Dianne Feinstein

Mrs. FEINSTEIN

Mrs. FEINSTEIN. I thank the Senator.

Mrs. FEINSTEIN. Mr. President, I earnestly implore my committee chairman, the key is simply to exclude the revenues from balancing the budget in an amendment to this amendment, and that would be presented next week. I believe it is the only way to have an honest amendment. I also believe that it makes sense. There are 40 million people today on Social Security. By the time this amendment is ratified and the first balanced budget is prepared, there will be 80 million Americans on Social Security. Young people working today can expect that the money will not be there to pay for their retirement, and yet they are paying FICA taxes. That is not right. They should not have to pay if the money is not going to be there. If the money is used to balance the budget, it just brings the crunch to Social Security that much sooner. I do not think that that should be a by-product of a balanced budget amendment. More fundamentally, I believe it is a flaw that will cause its nonratification by enough States to make it the law of the land. What I want to say, the bottom line is if we can adopt the amendment--and I just read the amendments to the Constitution again this morning--I think if we are going to have monetary policy in the Constitution, it is fitting, just as there are technicalities in other amendments on double jeopardy and that kind of thing, that there be an amendment which simply exempts the revenues from the trust funds that hold the FICA taxes. As I said yesterday, absent those, absent that amendment, I cannot vote for a balanced budget amendment. With that amendment, I can vote for a balanced budget amendment. So I say these things today, for whatever help it might be to my chairman in considering where this matter rests. Mr. President, in the year that I was born, the Federal debt amounted to less than $25 billion. In the year my daughter was born, the Federal debt was about $225 billion--10 times greater. My granddaughter Eileen was born 2 years ago. At the time of her birth, the Federal debt was more than 150 times greater than it was when I was born--nearly $4 trillion. That, in a nutshell, is why I am a strong supporter of a constitutional balanced budget amendment. The path we are on is unsustainable. We do not have another generation to allow this problem to fester. The time for action is now. In my first 2 years as a U.S. Senator, I have had the opportunity to observe the standard operating procedure of the Senate--the budget, authorization, and appropriations processes. I am convinced that without a constitutional amendment, this body will simply be unable to balance the budget. Let me share what I see the problem to be. The American people are sitting on a debt time-bomb jeopardizing the economic security of generations of Americans to come and I believe that without the imposition of an amendment such as this, it will continue to be business as usual. In my opinion, business as usual just isn't acceptable. Although amending the Constitution is strong medicine, I am convinced that without this strong medicine, America's fiscal health will not improve. I have listened to the various arguments about why we should not require a balanced budget amendment to the Constitution. In theory, certain of these arguments have merit. But, I am afraid that historical and present day practices often demonstrate the wide variation between theory and practice with regard to the Federal budget. In theory, the Federal Government might run deficits in times of recession to stimulate the economy or in war simply to pay its bills, and surpluses in times of prosperity because revenue increases and unemployment decreases. In fact, that has not happened. In the last 35 years, the Federal Government has balanced its budget exactly twice. Once in 1960, a surplus of $300 million and again in 1969, a surplus of $3.2 billion. In the last quarter of a century, the Federal Government has run up more than $4 trillion in debt without once balancing the budget. During this time, this Nation has experienced war and peace and economic booms and recessions. Yet, never did this Government balance the Federal budget, let alone run a surplus. As mayor of San Francisco, I balanced nine budgets in a row. I know how difficult it is to do. But that is why we are elected--to make those tough choices. I support this amendment and the line-item veto because I know that failing to balance the budget is a choice that this Nation cannot afford. interest on the debt The Federal Government now spends over $226 billion annually just to pay the interest on its nearly $5 trillion debt. Our interest payments alone are $59 billion greater than the projected deficit of $176 billion for fiscal year 1995. This means that if the United States did not have to service this enormous debt, there would be no deficit this year. In fact, we would have a small budget surplus. If current policies continue, the Congressional Budget Office estimates that net interest payments will reach $387 billion by the year 2004 or roughly 58 percent of the amount that is expected to be spent on all discretionary programs--$669 billion will go just to pay for interest on the debt. Today every dollar in personal income taxes collected west of the Mississippi is used to pay for nothing more than interest on America's staggering Federal debt, or put another way, that's 40 percent of each taxpayers' tax dollar. This money is not used to build new highways, planes, or ships, provide medical care to a child or grandparent, or education to our Nation's students. Americans receive no services, no public infrastructure, no investment for these interest payments. They get will become 50 percent, then 60 percent, and on and on till bankruptcy. What has 35 years of accumulated deficits meant to our economy? According to a study by the New York Federal Reserve Board, the low national savings rate, now under 3 percent--the lowest of any major industrialized country--mostly attributable to large Federal deficits, and it has resulted in a loss of 5 percent growth in our national income during the 1980's. Now that's a big deal. Let me tell you what it means. issues of concern For all those reasons, I believe the time has come to pass a constitutional balance budget amendment. I recognize, however, that amending the Constitution of the United States is very serious business. It has been amended just 17 times since 1791. Congress should not push through just any amendment that says just balance the budget no matter what. We must pass an amendment which will let us balance the budget honestly and wisely. social security amendment I must be frank. I don't believe that legislation before us is the best constitutional amendment. Its greatest flaw is that it continues the process of misusing Social Security funds. Let me explain how: First, this amendment would put Social Security on-budget, thereby reversing congressional action and undermining the integrity of the system. Between its creation in 1935 and 1969, Social Security has always been off-budget. In an attempt to cover the costs of the Vietnam war and later to mask growing deficits, Social Security was put on-budget. This was a misuse of the Social Security trust fund. In the 1990 Budget Enforcement Act, Congress put an end to this by declaring Social Security funds off-budget. The act states: * * * the receipts and disbursements of the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund--which together make up the Social Security Program--shall not be counted as new budget authority, outlays, receipts, or deficit or surplus for purposes of-- (1) the budget of the United States Government as submitted by the President; (2) the congressional budget, or (3) the Balanced Budget and Emergency Deficit Control Act of 1985. An amendment in the Senate to exclude Social Security from budget calculations was passed in the 101st Congress by a vote of 98 to 2. Every Member there that served in the 101st Congress voted for that amendment. The joint resolution before us now requires total outlays not to exceed total receipts for any fiscal year. This would clearly include Social Security and thereby overturn both the historical treatment of Social Security and Congress' recent decision to affirm the off-budget status of Social Security. Worse, it would allow the misuse of Social Security funds to continue. The important point is, Congress has already debated this matter and decided to take Social Security off-budget. This is not a loophole. It was an informed decision to budget honestly. Now this constitutional amendment will reverse that. This amendment would enshrine this abuse of Social Security in the U.S. Constitution. This debate is not about who wants to protect Social Security and who does not. It is about who wants to be honest with the American people in our budgeting and fiscal policy and who does not. To be honest, Social Security must remain off-budget. Including Social Security in the budget calculations would be the enormous loophole. It is not the Federal Government's money and should not be used as if it is. Second, Social Security is not like other Government programs and should not be treated like other Government programs. Social Security is a publicly administered, compulsory, contributory retirement program. Through the Federal Insurance Contributions Act [FICA], workers are required to contribute 6.2 percent of their salaries to Social Security. Employers are required to match that amount. This 12.4 percent contribution funds the Social Security system. By law, these funds are required to be held by the Federal Government in trust. They are not the Federal Government's funds, but contributions that workers pay in and expect to get back. Third, Social Security does not contribute to the Federal deficit. In fact, the Social Security trust fund surpluses are masking the true size of the deficit. In 1995 Social Security will take in $69 billion more than it will pay out in benefits. By 2001, Social Security will be running surpluses of more than $100 billion a year. By including Social Security in the constitutional balanced budget amendment, Congress would obfuscate the true deficit problem. Fourth, the failure to save Social Security's surpluses could undermine the system's viability. In the late 1970's and early 1980's, Congress changed the way the Social Security system was financed. Recognizing the large demand on the system that would be created by the retirement of the baby boomer generation early next century, the Social Security system was changed from as pay-as-you-go system to a system that would accumulate large surpluses now to prepare for the vast increase in the number of retirees later. Rather than saving these large surpluses, however, Congress has used them to finance the deficit. That means beginning in 2019, when Social Security is supposed to begin drawing down its accumulated surpluses to pay for the benefits of the vast numbers of retiring baby boomers, there will be no money saved to draw on. Congress will be forced to either raise taxes, cut benefits, or cut other spending programs to meet the obligations workers are paying for now. In short, the American workers will have to pay twice for the retirement of the baby boomers because we are not saving what they contribute now. As the chart next to me illustrates, the Social Security surpluses will decline and then plunge dramatically into deficit. The deficit will reach $700 billion a year by 2029. Between 1995 and 2002, Congress will essentially steal $705 billion from the Social Security trust fund. That is the amount of surplus that is supposed to be saved over that period, but instead will be used to balance the budget. If we are to save that money, the budget would have to run a surplus of $705 billion and we know that will not happen. By the year 2018, the Federal Government will owe the Social Security system $3 trillion. Those who say that Social Security is not on the table with this amendment are incorrect. It is--bigtime; to the tune of $3 trillion of reserves for retirement that will be involved unless our amendment is passed. Clearly, unless we begin saving the Social Security surpluses and addressing the long-term needs of the system, we will be spearheading a financial Armageddon for Social Security. The only way to save the Social Security surpluses to pay for future retirements is to balance the budget exclusive of Social Security. The impact of this, of course, would be that the Federal Government would run a unified budget surplus--a balanced Federal budget and a surplus in the Social Security trust fund. In this way, we would cut the Federal debt and save Social Security funds, not just watch the debt keep growing. That is what the amendment Senator Reid and I are offering would do--it would require a balanced Federal budget exclusive of Social Security. Social Security system does have a long-term financing problem. In my opinion, an expert advisory board should be formed to advise Congress on how to adjust the system to restore balance and make the system live within its means. The point, however, is that Social Security changes should be made to shore-up the long-term solvency of the Social Security system, not for any other reason. By keeping Social Security in this amendment, Congress would continue the shell game. My support for maintaining the integrity of the Social Security system reinforces my support for the balanced budget amendment. But, a balanced budget amendment that uses Social Security funds is not truly balanced. I support a constitutional balanced budget amendment that is honest, but I cannot support a balanced budget amendment which would enshrine the Constitution. If my vote is needed to pass this amendment, then Social Security will have to be exempted.

Mrs. FEINSTEIN. Mr. President, I voted for the balanced budget amendment last year. I also voted for the Reid amendment to exempt Social Security, take it off budget, last year. I want to state for the Record--and it is my intention--that I want to vote for a balanced budget amendment. There are two reasons I want to vote for a balanced budget amendment. The first is my own life experience. The year I was born, 61 years ago, the entire Federal debt amounted to just $25 billion. When my daughter was born, the entire Federal debt amounted to about $225 billion. And 2 years ago, when my granddaughter, Eileen, was born, the entire Federal debt was 150 times greater than when I was born; it was nearly $4 trillion. My life experience shows me that, with business as usual, the Congress is not going to be able to balance a budget that, in 61 years, has gone from $25 billion to $4 trillion in debt. So, in a nutshell, I want to support a strong balanced budget amendment. But I want to support the right balanced budget amendment. In my first 2 years as U.S. Senator, I have had the opportunity to observe the standard operating procedure of the Senate--the budget, authorization, and appropriations processes--and I have become convinced that a balanced budget amendment is in order. The American people are sitting on a debt time bomb. It jeopardizes the economic security of my daughter, my granddaughter, and even generations to come, because if it continues to be business as usual, the Nation's path is one toward bankruptcy and that, quite frankly, is not acceptable. I have listened to a lot of arguments about why we should not require a balanced budget amendment to the Constitution. In theory, certain of these have a great deal of merit. But historical and present day practices often demonstrate the wide variation between theory and practice when it comes to dealing with the Federal budget. In theory, the Government might run deficits in times of recession to stimulate the economy, or in war simply to pay its bills, and surpluses in times of prosperity because revenue increases and unemployment decreases. In fact, though, that has not happened. In the last 35 years, the Federal Government has balanced its budget exactly twice-- once in 1960, a surplus of $300 million, and again in 1969, a surplus of $3.2 billion. In the last quarter of a century, the Federal Government has run up this $4 trillion in debt without once balancing the budget. And during this time, the Nation has experienced war and peace and economic booms and recessions. Yet, never was this Government able to balance the Federal budget, let alone run a surplus. As mayor of San Francisco, I balanced nine budgets, and I know it is tough to do so. I support this amendment, and I support a line-item veto, because I know that failing to balance the budget is a choice that this Nation can no longer afford, for the reasons so stated. Let us talk for a moment about two charts which, when I came here, convinced me--and I regret that these are so small; we thought we had them enlarged, but we do not. These two charts, I think, are very instructive. If you can see them, Mr. President, in 1969--these are Federal outlay charts--military spending consumed 45 percent of our Federal outlays. In 1994, about 19 percent of our Federal outlays were military. So military spending has gone from almost one-half to just slightly under a quarter. Security, and AFDC--consumed about 27 percent of Federal outlays. In 1994, they consumed almost 50 percent of Federal outlays. There is the rub. In 1969, interest on our debt consumed slightly less than 7 percent. In 1994, interest on the debt had doubled to nearly 14 percent of total outlays. What is left? Discretionary spending--education, health, environment, Commerce, Interior, all those departments--in 1969 consumed 21 percent of Federal outlays. In 1994, 18 percent; actually down. Discretionary spending has gone down, military spending has gone down dramatically. What has gone up? Interest on the debt and entitlements. And there is the rub. There is the answer I believe to the right to know. That is the road that lies before us. If we really want to make the budget balanced, those are the hard choices: What to do about interest on the debt--which today net interest consumes 40 percent of every person's tax dollar--and how do we control entitlements, Medicare, Medicaid, Social Security, and so on? The Federal Government now spends $226 billion just on interest on its nearly $5 trillion debt. Our interest payments alone are $59 billion greater than the projected deficit of $176 billion for the year 1995. This means that if we did not have to service the debt, there would be no deficit this year. If we did not have to service our debt, there would be no deficit. As a matter of fact, there would be a small budget surplus. That is the irony of the problem that we have. So if current policy continues, the CBO estimates that net interest payments will reach $387 billion by the year 2004, or roughly 58 percent of the amount that is expected to be spent on all discretionary programs, $669 billion will go by the year 2004 just to pay for interest on the debt. That is not for Commerce. That is not for Interior. That is not for an education program. That is not for a health program. That will not purchase a tank or an aircraft carrier or a battleship. It will be just paper to service the debt. Today, every dollar in personal income taxes collected west of the Mississippi is used to pay for nothing more than interest. And that is the sad story, because the interest is growing and we need to stop it. So what has 35 years of accumulated deficits meant on our committee? According to a study by the New York Federal Reserve Board, the low national savings rate, now under 3 percent--and it is the lowest of any major industrialized power--is mostly attributable to large Federal deficits. And it has resulted in a net loss of 5 percent of national income during the 1980's. That impacts interest rates, it impacts jobs, it impacts the ability to buy a home, a car, to afford an education. It impacts the job base. It impacts everything we do every day in our life. And as it gets worse, I think what the Senator from Maine was saying is it impacts our children's destinies and our grandchildren's destinies as well. So for all of these reasons--and I want my chairman on the Judiciary Committee to understand this--I want to vote for a balanced budget amendment because I do not believe we can make the hard choices without it. And as I have said, they are all in that 50 percent--Medicare, Medicaid, Social Security, AFDC--and then that 15 percent which is interest on the debt for the most part. Now, I do not think Congress should push through just any amendment, no matter what. It has to be an amendment which balances the budget wisely and honestly. And that is the rub for me. This is where we come to Social Security. Let me be frank. I do not want to speak in detail because we will go into this later. But because of a statement I made yesterday indicating my position-- and I am particularly delighted that my chairman is on the floor so that he can hear this. I consider the greatest flaw in the amendment that we have before us is the fact that it places moneys placed in reserve through the FICA tax to pay for retirements in the future. It places those revenues on budget. And I believe that that is not an honest way to balance the budget. I believe that this puts Social Security essentially on budget. It reverses congressional action and it undermines the integrity of the Social Security system. Now between its creation in 1935 and 1969, Social Security was always off budget. Then in an attempt to cover the cost of the Vietnam war and to mask the growing deficit, Social Security was put on budget by this Congress. This was a misuse of the Social Security trust fund. In 1990, 2 years before I came to this place, the Congress saw that and they put an end to it. They declared as follows: Notwithstanding any other provision of law, the receipts and disbursements of the Federal Old Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund shall not be counted as new budget authority, outlays, receipts, or deficit or surplus for purpose of: (1) the budget of the United States Government as submitted by the President, (2) the congressional budget, or (3) the Balanced Budget and Emergency Deficit Control Act of 1985. In this body, that vote was 98 to 2. So clearly, Members said we must not use Social Security revenues held in trust for retirement to balance the budget. And, boom, the right thing was done and it was taken off budget. What this amendment does is put it back on budget again. This would clearly include Social Security. It would overturn both the historical treatment of Social Security and Congress' recent decision to affirm the off-budget status of Social Security. Worse, it would allow the misuse of Social Security funds to continue. The important point is, Congress has already debated this. They have taken it off budget. It is not a loophole. This amendment is not meant to be an escape hatch. I know that there is an amendment at the desk called S. 290. I reviewed that amendment. That amendment is flawed because that amendment deals with benefits. It does not deal with the moneys that are taken from the FICA tax paid by employees and employers and held in trust for retirees. Now, even without this balanced budget amendment, just for one short moment let us look at what happens with Social Security now off budget. Here we are today in 1995. Social Security is generating surpluses. As a matter of fact, Social Security will generate these surpluses, up to the year 2002. In 1995, $69 billion; 1996, $142 billion. It climbs and it climbs. In 1999, it is $394 billion. It goes up to $705 billion of surpluses from the FICA tax held in trust to pay retirements for the baby boomer generation that is now, alas, beginning to retire. What happens? What happens is this: There is $3 trillion by the year 2015 in revenue surpluses. Then they plunge. They go down to the year 2030, $700 billion negative. Negative. Now, here is the rub with this amendment. It takes all of these revenues and it puts them on budget. So these revenues are used to balance the budget. The way to avoid $705 billion in 2002 when this becomes relevant is to create a surplus of $705 billion. Nobody here believes we will be able to create a surplus of $705 billion to protect Social Security. So what is the answer? The answer is, in an honest amendment, take it off budget. Do not allow those revenues to be used. Now, I would like to have printed in the Record a letter I received today from Martha McSteen, the president of the National Committee to Preserve Social Security and Medicare. She says: I am writing with regard to S. 290, introduced recently by Senators Kempthorne, Dole, Thompson and Inhofe. The fact that the sponsors of S. 290 believe that it is necessary to take action to protect Social Security under a balanced budget amendment is, in my view, proof that it is imperative that the Senate adopt your amendment to exclude Social Security from the balanced budget amendment. The pending balanced budget amendment reverses the 1990 law removing Social Security from a consolidated budget and put Social Security back on budget as part of the Constitution. This represents a serious problem for Social Security which cannot be addressed by S. 290 or any statutory measure. Sponsors of S. 290 cannot bind future Congresses to their legislation or, for that matter, ensure that this Congress will not modify or overturn this legislation while Social Security I also note that while S. 290 attempts to prohibit Congress from increasing Social Security revenues or reducing benefits to balance the budget, it will allow Congress to continue using the surplus in the Social Security trust fund to conceal the deficit. This only confirms our understanding that the proponents of the balanced budget amendment intend to continue this budgetary charade, thereby avoiding balancing the budget well into the next century. I ask unanimous consent that the letter in its entirety be printed in the Record.

Mrs. FEINSTEIN. Not necessarily, I say to the distinguished Senator from Louisiana. If I might refer this to the chairman of the Judiciary Committee, I think it would be most interesting to have his response to this question.

Mrs. FEINSTEIN. That would be helpful.

Mrs. FEINSTEIN. I thank the Chair. I yield the floor. Several Senators addressed the Chair.

Mrs. FEINSTEIN. Mr. President, I yield.

Mrs. FEINSTEIN. Absolutely.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Mr. President, I rise today to pay tribute to Augusta Wolfe who will celebrate her 100th birthday on March 2. Augusta has been a resident of California for 62 years and when she and her friends and family gather to celebrate, I want her to know she has been honored by the U.S. Senate. Raised in New York City until age 17, Augusta had three sisters and five brothers. Her mother died when Augusta was only 13 and she assumed much of the responsibility and care of her younger siblings. Her father remarried and she acquired one half-sister. Her older brothers moved to Winnipeg, Canada. At age 17, Augusta joined them, then sent for the three younger brothers and one sister. While in Winnipeg, Augusta worked in her brother's store. At age 19, she met and married her brother's friend, Nathan Wolfe, and had two children. Two years later the family moved to Salt Lake City, UT, where they lived for 14 years. During this time, Augusta helped Nat found and operate a very successful retail business, Wolfe's Dept. Store. Mr. Chairman, In 1933, because Nat's health was failing, they moved to Beverly Hills and later to Palm Springs. After Nat's death in 1952, Augusta returned to New York City for a brief period and then to Santa Barbara. She devoted much of her energy to creative art, primarily the making of mosaics. Later, she moved to Laguna Hills, CA, where she continued her interest in art and began writing poetry, which she continues to do until this date. Her work has been recognized by the National Library of Poetry and some of it has been published in their publication ``Tears of Fire.'' Today she is active and in relatively good health. Her keen intellect and memory are unimpaired. She lost her daughter in 1979. In addition to her son, Bernard, a California lawyer, she has many devoted friends and relatives who will attend her 100th birthday celebration on March 4, 1995.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. I certainly know the 49'ers. From day one of this season, the 49'ers were picked by many as the team to beat. Assembled from a corps of seasoned veterans and prime talent developed within, the 49'ers had but one goal: beat Dallas and win the Super Bowl. After overcoming a number of early season injuries, the team finished with the best record in the league. they moved past the Chicago Bears in the first round of the playoffs, and realized part one of their goal with a hard-earned victory over the Dallas Cowboys. Now, they go into Miami as a heavy favorite, hoping to win an unprecedented fifth Super Bowl. I would like to know if my colleague also feels that this is a wonderful matchup?

Mrs. FEINSTEIN. Of course. Bruising contests are not unfamiliar in California as I well know from last year. If you add up all of the championships in World Series, Super Bowls, NBA, and NCAA Championships, California has won more than any other State. I ask my colleague to give her views on this Super Bowl.

Mrs. FEINSTEIN. Mr. President, the House may be debating the Contract With America, but I ask the Senate today to consider the Contact with America. On Sunday, the people of America will be in contact with one another, eagerly debating, disputing, and disagreeing. However, I regret to inform this body that they will not be in touch with us. They are of the mind that the issue is far too big for the Senate to tackle or the President to block. Government involvement would be called unsportsman-like conduct. The Supreme Court would be ruled off-sides, and even radio talk show hosts would be flagged for interference. Of course I mean Super Bowl XXIX--29. This ultimate contact sport presents a real problem for me and my colleague, Senator Boxer, because this year's Super Bowl pits two California teams against one another-- the four-time Super Bowl champs, the San Francisco 49'ers and the talented and challenging San Diego Chargers. Normally, if a California team would play a team from some other State, I would willingly wager with the rival Senators. But it would be unseemly for two Senators from the same State to wager against one another. Does my colleague, Senator Boxer, agree?

Mrs. FEINSTEIN. Well, no matter which team wins, Senator Boxer and I can take pride. There are obvious similarities between Government and football. In both, blows to the face are disallowed. And there is much that Government can learn from football--hopefully, beyond trick plays and sneaks. For one thing, we can learn that sportsmanship and mutual respect that go with handshakes between players after the battle is over, the score is settled and life moves on to other challenges. Here is to a great game.

Mrs. FEINSTEIN. While I realize that I represent the entire State of California, I must admit that I will be cheering for the 49'ers. I would like to point out to my colleagues that there is no public outcry for term limits in football. Otherwise, the 49'ers, with the shy smile and accurate arm of Joe Montana, would not have won super bowls in the 1981 season, in 1984, or in 1989 and finally in the following year, a crushing 55 to 10 win. Now, as a native San Franciscan, I do take pride in such an exemplary record. And, frankly, while wishing San Diego well, I expect Steve Young to demonstrate his mastery of the game with an unprecedented fifth Super Bowl victory for the 49'ers. Both teams, however, are to be congratulated for their success in reaching the Super Bowl, and for many other accomplishments, is that not right?

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Mr. President, I am joining my distinguished colleague, the chairman of the Senate Judiciary Committee, Senator Hatch of Utah, to introduce once again the Digital Performance Rights in Sound Recordings Act. Just as the version on which we collaborated last year did, this bill will--for the first time--provide recording companies and musical artists with the same protection under copyright law already enjoyed by songwriters and composers with respect to the performance of digital sound recordings. Senator Hatch and I introduced similar language in the last Congress for the express purpose of beginning in earnest the debate over how to redress the current imbalance in copyright law. I'm very pleased that, although time did not permit final congressional action on the bill last year, virtually all of the affected industries accepted our invitation--and that extended by former Congressman Hughes--to fully explore the complicated legal and commercial issues presented by technology's inevitable advance. Mr. Hughes, then chair of the House's Subcommittee on Intellectual Property and Judicial Administration, organized two highly effective roundtables that brought cable, broadcast, satellite, restaurant, and music industry leaders together with other copyright holder and labor organizations. I also met at great length with many of those principals last February, as did Chairman Hatch and his staff on many, many occasions. These efforts, I am pleased to say, produced a sweeping agreement on most major aspects of this issue last May. That agreement provided the framework for the bill we have introduced today. This legislation creates a digital public performance right in sound recordings that is applicable to transmissions for which subscribers are charged a fee. Most of these transmissions are subject to statutory licensing, at rates to be negotiated, or if necessary, arbitrated. However, interactive services remain subject to an exclusive right, in keeping with the bill as originally introduced last Congress. The bill contains protections for licensing of copyrighted works in vertically integrated companies and contains language to make clear that the new performance right does not impair any of the other copyright rights under existing law. Ditigal technology, and the industries built around its use to distribute sound recordings, have evolved and advanced dramatically in the 17 months since this legislation was first introduced, Mr. President. The need to keep America's copyright law current, therefore, has only become more acute. Accordingly, I believe that this Congress has not merely an opportunity, but a responsibility, to build on the tremendous bipartisan strides made last year by expeditiously considering, amending if need be, and passing the bill that Senator Hatch and I have introduced today. For those who have not reviewed this issue since the last Congress or are new to it, let me briefly review the principal reasons to adopt this legislation: First, it is the fair thing to do. Owners of almost every type of copyrighted work--movies, books, plays, magazines, advertising, and artwork, for example--have the exclusive right to authorize the public performance of their copyrighted work. Sound recordings, and the artists and companies that make them, however, have no such performance right. Accordingly, when a song is played over the radio, or, as is increasingly the case, over a new digital audio cable service, the artist who sings the song, the musicians and backup singers, and the record company whose investment made the recording possible have no legal right to control or to receive compensation for this public performance of their work. The artists who made the music, and the companies that underwrote its production and promotion, don't see a dime of the revenue realized by the ditigal transmitter. And, without a right of public performance for sound recordings by means of digital transmissions, they will not. That is just not fair, and this inequity will not be corrected unless and until this legislation is passed. Second, the advent of digital technology and the emergence of a whole new industry to distribute them directly to the home make prompt protection of artists and record companies critical. Let me explain why. Ordinary, or analog, radio signals are waves and, as such, they vary in strength and break down over distance. That breakdown greatly diminishes sound quality. In the past, therefore, the sale of comparatively high-quality recordings on cassette tapes and record albums was not jeopardized by the casual home recording of music played over the radio. The quality of home recording over-the-air simply did not compare with what a record or tape sounded like over a home stereo system. Today, however, the same technology that has given us compact discs now allows perfect reproductions of music to be digitized--turned into computer ones and zeros--that can be sent by reassembled into concert hall quality music in our homes. Predictably, and quite legally, this quantum leap in sound technology has had a revolutionary impact on the way that music is marketed. New subscription digital audio services have sprung up in cities, towns, and rural communities across the country. For a modest monthly fee, they deliver multiple channels of CD-quality music to customers in their homes--primarily through subscribers' cable TV wiring. Other companies are experimenting with similar services to be provided through home computers, or more sophisticated systems that will permit the customer at home to custom-order whatever music he or she would like to hear and record. Although it is extremely time- consuming to download a CD today, soon compression technology and high- speed transmission will permit virtual instantaneous access. All one will need is a modem. As the market is now configured, however, these companies need merely go to a local record store, buy a single copy of a compact disc which they can then transmit for a fee to tens of thousands, potentially millions, of subscribers. Because our copyright law is behind the technological times, record companies and recording artists do not see a penny of compensation from even one of those thousands of performances. It is thus no exaggeration to say, that, without the change in copyright law proposed today, these wonderful new services have the potential to put the current recording industry out of business. Why travel to a store to buy a record, tape, or compact disc when you can get the same, or custom-tailored musical packages, in your living room at the touch of a button? Frankly, that would be a tolerable evolution of the marketplace if artists and record companies were compensated for the use of their sound recordings by the new digital transmission services and on-line and interactive services. Right now, however, because of skewed copyright law, that is not the way the market works. Neither Senator Hatch nor I suggest that digital audio services should not be able to operate just as they do now to bring top-quality digital signals to American homes. Our bill does insist, however, that such services not be able to take advantage of a redressable gap in our copyright laws to avoid compensating record companies and artists fairly. Third, copyright experts have consistently urged Congress to create a right of public performance in sound recordings. The U.S. Copyright Office has recommended since 1978 that a performance right in sound recordings be granted in all public performances, not just digital transmissions, and recently reiterated the urgency of the need for such reform created by the advent of digital audio technology. Indeed, the Copyright Office testified before the House Judiciary Subcommittee on Intellectual Property and Judicial Administration in the last Congress, urgently calling for enactment of such legislation. In addition, the administration's working group on intellectual property rights of the information infrastructure task force, in its preliminary draft report, recently wrote: * * * the lack of a public performance right in sound recordings under U.S. law is an historical anomaly that does not have a strong policy justification--and certainly not a legal one. The report also reiterated the administration's support for the bill that Senator Hatch and I introduced in the 103d Congress and for H.R. 2575, its House counterpart introduced by Representatives William Hughes and Howard Berman. It is time to heed these expert calls. Fourth, taking the experts' advice also will help U.S. trade negotiators obtain greater protection for American copyright holders overseas than they are now able to demand. More than 60 countries around the world extend similar rights to producers and their artists, and have for many years. American negotiators' efforts to obtain protection for our own companies and artists have been hampered, as they have said repeatedly,by our inability to reciprocate. It is long past time to provide our trade representatives with this valuable bargaining chip. Finally, Mr. President, I want to reiterate that the legislation we are introducing today is no different in intent than S. 1421, although the content is somewhat different. We have attempted to continue the work of the last Congress. Furthermore, we are introducing this legislation in the same spirit with which last year's bill was submitted. Chairman Hatch and I want to continue to work closely with all the affected industries to make this as strong and properly tailored a piece of legislation as possible. We are standing at the cusp of an exciting digital age. Technological advances, however, must not come at the expense of American creators of intellectual property. This country's artists, musicians, and businesses that bring them to us are truly among our greatest cultural assets. This bill recognizes the important contribution that they make and provides protection for their creative works, both at home and abroad. I am once again very pleased to be working with Senator Hatch to correct an increasingly dangerous and inappropriate imbalance in our Nation's copyright laws.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. I thank the Senator very much. Mr. President, I would like to rise in support of the pending legislation, and I would like to compliment both Senators Kempthorne and Glenn. Mr. President, let me speak for a few moments as someone who in the 1970's was President of a Board of Supervisors in local government and, through most of the 1980's, was Mayor. I saw the development of these unfunded mandates firsthand, and, in so doing, I think I probably speak for the mayors and the local officials all across this Nation. Mr. President, in the 1970's, 22 new statutes were enacted imposing new regulations on State and local governments or significantly expanding programs. During the 1980's, while I was Mayor, 27 new laws with Federal mandates were added. The Congressional Budget Office has estimated that new regulations enacted between 1983 and 1990 imposed total costs of about $8.9 and $12.7 billion on States and local governments, depending on the definition of mandates used. Federal dollars during this time declined. Between 1981 and 1990, Federal dollars declined 28 percent, when the figures are adjusted for inflation, to satisfy these mandates. The drop in Federal dollars shifted more of the costs on State and local governments, draining their resources and making it increasingly difficult for State and local governments to meet their budgetary requirements. Let me speak about something I know well--California. Unfunded mandates now cost the State $8 billion annually. Just in providing health, social services, educational and correctional services to illegal aliens, unfunded mandates are costing California more than $2 billion annually. The State of California, since 1978, has been under proposition 13 whereby local jurisdictions effectively cannot raise revenues to meet these mandates. Now, rather than talk about my time in local government, let me give you some specific, current, ongoing examples of the impact that unfunded mandates are having throughout the State of California right now. Let us take, for example, a city of about 120,000 people known as Sunnyvale, California. The city has identified a total of 202 mandates that they must meet. It has incurred costs for 103 of these mandates during the last 5 fiscal years. The total cost of these mandates has been approximately $77 million, representing 18 percent of Sunnyvale's total operating budget. For example, Sunnyvale's compliance with environmental mandates accounted for 62.4 percent of the total costs of these mandates. The general and other nonutility funds of Sunnyvale were impacted by a total of $7 million in the 1993 budget. This represents in excess of 10 percent of the total operating costs of the city government, roughly equivalent to the costs of operating the library plus half of the parks in a given year, or roughly equivalent to 70 percent of fire services for that community. Again, the community cannot raise taxes to pay for it. The city estimates that one-third of the total single-family residence utility bills this year will be earmarked for compliance with State and Federal mandates. Mr President, let me take the city of Los Angeles. Unfunded mandates again have placed a recent burden on that city. Federal mandates will cost Los Angeles $4.2 billion over the next 5 years. For example, the Federal underground storage tank regulations require leak detection systems and corrective action affecting 206 sites and 431 storage tanks in Los Angeles. Corrective action will cost in excess of $31 million over the next 5 years. Compliance with the Safe Drinking Water Act will cost the city in excess of $245 million over the 5-year period. Costs to comply with the Americans with Disabilities Act are estimated to exceed $30 million. This includes costs for curb cuts, ramps, special bathrooms in public buildings, whether or not they are actually used. Federal law now requires all highway projects financed with Federal gas tax funds be designed and constructed in metric measurements starting September 30, 1996. Revisions to all city standards, manuals, standard plans, ordinances, and other documents will be required. Also, new drafting and design equipment will be needed, along with some training. The Los Angeles Department of Transportation will have to replace 14,000 speed zone signs at a one-time cost of $1.2 million. The total cost to comply with this program--that is, just changing to a metric system--is $2.6 million. And this is just one small change. Did anyone ever add up or, again, even know the cost when this bill was promulgated? I doubt it. Let us take Los Angeles County. To meet Federal mandates and still balance its budget, the county of Los Angeles has to significantly curtail other programs. For example, this year, Los Angeles County employees will have to forego cost-of-living and other wage adjustments, and aid to indigents will be substantially reduced. Several libraries are being closed and all others will be open for a reduced number of hours. Recipients of welfare and public health services will face longer waits due to minimal county staffing levels. Looking at the impact of immigration, Los Angeles County found that in 1991-1992, net county costs for services provided to legal immigrants, amnesty aliens, and illegal aliens and their citizen children were about $947 million, while county revenues received from this segment accounted for only $139 million. Another example. The city of Fresno is required under the Safe Drinking Water Act to fit each of its 217 wells with expensive radon filtration systems. The city estimates the total capital costs of the system in the Fresno metropolitan area at $191 million and an annual operating cost of $26 million. Considering the city currently has a $567 million budget with a very small percentage of discretionary dollars, the initial outlay and annual costs to comply with the radon standards could have a significant impact on Fresno. According to the city, the cost of compliance with the proposed radon regulation would force water systems to drop more compelling programs with greater public health and environmental benefits. For Stockton, CA, a city of 215,000 people, compliance with Federal mandated stormwater provisions of the Clean Water Act will cost the city approximately $1.2 million per year over the next 5 years or $15 to $20 per home. The city has the choice of either decreasing park and recreation, library services, or police services if the public will not accept the addition of a fee increase. The Clean Air Act requires Stockton to spend approximately $2.2 million in capital costs and $100,000 in annual operating expenses to control landfill gas. Again, the city must either increase user fees or shift funding from parks and recreation, library services or public safety. The Fair Labor Standards Act requires Stockton to pay overtime to firefighters who work more than 53 hours a week. As a result, the overtime costs Stockton an additional $400,000 a year and affects the city's ability to add public safety officers. Let me give what I think are rather egregious examples from my own city, San Francisco. The City of San Francisco is required under the Safe Drinking Water Act to comply with filtration mandates. The city would prefer to put more funds into watershed protection, which is cheaper and would make filtration unnecessary. But instead it is forced by Federal regulations to the more costly expenditure. Building a filtration plant would cost the city $500 to $700 million, while the cost for nonfiltration options range from $40 to $60 million. Let me give another example. Candlestick Park, this weekend, will be sold out--a major NFL game. A while back one person sued the City saying she did not have a seat as a disabled person at a game. The city came together and formed an agreement. But under the Americans with Disabilities Act, the Department of Justice is now saying that the agreement is not good enough. The city will have to spend $5 million to build another 600 seats for disabled at Candlestick Park. What is the rub? The stadium is sold out this weekend. There are 7,000 seats for disabled already, and they are not filled. Yet someone in Justice is saying the city must build another 600 seats. I submit, the real problem is that once the bills are passed and the regulations are drafted by someone in a department, there is no telling what can happen. While I was Mayor we would engage in consent decrees with all parties and someone in the Federal Government would say no, that is not acceptable to us. You must spend more money and to it our way. I think this is what is happening throughout the United States. It certainly is throughout the State of California. Compliance with the Americans with Disabilities Act will cost San Francisco $8.2 million in fiscal year 1995 in spite of conflicts with other code requirements. For example, safety cells for suicidal inmates in the new jail built to meet strict Federal codes say there should be no hard objects, such as bars, inside, and that there must be a lip on the floor by the door to keep fluids inside. However, the Americans with Disabilities Act requires bars by the toilet and a floor that a wheelchair can roll into. San Francisco faces other costs in fiscal year 1995 arising from unfunded mandates--$149.1 million for sewage treatment facilities required by the Clean Water Act; $830,000 for scrubbers and boiler retrofit to comply with the Clean Air Act; $3,090,000 to remove asbestos; $2,910,000 to test for lead, and $500,000 to implement drug and alcohol testing programs for employees responsible for operating certain vehicles as a condition of receiving Federal transportation funds. Mr. President, I believe it is unfair for the Federal Government to impose mandatory regulations on localities without providing the necessary funding to implement them. I feel very strongly that Congress must be responsive to the fiscal constraints under which local and State governments operate. Mr. President, S. 1 provides the kind of relief which State and local governments want and need. It requires: Any bill or amendment imposing a Federal mandate of more than $50 million on a State or local government the mandate's cost and the funds to pay for the mandate. If the bill or amendment imposing the mandate is to be paid for by future appropriations, the bill must provide that the mandate will be eliminated if moneys are not appropriated or scaled back to the level moneys are appropriated. Any bill or amendment without the CBO cost estimate and funding will be ruled out of order, but a point of order can be laid against it and overturned by a constitutional majority. CBO must consult with State and local governments in determining the costs of Federal mandates. Good. Finally. Federal agencies must consult with State and local governments in determining the costs of mandates in Federal regulations. Good. Finally. Any bill or amendment imposing a Federal mandate of more than $200 million on the private sector must include a CBO estimate of the mandate's cost. Good. Laws or Federal rules enforcing civil and constitutional rights, national security or treaty obligations, emergencies, and voluntary programs, as exempted. I urge my colleagues to support this important legislation.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Thank you very much.

Mrs. FEINSTEIN. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mrs. FEINSTEIN. Mr. President, I ask unanimous consent that I may proceed as in morning business.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Mr. President, I support Senator Chafee's proposal to extend the Medicare Select Program, which currently provides Medigap health benefits to roughly 400,000 older Americans by using a managed care model. Like many of the other original cosponsors of this legislation, I come from one of the 15 States where the Medicare Select demonstration program has proved its popularity during the last 3 years. Medicare Select, which currently provides 100,000 Californians with low-cost Medigap insurance using a managed care model, was enacted in 1990 as a 3-year demonstration program and has proved to be extremely popular, enrolling 400,000 seniors in 15 States. This program used a network of providers to cut premium costs by 10- 30 percent over fee for service Medigap products--those services and costs not covered by Medicare--according to several reports. In California, roughly 100,000 seniors have signed up for the program, and Blue Cross of California alone is enrolling an additional 2,200 per month. These Medicare enrollees are signing up because the Medicare Select Program can provide low-cost, high-quality health benefits, while still retaining a high degree of choice over their physician. The reason for the program's popularity are simple. In order to save money or receive added benefits, more and more older Americans are enrolling in managed care plans. In fact, Consumer Reports lists many Medicare Select products as its highest rated values, and extension of the Medicare Select Program is strongly endorsed by California Insurance Commissioner Garamendi, as well as the National Association of Insurance Commissioners. In addition, the Mainstream plan--and nearly every other health reform proposed this Congress--provided for a continuation and expansion of Medicare Select and other forms of managed Medicare. Certainly, managed Medicare programs like Medicare Select must be implemented carefully, in order to ensure that Medicare enrollees are appropriately informed of the benefits of this program, provided with high-quality services, and ensured access to highly trained physicians. In addition, managed care programs must be shown to provide lower costs to the Federal Government in addition to consumer discounts. However, without the extension of the Medicare Select Program, which will be cut off in July 1995--before additional health care reform will have been enacted. In the absence of national health care reform, I believe that this successful and popular managed Medicare program should be allowed to continue.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Mr. President, I thought it might be in order to give a very brief status report on the condition of the flooding in the State of California. It is a strange and altogether tragic irony that just about 1 year ago southern California was hit by wildfire and then the shattering Northridge earthquake. The 1-year anniversary of the Northridge earthquake will be this coming Tuesday, January 17. As we evaluate the recovery and expenditure of nearly $11 billion of Federal funding that has been committed to disaster relief in that earthquake, record levels of rain are falling in California and have been since late last week, flooding rivers, washing out roads, causing mud slides, knocking out electricity and water supplies, and affecting the lives of hundreds of thousands of people throughout the State. So I rise today, Mr. President, to give a brief status report on that record rainfall and flooding. To begin with, I have been in contact with FEMA Director James Lee Witt, who is currently in California, and my State staff is on alert to provide whatever assistance they can. In addition, Transportation Secretary Pena, Housing Secretary Cisneros, and Federal Highway Administrator Slater are on a 1 o'clock flight today to California to assess what additional Federal assistance will be necessary in the days and weeks ahead. Although the spirit in my State may be temporarily dampened, I am really confident that Californians will once again show the resilience and the determination that we have shown in the past and that we will overcome this disaster as we have the others. Californians have come together in times of disaster, and we will do so once again. Last night, at about 11:30 p.m. eastern time, less than an hour after a request from Gov. Pete Wilson, President Clinton declared a Federal disaster for 24 of California's 58 counties. I thank the President on behalf of California for quickly declaring this emergency so individual disaster assistance funds could begin flowing. FEMA started taking calls for disaster assistance as early as this morn- ing. For those that might be watching C-SPAN, FEMA encourages all disaster victims to call this number, 1- 800-462-9029, for information and to register for Federal assistance. Preliminary estimates of the damage are as follows: At least six people are dead; over 1 million have been affected by power outages up and down the State. Very preliminary damage estimates exceed $50 million as of now. This will undoubtedly rise as the waters recede and a full assessment of damages is made. Thousands of people have been evacuated from their homes. According to news reports, California has been hit with 6 months' worth of rain in 10 days. Last night I talked with Dr. Joe Friday, the Director of the National Weather Service, and he stated to me that although there is a brief respite today, heavy rains are apt to continue through the weekend. More than 50 major highways and freeways and hundreds of roads are closed due to flooding. In one 7-hour period yesterday, the California highway patrol logged 530 accident calls. That is more than five times the normal level, and by early afternoon had dealt with almost 500 disabled vehicles just in southern California alone. What is clear is that in many areas of the State near-record levels of rain have fallen with devastating consequences. Let me describe some examples of just what the State is facing. In the Russian River area of northern California, the entire business district and hundreds of homes in the community of Guerneville in Sonoma County have been underwater for the last few days. The Russian River has swelled to record flood levels. According to the U.S. Geological Survey, Monday's water flow in the Russian River was the highest ever recorded. The word from California this morning is that the river has begun to recede back to normal levels. However, Sonoma County has been without water, and the State is bringing water in. Everybody is being urged to boil their water. All 2,800 residents of Hamilton City in Glenn County were evacuated as the Sacramento River rose 3 feet above flood stage. People literally are kayaking down the main business street, State Street, in downtown Santa Barbara. Many of the communities still recovering from last year's earthquake and severe wildfires have been particularly hard hit, such as Malibu and many of the canyons in southern California. Everything that was a river or a creek yesterday is a flood basin today. The Pacific Coast Highway from Malibu to Santa Barbara has been closed due to mud slides. Pepperdine University and local businesses in the Malibu canyon are closed due to flooding. The Pepperdine campus was used for helicopter evacuations of residents in the surrounding canyon. Fortunately, but not for lack of practice, the local, State, and Federal responses are timely and effective. The State Office of Emergency Services under the direction of Richard Andrews quickly established a state operations center to coordinate State assistance. The California National Guard has activated 75 trucks, helicopters, boats, and 300 personnel, conducting rescue and evacuation operations in seven counties. FEMA Director James Lee Witt, already in California, is remaining in the State to coordinate the Federal disaster response. FEMA damage assessment teams have been on the ground since the weekend, though much of this work is impossible until the water finally recedes after the final rainfall. We do not know when that will be. FEMA has been requested by the State not to establish disaster assistance centers. All financial assistance to people will be done by teleregistration, through the number that I gave earlier. I would like to repeat it once again. Anyone who is a victim of the flood and wishes either information or assistance should call 1-800-462-9029. The for as long as necessary. Personnel have been deployed from FEMA's Infrastructure, Individual Assistance, and Hazard Mitigation Programs to California to begin work with State and local officials. As I mentioned, Secretaries Cisneros and Pena are on their way now to California to decide what additional assistance might be warranted. I will work closely with my colleague, Senator Boxer; my colleagues in the House; and you, Mr. President, and others in the Senate. Over 30 congressional districts in California have been affected by this disaster, and we, together, will make sure that Federal response is swift, effective, and complete. My heart goes out to the families that have members who have perished in this, our latest disaster, and to the many thousands of people that have been affected by the rising waters. My message to them is that FEMA will be there until we can get people back in their homes, businesses back on their feet, and lives back in order. I thank you very much, Mr. President, and I yield the floor.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Mr. President, I rise, not to discuss this subject, but to discuss another. I had a placeholder at 5:30 to introduce four amendments to this bill. But knowing that the proponents of the bill would very much like to have it passed without amendment, I simply would like to make a statement about these amendments and then hope to work on a bipartisan basis to achieve some consensus and propose them later. Mr. President, the amendments I was going to propose were in an area of congressional reform, which is as important as any area in this bill. It is campaign spending reform. I think campaign spending reform actually is more important, because it has so solidly conditioned the atmosphere of the public with respect to campaigns. I was going to propose four amendments, the first, on spending limits. As I understood it, there was substantial objection to the public finance aspect of spending limits. The amendment I would propose would contain the spending limits of the prior Senate bill. In other words, the limit per State would be based on voting-age population. It would range from a high of $8.1 million in a large State such as California and a low of $1.5 million in the smallest State. In exchange for complying with these voluntary spending limits, a candidate would be entitled to a half-price discount broadcast rate, a reduced postage rate, and a complying candidate would be able to match an opponent that would not abide by the spending limit or exceed the spending limit without regard for the individual contribution limit of $1,000. That would be the balance. The second amendment would limit PAC contributions to 20 percent of the total raised. The third amendment would require a candidate to state at the end of their television ad in the last 4 seconds, clearly and definitively, speaking on the tube, that ``I believe the facts in this advertisement to be true.'' The fourth amendment would be in the area of personal funds. They would require a candidate to declare if they intend to spend in excess of $250,000 or, second, in excess of $1 million in the race, within 15 days of qualifying as a candidate. If their answer was in the affirmative, then gradually the individual contribution limits applicable to the opponent would be raised. So, again, you would have the opportunity to achieve a more level playing field. Let me briefly state the rationale. I think there is probably no campaign in the Nation that better demonstrates the need for campaign spending reform than does the recent California Senate race. In my own election, and in others around the country, voters, I believe, saw some of the worst features of campaigns repeating themselves. There were spiraling campaign costs. More than $45 million was spent in the California Senate race. There was a virtual arms race of negative political advertisements day after day, beginning in February in California. One area my amendment would address, for example, is where there was a negative ad in the sense of one candidate referring to their opponent, the station broadcasting the ad would have to make a disclaimer. That is, this station has no way of ascertaining the truth of the ad that is about to appear. One of the problems we found is that people automatically believe a paid commercial spot is true, in the same way they believe a paid commercial spot for a product is true, and, of course, there is legitimate recourse for a false commercial spot. What we found is that there is no recourse for a false political spot. The station must run the spot, even if it is blatantly false. Therefore, why not have the station come forward and say that this station has no way of ascertaining the truth or falsity of the spot which is about to appear. The total amount of funds spent in the 1994 election cycle nationally is staggering. Spending by Senate and House candidates who survived primaries was $596 million, up 17 percent from 1992 and up 50 percent from 1990. Fifty percent more funds were spent in this race than just 4 years ago. Democratic candidates spent a record of $292 million, up 8 percent from 1992. And Republican candidates spent a record of $294 million, up 29 percent from 1992. The source of this is the Federal Election Commission. Now, we all know that there is no room in campaigns for people with sensitive feelings. However, in the 1994 campaign, negative messages, groundless attacks on character, and distorted images dragged political advertising to a new low. I would like to quote from an op-ed appearing in the New York Times and authored by Regionald Brack, chairman of Time Inc., and also chairman of the Advertising Council, which sponsors public-service ads. He reports: The cutthroat ads followed a disturbing formula. In clipped, agitated tones, attack your opponent's character. Distort his or her record. Associate him or her with extremists or unpopular political figures. To awaken fear, work in a between-the-lines racist message; foster suspicion, insinuate corrupt behavior. And by all means, steer clear of substantive issues. Examples abound. This year one ad implied that a candidate might have lied about drug abuse. At least two candidates suggested that their opponents' political philosophies were somehow to blame for the kidnapping and murder of a 12-year-old and for the lethal rampage of a foe of abortion. Each political party charged that the other would significantly erode Social Security, Medicare, and other such programs dear to the electorate. It is these 30-second negative ads that are driving politics in America today and turning away the American voter. These ads, which are short on substance and long on attack, are shaping the political debate. A post-election poll indicated that 75 percent of the respondents who said they voted in November said they were [[Page S645]] turned off by negative ads. In an election in which only 39 percent of the eligible voters went to the polls, 58 percent of those who did not vote said negative ads had influenced their decision to stay home. Now, what is the problem? What I found the problem to be, is that even if a candidate wants to take the high road and deal with issues, the simple fact is you cannot. And I want to tell you why. Focus group after focus group suggests this: The negatives drive through; the positives do not. When you ask in a focus group what do you remember most about this or that candidate, what they remember are the negative ads, and what they do not believe are the positive ads of record and accomplishment that a candidate may run. Therefore, what you find, as you watch poll numbers in big races, is that a candidate has to respond in kind to negative ads and if you try to respond to an attack with positives, the poll numbers drop. You also have to respond in quantity and equally to the opponent to have an effect. Consumers can file a complaint about false advertising of consumer products. But the aggrieved candidate has no legitimate recourse in a race. In my campaign, one television station began to run its own disclaimer before an attack ad saying that although the ad, they believed, was not correct, they still had to run it. Another disturbing problem is the specter of super-wealthy candidates being able to buy a seat. In the 1994 election, several candidates received as much as 16 to 17 percent of their total funds from loans out of their own pockets--the highest proportion since at least 1986. At least one way, I believe, the campaign system can offset the advantage of personal wealth without running afoul of the First Amendment and the Buckley versus Valeo decision is simply to loosen the constraints on the opponent. If a candidate declares up front that, ``I'm going to contribute either $250,000, up to $1 million, or over $1 million in personal funds,'' then the individual contribution limits on the opponent are adjusted gradually so that the opponent then can compete. Last, I strongly believe that campaign reform must look at the prevalence of contributions by PAC's. There is a real distortion in the public's mind that policymakers are beholden to special interests, and the special interests are the so-called PAC's, which overshadow average citizens, and impair, the public believes, an official's ability to make policy decisions based on national interests. Current law is thought to favor PAC's in two key respects. Most PAC's qualify as multicandidate committees and, as such, they may contribute up to $5,000. Now, in prior legislation, the Senate has banned PAC's altogether, and the House has opposed such a move. It seems to me that a fair compromise between the two is simply to limit the amount of PAC dollars a candidate can receive so that it does not exceed 20 percent of whatever the candidate raises. So I hope, Mr. President, in the future, to present these amendments, either separately or as a whole. There is no public finance in any of them. We would establish a campaign spending limit. We would be able to better bring about truth in advertising. We would be able to level the playing field when personal wealth is considered. And we would be able to reduce considerably the so-called involvement of special interests in campaigns. They are simple, they are direct, they make sense. So I will, in the days to come, be approaching, on both sides of the aisle, Members in hopes that I can put together a bipartisan commitment to just these four simple amendments and move them forward, either separately or as a whole. I thank you for your indulgence, Mr. President. I yield the floor. Mr. GRASSLEY addressed the Chair.

Mrs. FEINSTEIN. I thank the Senator.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Mr. President, I heard about 2:15 this afternoon that Senator Johnston was going to take the floor, so I picked up the phone and tried to reach him and missed him. I wanted to just say a few words. I listened, back in my office, to what he had to say. I was thinking, back when this mayor from San Francisco in the mid-1980's came back to see the head of the Energy Committee. I had an opportunity and I walked into his office. I saw the pelicans. I did not even know if he would really listen to me. I found a human being who was open, who was gentle, who was kind, who was listening, and who was interested. Then, of course, in 1992 I came to this Senate and I found a man who was a leader of the U.S. Senate--certainly a leader on the Democratic side and I believe a leader in the Senate--who had worked for 22 years, who had established a reputation in this body. I might say, many of the Members on our side, when we were discussing the California Desert Protection Act, said toward the close of the session, ``Don't worry. Watch Bennett. He is a master of the close.'' And as the months went on, the debate and the discussion on this bill, I saw indeed that Bennett Johnston was not only a master of the close, but was a master of strategy. I saw he is a man who is bright. He is a man who is articulate. But he is also somebody who is always a gentleman, always receptive, always able to say what he thinks in a way that brings the best from everyone around him. So, Bennett Johnston, I want to say to you: In the few days we have been back, this is the worst news I have heard. Even worse than the Contract With America, in many respects. I am just so sorry that this is going to happen. But there is one thing I do know: Even if you have made up your mind there are still 2 years, so we will be hearing much more from Bennett Johnston, the master of the close. I yield the floor.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Mr. President, today I am introducing a resolution to designate the visitors center at the Channel Islands National Park, California, as the ``Robert J. Lagomarsino Visitors Center.'' I am pleased to say Congressman Elton Gallegly is introducing the measure in the House of Representatives. The legislation is identical to S.J. Res. 152 and H.J. Res. 67 which we sponsored in the 103d Congress. The House of Representatives passed the measure in 1993 as part of H.R. 3252, the West Virginia Conservation Act. The Senate Energy and Natural Resources Committee also approved the measure last year, but the full Senate was unable to act before the 103d Congress adjourned. As some of my colleagues will remember, Robert Lagomarsino served in the House of Representatives for 18 years, from 1974 to 1992, representing the nineteenth district of California which then included Santa Barbara County and part of Ventura County. A member of the House Interior and Insular Affairs Committee and the Subcommittee on National Parks and Public Lands, Bob Lagomarsino was active on a wide range of natural resource issues, including the Alaska National Interest Lands Act, the Strip Mine Control Act, the California Wilderness Act, the Sespe Condor Rivers and Range Act, and hundreds of other bills. But perhaps Bob Lagomarsino is most closely associated with protection of the Santa Barbara Channel and the establishment of the Channel Islands National Park. Even before his election to the House of Representatives, Bob Lagomarsino worked to protect the fragile Channel Islands and their remarkable scenery and wildlife. As a Member of the California State Senate, Bob Lagomarsino authored the bill creating a state sanctuary around the Channel Islands. As a Member of the House, Bob Lagomarsino sponsored the legislation which expanded the existing Channel Islands National Monument and redesignated the area as a National Park. He then worked hard to secure the funding necessary to complete the park. Additionally, as a Member of the House, he fought to protect the Channel Islands National Park from potential oil spills, successfully persuading oil companies not to ship Alaskan oil through the Santa Barbara Channel and opposing new federal oil leases in the area. Given Bob Lagomarsino's long association with protection of the Channel Islands, I believe it is most fitting for us to designate the visitors center at the Channel Islands National Park as the ``Robert J. Lagomarsino Visitors Center''. I hope my colleagues in the 104th Congress will join me in recognizing the contributions of this distinguished Californian and enact this measure promptly. Mr. President, I ask unanimous consent that the text of the joint resolution be printed at this point in the Record.