay off the $1.4 billion in program debt that has accumulated. We have good bipartisan support on the legislation. Senators Harkin, Lautenberg, Leahy, Reid, Kyl, Bumpers, and Campbell have all cosponsored this effort, once again, to try to get rid of the helium program. It did not happen to be part of the plan I proposed to reduce the deficit during my campaign. But I had not thought about that one. It is important to add new ideas because, obviously, some of the things I wanted to cut, you cannot cut. There are not the votes for it. So the helium program was a great one to add on because we found out it really does not make sense anymore. I, along with the cosponsors, want to see the 104th Congress be the Congress that finally gets rid of this program. For this reason, I was delighted when the President highlighted, as the first program he mentioned for a cut in his State of the Union Address on January 24, the helium program. He said it is one of the businesses that the Federal Government ought to get out of running. I was also pleased, of course, to see that the President added this proposal into his budget, and that the President submitted that to Congress on Monday of this week. In my mind, this is exactly the step-by-step approach that real deficit reduction is all about: Proposing a bill, hoping the President will push for it in his budget, getting it down here, and hoping we will get to work on it right away instead of waiting for the balanced budget amendment to be approved or not and waiting for the States to ratify it or not. I hope, before this Congress adjourns, we will have completed this task and turned this program over to the private sector. If there is any reality at all to all this talk behind a balanced budget amendment, then surely the helium program should be on its way out. There is simply no good reason for the Federal Government to continue to stockpile helium or run a public program when a perfectly viable private industry has developed that supply that we need for all of the Nation's helium requirements. Mr. President, this program, like many of the deficit reduction targets that I have been involved with trying to get rid of--like Radio Free Europe or the wool and mohair program--was begun decades ago, when there was a different need and purpose. These programs, however, seem to survive long after the original purpose, because the constituencies build up that are dedicated to one cause, and that is simply preserving and continuing their existence whether we need the program or not. This is certainly true of the helium program. This program dates back to the Wilson administration, when observation balloons were thought to have strategic merit. The Helium Act of 1925 authorized the Bureau of Mines to build and operate a helium extraction and purification plant in Amarillo, TX, in 1929. According to the GAO, a nominal private helium industry existed in the United States before 1937. Between 1937 and 1960, the Bureau of Mines was the only domestic helium producer, selling most of what it produced to other Federal agencies, but also supplying some to private firms. This program got an additional boost in 1960 when the Eisenhower administration feared there would not be a sufficient supply of helium to meet the demand for strategic blimps to spot fuel tank pressure and rocket engines for the fledgling space program at the time. The 1960 act created incentives for private companies to return to the market and, as a result, we finally did have four private natural gas producing companies building five helium extraction facilities, and they entered the market. What is happening now, as of 1995, is that 90 percent of the helium produced in this country does come from these private operations. Unfortunately, though, the 1960 act also led to a growing Government- run operation and the stockpiling of helium purchased by the Federal Government. The act also stipulated that the Bureau of Mines set prices that would cover all of this Government-run program's costs, including its debt and interest, and that Federal agencies and contractors were then required to buy helium from the Bureau of Mines. Today, Mr. President, that debt is approximately $1.4 billion, and some have suggested that our current stockpile could supply the Government's needs, if you can believe it, for the next 80 to 100 years. Although the proponents of the program have a complicated argument about how this program does not really cost the Federal Government any money, the point is that the Federal Government does not need to run a helium program anymore. There is a private sector helium industry that can and does provide the necessary helium to the Government. By terminating the program now, Mr. President, selling off the helium reserves over time to ensure that the taxpayers receive a fair price for the helium they have financed, we can pay off the debt and, according to the CBO, we could recover between $1 and $1.6 billion from the reserves if sold at current prices. CBO also believes that we can double annual revenues from the program by doing this over time. Mr. President, achieving deficit reduction is a very difficult task. Programs like the helium program were created to meet certain needs. The defenders of the program have a variety of arguments to justify its continued existence, but the reality is that it appears over and over again on target lists for deficit reduction because it no longer makes any sense for the Federal Government to continue to run this program. It has not been terminated despite attempts of the Reagan, Bush, and now the Clinton administration because powerful constituencies fight to keep these types of programs alive. Mr. President we simply cannot afford to keep these programs going. The 104th Congress should be the place where this program is terminated. Mr. President, I ask unanimous consent that the article I referred to earlier from the Washington Post February 7, 1995, business section relating to the helium program be printed in the Record.

Mr. FEINGOLD

Mr. FEINGOLD. Mr. President, we are doing something very unusual here. We are working on a constitutional amendment. We know that has not happened many times in our history, and so when you deal with a constitutional amendment, you have to take an even tougher attitude about what you are doing. I think you have to consider that two different things can happen, obviously. One is that the amendment may be defeated which, in this case, I happen to prefer. As we go through the amendments, we also have to be responsible about the amendments we put on, because whether I like it or not, this may become the law of the land, part of the Constitution. So the amendments that are offered become particularly important. What we are doing here is to decide whether or not this balanced budget amendment should become the law of the land and possibly a straitjacket and a problem for a Federal Government from which it will be very difficult to extricate ourselves. So it is in that spirit that I address the amendment of the Senator from Nevada. I want to take this opportunity to commend the Senator from Nevada for his eloquent leadership on this issue of the Social Security aspect of the balanced budget amendment--his leadership last session and his leadership now. I also commend the senior Senator from California, who took the lead in the Judiciary Committee on which I serve in trying to provide at least this exemption for Social Security from the balanced budget amendment. The Senator from California did such a good job, and I was happy to be able to help her. We had a very close vote; we were only one vote off in the Judiciary Committee from defeating a motion to table the amendment. I see this amendment both in the committee and here on the floor as not only serious, but as a sincere and constructive amendment, even though I have reservations about the balanced budget amendment itself. I especially speak at this time because even though I think there is a chance the balanced budget amendment will not pass this body, and even though I think there is a possibility that even if it goes through the Congress it will not be approved by the States, the fact is that it may well do that. We may well be faced with the possibility that the U.S. Constitution will have a balanced budget amendment that provides no protection for the Social Security program. Listening to the debate in committee and in listening to the debate yesterday on the floor, I realized again that when you look at the Social Security amendment, it really depends on how you look at the Social Security fund itself. How one the contributions people make to the Social Security system. One group of people see the Social Security fund as a distinct and separate fund, based on a contract. They think they paid in the money, that a deal was made, that they are entitled to their Social Security benefits, and that it is not subject to congressional whim. There is another group that sees this as just another program, albeit a worthy program. I know of no Member of the Senate or any Member of the other body who does not think Social Security is a worthy program. But this other group just sees it as a program, something that may make sense, something that is expensive, something that we may have to move around and take some money from, but something that is worthy nonetheless. Those are really the two different ways to look at Social Security. It is because of this distinction--the differences between the way people look at Social Security--that people come down on different sides on what the chairman of the Judiciary Committee called in the committee the loophole. The chairman, the Senator from Utah, said that putting this amendment into the balanced budget amendment and into the Constitution would create a loophole; that the Members of Congress could take basically anything they wanted and label it Social Security and use it as a way to get out from under the amendment. That was the chairman's view of how this would create a loophole. But I think I look at the Social Security fund a little differently than the chairman--and I acknowledge that a lot of people support him in his view. But I look at the Social Security system as a contract. And so for me, the loophole is not the amendment that the Senator from Nevada is proposing; the loophole is the past and inappropriate use of the Social Security fund to mask the deficit and the debt. That has been the loophole that has been used in the Congress. We should not suggest even for a minute--and apparently it went a lot longer than that--that somehow the Social Security fund is part of that money that comes into the Federal Government and that we can use it in our budget calculations, as, in fact, it has been used in the past to mask just how big the deficit really is. I know that the Congress in recent years has recognized that this is inappropriate, but it was done--that is the dangerous loophole; that the Social Security fund can be regarded as a cookie jar, a slush fund, whatever you want to call it, to solve our problems that we have failed to solve. In my mind, that is the loophole, not the risk that the Constitution would say do not touch Social Security. I think the amendment of the Senator from Nevada and the amendment in committee of the Senator from California are critical because they permanently close the loophole as we move in the balanced budget era. In fact, I would say, based on a few years of listening to folks all over my State, that the use of the Social Security fund to mask the deficit and the debt is one of the really strong reasons people mistrust the Federal Government. They are troubled by their belief that we are willing to engage in gridlock and avoid solving our Nation's problems. But, they are also angry that we can be so arrogant as to consider Social Security system funds not to be part of a contract with the people who have paid into the system, but money that we can use to solve problems that we have not been willing to solve in the past. The amendment of the Senator from Nevada is responsible as to the future, as well. It is highly responsible, because what it does is address the future solvency of the Social Security fund. Just as the Social Security fund is not the reason we have a deficit today--we know that the fund is solvent--it is still the case that the Social Security fund faces an extremely likely, if not certain, strain in the future. It must remain intact as a separate system with a separate, credible, long-term financing plan so that Social Security will be there for those of us who come along in the future. Without the amendment of the Senator from Nevada, the balanced budget amendment becomes not a friend to the future, but a continuing threat to the integrity of the Social Security system. Now, that is not to say--and I think this is important--that there cannot be changes on the table for Social Security. I think there should be. Everything needs to be improved over time and, especially when you are facing future insolvency, we have to consider some changes. In fact, maybe we should look at some of the changes proposed by the so-called Entitlements Commission, the Kerrey-Danforth Commission. They put some ideas on the table that had to do with Social Security, such as whether or not we should raise the retirement age, whether or not there should be some different assumptions made in terms of how the Consumer Price Index is calculated as it relates to the cost-of-living increases. I am willing to consider those changes, but only if those changes are used to make sure that the money goes into the Social Security fund to make sure it is solvent for the future. Without the amendment of the Senator from Nevada, these tough changes, which are going to be controversial no matter what, will be changes that the American people may see as ways not to make the fund solvent for the future, but to take care of pork projects somewhere else out of their State so that Members of Congress do not have to balance the budget directly. I think that is a valid fear, not only for seniors, but for all the people who come after them and who hope that they have not paid into the Social Security system in vain. Mr. President, in this context, I am troubled not only by the notion that somehow we are creating a loophole in the Constitution, but I am especially troubled by the notion that I have heard expressed in committee and on the floor--I do not know whether it is a notion or a reassurance or a wish--which is this: The statement that somehow Social Security will compete well. It is going to do really well, we are told. It has a lot of support. There is nothing to worry about. Nobody is going to hurt Social Security. That is what the proponents of the balanced budget amendment tell us. That is what people say when they say we do not need the amendment of the Senator from Nevada. But I think that is troubling. I am afraid that the Social Security system may not fare so well in the brave new world of the balanced budget amendment or in this new marketplace of budgetary suitors. I think that the language of the marketplace in saying that Social Security will compete well is a direct breach of the whole concept of Social Security and the promise that was made to all those hardworking Americans who paid into the system over the years, understanding and believing in their Government that nobody would monkey around with their retirement money. Mr. President, we are not talking here about just another kind of tax revenue. Nobody likes taxes. Nobody likes April 15. But the understanding is, when you send in that money on April 15, or you have to send in a little extra amount because your withholding was not quite right, that it goes into a big pot out here and these Members of Congress get to decide, along with the President, what is done with it. People do not like it, but they understand that is our system. But that is not their understanding when it comes to Social Security. For 50 years, that is not what the American people have been told Social Security is all about. To put it another way, I do not think the American people think they should be part of, in effect, a large block grant that the Federal Government has where they have to compete against other programs, and that they hope they do well in this new block grant after the balanced budget amendment, and they hope there will be enough money there so they can get their Social Security benefits. That is not the understanding. Mr. President, words of ``competition'' and ``free market'' are almost always appropriate. That is what our system is based on. The words of ``free market'' and ``faring well'' and ``competing'' with other worthy programs are not appropriate when it comes to Social Security. this is often overlooked in attempts to minimize the importance of this amendment, is that there is an implication that this is just about senior citizens. Somehow, this is pandering to older Americans who want their Social Security benefits, as if there was something wrong with that. There are constant references to the power of the senior lobby, how we are pandering to older people. This is what we hear all the time. But I will say that I agree with the sentiments of the proponents of the balanced budget amendment who say that nobody is going to mess around with the seniors today. That is politically explosive. That is not going to happen. We are not going to take away from the benefits of senior citizens today. They are not, if you will, the at-risk population when it comes to the balanced budget amendment. I would like to identify three generations that are far more at risk because of this constitutional amendment than the seniors of today. The first generation is my generation, the baby boomers. Do not accuse me of pandering to seniors. Accuse me, if you will, of worrying about my own Social Security benefits. I am concerned. I am concerned that, if this institution has the right to mess around with Social Security funds, when my wife and I get up to be that age, there is not going to be anything there. And there are a lot of us in our generation. You bet, we have a lot of votes. But we also have a right to the benefits that we paid for and we were told we were going to get by participating in this system. Clearly, my generation is concerned. There is another generation that I know is concerned and they have become very vocal. They are called generation X, kids in their late twenties or early thirties. They actually have articulated a philosophy for which I do not pretend to be the spokesman. Obviously, I am too old. I have read the articles and heard the statements and seen them on TV. What they are saying is, we are not sure that the older folks--and now I am in that group--who are running the show in Washington care at all if Social Security is solvent when we get there. They know there are seniors today. There is a huge group of baby boomers that will eat up all kinds of benefits when they get there. They, I think, kind of smell a rat. When they get there, they are very concerned that this system that they are now paying into in their younger years, when they would probably like to get a house, buy another car, they are worried we are spending. There is a third generation, the age of my kids. People who are 14, 11, 9. People that do not understand this. Yet some are figuring out that we have an awful big Federal deficit here, and they will realize shortly as they graduate from high school and go into the work force, if we do not protect Social Security, they will be the ultimate victims of our fiscal irresponsibility of recent years. I conclude, Mr. President, noting that the people that we are always talking about with regard to the deficit and the balanced budget amendment are the children and the grandchildren. Would it not be ironic if, in the name of helping the children and the grandchildren, we take away forever the possibility that those same people would have the opportunity to have Social Security? That is ultimately what is going on here. We are taking away potentially, without this protection, the same rights and privileges that so many of us hope to enjoy, because there just will not be any money left in the fund. Mr. President, this is a sincere amendment. Whether the balanced budget amendment passes or not, it is absolutely essential that we keep it separate, that we keep our promise not only to those who have worked and paid in, but that we keep our promise to those who come after. I urge my colleagues to regard this as an important amendment. I strongly urge support for the motion of the Senator from Nevada. I yield the floor. Mr. FORD addressed the Chair.

Mr. FEINGOLD

Mr. FEINGOLD. Mr. President, today I am pleased to reintroduce legislation that I originally introduced in the Senate last year, the Anti-Redlining in Insurance Disclosure Act of 1995. Although the House of Representatives was able to pass a more limited disclosure bill during the 103d Congress, I was disappointed that the Senate was unable to address what I see as not only a critically important civil rights issue, but also an issue essential to any hopes of revitalizing the struggling economies of our inner cities. In recent years, this Nation has made tremendous strides in fighting various forms of discrimination, particularly in terms of employment and educational opportunities. Unfortunately, the progress we have made in combating these forms of discrimination has not lessened the need to exercise the same level of persistence in extinguishing equally offensive, less subtle forms of racism and bigotry. The term redlining actually evolved from the practice of particular individuals in the banking industry using maps with red lines drawn around certain neighborhoods. These individuals would then instruct their loan officers to avoid offering their financial services to residents of these redlined neighborhoods. These red lines typically encircled low-income and minority communities, resulting in the unavailability of the financial services necessary to purchase a home, a business, or an automobile. But even as Congress identified and moved to curb these discriminatory practices in the banking industry, a disturbing and growing level of discrimination was emerging from the insurance industry that would continue to deny certain individuals the opportunity to own their own home or start a small business. Home ownership is an aspiration that transcends the artificial boundaries of race and income in America. As anyone who has secured their first home loan can attest, there is an extraordinary feeling of prestige and sense of self-worth that accompanies home ownership. But for those individuals that reside in the economically depressed inner- city neighborhoods of Milwaukee, Chicago, and other such cities, these feelings of pride and accomplishment are even further intensified. It is Federal Government takes forceful action we will continue to send the wrong message to those who seek to stabilize and stimulate these inner- city economies. We must expose and eliminate these appalling redlining practices that prevent hard-working, fully qualified individuals from pursuing their dream, and their right, to obtain a home or business loan. Though it may seem obvious to some, we must recognize that any serious effort to rebuild the economies of these inner-city communities must have minority home and small business ownership as their cornerstones. There are many well-motivated individuals in these communities that are committed to economic revitalization--whether it is purchasing a home for their family or starting a small business and creating jobs. It is heartening that there are both Democrats and Republicans, conservatives and liberals who recognize the need to revitalize our inner cities, and yet it seems fruitless to discuss ideas such as enterprise zones and community development block grants without addressing a glaring problem that prevents an otherwise qualified individual from owning their own home or business. Several years ago Congress reacted to reports and studies that an element of the financial services industry was preventing residents of minority and low-income communities from obtaining home loans. In response, Congress passed the Home Mortgage Disclosure Act [HMDA] which required banks and thrifts to report their lending practices using a set level of criteria. This legislation, which contrary to dire predictions has had a nominal impact on the vitality and prosperity of the lending industry, has provided Federal and State regulators in the mortgage financing field with detailed information to identify mortgage redlining. This critical piece of legislation was passed for precisely the reason of enhancing the power of State and Federal authorities to determine if banks and other lending institutions were discriminating in their lending practices. But as effective as disclosure requirements have been in exposing these abuses in the banking industry, it is clearly not enough. Property insurance, as we all know, is almost a prerequisite to obtaining a home loan. This was best illustrated by Judge Frank Easterbrook of the U.S. Seventh Circuit Court of Appeals in that court's ruling that redlining practices are illegal and a violation of the Fair Housing Act. Speaking for a unanimous court, Judge Easterbrook observed that ``lenders require their borrowers to secure property insurance. No insurance, no loan; no loan, no house; lack of insurance thus makes housing unavailable.'' Judge Easterbrook's remarks underscore the need to place people of all racial and ethnic backgrounds on a level playing field when it comes to the opportunity to purchase insurance. In short, denying an individual access to affordable and adequate property insurance is essentially denying that individual access to home ownership. The key question, of course, is do redlining practices exist? Countless new reports and studies indicate that there is a prevalent and growing level of discriminatory underwriting in the insurance industry. Studies such as the 1979 report of the Illinois, Indiana, Michigan, Minnesota, Ohio, and Wisconsin Advisory Committees to the U.S. Commission on Civil Rights and the recent study on home insurance in 14 cities released by the community advocacy group ACORN have pointed out that insurance redlining practices are widespread in America. These reports highlight the fallacies in the contention that lack of adequate insurance in many of these communities is due to economics and statistically based risk assessment. In addition, there is substantial anecdotal evidence that suggests individuals residing in minority and low-income communities are systematically denied affordable or adequate homeowners insurance. I was shocked and outraged when I first saw the extensive media reports of the statements made by a district sales manager of a large insurance company which serves the city of Milwaukee. The sales manager was recorded saying to his insurance agents: Very honestly, I think you write too many blacks * * *. You gotta sell good, solid, premium paying white people * * *. They own their homes, the white works * * *. Very honestly, black people will buy anything that looks good right now * * * but when it comes to pay for it next time * * * you're not going to get your money out of them * * *. The only way you're going to correct your persistency is get away from blacks. This policy of denying affordable insurance to minorities was also illustrated when the manager showed one agent how to accomplish this goal by stating that * * * if a black wants insurance, you don't have to say, just tell them, because based on this kind of policy, the company will only allow me to accept an annual premium. Do it that way. Mr. President, Milwaukee, WI is truly a wonderful city. It has midwestern charm, a strong work ethic and like many other of our Nation's urban communities, a large inner-city population that is struggling to become economically vibrant and prosperous. But what redlining practices do is deny those who are playing by the rules the opportunity to own their own home or business. Again, there are those who will assert that insurance is less available in these areas because of risk-assessment and other economic principles. But according to a study by the Missouri insurance department, data comparing low-income minority areas with low-income white areas in St. Louis and Kansas City showed that low-income minorities on average paid higher premiums for homeowners insurance than white homeowners of similar means for comparable coverage. On top of this, actual losses were lower in the minority areas. Clearly the problem of discrimination exists and is widespread. The question now is what can we do about it. Redlining practices are illegal. This was established by Judge Easterbrook and the Seventh Circuit Court of Appeals in NAACP versus American Family Insurance, when the court ruled that the Fair Housing Act also applies to the underwriting of homeowners insurance. The problem is with the inability of some regulators and the unwillingness of others to enforce the law. In powerful testimony before several congressional committees, it has been stated over and over that to enforce the law greater disclosure of crucial information is needed from the insurance industry. Assistant Secretary Roberta Achtenberg, head of the Department of Housing and Urban Development's Division of Fair Housing and Equal Opportunity testified to this, as did Deval Patrick, assistant attorney general for civil rights. It was also expressed by numerous State insurance commissioners including those from Texas, California, and Missouri, as well as several civil rights and community groups. As clear as the problem of insurance redlining has become, so has the solution. Public disclosure can serve multiple purposes in combating insurance discrimination by allowing for an accurate assessment of the extent and nature of the problem, as well as assisting Federal and State regulators who are charged with enforcing the antidiscrimination laws that currently exist. The Home Mortgage Disclosure Act has been effective, but passing disclosure laws that only apply to banks and thrifts is like throwing out a life preserver with rope that is several feet short. We must go further, and pursue disclosure regulations that will provide Federal and State insurance regulators the same tools that Federal and State banking regulators have, and allow them to detect and expose any incidence of discrimination in the availability of homeowners insurance. The bill I am introducing today, the Anti-Redlining in Insurance Disclosure Act, would require insurance companies to disclose information regarding where they write property insurance and is closely patterned after the requirements in the Home Mortgage Disclosure Act. The bill would require the Secretary of Housing and Urban Development to establish requirements for insurers to compile and submit policy information annually. The information that the bill requires to be disclosed must be reported along census tract lines, and must include the number and types of policies written, the race of the applicants, whether the applicant was accepted or rejected and the loss data for the specified area. This information would be collected in the 50 largest metropolitan statistical areas diversity and size of MSA populations. These disclosure requirements are almost identical to those recommended by the General Accounting Office in their investigation of this issue last year. Providing this extensive and detailed information will enable regulators to analyze and compare the availability, affordability, and quality of insurance coverage for property, casualty, and homeowners insurance. Insurance redlining is a national phenomena that demands a Federal response. In the insurance industry, enforcement by State officials of existing antidiscrimination statutes has proven to be difficult for one principal reason; though many State insurance commissioners have been forceful and aggressive in exposing and sanctioning appropriate parties, other State insurance commissioner offices lack the necessary resources to collect and compile data information adequately. In many markets this data is simply unavailable. And critical to this effort is the need to collect claims and other loss data which is central to determining if the unavailability of adequate and affordable insurance is due to sound economic underwriting principles, or to reprehensible factors such as the race and ethnic background of the applicant. Last year, the efforts of Representatives Cardiss Collins, and Joseph Kennedy resulted in the House of Representatives passing a disclosure bill similar to the bill I have introduced today. My colleague from Wisconsin, Representative Tom Barrett, has also been actively involved with the insurance redlining issue. Just last year, Representative Barrett chaired a field hearing in Milwaukee where first-hand testimony was given about the extent of these discrimination abuses in Milwaukee and other cities plagued by similar problems. In addition, it is my understanding that due to the leadership of Secretary Cisneros and Assistant Secretary Achtenberg, HUD is considering the promulgation of disclosure requirements similar to the reporting requirements in the bill I have introduced today. Although some have suggested that HUD lacks the necessary authority to pass such regulations, it is important to note that HUD has been identified by a Federal court in Ohio as legally authorized to enforce the Fair Housing Act as it relates to homeowners insurance. This was affirmed in Nationwide Mutual Insurance Company versus Cisneros, when the U.S. District Court upheld HUD's regulatory authority, noting that HUD's contention that it had been delegated authority under the Fair Housing Act was ``reasonable and entitled to substantial deference.'' I look forward to monitoring the development of HUD's actions, and will certainly lend my support and assistance to their efforts to curb redlining practices. Mr. President, Voltaire once said that ``Prejudices are what fools use for reason.'' It is clearly one thing to underwrite insurance policies based on sound economic factors and principles--it is another thing to deny adequate or affordable insurance based on an individual's race or ethnic background. We should be very proud of the civil rights accomplishments our society has made in the last 30 years. But as many potential homeowners in my State and across the country have discovered, too many individuals in the insurance industry have used their prejudices to determine the economic and social future of communities that are on the brink of collapse. Passing this legislation would represent marked progress in the pathway to offering all of our citizens, regardless of racial or ethnic background, equal access to social justice and economic opportunity. I would like to conclude, Mr. President, by asking unanimous consent that several items be printed in the Record. These items include the text of the bill, a letter I received from several organizations supporting the legislation, a letter that I, Senator Simon, and several member of the House sent to Roberta Achtenberg, Assistant Secretary for Fair Housing and Equal Opportunity as well as a response I received from that Department, and finally, two editorials from the Houston Post and the Dallas Morning News on the issue of insurance redlining.