Bob Graham

Mr. GRAHAM

Mr. GRAHAM. Mr. President, before the Senator does that, will he yield since we are on this subject?

Mr. GRAHAM. What leads the Senator to believe that the only way in which the States would secure savings under the Graham-Smith amendment would have been through the catastrophic savings?

Mr. GRAHAM. Will the Senator yield for another question?

Mr. GRAHAM. I think my integrity was impugned when it was suggested yesterday that we had slipped into this amendment, hoping it would go undiscovered, a provision that would end up costing the States some $70 billion over the next 10 years. That is close to a verbatim statement. That was made on the basis of this sheet which was printed and distributed on the Senate floor without a source and without anyone accepting personal responsibility. This is what I call Enron accounting. You only accounted for the additional cost to the States without any reference to the savings the States would get as a result of the Federal Government picking up substantial costs the States are currently incurring which the Congressional Budget Office has stated to be approximately equal to what the States would have to expend in terms of these new obligations. No reference was made----

Mr. GRAHAM. No reference was made on this chart to the fact there were very substantial savings to the States in addition to the costs.

Mr. GRAHAM. Will the Senator yield for a question?

Mr. GRAHAM. These additional costs.

Mr. GRAHAM. Does this chart in any of the columns contain the offset savings which the States would have secured as a result of the passage of the underlying Graham-Smith amendment?

Mr. GRAHAM

Mr. GRAHAM. I ask unanimous consent the order for the quorum call be rescinded.

Mr. GRAHAM

Mr. GRAHAM. Will the Senator yield?

Mr. GRAHAM. I thank the Senator.

Mr. GRAHAM. The Florida retirement plan, prior to its modification, was in what would be called a defined benefit plan that gave security assurance to Florida's retirees as to what they would have in retirement, what they could count on, what they could sleep comfortably at night knowing was going to be available to them.

Mr. GRAHAM. Finally, does not the Senator think there are ample opportunities available for a person who wishes to take the risk and assume the chance that they may be buying into a stock market which is not always going up, they might be buying into a stock market such as in recent months it seems that goes down more than up, that they have plenty of opportunities with their savings, and if they have an individual retirement account or a 401(k) to take some risk, but with the core of their retirement, Social Security and the basic retirement through their employer, that they would be well served to have the confidence and assurance of knowing what they are going to do and not be on the Wall Street roulette wheel as to what their retirement benefits will be?

Mr. GRAHAM

Mr. GRAHAM. But I think it is a given that no State is going to have zero savings. So that every one of these State-by-State numbers is overstated.

Mr. GRAHAM. What CBO has said is that for the States as a collective, that there would be no additional cost as a result of this. I have asked CBO to prepare a State-by-State analysis of what those offsetting savings would be. I do not have those numbers today.

Mr. GRAHAM. I completely agree. I think we should have an analysis that includes both the debit and the credit side of the accounting ledger so we will be able to make an informed judgment as to what the real economic consequences of our decisions will be.

Mr. GRAHAM. What got Enron in trouble was it set up a whole constellation of off-budget partnerships in order to hide their expenses.

Mr. GRAHAM. Let me just finish, get the facts out, and then we will talk about the policy. So I showed them this chart. They pointed out what was obvious which was that this chart only shows half, in fact less than half of the equation. It shows the additional costs to the States that will come incident to their picking up some of the prescription drug costs. What it does not show is that the States are going to be relieved of a substantial amount of their current costs. The Senator from Oklahoma mentioned one of these costs. But, in addition to that, there are other costs from which the States will receive relief. For example, there are 31 States that provide State pharmacy assistance for low-income senior citizens, the States which have received Medicaid waivers in order to allow them to cover additional groups of seniors. As the Federal Government has dawdled on the subject of providing prescription drugs for senior Americans, many States have stepped forward and have done so. So within the Medicaid Program as well as in areas where the States have tried to fill the void that the Federal Government has left behind, there are substantial savings to the States--thus the report of the Congressional Budget Office that there is no increased cost to the States. But there is no column or figures on this chart which reflect the fact that there are these offsetting savings to the States.

Mr. GRAHAM. Mr. President, this is the last day of a long legislative season. We are about to take the month of August to go back to our home States, be with our constituents, and maybe have a little opportunity to get some personal relaxation and rejuvenation, and come back after Labor Day and complete this 107th session of Congress. It is exactly this time in the legislative calendar where maybe tempers and tolerance are beginning to wear thin and short. I share with my friend from Oklahoma high feelings for the persons who debated vigorously over the last 2 weeks on an issue whose importance we all understand and feel deeply about, which is the issue of providing a health care program to 40 million senior Americans by adding to that 37-year-old program, at long last, a prescription drug benefit. I think the goal is one we all share. We have somewhat different ideas as to how to get to that goal. The reason I came to the floor earlier today was out of, yes, a sense of personal attack but also a sense of the need to set a very obvious erroneous record somewhat straighter. My concern was piqued by a statement that was made which implied that I, Senator Smith, and others, tried to slip something by the Senate. And that ``something'' was not a small amount, but a very substantial, maybe as much as a $70 billion additional cost on the States according to my Republican colleagues. I knew that was not accurate because I had received from the Congressional Budget Office, which had scored our legislation, the fact that they had determined that, in fact, there was no additional cost to the States and I had made that representation to my colleagues. I felt my personal credibility was at stake. So I went back to the Congressional Budget Office today to recheck what they had said and they reaffirmed the statement that there was no additional cost to the States. I showed them this--

Mr. GRAHAM. I am almost there. Therefore, presenting the impression that the passage of this amendment would result in substantial additional cost to the States-- touted to be $70 billion--is a patently untrue statement. I wanted to set the record straight before we went home so none of our colleagues spend August worrying that they might have been deceived into believing there was going to be a very major additional cost to the States and that might have influenced their vote on this matter. So my only purpose was to make those corrective comments and express my hope that in the future we would follow the spirit and custom of the Senate, which is when you distribute a document such as this, you put your name on it so someone is held accountable. And I suggest it would also be helpful if we adopted the custom that there be some source given for documents such as this, so those who are interested in pursuing the basis upon which the calculation was made would at least know whose telephone number to call.

Mr. GRAHAM

Mr. GRAHAM. Yes, Senator Nelson that is correct. The University of North Florida has requested $750,000 for this important, new project and I request conference report language to identify this program to be eligible for funding from the Chem-Bio Defense Initiatives Fund.

Mr. GRAHAM. Mr. President, I rise with colleague from Florida, Senator Nelson, to engage in a colloquy with Senator Inouye, the Chairman of the Defense Appropriations Subcommittee. Senator Nelson and I note the critical importance of the Center for Southeastern Tropical Advanced Remote Sensing, CSTARS, at the University of Miami, and are thankful for the support of this critical program. The university has initiated the acquisition and construction of this regional satellite collection, processing and analysis facility in partnership with the U.S. Southern Command and other academic institutions. The Center will offer unprecedented capability in the southeastern United States to link with a broad range of low-Earth satellite orbiting systems. When made available to regional as well as to key partners like the Southern Command, these resources will provide a unique and much-needed capacity for environmental observation, climatic prediction and resource analysis, watershed and ecosystem assessment, and natural hazards monitoring critical to effective emergency response. I yield to Senator Nelson for a few words about this important program.

Mr. GRAHAM

Mr. GRAHAM. Mr. President, I rise today to commend the National Guard and urge my colleagues to support the National Guard Counter Drug States Plan Program. The National Guard role is to provide counterdrug and drug demand reduction support as requested by local, State, and Federal law enforcement agencies and community-based organizations with a counterdrug nexus. The National Guard provides this support in consonance with the Office of National Drug Control Policy and Department of Defense guidance. The mission of the National Guard Counter Drug Program is to assist and strengthen law enforcement and community-based organizations in reducing the availability of, and demand for, illegal drugs within the State and Nation through professional military support. The principal elements of counter-drug military support include highly skilled personnel, specialized technology, facilities, and diverse types of military training and skills. Operationally, this translates into port security assistance, operating nonintrusive inspection devices, aerial and ground reconnaissance, technical support, general support, community antidrug coalition support, youth drug awareness programs, and use of training facilities. The National Guard offers numerous military-unique skills to the counterdrug mission. These include linguist and translator support, investigative case and analyst support, communications support, engineer support, diver support, marijuana eradication support, transportation support, maintenance and logistical support, cargo and mail inspection, training of law enforcement and military personnel, surface reconnaissance, and aerial reconnaissance. In addition, the National Guard provides command, control, communications, computers, and information, C4I, integration; logistics planning; tactical and strategic operational and intelligence planning; the ability to support around-the-clock operations; liaison skills with civilian authority and interagency cooperation; resource integration; force protection training; operational security enforcement; communications security enforcement; and risk management skills. We must fully fund the National Guard Counter Drug States Plans Program. The National Guard's success in interdicting drugs and other contraband contributes to the security of the Nation as a whole. Using my home State as an example, Florida has valid support requests from law enforcement and community-based organizations that would require approximately 250 personnel. Under the constraints of the estimated fiscal year 2003 budget, the National Guard was able to field 111 personnel, resulting in unfunded requests for 139 personnel and an unfunded requirement of 99 personnel based on an optimal program size of 210 personnel. In fiscal year 2002, the State of Florida fielded 148 personnel, and unfunded personnel requests totaled 102. I am also a great believer in a balanced counterdrug program, both interdiction and demand reduction. The National Guard does some of the finest demand reduction work in the country. Young people look up to these citizen-soldiers and listen to what they say. Counterdrug personnel assigned to perform drug demand reduction activities utilize numerous military skills including command, control and communication skills, tactical and strategic planning, liaison skills and training design and implementation skills. These assist communities with work plans, realistic time lines and assigned responsibilities. This support is essential for many community-based organizations in order to mobilize and sustain their efforts. Additionally, the military value system and discipline instilled in all counterdrug personnel creates a significant demand to serve as role models and mentors supporting a wide array of prevention activities. Community based prevention organizations rely on National Guard personnel to incorporate this unique military orientation into activities such as youth camps, ropes challenge courses, high adventure training, high school drug education, Drug Education for Youth, mentoring, and other prevention and skill training activities. The National Guard also provides unique facilities and equipment such as armories, training sites, obstacle courses, aircraft and wheeled vehicles in support of community prevention strategies. These facilities and equipment are often the only resources available to conduct youth camps, coalitions meetings or experiential learning initiatives. The leadership skills and military values embedded within our youth hopefully provide a morale foundation for future generations, as well as conveying to many thousands of youth the value of military service. The National Guard Counter Drug States Plan Program benefits not only the States, but also the Department of Defense. The primary benefit is increased combat readiness, as well as significant Guard experience in Military Operations Other than War, MOOTW, within the continental United States and abroad. Service in the counterdrug program also provides members with joint experience and inter-service cooperation skills for immediate response to national emergencies. The National Guard, in many communities, is the only real connection the public has to our armed services. The visibility of uniformed National Guardsmen provides a deterrence to the smuggling of drugs, arms, explosives, weapons, aliens, and other contraband, as well as direct support for interdiction operations. I can not say enough good things about what the National Guard does for the State of Florida and the Nation. I am grateful that it appears we have avoided personnel reductions for fiscal year 2003, which we struggled through in fiscal year 2002, but I am concerned that we may have a funding shortfall and personnel reductions in fiscal year 2004. I urge my colleagues to review the great merits of the National Guard Counter Drug State Plans Program, given the National Guard's integral role in both the National Drug Control Strategy and Homeland Defense Strategy. Please help us fully fund and deploy the National Guard for the protection of our United States.

Mr. GRAHAM

Mr. GRAHAM. Madam President, yesterday, July 31, the Senate voted not to waive the Budget Act to allow consideration of the Graham-Smith prescription drug compromise. This legislation was estimated by the Congressional Budget Office to cost $390 billion over the 10-year period, a cost which turned out to be within a few percentage points of the legislation offered by the Republicans. Although unscored by the Congressional Budget Office, the sponsors of the Republican legislation estimated that their cost was in the range of $370 billion. However, in spite of the fact that both the Democratic and the Republican plans were above $300 billion, which had been provided in the 2001 Budget Act, almost 18 months out of date, in spite of that fact, we could not get the 60 votes to waive the Budget Act and allow consideration of the substance of the proposal to provide a critical additional health care benefit for America's older citizens. Had we gotten to the proposal, what would the Graham-Smith compromise have provided? It would have provided full coverage to the 47 percent of America's seniors whose incomes were below 200 percent of poverty, approximately $17,700 for a single person. It would have provided a mechanism for significant discounts, in the range of 15 to 25 percent, as well as a Federal subsidy on top of those discounts for all Americans. For all Americans, it would have also provided insurance against catastrophic costs, costs beyond $3,300 of payments made by the beneficiary. Think of this: Had we been able to get to the substance of our amendment, Americans could have had the opportunity of purchasing an insurance policy for $25 a year that would have given them the peace of mind they would not be crippled, potentially financially devastated, by the consequences of a major health emergency, such as a heart attack or being determined to have a chronic disease such as diabetes. All seniors who fell into that category would have had all of their prescription drug costs above $3,300 per year paid with only a modest $10-per-prescription copayment. This compromise would have afforded very real protection and assistance to all Medicare beneficiaries at a cost which both Republicans and Democrats had deemed to be reasonable. One of the fundamental reasons this failed yesterday and I appear today is because at the last minute--I correct that to say, within the last hour before the vote was taken, the information on this chart was dragged from some source and reproduced on a floor chart used by one of my colleagues and in handouts which were circulated in the Chamber, which purported to show that the effect of adopting our amendment would be to impose massive new costs on the States. It was stated that the first-year cost would be over $5 billion, and the 10-year cost would be $70 billion. Madam President, I accept the fact that we have rules in the Senate and that one of those rules requires that to waive the Budget Act, you have to have 60 votes. But what I cannot accept is the method that some of our opponents used to defeat our plan. There is an old adage: Everyone is entitled to their opinion; no one is entitled to their own facts. It is impossible to have an honest debate without everyone using the same factual basis as the premise for their arguments and opinions. We can't pass legislation in 1 week to make businesses adopt honest accounting practices and standards and then not apply honest accounting standards to ourselves. Using only partial information that intentionally misleads U.S. Senators--in this case, misleading them to the wrong conclusion--is demeaning to this, the world's greatest deliberative body. Several of our colleagues used a chart which misled other Senators into believing that the Graham-Smith amendment imposed these massive unfunded mandates. In the words of one of our colleagues: ``$70 billion on the States.'' This is simply untrue. It is, in my opinion, an intentional misrepresentation of the facts. The floor chart used yesterday, as well as the paper distributed on the Senate floor, contained no source as to where the data was analyzed, or who among our colleagues would assume responsibility for distributing this information. No one--in violation of the spirit of the Senate rules--would accept personal responsibility for these distortions. What happened yesterday was Enron accounting come to the Senate Chamber. It makes a point based on an inaccurate representation of the facts. It seems to me that if we are going to require companies to be more accountable, require their chief executives to sign the financial statements before they are released to the public, we should require the same of ourselves in the Senate. In addition to distributing this distorted information, there were also statements made as to the motivation of the sponsors of this amendment. I will quote a statement made by one of our opponents who stated that: The sponsors chose to spring the text of this amendment on the Senate yesterday for the first time. Perhaps they thought they could slip in something new that we would not catch. Well, we caught it, and you know we have caught it by the speeches of the Senator from Maine. We actually have had a chance, and we have studied the Graham amendment. The Graham amendment imposes a massive new burden on States just when State treasuries are in terrible shape. We have been accused of bad faith in offering this amendment, surreptitiously attempting to commit the States to a massive new unfunded commitment. That is not true. In fact, the Congressional Budget Office is the basis of the analysis that we have done. It was the basis of the support that was sought and gathered for the Graham- Smith amendment. None of its supporters, intentionally or otherwise, would have allowed a provision to be included that increased State costs. On the other hand, we have an analysis that was developed by an unknown source, distributed by unknown persons to the Senate floor. The basis of our estimate is the nonpartisan Congressional Budget Office, a set of experts with no political stake in this debate. The Congressional Budget Office estimates that the Graham-Smith amendment would not increase State spending. Let's look at an analysis upon which the Congressional Budget Office predicated that statement, realities which the Republican analysis totally ignores: States would receive considerable relief from the creation of this new Medicare prescription drug benefit. Let me explain why. Under current law, States are required to provide drug benefits to those eligible for Supplemental Security Income, SSI-- generally, those below 75 percent of poverty--and others fully eligible for Medicaid. In addition, some States have elected to go up to 100 percent of poverty. Those seniors' drug costs are now paid by the States at their regular Medicaid matching rate. Therefore, States are paying for part of total drug costs for these seniors, and the Federal Government is paying for part. Under our proposal, the Federal Government would assume 100 percent of the cost above $3,300 incurred by each senior currently covered by the Federal-State match. In addition, the Federal Government would be solely responsible for 5 percent of the costs incurred by each senior currently covered by the Federal-State match; that is, 95 percent of the costs below the stop loss would continue to be shared between the State and the Federal Government. However, all the costs above $3,300 would be assumed by the Federal Government. Additionally, the Federal Government will pay for 100 percent of 5 percent of the drug costs. The 100-percent Federal assumption of costs that are currently shared between the Federal and State governments would result in substantial savings to the States. None of these savings are included in this analysis. Just yesterday, the administration approved a Medicaid waiver for the States of Maryland and Florida. This waiver will allow those States to extend coverage for prescription drug costs to their citizens between 175 percent and 200 percent of poverty, respectfully, at the regular Medicaid matching rate. These States, plus others with similar waivers, would receive significant relief from having both a Medicare drug benefit and a higher Federal matching rate--including 100 percent matching rate for costs of those with incomes between 150 and 200 percent of poverty. None of these savings are included in the analysis presented by my Republican colleagues. The Graham-Smith amendment does not include a ``maintenance of effort'' provision on current State spending on these programs. According to the National Council of State Legislators, 31 States already provide pharmacy assistance programs and Medicaid drug waiver programs to seniors above 100 percent of poverty. Three more are authorized to do so, but have not yet implemented their authorization. All of these States would receive significant relief under my proposal. Yet, none of these savings are included in the analysis presented by my Republican colleagues. According to the Congressional Budget Office, states are currently spending roughly $95 billion on prescription drugs for Medicare beneficiaries through the Medicaid program. A significant portion of this amount would be assumed by the Federal Government under the Graham-Smith compromise amendment, resulting in savings to the States. The floor chart used by my colleagues showing $70 billion of new expenses was incomplete. I don't know if the $70 billion figure is accurate, but I do know that the State savings achieved by the Federal assumption of costs currently borne by the states is not reflected on that chart. So what we have is an analysis that only stated what the new cost to the States would be as a result of this program and failed to include the new savings to the States as a result of this program. Even the most junior budget analyst would not make the mistake of forgetting that States will save dollars as a result of the Graham- Smith amendment from the Federal assumption of many costs. This is more than an oversight; it is a deliberate omission intended--unfortunately, in some instances it apparently had this effect--to scare off potential supporters of a responsible prescription drug benefit for older Americans. This analysis is but one of several politically motivated analyses which have come out of the White House that conveniently support their policy positions. Let me just review a few of those positions. On July 18, 2002, the Office of Management and Budget wrote: However, the administration opposes S. 812, [the underlying generic drug bill that the Senate, by an overwhelming majority, passed yesterday] in its current form because it will not provide lower drug prices. No analysis by the Office of the Actuary supports that claim, and the Congressional Budget Office estimated that the bill will save $60 billion to American prescription drug consumers over the next 10 years. The Senate, by its overwhelming vote, obviously decided with the Congressional Budget Office and not with the White House Office of Management and Budget. Second, the White House produced an analysis claiming that the original Graham-Miller-Kennedy bill would ``bankrupt'' the Medicare trust fund--when this drug benefit, like the drug benefits in the Republican plan, is funded through a distinct fund that has nothing whatsoever to do with Medicare's Part A. Third, just this month, OMB made its midsession review look substantially more rosy by including only $190 billion for prescription drugs, despite the fact that the Secretary of Health and Human Services, former Gov. Tommy Thompson, stated before Congress in April: Congress has seen fit to raise the funding for prescription drugs to $350 billion, and I came here today to indicate to you that the administration wants to work with that latter number. This administration has not demonstrated in actions or words that it prioritizes State fiscal relief. As such, its concern for States, as expressed on this distorted chart, is a new revelation, only emerging when it is seeking an excuse to oppose an amendment to provide significant prescription drug assistance to America's seniors. Less than a week ago the Administrator of Medicare, Mr. Tom Scully, stated the administration opposed increasing the Medicaid matching rate even temporarily, an amendment which has been aggressively sought by the States in order to receive some relief from rapidly escalating Medicaid costs. The administration opposed that amendment. The Senate, by an overwhelming vote last week, adopted it. I might say that during the consideration of the tax bill, I was concerned that the proposal of the White House was to accelerate the repeal of the State's portion of the estate tax at a substantially faster rate than the repeal of the Federal estate tax. In fact, the State's portion of the estate tax will evaporate in approximately 3 to 4 years, while the Federal Government's share of the estate tax continues until the year 2010. The effect of that early acceleration of the repeal of the State component of the estate tax will have a significant adverse financial effect on the States beginning this fiscal year. The 47 percent of Medicare beneficiaries with incomes below 200 percent of poverty would have gained comprehensive drug coverage had the Graham-Smith amendment been adopted. Seniors in all States would have been helped. Seniors in all States would have been given the peace of mind that if they suffered a debilitating illness or disease or accident that they would have been helped with their catastrophic drug costs, and the States would have been helped by getting relief through the Federal assumption of costs that they are currently bearing. I conclude by saying that I hope in future debates on the Medicare prescription drug benefit that we will all rely on the facts, not on incomplete and distorted analysis. Our seniors deserve better than what we have done to date, because what we have done is talk about, talk about, talk about, the need for a prescription drug benefit. We have not yet delivered, delivered, delivered a responsible prescription drug benefit. It is going to be our challenge over the next few weeks, working with the facts and with honest analysis of those facts, to arrive at a prescription drug plan that will meet the needs of our seniors, will provide us with the basis of integrating a prescription drug benefit into a comprehensive health care program for older Americans, and to find the political will to act this year. That will be our challenge and that quest will be advanced if we all agree that we are going to differ in our opinions, yes, but that we will all agree that we would use the same set of legitimate facts. I thank the Chair, and I suggest the absence of a quorum.

Mr. GRAHAM

Mr. GRAHAM. I am agreeable to the unanimous consent agreement that I follow the Senator from Utah.