T. Gorton

Mr. GORTON

Mr. GORTON. Mr. President, I ask unanimous consent that the Subcommittee on Airland Forces of the p.m., on Wednesday, May 10, 1995, in open and closed session, to receive testimony on tactical intelligence and related activities in the Army and Air Force in review of S. 727, the National Defense Authorization Act for Fiscal Year 1996, and the future years defense program.

Mr. GORTON

Mr. GORTON. Mr. President, I move to reconsider the vote.

Mr. GORTON. Mr. President, again, for the information of Members, we will now have the vote on my motion to table the Dorgan amendment. There are then two other amendments, all amounting to the same thing, that will come before final passage. I hope that those two amendments will be adopted by voice vote. I will then ask for a rollcall on final passage of the bill.

Mr. GORTON. Very briefly, Mr. President, I think that Members should know that this amendment by the Senator from North Dakota is all- encompassing and that it overrides the amendment which was supported by the vast majority of Members of the Senate that does have strict limits on punitive damages in cases involving small businesses, businesses with fewer than 25 employees and individuals of relatively modest means whose total assets are less than half a million dollars. So they, after having been the beneficiary of the last week of that very careful protection, protection against absolute bankruptcy, should the Dorgan amendment be adopted, they will be thrown into a situation in which absolutely unlimited punitive damages can be awarded against them. It is important for Members to understand that. Unanimous Consent Agreement

Mr. GORTON. Mr. President, unlike the situation at the time at which the Senator from North Dakota presented this amendment a week or so ago, we now have a bill in the Chamber in which there is no cap on punitive damages. I say that not in triumph but in regret. I believe that one of the great vices at which legislation of this sort properly should be aimed is at creating some kind of relationship between the actual damages caused by a tort, caused by a wrong, and the damages that can be recovered as a result. But with the latest set of amendments here, we have permitted a judge on certain findings of egregious conduct to go beyond what juries are permitted successfully to impose in the way of punitive damages. The entire matter, Mr. President, is at one level an argument on philosophy but at another level it is a debate about the Constitution of the United States. The Supreme Court in several recent cases, while not setting a specific ceiling or cap on punitive damages itself, has spoken of serious constitutional questions caused by unlimited punitive damages, or by punitive damages that are not related in any rational fashion to actual damages found by a jury or determined by a court. In other words, the Supreme Court of the United States has invited the Congress to do exactly what I had hoped we would do more successfully than we have accomplished in this bill. But just to go over it again, we have said that the maximum punitive damages that can effectively be awarded by a jury are in an amount twice the total of all economic damages and all noneconomic damages that go for pain and suffering. And since those damages, in very serious cases of people being maimed for life, can well go into eight figures, and sometimes do, we have a very large potential remaining for punitive damages. But in addition to that provision, in the so-called Snowe amendment is a $250,000 figure when twice the total of economic and noneconomic damages would be less than $250,000, together with the right of a judge to go beyond even the Snowe formula where the judge feels that formula to be too limited not to permit proper punitive damages for particularly egregious conduct. So the Senator from North Dakota, in a number of respects, has already succeeded. There is no number. There is no specific formula which limits punitive damages. As I have said frequently, I think there should be. Working with the laws of my own State and a handful of other States where punitive damages are not allowed at all, where the cap is zero in most cases, we find no difference in the safety or carefulness of business enterprises in those States. No case has been proven for the efficacy of punitive damages as a deterrent, in any event. My own view is that the original limitation in this bill was an appropriate one, but that original limitation has twice been liberalized in the course of this debate. And I express the fervent hope that in concerning ourselves with the proposition that we should not permit absolutely unlimited discretion on the part of juries, we should not have no maximum sentence in civil cases for wrongs, that we will make the partial and halting move toward some kind of rationalization which is now contained in this bill. Mr. President, we are in a peculiar situation here this morning in that we have a potential of this amendment and one other to be dealt with and we do not have specific limitations on the amount of time that can be utilized for them. So I hope that, when either the Senator from West Virginia or the Senator from North Dakota next speaks, we can get an indication as to when they will finish to allow the other amendment to take place. There will be votes on any other amendments which come up, but we will be asking unanimous consent that those votes take place after closing arguments and before the vote on final passage. So the sooner we know how long these two amendments will be debated, the earlier we will be able to predict to our Senators who are not here when they will have to come back to the floor to vote. Mr. ROCKEFELLER addressed the Chair.

Mr. GORTON. I move to table the Dorgan amendment and ask for the yeas and nays.

Mr. GORTON. Mr. President, I ask unanimous consent that a letter I received from the National Federation of State High School Associations be printed in the Record.

Mr. GORTON. Mr. President, first a procedural announcement. Thirty minutes remains under the order with respect to debate on product liability. Senators in their offices, therefore, should be on notice that approximately at 11:40 there will be a vote on my motion to table the Dorgan amendment, followed immediately by a vote on final passage of the product liability bill with, we think, the substitute adopted by voice vote. So Members should be prepared to come to the floor at or shortly after 11:40. On a second matter, in which I know I am joined by my colleague from West Virginia, regrettably, due to the inability of the Senators from Washington and West Virginia to get unanimous consent to make one additional change in their proposal, the so-called new trial provision after an additur remains in this bill. The Senators from West Virginia and Washington have pledged that the bill will not be presented by them to this body with that provision in it, and that pledge remains. Other than that, this bill is the work of many years of effort culminated in this Congress, as in the last Congress, by the joint efforts of the Senator from West Virginia and myself, and of many others whom I will mention after we have had a final vote. Together, with the input from Members on both sides of the aisle, I am confident that the bill will pass and that it will represent a significant step forward. Mr. President, one other comment that I make as a sponsor and one of the people who drafted this bill in the punitive damages section, we included an additive provision at the request of the Department of Justice of the United States, with the assurance that the provision is constitutional. That opinion, in my view, is correct. Such provisions are found in the laws of many States. If a court should, however, find the additive provisions to be unconstitutional, it is our intention that the remainder of the punitive damages provision will stand and that only the additive provision which is now found in section 107(b)(3) would be severed. Mr. President, one argument against congressional legislation in this field, which has been raised by almost all of those who have come here to speak against it, is that we should not interfere in the Federal system with the laws of the 50 States. It is a curious argument as it is generally advanced by those Members of this body who are most anxious to interfere with the prerogatives of the States in many areas for which there is no explicit constitutional warrant. This, however, is a case in which congressional legislation is expressly warranted by the Constitution, and may very well have been anticipated, or would have been anticipated had they known what the economy of the United States would look like in the late 20th century, by those who wrote the Constitution itself. One of the principal reasons for the Constitutional Convention was the chaos that attended interstate commerce among the 13 States after the close of the War of the Revolution and before the adoption of the Constitution. So under article I, section 8, clause 3, the interstate commerce clause, the Congress is invited, is given plenary power over interstate commerce. Of course, most of the products with which this bill deals are made of materials that arrive in interstate commerce and are sold after they are manufactured in interstate commerce, and a far greater degree of uniformity that is now in this bill would be constitutionally warranted. The compromises in this bill are in certain cases political and in other cases highly principled attempts to provide a degree of predictability and uniformity which will lead to more economic development, greater jobs, and better products for consumers with the very real history of local control over our courts and over our litigation. But as long ago as in the Federalist Papers, Alexander Hamilton made it clear that one of the key purposes of the Constitution was to prevent interstate commerce from being, and I quote him: ``Fettered, interrupted, and narrowed'' by parochial State regulations. That, regrettably, is exactly what we have, particularly in that handful of States, often in rural counties, in which we find repeated huge punitive damage awards, almost invariably entered against out-of- State defendants or out-of-State corporations in a way which fetters, interrupts, and narrows interstate commerce by discouraging research and development and discouraging the marketing of new products. We have seen that happen in instance after instance in which companies large and small have found it improvident to develop new products to cure previously incurably diseases or to solve problems in our society because they might have an adverse impact on some individual, and that individual might sue and that individual might persuade a jury in someplace or another to award punitive damages in an amount that would make it utterly unprofitable ever to have entered that business in the first place. Perhaps worse, and perhaps a greater interference with interstate commerce, is successful defense litigation where large companies find that they have spent tens of millions of dollars successfully defending against product liability litigation over products, that gross price of which is far less than those legal fees. So they say, ``Why produce parts for implant into the bodies of people of the United States, as much good as those things do?" It is our hope to make a modest step forward in creating a balance, not by denying any person the right to go to court, not by limiting the actual damages that any individual can receive for an act which is the responsibility of the individual or company which is called upon to make payment, but to see to it that there are fewer arbitrary required to pay for the negligence or for the acts of others. Mr. President, a day or so ago, the Senator from California [Mrs. Boxer], argued at length with respect to the McCain-Lieberman portions of this bill on biomaterials and that corporations would be allowed to set up shell subsidiaries and protect themselves from liabilities. That concern was raised in the Commerce Committee by the Senator from Nebraska [Mr. Exon], and expressly taken care of by an amendment that will allow piercing that corporate shell and not preventing the corporation, which is actually in control and which has assets, from protecting itself from the consequences of its own negligence. But basically, Mr. President, we now have a product liability bill which includes a statutory repose for products that are used in a business enterprise. We have a limitation on joint liability with respect to noneconomic damages--that is, pain and suffering--under which we simply say that you are responsible as a defendant for the degree to which you have harmed the claimant, but that a defendant that is only 10 or 20 percent responsible for these damages is not going to be charged for the entire verdict simply because some other defendant cannot be reached. We have imposed some modest rationality on the award of punitive damages. My colleague here this morning came up with one of the best sets of examples I have ever heard, something which has not been brought before the Senate in this 3 weeks, when he points out that for all practical purposes every Federal criminal statute which includes the right to a fine as a part of the sentence has a limitation on those fines, and yet to be subjected to a criminal fine one must be found guilty beyond a reasonable doubt. One has all of the protections of the fifth amendment against self-incrimination. And yet here we, the Congress of the United States, have set a maximum fine, $10,000; maximum fine, $25,000. I think the maximum fine they found was $250,000. We vote for these criminal penalties, and yet our opponents tell us how outrageous it is in a civil case, with no fifth amendment rights, no standard of proof beyond a reasonable doubt, how unreasonable it is to set any limit on what a jury can do in the way of punishment-- punishment over and beyond all of the damages that are actually proven by the claimant in a particular case. Mr. President, this bill is not a perfect bill, in my view, and it is not a perfect bill because it does not limit that form of arbitrary punishment sufficiently. But it does begin down a road which we have been invited to take by the Supreme Court of the United States which says without having set standards itself that there are constitutional implications to unlimited punitive damage verdicts. And so here we have an experiment. We attempt to balance the rights of trial lawyers against the necessity for a better and more effective economy, one in which people are encouraged to innovate, to create new jobs and to create new products for the American people. We have been at this for a long time. I know from personal experience that there were product liability bills in the Senate and in the Commerce Committee on which I serve as long ago as 1982. I suspect that they existed before that time. I can remember one product liability bill in that committee against which I voted myself because it seemed to me it went too far, that it was unbalanced on the other side. This one is not, Mr. President. This one is a good piece of legislation. It is something that will help the American economy and help the cause of balanced and appropriate justice. Finally, Mr. President, it is a precedent in a sense but it has one preceding element. A year or so ago, we passed a very modest product liability bill for piston driven aircraft. The legal system, the legal system defended by the other side here, had destroyed that business, reduced its production by 95 percent. A modest change in the law at the Federal level has already contributed to the recovery, the beginning of the recovery of that business--a dramatic illustration that the horror stories are not true and that the promises made by the proponents of this litigation have been proven to be valid by history. If my colleagues will vote for this, if we get it accepted by the House and signed by the President of the United States, this country will be significantly better off. Mr. HOLLINGS addressed the Chair.

Mr. GORTON. Mr. President, I ask for the yeas and nays.

Mr. GORTON. Mr. President, I move to reconsider the vote.

Mr. GORTON. Mr. President, I would want to take this opportunity to first congratulate the majority of the Members of the Senate and Members on both sides of the aisle for by far the most significant step in legal reform which has been taken by the Senate in many, many years, perhaps in the memory of the most senior of the sitting Senators. This has been a project by members of the Commerce Committee which has lasted for a decade and a half. It also, I may say, after 2\1/2\ weeks of debate, has been one in which the views of the Members had an impact, had an impact in showing that a majority of the Senate, a bare majority, wants a broader legal reform package than is included in this bill, but that others worried about particular details were willing to work on those details, and to cast their votes accordingly. So I believe that the Senate has worked its will in a particularly fine fashion. I want to pay particular tribute to my colleague, the Senator from West Virginia [Mr. Rockefeller]. In many respects this has been a far more difficult task for him than it has been for me. I represent a broad coalition of views within my own political party with only a few having had differences. Senator Rockefeller throughout this entire period of time has spoken for a significant number of Members of his colleagues but by no means a majority of them. But his dedication to the cause of this reform has been exemplary, and his persuasive ability with many of those colleagues has constantly left me in awe and with a great deal of inspiration. I believe that his persistence has paid off, and how wonderfully that it has done so. I have gotten to know Tamera Stanton, his legislative director, and Ellen Doneski, his legislative assistant, very well during the course of this period of time and know how much they have contributed to his success, as has Trent Erickson, Lance Bultena, Jeanne Bumpus for me, and the majority leader's assistant, Kyle McSlarrow. Other Senators have contributed significantly to this result, the chairman of the Commerce Committee, Senator Pressler, Senator Coverdell, and Senators Snowe and DeWine who came up with the formula for punitive damages which appealed to the majority of Members of this body. I only regret that Senator Lieberman, the other principal cosponsor of this bill, through a family emergency is absent today. I know that he would like to have been in on the end of this. But his contributions are greatly appreciated. And he is one of the primary authors of the portion of this bill that deals with medical devices. Now we go on to try to get a final proposal passed by the Congress and through the President of the United States. The majority leader has been patient in allowing us 2\1/2\ weeks on this, and was an absolute key to its success as well. With that, I think he wishes us to go on to another subject. Mr. HOLLINGS addressed the Chair.

Mr. GORTON

Mr. GORTON. Mr. President, this morning the leader time has been reserved and the Senate will resume consideration of H.R. 956, the product liability bill. Under the provisions of the agreement reached last night, there will be at least two rollcall votes beginning at 9:45 this morning on or in relation to amendments to the substitute amendment. Further rollcall votes are expected following the 9:45 a.m. stacked votes, and a vote on final passage can be expected at about 11:30 this morning. Senators should also be aware that the Senate will begin consideration of the solid waste disposal bill at noon.

Mr. GORTON

Mr. GORTON. Mr. President, a final passage vote is expected on the product liability bill at approximately 11:30 a.m. Also, at 12 noon, the Senate will begin consideration of calendar No. 74, the solid waste disposal bill. Therefore, votes can be expected to occur throughout the day on Wednesday.

Mr. GORTON

Mr. GORTON. Mr. President, I ask unanimous consent that the resolution be considered and agreed to, the preamble be agreed to and the motion to reconsider be laid upon the table; and that any statements relating to the resolution appear at the appropriate place in the Record.

Mr. GORTON. Mr. President, I ask unanimous consent that the Senate proceed to the immediate consideration of Senate Resolution 119, submitted earlier today by Senators Dole and Daschle, authorizing representation by Senate legal counsel.

Mr. GORTON

Mr. GORTON. Mr. President, if there is no further business to come before the Senate, I now ask unanimous consent that the Senate stand in recess under the previous order.

Mr. GORTON

Mr. GORTON. Mr. President, I ask unanimous consent that the first vote of the 9:45 a.m. voting sequence be 15 minutes in length, with the remaining votes in the sequence limited to 10 minutes each.

Mr. GORTON. Mr. President, for the information of all Senators, the Senate will resume consideration of the product liability bill at 9:30 a.m. At 9:45 a.m., there will be at least two stacked rollcall votes on, or in relation to, amendments to the substitute amendment.

Mr. GORTON

Mr. GORTON. Mr. President, I ask unanimous consent that when the Senate completes its business today, it stand in recess until the hour of 9:30 a.m., Wednesday, May 10, 1995; that following the prayer, the Journal of proceedings be deemed approved to date, the time for the two leaders be reserved for their use later in the day and the Senate then immediately resume consideration of H.R. 956, the product liability bill.

Mr. GORTON

Mr. GORTON. Mr. President, I ask unanimous consent that if and when the Senate's Commerce Committee reports S. 776, a bill to authorize the Atlantic Striped Bass Conservation Act, introduced by Senators Chafee and Kerry, it be sequentially referred to the Senate Committee on Environment and Public Works for a period not to exceed 20 session days of the Senate; time, it be automatically discharged and placed on the Senate Calendar; provided further, that if and when the Senate Commerce Committee reports H.R. 1139, it be sequentially referred to the Senate Committee on Environment and Public Works for a period not to exceed 20 session days of the Senate; and that if the bill is not reported by that time, it be automatically discharged and placed on the calendar.

Mr. GORTON

Mr. GORTON. Mr. President, I ask unanimous consent that the Senator from Louisiana [Mr. Breaux], and the Senator from Oregon [Mr. Packwood], be added as original cosponsors to S. 768, the Endangered Species Act Reform Amendments of 1995, which I introduced earlier today.

Mr. GORTON

Mr. GORTON. Mr. President, today is an important day for working people and their families across America whose lives have been impacted by the implementation of the Endangered Species Act. Today I am proud to introduce legislation, together with Senator Johnston, Senator Shelby, Senator Breaux, and Senator Packwood to amend the Endangered Species Act to require that the act consider people. For 6 years, this Senator has fought to bring legislation before the Senate to amend the Endangered Species Act. For much of these 6 years, I have been unsuccessful in forcing the Senate to debate reauthorization of the act. This year, however, is different. I believe that this year proponents of reform have a unique opportunity to bring legislation to reform the act before the Senate for debate. I intend to work very hard to see that this does, in fact, happen. I am committed to working with Senator Chafee, as the chairman of the Environment and Public Works Committee, and with Senator Kempthorne, as chairman of the Drinking Water, Fisheries and Wildlife Subcommittee, to see that legislation to reauthorize the act is passed by the Senate this year. The debate over the ESA is all about choices. Difficult, yet fundamental choices that as people who live in a free and productive society have to make. How important to society is this species? What is the biological significance of the species? Is it the last of its kind? Will it provide a cure for a deadly disease? How many people will lose their jobs as a result of protecting this species? How will species protection impact the lives of people, their families, and their communities? In short, the debate will be about people, and choices we must make. Earlier this year, a wonderful book entitled ``Noah's Choice'' focused on these choices. The title is designed to remind us of the story in the book of Genesis, where God commands Noah to build an ark to house his family and a male and female pair of every species. As the story goes, it then rained for 40 days and nights, and when the rain stopped, and the water dried, Noah had saved every living substance. The authors write: Noah had it easy. The materials he needed to build his Ark were at hand and the design, provided by the Supreme Deity, was guaranteed to be sufficient for the task. Two by two, the creatures walked aboard, filling the vessel just to capacity. When the parade finished, Noah had fulfilled his obligations. He had saved ``every living substance.'' There had been no need to exercise judgement or agonize over tough choices. He and his sons everything in. When no creature was waiting outside, he shut the door and waited for rain. Unfortunately our choices are not so simple. The act must be reformed to include choices, Mr. President, because currently it does not. The current act is all about uncompromising, intrusive, and unrelenting Federal mandates, and little about choices. To prove this point, you only have to take a look at the Pacific Northwest. pacific northwest as a test case for the esa Consider this: less than a decade ago, rural timber communities across my State were thriving. Families were strong and together. Fathers had a steady job at the mill, that paid a good family wage. Mothers could afford to stay home and take care of the children, to be there when they got home from school. Parents could save for their kids' education. Kids could be kids. These were good places to live and work. Rural areas, surrounded by our national parks and forest lands. Communities built up around the timberlands. Families who had worked for generations in the woods, continued to pass the trade down to the next generation. These were communities where you didn't have to lock the front door. Places where strangers get a wave, or a nod of acknowledgement as they drive through town. That was 10 years ago. Today it's different. Unemployment is up. Families that were once strong, and together, are falling apart. Divorce and incidents of domestic violence have dramatically increased. People can't find work. Mills have shut down. Food bank use has skyrocketed. Homes are for sale. Once proud, and productive members of our society, have, reluctantly, become society's burden. All of this, Mr. President, in the period of 6 short years. It began when the northern spotted owl was listed under the Endangered Species Act in 1989. And in the time since that listing, the destruction of rural timber communities has followed. But I want to make clear, it was not the listing of the owl that caused this devastation. It was the implementation of the act that caused it--the implementation of an act that does not consider the impacts on people, and their communities. Last month, I held a timber family hearing in Olympia, WA. The purpose of my hearing was to hear from the people whose lives have been impacted by the Endangered Species Act, to hear from them, once again, as to why this act must be changed. Over the course of 6 years, I have heard the personal stories of people who live--or once lived--in my State's timber communities. Their stories are hard to listen to, because their stories could have been different--if only their Federal Government had listened to their plight. Here are a few of the stories I heard. One man, probably close to 40 years old, told me that before the listing of the spotted owl, he went to work each day and came home to his wife and children. In other words, he lived a normal life. But today he's got to go across the State in order to find work. He's away from home for weeks at a time. He told me that he can't afford to buy a video camera or VCR to record his children as they grow up. He told me that he misses his children, that he misses his wife. He asked me if I could fix this law so that he could go home to stay, so that he could live with his family again. Another story. Barbara Mossman and her husband used to own a logging truck company. Today they live day to day, and, if they are lucky enough to find work, paycheck to paycheck. Before the owl crisis, Barbara and her husband were hardworking small business owners. Barbara told me about the first time she and her husband had to go to a food bank. They didn't want to do it, that's not the way they were raised. They were brought up to believe that if you are a hard worker, you will always find a job, that you should take care of yourself, your family, and help your neighbor. They were proud. But, as Barbara told me, they had to set aside their pride and go to the food bank, because they did not have anything to eat. But if anything captured the spirit of my timber family hearing it was a plea from Bill Pickell, of the Washington Contract Loggers Association. The people in this room, he said, do not want a handout. They do not want a government program. They want to take care of their neighbors, help their community spring back to life. They want to work. Mr. President, the stories are real. They are not made up. There are hundreds of stories like this from across my State. The message is the same--the act does not consider people. Of course, if you read the newspapers, or listen to the nightly news you would never realize that people are suffering across my State, and the Nation, because of misguided Federal policies. The media spins a different tale. In 1990, in the media frenzy to pit people against nature, there was a rush to judgment. A judgment was made that people who live and work in natural resource-based industries cannot coexist with their environment. That the two are mutually exclusive. That the timber worker was an evil raper of the land. That the environment would perish because of his life's work. In this rush to judgment, Time magazine put a spotted owl on its cover with the heading ``Who Gives a Hoot? The timber industry says that saving this spotted owl will cost 30,000 jobs. It isn't that simple.'' Time got one thing right--it is not that simple. But I wonder, in 1995, would Time put a picture of the unemployed timber worker and his community on the cover of its magazine, under the heading ``Can it be saved?'' The answer? Probably not. It's a tactic often used by the media to oversimplify. To make it, us versus them. Jobs versus the environment. People versus owls. This Senator believes that the media does the public a great disservice in its efforts to provide trite, oversimplifications of complex issues. This Senator gives the American public more credit. The legislation that I have introduced today, with that of my primary sponsors, recognizes that in order to find the appropriate balance between people and their desire to protect the environment difficult choices must be made. My legislation recognizes that these decisions are not simple, and that the people and the communities most directly affected by these decisions must have a say in the process. My legislation attempts to achieve the delicate balance that has long been absent from the current act. the esa reform act of 1995 Mr. President, 22 years ago Congress passed, and President Nixon signed, legislation creating the Endangered Species Act. The legislation was written in broad brush stokes--leaving the details to Federal bureaucrats to plug in. Not having been a Member of the U.S. Senate at the time the original law was enacted, one can only guess that most Members of Congress were enthusiastic about passing such legislation. This was legislation, after all, that would protect our Nation's symbol of freedom, the bald eagle, and the other precious and unique creatures that we identified with as Americans. Simply put, the legislation was as American as baseball and apple pie. In writing the original legislation, Congress, in all its wisdom, decided that it could, in fact, become Noah. The Endangered Species Act was developed, as most laws are, to address a seemingly one-dimensional situation--to stop species from extinction. But 22 years later, the details of the legislation have been filled in, and slowly people have begun to realize that the original act was written without an eye to the consequences. Mr. President, from the start of this debate in 1989, I have advocated for a balance--a delicate balance between the needs of people and that of their environment. The two are not mutually exclusive. In 1989, my call for balance was viewed as radical and extreme. In 1995, newspaper editorials in my State consistently use the word to describe how the act should be reformed. The administration has even put forward 10 principles for ESA reform that advocate for a more balanced decisionmaking process. Under my legislation, sound, peer reviewed science would drive the listing process. Economic considerations are not included in the listing process. Upon a final decision to list a species, an interim management period would begin, in which the listed species would killing or injury to the species. This is a dramatic departure from current law. Under current law, with the final listing decision comes a whole host of regulations restricting the use of property and ongoing activities. Under my legislation, the Secretary is required to make a well informed decision before designating critical habitat or other regulations. Once a final listing decision is made, the Secretary convenes a planning and assessment team to review the biological, economic, and intergovernmental impacts of the listing decision. The team would consist of representatives of affected local communities, as nominated by the communities, representatives from the State, as nominated by the Governor, and the appropriate biologists, economists, and land use specialists. The cornerstone of the legislation is the development of the Secretary's conservation objective for the listed species. The team provides the Secretary with the information from which he will develop his conservation objective for the listed species. The team provides the Secretary with the answers to questions like this: What's the biological significance of the species? What is the critical habitat of the species? How many jobs would be lost if the species were afforded the full protections of the act? What would be the impact on the local economy? On social, and community values? In other words, the team provides the Secretary with the information to select the conservation objective for the species. Under current law, the Secretary must provide for the full recovery of a species once it is listed. No flexibility. No questions asked. My bill changes this by providing the Secretary with a range of options. In developing a conservation objective for the species, the Secretary selects an objective from a range consisting of, but not limited to: full recovery of the species, conservation of the existing population of the species, or a prohibition against direct injury or killing of the species. The Secretary must always provide protection for the listed species from direct injury or killing. The selection of this objective is solely at the Secretary's discretion. This is a revolutionary concept. No longer will the Secretary's hands be tied to an inflexible standard. In selecting a conservation objective, and, if necessary, developing a conservation plan for the listed species, the Secretary is provided the broadest discretionary authority. The only challenge to the Secretary's decision in the courts would be if it could be proven that the Secretary grossly abused his authority, traditionally a very hard challenge to meet. What does this mean? In real life terms it means that the Secretary cannot hide behind the law he is charged with implementing in making a decision to conserve a species. The administration could no longer say that a plan it put together to protect a species, although it might be bad for people, was the best plan it could put forward under the law. Under my legislation, there would be no more excuses. The Secretary would be held politically accountable for his or her decision. After the Secretary develops a conservation objective for the species, the Secretary is directed to look toward voluntary, non- Federal conservation proposals that meet the objective. My legislation recognizes that the Federal Government is not the solution to every problem--that individuals, and State and local governments, if given the incentive and opportunity, can effectively provide for the conservation of a listed species. There is, however, a degree of risk to my legislation. The Secretary has the discretion to totally disregard all of the information--all of the social and economic consequences of draconian recovery measures-- and mandate full recovery, for every single species, every time. And, if the Secretary makes this decision, under the full sunshine of public review, then so be it. But the people affected by his decision will know that it was his decision--and his alone--to make. If the people affected by the decision don't like it, they have a recourse. Their recourse comes every other November in the voting booth. Under my legislation, the Secretary and his boss, the President of the United States, will be held politically accountable for their decision. Throughout my legislation everyday citizens are included in the process. Contrary to old ways of thinking, I believe that people, their families, and local communities know best. They know how to run things better than Washington, DC bureaucrats. To some people--especially for the opponents of change--this is a revolutionary way of thinking. For me, and for the people I have been fighting alongside for 7 years, these are not revolutionary ideas. It is just the way it should be. administration's 10 esa reform principles Two short months ago, after years of insisting that the ESA did not need to be reformed, the administration put forward 10 principles for ESA reforms. When I read the reforms, I found myself nodding in agreement with each one. ``Minimize Social and Economic Impacts of the Act'' reads one. This Senator certainly agrees with that principle. ``Base ESA Decisions on Sound and Objective Science'' reads another. I agree with this principle too. In fact, Senator Johnston, Senator Shelby, and I, agreed with each and every principle put forward by the administration and included them in our legislation. I applaud the administration for recognizing that the act must be reformed. people must be considered The fundamental flaw of the current act is that it does not consider people. In the case of the spotted owl in the Pacific Northwest, people, their jobs, and their communities were not considered at all in the decisionmaking process. Their life's work was denigrated. Their views were not considered. Their Federal Government did not care about their plight. The decisions we must make to protect endangered or threatened species will involve choices. Sometimes these choices will be easy, and most often they will not. But we must give the people whose lives are directly affected by these decisions an opportunity to have their voices heard. To know that they have a say in the decisions that will forever change their lives. Six years ago, I wish that the people in timber communities in my State had the opportunity to have a say in the decisionmaking process. To tell the Secretary on how their lives would forever be changed by his decision. Maybe the Secretary would have ignored their views, but at least they could say that they had given it a shot. That they had participated in the process. That they went down swinging. But they were not given that opportunity. We must change the act to give people the opportunity to be heard. I recall again, Bill Pickell's request of me last month at my timber family hearing: The people in this room do not want a handout. They don't want a government program. They want to take care of their neighbors, help their community spring back to life. They want to work. A simple, heartfelt plea that speaks more eloquently than I can about the need for us to bring balance to this act. To give communities across our Nation the ability to work, to provide for their families, and be productive members of our society. The debate that we will have this year will be about choices. Choices that will impact people's lives, their families, their communities. This Senator believes that the people who are directly affected by these decisions should have the opportunity to be heard. That is what my legislation seeks to accomplish, and I hope that my colleagues will join me in this effort.

Mr. GORTON

Mr. GORTON. Mr. President, I ask unanimous consent that there now be a period for the transaction of morning business, with Senators permitted to speak for up to 5 minutes each.

Mr. GORTON

Mr. GORTON. Mr. President, the Senator from Iowa assumes the question of deterrence, misconstrues the actual impact of punitive damages, and totally misstates the provision that he purports to amend. There is no $250,000 punitive damage cap. In the case of serious injuries, for anything other than the small business, which is exempted both in the bill and in the amendment of the Senator from Iowa, for anything other than a small business, the cap is $250,000 only if the damages to the plaintiff are minimal. In the cases repeatedly cited by the Senator from Iowa, the individual maimed for life--that was the last quotation I remember--it is obvious that the economic damages to that individual together with the award for pain and suffering, unlimited by any feature of this bill, added together and multiplied by two is infinitely greater than $250,000. Every week in the United States we have compensatory damage awards well up into the millions of dollars, and in each of those cases, except for the very, very small business, the maximum award of punitive damages on the part of the jury under the bill as it exists now is twice whatever those damages are. The $250,000 figure was only put back into this proposal to say that you could go that high in case of a jury award for actual damages that was extremely small. And, Mr. President, if a claimant goes all the way through a trial and proves that his or her damages are only $10,000, why should we allow a $4 million punitive damage award? That is, of course, the essence of what this debate is about. Moreover, even the figure twice the sum of economic and noneconomic or pain and suffering damages contained in the bill has an exception pursuant to which the judge can increase that award, if the judge finds the conduct of the defendant to be as egregious as the description propounded to us by the Senator from Iowa. The Senator from West Virginia and I have said that this bill in its final form will not contain any automatic new trial right for a defendant in any such cases. So, Mr. President, the present bill that we are being asked to vote on does not have any ultimate cap at all on punitive damages in that extraordinarily rare case in which a judge felt that a very, very high such award was appropriate. So the Senator from Iowa is wrong that a badly injured, maimed individual is not going to have a $250,000 cap on punitive damages when an injury was caused by the deliberate acts or the outrageous acts of the large corporation. In fact, that individual is not going to be subject to any cap at all if he or she can prove the kind of case which was given us here as this horror story. But what we are doing in this bill is to provide some remote connection between the actual losses an individual suffers and how much can be added to that amount by a jury acting without any rules or instructions whatsoever. It is neither more nor less than that. We should not have the legal system of the United States of America as a national lottery where, under certain circumstances with a handful of juries can create a bonanza partly for an individual but basically, this is what the debate is all about--for the lawyer class in this country who find these actions to bring. More fundamentally, and we have not gotten back to this point recently in this debate, and I speak not just of the remarks of the Senator from Iowa but of all of the opponents of this bill, none has shown that their slogans about deterrence have any true meaning. No single study has ever shown that punitive damages, the lottery of a huge punitive damage award, has any real effect on deterrence or on safety. I am astounded that a Member of this body who believes so firmly in the presence of government in our life and of its regulatory capacities has so little faith in the ability of all of the statutes of the United States and of all of the statutes of the States dealing with safety in the production of products to cause them actually to be safe. We passed measures on automobile safety, on toy safety, and on all other kinds of product safety, and on the way in which we license drugs and the way in which we build airplanes to see to it that they are safe and effective. Yet, apparently, according to the opponents of this bill, nothing would be safe in America if we did not have unlimited punitive damages. That is the only way we can see to it that corporations behave, that we can have a reasonable society. Mr. President, retired Justice Powell said--and I paraphrase him but I agree with him--the jury system of litigation taken as a whole is the most irrational method of business regulation imaginable. It is not a criticism of a particular jury to say so, Mr. President. That jury deals with a single instance. It does not know what other instances there are in many cases. The Congress of the United States, the legislatures of the several States, when they determine on regulation, determine it on the basis of all of the evidence, of all of the weighing of how much we want to encourage certain kinds of production and what kind of cautions we put on them. This is the way in which the job is done. No study shows that punitive damages do anything other than have an utterly irrational impact of telling many companies it is not worthwhile going into a new line of business--it is not worthwhile, as one of our major companies has said, to try to go into the business of finding a new drug which helps AIDS. We cannot make enough money on it to risk that lottery that some lawyer someplace will persuade some jury to whack us with a $25 million punitive damage award. So we have had dozens of companies get out of the business of producing the vaccine against whooping cough. Is that a triumph of the American system, that the cost of whooping cough vaccine has gone up 500 percent and only one or two companies are even willing to make it? Is it a triumph of the American system that 18 of the 20 companies that used to manufacture football helmets are not in the business anymore because it just simply is not worthwhile? Is it a vindication of the American system that a large company which produces plastic piping for heart implants, on which it might possibly make $1 million in a several-year period, has paid close to 40 times that in defending successfully product liability actions, and looks at the bottom line and says, what in the world are we doing this for? Why should we produce this particular product? Those legal fees adhere to defendants who win just as much as they do to those who lose. And when the company says it is just costing us too much, we will abandon this line of research; we will abandon this product; the American people are not benefited. Who is benefited? A tiny handful of lucky players and a larger group of trial lawyers. So what we do in this bill, much more modestly than I would prefer, is to say at least in the great bulk of cases there ought to be some relationship to how badly the plaintiff or claimant is actually damaged and what the maximum punitive damages are. Let there be a ratio. If in fact the individual is maimed for life, then they are going to be entitled to huge punitive damages. But if in fact they are damaged $10,000 or $500, why should they win the lottery when there is no evidence that this does anything but to constrict our economy? I say once again, the State immediately adjacent to the State of the Senator from Iowa, Nebraska, like my own State of Washington, just does not have punitive damages in the kind of cases we are talking about here. It does not allow them at all. Why? Because the Constitution of the United States protects anyone accused of a crime. They have fifth amendment rights. The case against them has to be proven beyond a reasonable doubt. There is a maximum sentence. But those who uphold those constitutional protections as fundamental to our system of justice say, oh, no, but a civil jury can punish without any limitation or without any guidelines whatsoever, rationally or totally or temporarily. There just is no connection between those two. Moreover, there is also no relationship at all between the responsibility of business enterprises, the safety with which they build their products, that is related to whether or not they operate in a State which has punitive damages or one which bans punitive damages. Not a scintilla of evidence, not any instance has been imparted to this body that oh, boy, we better keep punitive damages because look at how irresponsible companies are that operate in Nebraska or Washington or one of the other States. Not a peep, Mr. President, about that. The bottom line is we are dealing with a system that is a great system for a handful of lawyers in this country. They and their sidekicks get 60 percent of all of the money that goes into this product liability system. Claimants get 40 percent of it. We want to make it a little bit more rational. The Harkin amendment does not make it more rational. The Harkin amendment does not even recognize the nature of the $250,000 cap, which does not apply to anything he talked about, or the fact that there is no cap at all when the judge finds that the conduct of the defendant has been particularly egregious, and the Harkin amendment should therefore be rejected. Mr. ROCKEFELLER addressed the Chair.

Mr. GORTON

Mr. GORTON. I am glad we clarified the meaning of section 106.