Chuck Grassley

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I am sorry the Presiding Officer, the Senator from Virginia, has to listen to me twice on the same subject. When I am referring to a bill, I am referring to the 2,000-page House bill. Small business is very vital to the health of our economy. The President and I agree that 70 percent of new private sector jobs are created by small business. Small business is the employment machine of the American economy. However, where the President and I differ is, I believe small business taxes should be lowered, not raised, to get our economy back on track. You will hear from my discussion, this 2,000- page bill raises taxes on small business. The President and my colleagues on the other side of the aisle have proposed increasing the top marginal tax rates from 35 percent to 39.6 percent, respectively. We can see that on the chart under the proposed Obama budget, 39.6 percent is where they would raise them. They have also proposed increasing the tax rates on capital gains and dividends to 20 percent and providing for an estate tax rate as high as 45 percent and an exemption of that estate tax of $3.5 million. Also, the President and congressional Democrats have called for fully reinstating the personal exemption phase-out. I will refer to the personal exemption phase-out as PEP. They would do that for those making more than $200,000 a year. In addition, they have called for fully reinstating the limitation on itemized deductions, which is known as Pease after a former Congressman Pease of Ohio, for those making also more than $200,000. Under the 2001 tax law, PEPs and Pease are scheduled to be completely phased out in 2010. That means the tax rate for current 35-percent-rate taxpayers would go up, as we can see on the chart, to 41 percent. For the vast majority of people who earn less than $200,000, raising taxes on high earners might not sound so bad. However, this means many small businesses will be hit with a higher tax bill. From the standpoint of it being where they create 70 percent of the new jobs, that is bad not only for those taxpayers, that is bad for the entire economy. As if this was not bad enough for small business, the tax increases I have already talked about, the House Democrats, in this 2,000-page health care reform bill, have proposed a new surtax of 5.4 percent. With this small business surtax, a family of four in the top bracket will pay a marginal tax rate of 46.4 percent by the year 2011. So we go from current law of 35 percent to automatically, if Congress doesn't intervene, 39.6 percent; and then eliminate the PEPs and Pease, 41 percent; and then do what the House Democrats want to do, 46.4 percent, a marginal tax rate that is very high and very negative to employment by small business. This tax change would result, cumulatively, in an increase of marginal tax rates of 33 percent, a 33-percent increase over what taxes people pay right now. Owners of the many small businesses, whether regular--which could be so-called C corporations--or other entities that receive dividends or realize capital gains, would face a 25-percent rate increase under this House bill. So we have a 15-percent capital gains rate today on dividends going up almost 70 percent by January 1, 2011. Campaign promises are pretty important. Candidate Obama pledged on the campaign trail that: Everyone in America--everyone--will pay lower taxes than they would under rates Bill Clinton had in the 1990s. That is quite a promise. That is good for business, if it is lower than what Bill Clinton had. The small business surtax proposed by House Democrats, however, violates President Obama's pledge he made as a candidate. Therefore, I want Members to know I stand with President Obama in opposing the small business surtax proposed by House Democrats in this bill, this 2,000-page bill. According to the National Federation of Independent Businesses--they made a survey--their data shows that 50 percent of the owners of small businesses that employ 20 to 249 workers would fall into the top bracket. The red bar shows 50 percent of all small employers fall into that bracket. According to the Small Business Administration, about two-thirds of the Nation's small business workers are employed by small businesses with 20 to 500 employees. Do we want to raise taxes on these small businesses that create new jobs and employ two-thirds of all small business workers? In his radio address a few months ago, the President noted small businesses are hurting. They are hurting because we are helping Wall Street, but we are not helping Main Street with all the things we are doing in Congress. Of course, there is no argument from this side of the aisle on that point. President Obama recognized in that speech the credit crunch on small businesses continues, despite hundreds of billions in bailout money to big banks. With these small businesses already suffering from the credit crunch, do we want to think it is wise to hit them with a double whammy of a 33-percent increase in their marginal tax rate? Just yesterday, we received data from the nonpartisan official congressional tax scorekeepers, the Joint Committee on Taxation, that said $1 out of every $3 raised by the massive $461 billion House surtax--and that is in this 2,000-page bill--would come from small businesses. That is a conservative, a very conservative estimate because other kinds of income that these business owners receive, such as capital gains and dividends, are not included in that figure. If the proponents of the marginal rate increase on small business owners agree that a 33-percent tax increase for half--half--the small businesses that employ two-thirds of all small business workers is not wise, then they should either oppose these tax increases or present data that shows different results. This House bill of 2,000 pages and the surtax included in it piles on the heavy taxes small businesses will face. In a time when many businesses are struggling to stay afloat, does it make sense to impose an additional burden on them by raising their taxes? Odds are, they will cut spending. In other words, the small businesses will cut spending. They will cancel orders for new equipment, cut health insurance for their employees, stop hiring, and lay off people. Instead of seeking to raise taxes on those who create jobs in our economy, our policies need to focus on reducing excessive tax and regulatory barriers that stand in the way of small businesses and the private sector making investments, expanding production, and creating sustainable jobs--creating sustainable jobs, which is what I refer to as small business being the job-creating miracle of our economy. So I want you to know, regardless of this 2,000-page House bill, with these big tax increases in it, I will continue to fight to prevent a dramatic tax increase on our Nation's job engine, the small businesses of America. I hope my friends on the other side of the aisle will follow accordingly. Mr. President, I ask unanimous consent that a statement from the Joint Committee on Taxation, backing up some of the figures I used in my speech, be printed in the Record.

Mr. GRASSLEY. Mr. President, I yield the floor.

Mr. GRASSLEY

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

Mr. GRASSLEY. Mr. President, over the past few days, this Senator and several other Senators have been coming to the floor, talking about various aspects of the health care reform bills the majority has brought forward so far. Today I want to review the impact of these bills on Medicare beneficiaries. First, this is the Senate Finance Committee bill. It would cut Medicare by about $470 billion over 10 years. The House version takes an even bigger bite out of Medicare. In that bill, Medicare is cut by about $540 billion. That is more, obviously, than $\1/2\ trillion. Cuts of this magnitude are sure to hurt Medicare providers and threaten beneficiaries' access to care. Take a look at the cuts in these reform bills. It shows why there is genuine concern that health care for Medicare beneficiaries will suffer greatly because of health care reform. The proposed legislation permanently cuts all annual Medicare provider updates. Permanently, or another way to say it, cuts them forever. In addition, some providers, such as hospitals, home health agencies, and hospices, would face additional cuts over the next 10 years. These permanent cuts are supposed to reduce Medicare payments to account for increases in productivity by health care providers. Supporters of those productivity adjustments believe Medicare generally overpays providers. I wish they would ask providers in my State of Iowa. And they say this would happen because today's Medicare payments do not take into account productivity increases that might reduce the cost of providing care to beneficiaries. However, this proposal for productivity adjustments is an extremely blunt instrument that will threaten beneficiary access to care. It is flawed in at least two ways. First, the productivity measure used to cut provider payments in the bill does not represent productivity for specific types of providers, such as nursing homes. I mean, you would think that if Medicare is going to reduce your payments to account for increases in productivity, it would at least measure your specific productivity, but that is not the case. Instead, these reform bills would make the payment cuts based on measures of productivity for the entire economy. So if productivity in the economy grows because let's say computer chips or any other products are made more efficiently, then health care providers see their payments go down. Where is the connection? But there is a second major problem. This other problem is that the productivity adjustment actually punishes providers for increases in productivity. This policy says that when a provider is more productive, Medicare is going to take it all--100 percent of the productivity increase. The provider does not even get to keep half of the financial benefit for that increase in productivity. Where is the reward? Confiscating the entire productivity increase removes all of the incentives for providers to improve their productivity in the first place. This is a typical government policy. If you do better, the government wants its share. But here, the government not only takes its share, it takes all of it. These cuts are sure to impact health care for seniors. But I don't want you to take my word for it, so I am going to go to one of those nonpartisan people in government. There are a lot of nonpartisan, very professional people in government. But now I refer to the Chief Actuary of the U.S. Department of Health and Human Services. He recently identified this threat to beneficiary access to care. He confirmed this in an October 21 memorandum analyzing the House bill. The House bill and the Senate Finance bill both propose the same types of permanent Medicare productivity cuts. Here we have a chart referring to the Chief Actuary. Here is what Medicare's own Chief Actuary had to say about these productivity cuts. In reference to those cuts, he wrote that: The estimated savings . . . may be unrealistic. In their own analysis of the House bill, Medicare's own Chief Actuary says: It is doubtful that many could improve their own productivity to the degree achieved by the economy at large. They go on to say: We are not aware of any empirical evidence demonstrating the medical community's ability to achieve productivity improvements equal to those of the overall economy. In fact, the Chief Actuary's conclusion is that it would be difficult for providers to even remain profitable over time as Medicare payments fail to keep up with the costs of caring for beneficiaries. So let's go back to this chart again. Ultimately, here is their conclusion: Providers that rely on Medicare might end their participation in Medicare, ``possibly jeopardizing access to care for beneficiaries.'' Medicare's Chief Actuary confirms what I have been hearing from providers back in my State of Iowa about these permanent productivity payment cuts. Those providers are doing everything they can to be efficient and to be innovative. They are doing everything they can to get the biggest bang out of every Medicare dollar they can. But assuming the level of productivity assumed in these bills would be like getting blood out of a stone. These health reform bills will make it even harder for them to keep their doors open. Look at providers such as nursing homes and hospices. They provide labor-intensive services. There are few gadgets or processes in these settings that will increase productivity. Nothing in these settings replaces staff being at their bedside and providing care. So it is very incorrect to assume these providers will achieve levels of productivity like the rest of the economy, justifying those cuts that these bills anticipate. Let's look at other providers affected by these productivity adjustments, like ambulances. The Finance Committee bill would permanently cut payments for ambulance services beginning in 2011. It would do this in spite of the fact that Congress enacts payment increases to ambulances year after year. In fact, the Senate Finance bill extends the existing add-on payments for ambulance services for another 2 years, until 2012, and then you know what, it turns right around and cuts them. I have no quarrel with providing additional payments for ambulance services because without them many ambulance providers would not survive. Well, what about this slight of hand? What is the impact? The bill proposes that we cut ambulance payments while we vote to increase them. It is kind of like, I voted to cut before I voted to increase. There is another proposal in the Senate bill that cuts Medicare, and now I am talking about the Medicare Commission. The pending insolvency of Medicare is a very serious problem, and Congress needs to stop kicking the can down the road when it comes to shoring up Medicare. We are nearing the end of that road. This Medicare Commission is fatally flawed, and the risk of unintended consequences that will hurt seniors outweighs any benefits it might have. Not only will it be harder to find a doctor or hospital that will see Medicare patients, you can also forget President Obama's promise about keeping what you have. After all the promises about not cutting Medicare benefits, Congressional Democrats and the White House are using the Medicare Commission to take aim at the popular Medicare prescription drug benefits and the Medicare Advantage Program. Under the Finance Committee bill, this new Medicare Commission would be given explicit authority to cut Federal subsidies for Medicare prescription drug premiums. Think about that. Today, that Federal subsidy pays for about 75 percent of the premium for Medicare prescription drug coverage for seniors, but the Finance bill says: Cut that subsidy. It says: Raise Part D premiums for our seniors. That is right. But again, do not take my word for it. On October 13, during the Finance Committee health reform markup, the Director of the Congressional Budget Office, CBO, was asked whether reducing the Part D subsidy would raise premiums. So chart 2 here is what Dr. Elmendorf, the Director of CBO, said: ``Yes . . . [reduced subsidies] would raise the costs to beneficiaries.'' So this was clear confirmation that if the Medicare Commission cuts payments to Medicare drug benefits, it will cause Part D premiums for seniors and the disabled to go up. At a time when the country is facing record unemployment and Americans are struggling to keep up with increasing prescription drug costs, these provisions will make these lifesaving prescription drugs more expensive for beneficiaries. These are the kinds of things that get buried in a 2,000-page bill. When the other side does not understand why the American people are concerned about these huge bills, those are some of the reasons. These health reform bills also propose to cut up to $170 billion from Medicare Advantage. In my home State of Iowa, these cuts will cause about a 25-percent cut in the amount of money going to extra benefits for 63,000 seniors who are enrolled in Medicare Advantage. That means fewer low-income Iowans will be getting the eyeglasses, hearing aids, and chronic care management they have come to rely upon. Some health care providers, such as hospitals, got a special deal. They are exempted from the Medicare Commission's payment cuts. That means other providers and programs, such as drug benefits for seniors and Medicare Advantage, will be bearing the brunt of payment cuts. The Medicare Commission would also become a permanent program that Congress would, for practical purposes, be unable to undo. By making the Commission a permanent program, it becomes part of the baseline in the budget over the next decade, so it just goes on forever, sort of like the Energizer bunny--it will just keep cutting and cutting and cutting. If Congress ever wants to shut off those cuts, then it will have to offset the cost when of terminating this commission. That will make it effectively impossible, and the damage will have been done. These Medicare cuts will also only make things worse for beneficiaries in rural areas. Seniors in rural areas already face health care access problems. Medicare generally pays rural providers less than those in urban areas. Cuts of this magnitude will make it much harder for rural Medicare providers to care for beneficiaries. But believe it or not, it only gets worse. My colleagues on the other side of the aisle intend to create a government-run health plan. If this government plan pays providers based on already low Medicare rates, it is only going to make this whole situation with access and keeping hospitals open much worse. These Medicare cuts are achieved at the expense of health care access and quality. These Medicare cuts turn a blind eye to threats to health care quality and access. There are no fail-safes in these bills that kick in automatically if these drastic cuts cause limited provider access or worse quality of care. Instead, Congress will have to step in. The Congressional Budget Office has already projected that these Medicare cuts keep increasing by--can you believe it?--the cuts will keep increasing 10 to 15 percent each year over the next decade, so 15 percent even beyond the year 2019. And provisions such as these productivity adjustments and the Medicare Commission would drive the increased cuts to the program. So this will give you an idea of the damage these bills will do to health care, particularly for seniors. This is an example of the challenge Congress will face in the next decade if these bills become law. And this is just what we know about these bills we see. Who knows what is being cooked up behind closed doors right now. Once again, it is time to back up this process. It is headed in the wrong direction. A bill of this magnitude should be done on a bipartisan basis with broad support. We can get it done right, if we work together. These bills have massive Medicare cuts. They will do permanent damage to our health care system--higher prescription drug premiums for seniors, increased costs, jeopardized access for beneficiaries. These bills are taking us in the wrong direction. I yield the floor.

Mr. GRASSLEY. Mr. President, I would like to take a moment to express my concern about a provision included in the unemployment compensation bill before the Senate. The provision I am concerned about deals with a reversal of a sound international tax policy reform. Back in 2004, Congress passed and President Bush signed a major bipartisan business tax reform bill. The centerpiece proposal in the international tax reform area was a restoration of the Finance Committee position from the 1986 Tax Reform Act on the treatment of interest for the purposes of the foreign tax credit. This reform, known as World Wide Interest Apportionment, was due to take effect at the beginning of 2009, but its implementation was delayed for 2 years in order to pay for housing legislation enacted in July of 2008. I expressed my concerns at the time about delaying sound international tax policy in order to fund new spending priorities. However, my view lost out and the delay of this provision was used as an offset. Now, here we are again, in need of revenue offset in order to fund other priorities. The proposal in the bill before us delays this important reform an additional 7 years, until December 31, 2017. I support the main provisions of the bill intended to provide relief to those struggling to find work by extending unemployment benefits and to provide a lift to the economy by extending the homebuyer tax credit and the expanded net operating loss carryback period for small businesses. My opposition to this revenue offset rests in the bad tax policy this proposal represents. The interest allocation reform would, if allowed to take effect, lower the chance of double tax that arises under current law from the artificial overallocation of interest expense to foreign income, even when the debt is incurred to fund domestic investment. The current rules actually penalize domestic manufacturers that compete in global markets by making it more likely they will be double-taxed on their foreign income. Several companies have spoken to my staff about the negative ramifications this delay will have on them. Some of these companies are just starting to grow their businesses beyond the U.S. borders. The delay of this important international reform will make it more costly for these companies to expand into these markets. If these companies cannot grow beyond the domestic economy, they will be unable to compete in the global marketplace. Mr. President, I ask unanimous consent that a letter I received from John Deere explaining their concern about delaying the implementation of this provision be printed in the Record.

Mr. GRASSLEY

Mr. GRASSLEY. Thank you, Mr. President. Mr. President, I come to the floor to address the issue of health care reform. In order to demonstrate the complicated issues that face us, I have with me the House of Representatives health care reform bill, approximately 2,000 pages; I have over here the Senate HELP Committee bill, approximately 1,000 pages; and over here, the Senate Finance Committee bill, approximately 1,500 pages. Some on the other side of the aisle are saying their bills do not represent a government takeover of the health care system. I want to believe that. I would really like to believe it, but the facts seem to tell a different story. If we look at the specifics of the bill reported by the Senate HELP Committee or the House bill released last week, I don't see how one could call it anything but a government takeover. So I wish to start with the Senate HELP Committee bill. On September 17, the HELP Committee finally released what I previously said was a bill containing about 1,000 pages--more accurately, 839 pages--over 2 months after the majority party on the HELP Committee voted to report it. When I was back in my State of Iowa for the August recess, I held 17 townhall meetings. Due to the controversial health care bill the HELP Committee and the three House committees had just voted on, the attendance was the highest I have seen in the 2,871 townhalls I have held during my years in the Senate. Many of the people who attended were citing sections from the health reform bills. They had good questions. I heard repeatedly about the new powers being granted to the government in these bills. So I decided we should have a catalog of how many times these bills grant new powers to the Secretary of Health and Human Services. Well, I have the HELP Committee bill with me today, and there is a lot going on in the 839 pages of that bill. We have gone through the 20,725 lines of legislative text just to see how many new government authorities it creates, and here is what we found: This bill creates a total of 87 new government programs. In addition to the 87 new government programs created by this legislation, a substantial amount of new regulatory authority has been granted to the Secretary of Health and Human Services. I know the other side doesn't like to hear that this bill calls for a government takeover of our health care system, but let's let the facts speak for themselves. If it isn't a government takeover of our health care system, why does the word ``Secretary''--meaning Secretary of HHS-- appear 982 times in this bill? Maybe the other side needs a reminder that the Secretary of Health and Human Services is an agent of the Federal Government appointed by the President, confirmed by the Senate. Iowans keep telling me that Congress needs to just slow down, consider all ideas, and, of course, common sense tells us to actually read the legislation. But the HELP Committee bill makes it clear that the majority leadership and the White House would rather push something through quickly and leave the important decisions to an unelected, unaccountable government official. The long list of new powers granted to the Secretary begin on page 11 of the HELP Committee bill, and I quote: The Secretary shall by regulation establish a minimum size for community ratings areas. So let me put it in common language rather than statutory language. This bill includes a number of controversial rating reforms, and one of those reforms would set a 2-to-1 age rating band. That means premiums for the oldest person could be no more than twice the cost of the premiums to the youngest person. Now, that is going to reduce premiums substantially for older people, and that is a fine goal, but the money has to come from somewhere. So to pay for those lower premiums for older people means much higher premiums for younger people. It is a new hidden tax being imposed on young people. It will increase premiums for young people by at least 50 percent. This bill would give the Secretary the regulatory power to draw the map in each State for these rating areas, and that is where we go back to the quote I just cited: The Secretary shall by regulation establish a minimum size for community rating areas. Keep in mind, under current law this sort of policy is presently decided by 50 different State legislatures or by 50 different insurance commissioners. But some in Congress want to take this responsibility away from the States and turn it over to unelected bureaucrats in Washington, DC. I spoke on the Senate floor earlier last week about how the Democratic proposals for health care will increase premiums and overall health care spending. Quite the opposite: I think to most people hearing us talk in Washington, DC, about health care reform, the word ``reform'' would mean to them not increasing premiums and overall health care spending. To offset the increase in premiums, they say they will subsidize them using taxpayer dollars. But guess who is given the power to decide what benefits are eligible for these new subsidies? I will read the answer straight from the bill on page 90, line 11. It says: The Secretary shall establish . . . the essential health care benefits eligible for credits. . . . My friends on the other side of the aisle claim their proposal will increase choice and competition in the health insurance industry. But after reading this bill, it is clear that only 1 percent will have a choice, and that person is the Secretary of HHS. On page 74, line 17, the Secretary is given the power to regulate what type of health plan works best for you and your family. I will read that quote: The Secretary shall, by regulation, establish criteria for certification of health plans as qualified health plans. After the Secretary chooses what plan works best for you and your family, the Secretary can choose what conditions your doctor must meet in order to contract with the plan chosen for you. On page 80, line 14, it says that a qualified health plan may contract with `` . . . a health care provider if such provider implements such mechanisms to improve health care quality as the Secretary may by regulation require.'' That means if you want to purchase coverage through a new exchange established by this bill, the Secretary of HHS will be deciding what health plan and what doctor is best for you and your family. This bill also extends the Secretary's influence into classrooms, where our future doctors are being trained. On page 685 of the bill, line 10, it says: The Secretary shall support development, evaluation, and dissemination of model curricula for . . . use in health professions schools . . . and for other purposes determined appropriate by the Secretary. That is a lot of power in a sentence of the law that says ``and for other purposes determined appropriate by the Secretary.'' Are all of these new requirements and regulations going to help our health care system? Will they make Americans healthier? The truth is, we have no way of knowing since so much in this bill, including what I have highlighted, is left to the regulatory decisions of an unelected government bureaucrat. The proponents of this bill say it isn't a government takeover of health care. But after reading only a fraction of the bill out loud, as I have done, it is hard to argue the fact that the Secretary of HHS is granted a lot of power over our health care system. The Secretary will determine the size of new rating areas. The Secretary will decide what benefits health care plans have to cover. The Secretary will decide what health plan works best for you and your family. The Secretary will decide what conditions your doctor must meet to be included in your plan. The Secretary will decide what curriculum should be taught in our medical schools. You may be tired of hearing me say ``Secretary,'' because I am tired of saying it. I have only said it 25 times in this speech. But this bill uses the word ``Secretary'' another 957 times, which is an indication that the HELP Committee bill is moving control of our health care system in what many people in this country consider the wrong direction. That brings me to the House bill that was released last week. The House bill, right here--2,000-some pages--seems to be heading in the wrong direction also. In fact, a spokesman for the small business industry said to the Hill newspaper: [The House bill] is a ``how to'' on how not to do health care reform. That is pretty disappointing, since the bill costs about $2.2 million per word. You would think we would be getting something for that kind of investment. The Wall Street Journal today calls the House bill ``the worst bill ever.'' Quoting, ``Epic new spending and taxes, pricier insurance, rationed care, dishonest accounting: the Pelosi bill has it all.'' Again, that was from the Wall Street Journal. Let's start with what is in the 2,000 pages and $1 trillion in spending in this new bill. The bill includes a government-run insurance provision. All the caveats aside, it is still a government insurance plan--or let me say government insurance company, plain and simple. Interestingly, after all the promises about lower costs, the Congressional Budget Office has said that premiums in the government- run plan would be more expensive than premiums in the private market. That report just came out within the last couple of days. The bill also locks every American with an income below 150 percent into Medicaid. Today, a family of 4 with an income of $33,000 is at 150 percent of the poverty level. Under this new House bill, that family would not get any assistance to get private health coverage. In other words, they would not have choice. Let me point out that Medicaid is already financially unsustainable in its current form. This is the biggest expansion of Medicaid in its history. With this Medicaid expansion, the new House bill continues to leave States liable for a significant share of that new spending--a share States cannot afford. Ultimately, that will force States to raise taxes to pay for their share of this expansion of Medicaid. That is a hidden tax, although it will come separately among the 50 States. The bill also proposes a host of new Federal insurance market reforms that will actually raise costs for most individual Americans. With the creation of a new unelected Federal bureaucrat, called the ``health choices commissioner,'' the Federal Government will now be in charge of deciding what insurance you have to buy. If this isn't a government takeover of health care, I don't know what it is. If you don't like what the new health choices commissioner comes up with or you cannot afford it, you will be hit with a new individual mandate tax penalty, and that will be enforced by the IRS. Despite all the promises about being able to keep what you have, the bill cuts more than $150 billion from Medicare Advantage plans, endangering the existing coverage for millions of seniors. Don't take my word for it, because the Office of the Actuary--that is a professional office, not a political office--at the Department of Health and Human Services said that with this level of cuts ``enrollment in [Medicare Advantage] plans would decrease by 64 percent.'' The CBO has taken a look at some of the changes in the Medicare Part D drug benefit and concluded that the changes will actually raise premiums. So whether you are in Medicare Advantage, Medicare Part D, or private insurance, this new House bill means higher costs, more government interference, and less choice. I don't think that is what people in my State of Iowa have in mind when they ask us to fix the health care system. The House bill also includes a part that is called the CLASS Act, which creates a new long-term care entitlement. I happen to be very supportive of taking steps to improve long-term care for Americans. But the CLASS Act is fiscally irresponsible. I am not going to name the prominent Senate Democrat, but one has been quoted as calling the CLASS Act a Ponzi scheme that Bernie Madoff would have been proud of. Finally, I hope everyone out there pays special attention to what House Democrats call ``shared responsibility.'' If you make money in America, the House Democrats expect you to do some extra sharing. Lots. The bill includes a massive tax increase to pay for it. Now I wish to go to what is not in the bill. Even though President Obama continues to support medical liability reform, as I do, the House still refuses to consider it. In the ``devil's in the details'' category, I find it particularly worrisome that the House bill failed to include a prohibition on rationing that was in their original discussion draft. The discussion draft of H.R. 3200 stated that the committee should ``ensure that essential benefit coverage does not lead to rationing of health care.'' Every time you get the government more involved in health care, the issue at grassroots America comes up: Will we have rationing? A lot of committees have tried to say that there would not be any rationing coming from this, and that was in the original House bill. But as it is put together as one final package, as it is here, that section, unfortunately, was dropped. In other words, the prohibition on rationing is not in this bill. This is what the latest House bill proposes: more taxes, more spending, higher premiums, fewer choices, a government-run plan, the biggest Medicaid expansion in history, unsustainable new entitlement programs, and 2,000 pages. Despite all the promises, the facts don't lie. The House bill and the HELP Committee bill I referred to during these remarks represent an unprecedented government takeover of our Nation's health care system--a takeover that this country cannot afford, and a takeover that the American people don't want. I thank my colleagues for giving me this time beyond the hour of 4, when the unemployment compensation bill was to be taken up, so I could keep another obligation. I yield the floor.

Mr. GRASSLEY

Mr. GRASSLEY. Madam President, I am going to continue on a point that the Senator from Kentucky made, and that is tax increases. I want to be a little more specific about how the health care reform bill is going to very dramatically increase taxes--particularly for groups of people with under $250,000 a year in income, which group President Obama has promised would never have their taxes increased. On September 12, 2008, in Dover, NH, candidate Obama said: And I can make a firm pledge: No family making less than $250,000 will see their taxes increase--not your income taxes, not your payroll taxes, not your capital gains taxes, not any of your taxes. You can see on the chart that quotation. It is very firm, very clear. Well, I believe we are at the point of abrogating that promise. President Obama's pledge has also been repeated by the President and his advisers numerous times since candidate Obama has been in office. However, the health care reform bill reported out of the Senate Finance Committee is loaded with tax hikes on ``the middle class.'' President Obama, however, has defined the middle class as those making under $250,000. Candidate Obama stated that ``if you are making less than $250,000, then you are definitely somewhere in the middle class.'' President Obama's budget tracks this definition by preserving the current income tax rate structure for families under $250,000 and singles under $200,000. And the Democratic leadership budgets adopted President Obama's definition of the middle class. President Obama and congressional Democrats have adopted this definition of the middle class in the context of health care reform. As evidence, on August 3, 2009, President Obama's press secretary Robert Gibbs said: Let me be precise. The President's clear commitment is not to raise taxes on those making less than $250,000 a year. In his Portsmouth, NH, townhall meeting, the President--referring to ways in which to pay for health care reform--said this: It should not burden people who make $250,000 a year or less. The congressional Democratic leadership have made similar commitments. So the question is: When health care reform comes up, will it not increase taxes for people making under $250,000? Will the promises that the President made as a candidate be kept by the bills that may become law? I don't want to refer to this Senator's judgment of this. I want to use the words of the Joint Committee on Taxation and the Congressional Budget Office. These are people who are experts-- nonpartisan--and nobody questions their judgment. They are intellectually honest. They are not Republicans or Democrats. According to these official scorekeepers--Joint Tax and the Congressional Budget Office--the Finance Committee bill contains over $500 billion of taxes, increases, fees, and penalties on individuals and businesses. The Joint Committee on Taxation testified that a significant percentage of these tax increases, fees, and penalties will be borne by the middle-class taxpayers--those making under $250,000. Joint Tax also performed a distributional analysis of three tax provisions of the Senate Finance Committee bill for the year 2019--when these provisions are fully in effect. In other words, Joint Tax and the Congressional Budget Office look ahead 10 years. So we are talking about between now and 2019. The three provisions that Joint Tax made distributional analyses of are: the advance refundable insurance premium tax credit; second, the high cost plans tax, also known around here as the Cadillac health insurance plans--and that is the tax connected with it; third, the medical expense deduction tax increase. The Joint Committee on Taxation found that, on average, by 2019, singles making over $40,000 a year, and married couples making over $75,000 a year would have a net tax increase under the Finance Committee bill. Again, if you are single and making over $40,000 a year, or married and making over $75,000 a year, your taxes are going up, on average, under the Finance Committee bill. We have two charts up here that make that very clear. My colleagues on the other side of the aisle may say that the Finance Committee bill lowers people's taxes. Let's look at that. This may be a little bit true for some taxpayers. But for middle-class taxpayers, their taxes will go up. Further, Joint Tax--the official congressional tax scorekeeper--said so. So if the President signs the Senate Finance Committee bill, or some of the financing measures in that bill, into law, the President would break that campaign pledge. The President then would be raising taxes on families making $250,000 and singles making $200,000. Now that we have established that the Finance Committee bill raises taxes on the middle class, I would like to dig a bit deeper. In looking to 2019, Joint Tax data leads to the conclusion that 77 percent of the burden of the tax increases in the Finance bill would be borne by middle-class taxpayers. In 2019, out of these taxpayers making under $200,000 who are affected by the three provisions mentioned above, 54 percent of them will see tax increases. In other words, 46 million middle-class families and individuals would pay higher taxes under the Finance Committee bill, contrary to what the President has said. Joint Tax data also finds that middle-class families who file joint returns are very dramatically affected. Specifically, in 2019, over 64 percent of middle-class families filing joint tax returns would face a significant increase, and these families, obviously, make less than $250,000 a year. Once again, I have charts that will show the different divisions of people falling into those income categories. Another way to look at this is, there are four groups of middle-class taxpayers who are treated differently under the Finance Committee bill. The first is a group of 14.5 million who will receive refundable tax credits. These refundable credits represent government spending and not tax relief. That is the judgment of these official scorekeepers, not this Senator. In 2019, this government spending amounts to $77 billion alone. In the second group, some of the 25 million will see some tax relief. However, a substantial number of those 25 million in this second group will not see any tax relief under the bill. The third group, made up of 46 million middle-income taxpayers, will bear a large tax increase. A fourth group of 83 million will have a tax increase from provisions in the bill that Joint Tax has not yet analyzed, so I cannot go into depth about that group. For example, Joint Tax has not yet provided distribution analysis on the effect of the fees on health insurers that will be passed through and medical device manufacturers.

Mr. GRASSLEY. I ask for 5 additional minutes.

Mr. GRASSLEY. Because we do not have that analysis, we do not know how many of those 83 million will face tax increases. For instance, many of those 83 million buy health insurance themselves or their employers buy it for them, and they will bear the burden of the new insurance fees in the form of higher insurance premiums. During the Finance Committee debate, some Senators of the majority party described the Finance Committee bill as providing a net tax cut. Let's look at what is a net tax cut because the official scorers would not determine that is what it is. To understand whether these claims are accurate, one has to figure out what is meant by the words ``tax reduction.'' The premium tax credit under the bill is refundable. That means tax return filers receive the tax credit, even if they have no income tax liability. If a tax filer has no income tax liability, how can their taxes go down? Joint Tax does not describe that as a tax reduction. Instead, Joint Tax says these filers receive a Federal benefit. Joint Tax also tells us that 73 percent of the $453 billion in the refundable tax credits for health insurance is, in fact, pure and simple, government spending. That leaves just 27 percent--or $122 billion--that might legitimately be called a tax reduction, and we see it on the chart. Meanwhile, as mentioned above, there are over $500 billion in tax increases--$\1/2\ trillion is another way of saying it. Even if we add in the meager small business tax credit of $23 billion, which is the only other tax benefit in the bill, this bill contains a net tax increase of over $350 billion. Because the refundable insurance premium credit is called a tax credit, Democrats have argued the entire $453 billion is a tax credit. However, Joint Tax and the Congressional Budget Office scores 330 billion of that $453 billion as pure and simple government spending. Colleagues on the other side of the aisle argue that such government spending is actually a tax cut. However, Joint Tax scores this as government spending, not tax cuts. An outlay results when the tax credit is larger than an individual's income tax liability, if any. That individual simply receives a check from the Internal Revenue Service. Sending a check to an individual who pays no income tax cannot credibly be called a tax cut. Some colleagues argue that the refundable tax credit offsets payroll taxes. However, payroll taxes are meant to be paid so individuals can receive benefits from Social Security and Medicare later in life. Even if you agree that individuals should not have to pay payroll taxes but should also receive Social Security and Medicare benefits, that rationale cannot be used over and over. It should only be used once. We already have a number of generous refundable tax credits. The child tax credit, the earned-income tax credit, and the making work pay credit are all refundable tax credits. The insurance premium credit in the Finance bill is added to that list. Therefore, this same payroll tax cut rationale has been used four times to claim that this government spending is actually a tax cut. Joint Tax scores these outlays as government spending, not as a tax cut. That is not this Senator saying that; it is the professionals in Joint Tax who say it is government spending, not a tax cut. The interesting thing about the refundable tax credit for health insurance is, it does not go to the individual or family. Instead, this Federal tax benefit goes from the government directly to the insurance company providing health care coverage. That is a check from the Federal Government made out to your insurance company dated, signed, sealed, and delivered directly to that insurance company. I remember hearing President Obama criticize sending money directly to insurance companies. On October 4, before his election, in Newport News, VA, then-Candidate Obama criticized Senator McCain's health credit for health insurance by saying these words: But the new tax credit he is proposing? That wouldn't go to you. It would go directly to your insurance company--not your bank account. That is what the President said in that quote. If Candidate Obama was against it then, how is President Obama for it now? But that is what is in this legislation.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, last week, President Obama delivered a speech at the Massachusetts Institute of Technology on the environment and on clean energy. He made an appeal for congressional support for biofuels, wind, and solar energy, clean coal technology. Naturally, as father of the wind energy tax credit of about 18 years ago, I share President Obama's support for homegrown renewable energy. When the President was in the Senate, he and I worked together to promote the production and distribution of biodiesel and ethanol. It is because of our common interest and shared support that I make an appeal today to President Obama. The Environmental Protection Agency is currently reviewing a number of proposals that are incredibly important to our Nation's ability to reach its potential in terms of renewable fuel production. On September 3, I was fortunate to host EPA Assistant Administrator Gina McCarthy and Margo Oge, Director of the EPA's Office of Transportation and Air Quality, on a family farm in my State of Iowa. I was happy they accepted my invitation. It was a very good visit. With the tremendous impact EPA decisions have on the family farmer, it seemed worthwhile for Administrator McCarthy and Director Oge to see American agriculture directly through the eyes of a family farmer. I also had the opportunity to share my concerns on many pending issues, and I believe these EPA officials were a welcome audience. The first issue I am speaking about relates to the EPA's proposal to penalize biofuels for greenhouse gas emissions from supposed changes in international--I emphasize international--land use. I know President Obama is aware of my concerns because I relayed them to him personally over lunch at the White House on May 6 of this year. Their new renewable fuels standard, enacted in the year 2007, requires various biofuels to meet specified life cycle greenhouse gas emission reduction targets. The law specified that the life cycle greenhouse gas emissions are to include direct emissions and significant indirect emissions from indirect land-use changes. However, the proposed rule relies on incomplete science and inaccurate assumptions to penalize U.S. biofuels for so-called indirect land-use changes. Under the EPA's analysis, ethanol produced from corn reduces greenhouse gas emissions by 16 percent compared to gasoline. However, if you remove the murky science of emissions from indirect land-use changes, corn ethanol reduces greenhouse gas emissions by 61 percent compared to gasoline-- remembering that the other figure was just 16 percent compared to gasoline. So you can see what we know from science--sound science--is ethanol is very environmentally positive. The EPA's models conclude that changes in international land use-- again, emphasis upon international land use--contribute more in greenhouse gas emissions than the entire direct emissions of ethanol production and use. The fact is, measuring indirect emissions of greenhouse gases is far from a perfect science. There is a great deal of complexity and uncertainty surrounding this issue. That is why Senator Harkin and I, along with 10 other Senators, asked EPA earlier this year not to include calculations of indirect land-use changes. But the EPA ignored the request of Senator Harkin and myself. In its proposed rule, the EPA grossly underestimates future crop yields that will help meet the demand without requiring new crop acres. In addition, the EPA fails to adequately measure the land-use credits for the feed value of corn ethanol coproducts. Similar miscalculations exist for biodiesel as I have explained for ethanol. The EPA miscalculated the value of coproducts associated with biodiesel production and even included a nitrogen penalty. I wish to speak to the nitrogen penalty because it is a case of total ignorance on the part of the EPA. Farmers know that growing soybeans does not require nitrogen use. Soybeans, in fact, capture nitrogen and return that very valuable product to the soil naturally. During consideration of the Interior appropriations bill last month, Senator Harkin filed an amendment to block EPA from including the international component of the land-use change calculation. In response, EPA Administrator Jackson sent a letter to Congress claiming the amendment would prevent them from carrying out their statutory obligations. There are two points that need to be made with regard to Administrator Jackson's letter to us in the Congress. First, the statute does not require the inclusion of international land-use changes. Nowhere does the word ``international'' appear in the statute. Second, in measuring greenhouse gas emissions, the statute states clearly: Direct emissions and significant indirect emissions such as significant emissions from land use changes. If the EPA can't determine the impact of land-use changes with any degree of certainty, how can it be sure the impact is significant? Isn't there the same probability it is entirely insignificant? Importantly, the House of Representatives demonstrated its lack of confidence in the EPA's handling of this issue during consideration of the climate bill in June. In that bill, Agriculture Chairman Peterson, Speaker Pelosi, and Energy and Commerce Chairman Waxman agreed to an amendment that recognized there is no scientific agreement or no consensus that links U.S. biofuels production to international land-use changes. The amendment blocked EPA's consideration of international land-use changes for 5 years, until it can be measured using what we ought to expect them to use--sound science. There is strong bipartisanship on the record in opposition to EPA's finding in this area. So I hope EPA gets the message. The second issue pertains to the volume mandates required for biodiesel under the expanded Renewable Fuels Standard. The RFS-2 requires the use of 500 million gallons of biodiesel in 2009 and 650 million gallons in 2010. However, EPA's rulemaking to implement these volume requirements has not yet been finalized and may not be until well into next year. The U.S. biodiesel producers are in a tough financial situation. They need this mandate--which Congress did enact--to ensure a domestic marketplace for their renewable fuels. While the EPA took action to increase the overall volume mandate to comply with the law, it has failed to implement the specific biodiesel mandate. In early August, Senator Conrad and I were joined by 22 other Senators in writing President Obama to ask for his help. Mr. President, I ask unanimous consent to have printed in the Record a copy of the letter to President Obama.

Mr. GRASSLEY. Mr. President, the domestic biofuels producers are in a precarious state, so we asked President Obama to take immediate action to implement the volume mandates for biodiesel. It is in our Nation's economic and environmental interest to maintain a robust biodiesel industry. Unfortunately, no action has been taken to immediately implement the volume mandates. Finally, the EPA continues to delay in approving higher blends of ethanol in our transportation fuels. Earlier this year, a number of ethanol producers submitted a request to EPA to allow higher blends of ethanol. Currently, ethanol blends are limited to 10 percent in nonflex-fuel vehicles. The waiver request is simply requesting that EPA allow ethanol to be blended at 15 percent levels instead of 10 percent. While the waiver request was submitted back in March, the EPA has not made a decision. The EPA's delay in considering this request is having a negative impact on U.S. ethanol producers and is harming consumers who would otherwise benefit from lower prices at the pump. The delay is also putting off our efforts to use more homegrown renewable fuels in place of imports. The delay is also putting off our efforts to use more homegrown renewable fuels in place of imported fossil fuels. I recognize that prior to approval of higher ethanol blends, the requisite studies and testing must be concluded. A number of scientific studies conducted in recent years confirm that higher ethanol blends do not cause significant changes in tailpipe emissions, vehicle drivability, materials compatibility or durability. It is time to end the delays and take action to further reduce our dependence on foreign oil. I am speaking today to ask President Obama and his staff at the White House to pay close attention to these three issues. Our Nation currently has a strong, renewable fuels infrastructure that is working every day to reduce our dependence on foreign oil. Those involved are also working diligently to increase efficiencies and strive toward the second generation of advanced biofuels. But, we can't get there by undermining today's industry. The President can take action within his administration to ensure that no harm is done to the renewable fuels that are displacing dirty fossil fuels today. He can ensure that EPA uses only sound science and avoids speculative assumptions when determining the greenhouse gas emissions of biofuels. He can take action to see that America uses even more homegrown, green energy by ensuring that even more renewable fuel is blended in our Nation's transportation mix. And, he can take action to immediately provide the certainty for biodiesel producers that Congress intended in the energy bill of 2007. That is what I am asking him to do. By zeroing in on these three pivotal issues facing the renewable energy effort today, President Obama and his staff can make a major positive difference for the production of even more clean, renewable, domestic biofuels.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, with the words ``health care reform,'' everybody would expect costs to go down, premiums to level off, and more people being served. But it seems as though the proposals that are before the Senate are going to increase taxes, cut Medicare, and increase health insurance premiums. I think anybody hearing that would say that is not health care reform or at least not the health care reform they expected Congress to pass. So we are here in the Congress, soon about to consider a single bill that will personally affect the lives of every single American. Not often do we pass a bill that affects the lives of every single American, and not often do we pass a bill that restructures 17 percent of the U.S. economy--maybe never before. As one Washington Times editorial pointed out--and I am going to quote from it, and it is here for the audience to read: [The U.S. health care system] is bigger than Great Britain's entire economy. Imagine five bickering Congressional committees trying to redesign the British economy successfully in just a few weeks. No wonder people are getting nervous. It is true, people are getting nervous. As I travel around Iowa, I hear a lot of concern about out-of-control government spending and a massive government takeover of our health care system. People are worried that health care reform will result in lower quality, less access, and government bureaucrats deciding what health insurance they can or can't have. On top of all of that, Gallup released a poll last week saying 49 percent of Americans believe their personal costs will get worse--yes, worse--after health care reform is enacted. The poll also reported that only--and I emphasize ``only''--22 percent actually think costs will go down. Less than one-quarter of the people polled actually thought health reform would accomplish its top priority: making health care more affordable. I can't speak for my colleagues. I don't know what they are hearing from their constituents. But I know Iowans can't afford to pay more for health care. Costs are already rising three times faster than the rate of inflation. Costs are straining family budgets, and they are making it increasingly difficult for employers to offer health insurance. The nonpartisan Congressional Budget Office, the Joint Committee on Taxation, and even the Office of the Actuary at the U.S. Department of Health and Human Services have told us what the American people already know: These massive partisan health care reform bills are going to make the problem worse. Let me emphasize for the American people who might be listening that the people at the Congressional Budget Office, the Joint Committee on Taxation, and the Office of Actuary at the Department of HHS are professional, not political. They don't change from time to time when the makeup of Congress changes. They are there over a long period of time studying things in an intellectually honest way to tell it like it is. This is what they are saying: These massive partisan health care reform bills are going to make the problem worse. So I wish to go to some analyses we have already received from these nonpartisan, intellectually honest organizations. According to a September 22 letter from CBO to Chairman Baucus about the Finance Committee bill: Premiums in the new insurance exchanges would tend to be higher than the average premiums in the current-law individual market. So according to CBO, after these bills spend $1 trillion, many of the people struggling to afford their premiums today will actually end up seeing those premiums go up if this bill is enacted. The Congressional Budget Office also commented on how the tax increases would also raise premiums. During the Finance Committee markup, Senator Cornyn asked this question: Would the new fees on health insurers be passed down to health care consumers? Dr. Elmendorf, Director of CBO, responded by saying: Our judgment is that, [the new fees] would raise insurance premiums. The Joint Committee on Taxation confirmed that they came to the same conclusion during the markup. Mr. Barthold, the director there, said: Basic economics is that that fee will be reflected in higher premium costs. Let's not forget that these new insurance fees begin next year, in the year 2010, 3 years before any of the reforms in the bill take effect. So it is irrefutable that premiums will go up for every single American starting next year as a result of a bill that came out of the Senate Finance Committee. The Office of the Actuary with the U.S. Department of Health and Human Services--another nonpartisan, highly regarded set of expert analysts, by the way--has also looked at some of the Democratic health reform proposals. In a memo released on October 21, the Department of Health and Human Services, Office of Actuary, provided an analysis of House bill H.R. 3200. In the memo, the Health and Human Services actuary writes that the House bill does bend the growth curve, meaning the inflationary increase in health care costs. Of course, a top priority for Congress and the White House was to bend that curve. Unfortunately, the chief actuary says the Democratic leadership and the White House have failed to tell the American public it bends the curve in the wrong direction-- not downward but upward. According to the HHS memo, health care spending would actually increase if the House bill became law. The actuary writes it this way: In the aggregate, we estimate that for calendar years 2010 to 2019, national health expenditures would increase by $750 billion, or 2.1 percent, over the updated baseline projection. While some of the supporters of these partisan bills may not want to tell their constituents, we all know that as national spending on health care increases, American families will bear a burden through increased health insurance premiums. Let me be very clear. As a result of the pending health care proposals, most Americans will pay higher premiums for health insurance. Some of my colleagues will try to refute this claim by mentioning the taxpayer-funded subsidies included in these health care bills. It is interesting that they don't even try to deny, in the process of talking about taxpayer-funded subsidies, that premiums will still go up. They don't deny that. They just say the government--or let's say the taxpayers--are going to pick up the tab. It is true the proposals we have seen so far include about $\1/2\ trillion in cuts to Medicare and massive tax increases to pay for this new entitlement program. But once again, some of my colleagues fail to mention that most Americans would not qualify for these subsidies. Most Americans--about 160 million--get their health care through their employer. But if you are one of those people who get their health care through an employer, you don't qualify for any subsidy until you spend 10 percent of your income on health care premiums.

Mr. GRASSLEY. I ask unanimous consent for an additional 7 minutes.

Mr. GRASSLEY. The other side plans to throw much of your hard-earned dollars at it to make premiums appear affordable. But even with their $1 trillion in spending, the Congressional Budget Office has confirmed that in 2019 only about 7 percent of those insured will be getting government subsidies. So even though there will be a huge new taxpayer-funded subsidy program to help pay for these premium increases, most people would not actually qualify for any of that help. They will just be stuck with higher taxes--yes, higher taxes--less choices--yes, less choices--and higher health insurance premiums. Some people may wonder what parts of the bill are driving up these costs. We have already identified the new insurance fee. One analyst of the Federal policy group concluded that the insurance fee alone could raise premiums up to $500 per year per family. Then there are the new benefit requirements. Under the proposals we have seen so far, the Federal Government is now defining what kind of insurance you can buy anywhere in the United States. This means it will be illegal for insurers to sell or for you to buy many of the policies people are currently enrolled in. By law, it will be illegal to buy policies that don't meet an actuarial value of 65 percent and cover a long list of mandated benefits. The consulting firm Oliver Wyman has said that since this new Federal minimum standard is higher than many of the policies sold today, new enrollees will have to pay about 10 percent more to meet the new government benefit standard. This is just under the Finance Committee bill. That 10-percent increase in premiums would be much higher under any of the House bills and the Senate HELP Committee proposals. Once again, the other side of the aisle will point to a grandfathering policy that, as the President has said, will let you keep what you have. But they fail to mention that this grandfathering policy doesn't count if you ever plan to move or, two, your insurer stops offering coverage or, three, you want to change your policy to add vision or dental coverage. If you meet any one of those criteria, the promise that you will be able to keep what you have doesn't apply to you. Another factor that will drive up premiums is the new age rating rules. These rules set limits on the amount premiums can vary between younger and older enrollees. Some of the proposals being considered would tighten this variation so much it will drive up premiums by almost 70 percent for younger, healthier enrollees. So all those so-called young invincibles we need to get into the health insurance pool, all the recent college graduates, will be hit hardest by the increase in premiums because of the proposed market reforms. Taking all these factors into account, Oliver Wyman actuaries also concluded that individuals would pay as much as 73 percent more as a result of the policies in the Finance Committee bill. Small businesses could face about a 20-percent increase, which will lead to about 2.5 million less people getting coverage through their small business. We can certainly debate all these numbers. Some may question whether rates will increase by that much. I am sure some will question the sources of these studies, although I should note we didn't take these estimates at face value. In fact, ever since the Gang of 6 meetings, we have had some of the best independent actuaries and insurance experts analyzing this data. But even the people who want to debate the sources do not deny the fact that health insurance premiums will go up as a result of the bills we are considering. I am beginning to understand the game. I am actually beginning to wonder if the reason no one is denying it is because this is intentional. If these bills drive up premiums in the private market, it is going to make it a lot easier to push for a government-run insurance program or a new entitlement program. A Washington Post story over the weekend reinforced this concern: [Senator] Reid's original inclination was to leave the public option out of the final bill . . . but his liberal colleagues began urging him two weeks ago to reconsider, after insurance industry forecasts that premiums would rise sharply under the Finance Committee bill. Let's hope the Democratic leadership and the White House aren't willing to push a bill that forces 200 million people to pay higher premiums unless they enroll in a new government entitlement insurance program. But that is certainly what it sounds like. Whatever the motive may be, the facts are undeniable. Health insurance premiums will increase for every individual and small business as early as next year as a result of the pending health bills. It will hit young, healthy people the hardest. It will cause small business to stop offering health insurance premiums. We have heard it from Joint Tax, we have heard it from CBO, and we have heard it from the Office of the Actuary within the U.S. Department of Health and Human Services. I wish to make sure all the American people hear it. I yield the floor.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I would like to alert my colleagues that I intend to object to any unanimous consent agreement for the consideration of S. 1782, the Federal Judiciary Administrative Improvements Act of 2009. This legislation will increase the Federal outlays for the judicial branch and does not have an offset to the spending increases. In particular, I object to two provisions in S. 1782. First, this legislation will increase Federal expenditures by allowing senior executives in the Federal courts, the Federal Judicial Center, and the Sentencing Commission to carry over more annual leave days from 1 year to another. The bill would change the current allowance, 240 hours--30 days--to 720 hours--90 days. This provision is a limited benefit to a number of senior executives and will cost Federal taxpayers millions of dollars. Second, the legislation includes a provision increasing the salaries of the four division directors at the Federal Judicial Center. This provision would increase the salary from Executive Schedule V-- $139,600--to Executive Schedule IV--$149,000. While this is only a slight increase to the spending outlays, it is the wrong message to send the American taxpayers when nearly 10 percent of the workforce is unemployed. Americans across the country are tightening their belts and finding ways to save money. Social Security beneficiaries are fighting to stretch their dollars because they will not see a cost-of-living increase for 2010 for the first time in nearly three decades. To expand benefits in the judicial branch for a chosen group of senior executives is the wrong thing to do when everyone is making sacrifices and millions of Americans are looking for work. If the Senate majority insists on offering S. 1782 for consideration notwithstanding my objection, at the very least, I will insist on offering S. 657, the Sunshine in the Courtroom Act as an amendment and request a rollcall vote. Unless this amendment is afforded a vote, I will continue to object to any unanimous consent agreement regarding S. 1782. In this time of financial uncertainty, we should not be providing senior executives in the judiciary increased benefits absent legislation that will bring some sunshine to the courts by allowing media coverage of court proceedings.

Mr. GRASSLEY

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

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, reforming the Medicare physician payment system is one of the most difficult issues we face in Medicare today. The name of the formula is the sustainable growth rate. Generally around here we refer to that as the SGR. It is the formula for the reimbursement of doctors under Medicare. It was designed in the first instance to control physician spending and to determine annual physician payment updates by means of a targeted growth rate system. The SGR is not the only problem with the Medicare physician payment system. Everyone who knows anything about physician payments and Medicare knows that this SGR formula is not working. It is a fee-for- service system that rewards volume instead of quality or value. This means that Medicare simply pays more and more as more and more procedures and tests and services are provided to patients. Providers who offer higher quality care at a lower cost get paid less. Somehow, it is a backward system, a perverse system. It is one of the driving forces behind rising costs and overutilization of health care, particularly in some parts of the United States. In addition, the sustainable growth rate formula itself is flawed. The SGR is designed to determine annual physician payment updates by comparing actual expenditures to expenditure targets. The purpose of the SGR was to put a brake on runaway Medicare spending. The SGR was intended to reduce physician payment updates when spending exceeded growth targets. In recent years, Medicare physician spending has exceeded those SGR spending targets. That has resulted, naturally, in physician payments being cut. As the magnitude of these payment cuts has increased over time, Congress has stepped in to avert these scheduled cuts in reimbursement to doctors. In a roundabout way, the SGR has been serving its purpose. Numerous improvements in Medicare payments in other areas have been implemented over the years to offset or to pay for the various so-called doc fixes we have had to do and generally do them on an annual basis. Presently they are done on an 18-month basis, expiring December 31 this year. We should, in fact, be reforming physician payments. That is why I supported the SGR amendments offered by my colleague, the Senator from Texas, during the Senate Finance Committee markup that concluded 8 days ago. Those amendments would have provided a fully offset, positive physician update for the next 2 years. And if we erroneously take up a debate on this flawed Stabenow bill, I will have an alternative to offer with my good friend, the chairman of the Senate Budget Committee, Senator Conrad. A Conrad-Grassley amendment would be a bipartisan approach to this. Realigning incentives in the Medicare Program and paying for quality rather than quantity of services is, of course, an essential part of physician payment reform. But as fundamentally flawed as the physician payment system is, S. 1776, the bill before us, is just as fundamentally flawed. S. 1776 would add--can my colleagues believe this--a $\1/4\ trillion cost to the national debt. A quarter of a trillion, obviously, is $250 billion. But worse yet, it does not fix the problems we have with the physician payment system. It simply gives a permanent freeze to those payments. The American Association of Neurological Surgeons and the Congress of Neurological Surgeons oppose the Stabenow bill for precisely that reason, and I applaud them for having the courage to say so. My esteemed colleague, the majority leader, claims this bill has nothing to do with health reform. I think it has everything to do with health reform. He says the $247 billion cost of this bill is just correcting, in his words, ``payment discrepancy;'' merely, in his words, ``a budgetary problem,'' a problem that needs to be fixed. But I don't believe anybody is going to buy that argument, not even the Washington Post. I have here a recent editorial. They said: $247 billion . . . is one whopper of a discrepancy. S. 1776 isn't being offered to fix a budget payment discrepancy, it is being offered as one whopper of a backroom deal to enlist the support of the American Medical Association for a massive health reform bill that is being written behind closed doors. Nobody is being fooled about what is going on in this body, the most deliberative body in the world, the Senate. When President Obama spoke to a joint session of Congress last month--the week after we came back from our summer break--he made a commitment to not add one dime to the deficit now or in the future. Those are his words, not mine. But as this Washington Post editorial notes, S. 1776 would add 2.47 trillion dimes to the deficit. We go to chart 2 now. That would be 2.47 trillion dimes, enough to fill the Capitol Rotunda 23 times. Now we have chart 3. I wholeheartedly agree with the editorial's conclusion. The Post editorial said: A president who says that he is serious about dealing with the dire fiscal picture cannot credibly begin by charging this one to the national credit card . . . This quote is highlighted out of that same editorial. The Office of Management and Budget and the Treasury Department announced that the fiscal year 2009 deficit hit a record of $1.4 trillion. According to the Government Accountability Office, public debt is projected by the year 2019 to surpass the record that was set in 1946, 1 year after the end of World War II. That debt was attributable to the war, which was the war to save the world for democracies because of the dictatorial governments of Italy, Germany, and Japan, as we recall from history. There is no doubt that fixing the flawed physician payment system is something that must be addressed. But the problem--this problem--with the physician payments is one of the biggest problems in health care that needs fixing. But at a time when the budget deficit has reached an alltime high of $1.4 trillion, this situation demands fiscal discipline. As the Washington Post has correctly pointed out, S. 1776 is, indeed, a test of the President's pledge to pay for health care reform. Repealing the SGR without any offsets, as S. 1776 would do, is a flagrant attempt to try and hide the true cost of comprehensive health care reform. Let me suggest to the American people that bill, comprehensive health care reform--at least the one that came out of the Senate Finance Committee--is thick, at 1,502 pages that we all are committed to reading before it goes to the floor. That bill, of course, will not go to the floor because now it is being merged in secrecy with the Senate HELP Committee bill, and so it may come out thicker. Who knows. We are talking about a great deal of cost connected with that and the SGR fix being connected with that as well. We have in the Senate Finance Committee bill, that was reported out, significant payment system reform. That bill takes savings of almost $\1/2\ trillion to fund a new entitlement program outside Medicare. The priority for Medicare savings should be fixing Medicare problems, and the physician payment issue and the SGR is the biggest payment system problem in Medicare today. It should get fixed in health care reform with those Medicare savings. I must, therefore, object not to fixing the SGR and improving the system for physician payments--which clearly must be done--but to this very flawed bill. It is only a permanent payment freeze. It does not fix the problem. It is not paid for. It should be a part of health care reform. It adds $\1/4\ trillion to the deficit. It is one whopper of a discrepancy. It is not credible. I urge my colleagues to oppose cloture on this train wreck of a bill. I yield the floor and, since I do not see any of my colleagues waiting to speak, I suggest the absence of a quorum.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, while I voted in support of the fiscal year 2010 Homeland Security appropriations bill, I do want to take this opportunity to express my frustrations with the fact that many good provisions were taken out of the final bill by the House-Senate conference committee. The provisions I want to talk about were intended to improve our ability to enforce immigration law in the interior and to secure the border to protect the homeland. First, I want to talk about the amendment I pushed for during Senate consideration of the appropriations bill. It would have given businesses the tools to ensure that they have a legal workforce. My amendment would have allowed employers to voluntarily check their existing workforce and make sure their workers are legally in this country to work. It said that if an employer chooses to verify the status of all their workers--not just new hires--then they should be allowed to do so. And, it had protections in place. If an employer were to elect to check all workers, they would have to notify the Secretary of Homeland Security that they plan to verify their existing workforce. The employer would then have 10 days to check all workers. This short time period would prevent employers from targeting certain workers by claiming that they are ``still working on'' verifying the remainder of their workforce. And, my amendment would have required the employer to check all individuals if they plan to check their existing workforce. If they check one, they check them all. Employers want to abide by the law and hire people that are legally in this country. Right now, E-Verify only allows them to check prospective employees. But, we should be allowing employers to access this free, online database system to check all their workers. Second, while I am grateful that the committee recognizes the need to keep E-Verify operational and that the bill includes a three year reauthorization of the program, I am disappointed that the conference committee stripped an amendment to permanently reauthorize E-Verify. The amendment authored by Senator Sessions was passed with bipartisan support. The administration and the majority leadership claim they fully back the E-Verify program, but their actions don't show it. Our businesses need to know that this program will be around for the long- term, and that they can rely on the Federal Government to make sure that the workers they hire are legally in this country. The third amendment stripped by the conference committee would have increased our ability to secure the border by putting funds into fencing to reduce illegal pedestrian border crossings. The DeMint provision would have required 700 miles of reinforced pedestrian fencing to be built along the southern border by December 31, 2010. Finally, an amendment to allow the Department of Homeland Security to go forward with the ``no match'' rule was stripped. This amendment by Senator Vitter would have blocked the Obama administration from gutting the ``no-match'' rule put in place in 2008 to notify employers when their employees are using a Social Security number that does not match their name. These ``no match'' letters help employers who want to follow the law and make sure they are employing legally authorized individuals. I voted for this bill on the Senate floor because homeland security is not something we should play politics with. Defending our country is our No. 1 constitutional priority. Taxpayers expect us to get these bills passed and we have that responsibility. I voted for this bill today because it includes funding for essential border security and interior security efforts. However, there are a number of problems with this bill despite my vote for it. I am concerned that the House and Senate conference committee did a disservice to the American people by taking out language preventing illegal aliens from gaining work in this country. The conference committee, had they kept the provisions I talked about, would have helped many Americans who are looking for work and struggling to make ends meet. The provisions would have also held employers accountable for their hiring practices. It's my hope that this body will work harder to beef up our immigration enforcement efforts, and ensure that Americans are given a priority over illegal aliens during this time of high unemployment.

Mr. GRASSLEY

Mr. GRASSLEY. Before I speak, Madam President, from my text, this year, for the most part, I haven't spoken on the Senate floor much on health care reform because so much of this period of time I have either been in consultation with Chairman Baucus or with what has been called the Group of 6, three Republicans and three Democrats, trying to negotiate a bipartisan health care reform package. I didn't speak during that period on the floor because in intense negotiations, you can say things sometimes that might upset the negotiations. I didn't want to do anything to do that. I want people to know that those negotiations, obviously, were not fruitful in the end because the leadership and the White House thought they had gone on long enough and that we ought to move ahead. I am not sure that was to Chairman Baucus's liking because I think he was comfortable thinking we could get to a bipartisan negotiation. Everybody in the Group of 6 wanted to. But, of course, they came to an end. Then, of course, it took a partisan approach from that point on. I want everybody to know, though, that during that period of talks we had in the Group of 6 and what Senator Baucus and I were doing individually, it ended in a way that was congenial in the sense that up to that point everything was moving along, and during the 2- or 3-month period of time we were negotiating, there was never a period that anybody walked away from the table. There was never a period that there was ever a harsh word. There was a sincere effort during all that time to reach a bipartisan agreement. I am sorry that didn't materialize, but I have no regrets that I participated in the process because you never know, you take it a day at a time around here. You never know, it could be very fruitful. And if it had been fruitful, it probably would have been better for this process in the Congress and better for the country as a whole. For sure, this issue of health care reform is, in a sense, redirecting one-sixth of the economy because $1 out of every $6 spent in America involves health care. Of course, the issue of health care itself is a life-or-death situation with every American. That is what health care implies. Never before has Congress done stuff so encompassing and affecting such a large segment of the economy. So in the process of 6 months of negotiation on health care reform, I feel much better informed about health care than I otherwise would have been, and I want to thank Senator Baucus for his patience in negotiating that and for every courtesy he gave to me and Senator Enzi and the Senator from Maine, Ms. Snowe. (Mr. BURRIS assumed the Chair.)

Mr. GRASSLEY. Mr. President, the bill is now out of the Senate Finance Committee. I commend the chairman for bringing the markup to where it was yesterday. It seems a long time since we started that markup on September 22. We have been able to air our differences, and we have been able to have votes. I think Senator Baucus tallied up 61 different rollcall votes we had during that 7- or 8-day period of time. I would have to say to my colleagues in the Senate, I wish I felt better about the substance of the bill and would not have had to vote no. The chairman's mark underwent many changes during the process since the bipartisan talks ended, and I think the changes that happened since then are not for the good. I want to highlight a few of the changes I find most disturbing. As I highlight these issues, it will be clear that this bill is already sliding rapidly down the slippery slope to more and more government control of health care. It has been the biggest expansion of Medicaid since it was created in 1965, and I think that is going to add up to 11 million more people being on Medicare. It imposes an unprecedented Federal mandate for coverage backed by the enforcement authority of the Internal Revenue Service. I could put that another way as well: In the 225-year history of our country, never once, to my knowledge--and I would be glad to be informed if I am wrong on this, but the Federal Government has never said any citizen in this country, anytime in that 225-year history of our country, has ever had to buy anything. They do not tell you what you have to buy or not buy. You make a consumer choice. So for the first time in the history of our country, enforced by the power of the Internal Revenue Service, people are going to have to buy health insurance. And if they do not buy health insurance, a family is going to be fined $1,500. Additionally, it increases the size of government by at least $1.8 trillion when it is fully implemented. I want to emphasize ``fully implemented'' because right now we would read the papers as saying it is $820-some billion and fully paid for, et cetera, et cetera. But this program really does not start until 2013. Oh, the taxes and the increase in premiums will start more immediately, but the program does not take off until 2013. If we figure 2013 to 2023 as the 10-year window, at that particular time--being fully implemented--$1.8 trillion. Additionally, it gives the Secretary of Health and Human Services the power to define benefits for every private plan in America and to redefine those benefits annually. That is a lot of power over people's health insurance and over people's lives. Further, it will cause health care premiums for millions to go up, not down. It tightens further the new Federal rating bands for insurance rates. That means millions who are expecting lower costs as a result of health reform will end up paying more in the form of higher premiums. The new rating reforms alone will raise premiums by as much as 50 percent on millions, particularly in those States where there is not a lot of regulation of insurance and requirements on insurance. I would say in regard to premiums going up, I will bet most of the 85 percent of the people out there who have private health insurance--we are talking about health insurance reform--that one of the things they would expect is that we would not have these big increases in premiums, as has happened over the last 10 years--terrible increases in premiums. Right now, we have the Congressional Budget Office and CBO saying that premiums are going to go up. Part of this is because it is going to impose new fees, but it also has increases in taxes. These new fees and taxes will total about a half trillion dollars over the next few years. On the front end, these fees and taxes will cause premium increases as early as 2010, even before most of the reforms take place. So let me say that a second time but yet another way: By saying that, a lot of the increases in revenue coming into the Federal Treasury or the money that is going to be saved in certain programs that is going to help pay for some of those start next year, but the benefits from the program and the policy does not kick in until the year 2013. So one of the reasons we can say it is revenue neutral is from the standpoint that there are 10 years of revenue or savings but only 6 years of policy costs that are there. Then, of course, after making health premiums go up, this bill makes it mandatory to buy that insurance. That is what I previously referred to as the first time in American history--the first time in American history--the Federal Government has said we had to buy anything. On several occasions, Republicans tried to take the chairman's mark in a different direction. We tried to ensure that the President's pledge to not tax middle-income families or tax seniors or veterans or change seniors' and veterans' programs was carried out. We were rebuffed every step of the way. Republican efforts to provide consumers with lower cost benefit options were consistently defeated. This means that despite these promises, a lot of people are not actually going to be able to ``keep what they have.'' We heard the President say that during the campaign, and we heard the President say that in September when he gave an address to a joint session of Congress. It imposes higher premiums for prescription drug coverage on seniors and the disabled, it creates a new Medicare Commission with broad authority to make further cuts in Medicare, and it makes that Commission permanent. In our Group of 6 negotiations--which I said broke up when the White House decided it was taking too long to do things right because they wanted to do it right now--during our Group of 6 negotiations, I resisted making the Commission permanent. I certainly was not going to agree to target prescription drug premiums. But this bill now requires the Medicare Commission to continue making cuts to Medicare forever. The damage this group of unelected people could do to Medicare is very unknown. In fact, we will not know for quite a few years because it does not even start operation until the year 2014, as I recall. What is more alarming is so many providers got exempted from the cuts this Commission would make that it forces the cuts to fall on those who are covered, to fall directly, more so, on seniors and the disabled. The Congressional Budget Office has confirmed that the Commission structure requires it to focus its budget axe on the premiums seniors pay for Medicare Part D prescription drug coverage and for Medicare Advantage. Sooner or later, it has to be acknowledged that by making the Commission permanent, those savings are coming from more and more cuts to Medicare. Finally, I cannot help but note the incredible cynicism in an amendment that took benefits away from children. That amendment was offered and passed because the chairman's mark had the audacity to let children get covered through private insurance where, of course, there is a great deal of choice. In 41 States, children would have received access to a program that is called the EPSDT benefit--basically diagnostic services. These benefits cover vitally needed services for children such as rehabilitation services, physical, occupational, and speech therapy, particularly for children with developmental diseases. But those benefits were deleted by Rockefeller amendment No. C21. Now children in 41 States will not have access to health care, and they will be left in a grossly underfunded public program. They lost these important benefits. What this mark has shown is that there is a clear and significant philosophical difference between the two sides. Throughout this markup, we have focused on trying to reduce the overall cost of the bill. We were told, flatout, no. We focused on trying to reduce the pervasive role of government in the chairman's mark. We were told, flatout, no. We tried to make it harder for illegal immigrants to get benefits. We were told, flatout, no. We tried to guarantee that Federal funding for abortions would not be allowed under this bill. We were told, flatout, no. We tried to allow alternatives to the individual mandate and also to the harsh penalties associated with that part of the bill that requires everybody, for the first time in the 225-year history of this country, to buy something that maybe they do not want to buy. We were told, flatout, no. We tried to reward States with extra Medicaid dollars if they passed medical malpractice reform. We were told not just no, but, shockingly, we were told Medicaid is not even in the committee's jurisdiction. We have watched while the other side has expanded public coverage. We saw Democratic amendments move millions from private coverage to public coverage. We saw Democratic amendments create new government programs that cover families making close to, would you believe it, $90,000 a year. At the end of the day, after raising billions in new taxes and cutting hundreds of billions from Medicare and imposing stiff new penalties for people who do not buy insurance and increasing costs to those who do, we still have 25 million people who are going to be uninsured. I do not think this is what the American people had in mind when we promised to fix the health care system. As I said when this process started, the chairman's mark that was released 27 days ago was an incomplete but comprehensive, good-faith attempt to reach a bipartisan agreement. But then the modifications pulled that attempt at bipartisan compromise very far toward a partisan approach on several key issues. With this markup being completed yesterday, we can now see clearly that the bill continues its march leftward. The broad bipartisan character of the reform proposals have very dramatically changed. This partisan change is precisely what Republicans feared would have occurred at the later stages in the legislative process. Today, as we saw yesterday, we see that those fears that were expressed when the bipartisan process ended were legitimate, and we now see they were justified. The product proves that justification. Nevertheless, I want people to know I still hope that at some point the doorway to bipartisanship will be opened once again. That might happen because I have read in the newspapers, and I guess I have talked to one of the Senators who is involved in promoting a great deal of transparency in this process--making sure things are on the Internet for 72 hours before we take up the bill; making sure it is paid for or at least we have a CBO score--maybe there is a chance there are enough Democrats out there who have some questions about the movement of this bill leftward that we would be able to have that doorway to bipartisanship opened again. I also hope that at some point the White House and leadership will want to correct the mistake they made by ending our collaborative bipartisan work. I hope, at some point, they will want to let that bipartisan work begin again. Then they need to go back to that effort and give it the time needed to get it right instead of getting it done right now. I am open to that. I hope to speak to people on the other side of the aisle about that process moving forward because, here again, I get back to something I heard Senator Baucus probably say first, but I totally agree with him. It was said many months ago, and I think Senator Baucus still believes it. We may not be in a process that gets him to where he said he wanted to go, but something as serious as health care reform and something as serious as redirecting one-sixth of our economy ought to be done on a fairly consensus basis. During the process of bipartisan talks of the six of us, and even before that when Senator Baucus and I were talking one on one, we were talking in terms of getting a bill that 75 to 80 people would support in this body because of the significance of the issue we are dealing with: Redirecting one-sixth of the economy. At the same time, the words ``health care'' imply life or death. It affects the lives of all 306 million Americans who are here. It is clear that yesterday was not the day when that was going to happen, but you take a day at a time around here. I think, eventually in this city, right wins out. Maybe not always. Maybe some people would think Chuck Grassley by saying that is very naive about the process, but there is something about ``I believe,'' and I believe in the process of democracy. I think we saw that at work in the last several months. I am not referring to the raucous things we saw on television that went on in town meetings. I only saw the ones that went on in Pennsylvania, Maryland, and Missouri; maybe they went on elsewhere. The town meetings we had in my State of Iowa were not raucous. Everybody was able to speak their piece. In every instance, I was asked a question, I was given the opportunity to answer it. I saw some of my colleagues not even being able to control their respective town meetings. It wasn't that way in my State. But I say this process, whether it is raucous or whether it is more civilized, is a process of representative government. I think the people of this country now have about a month to weigh in on this issue, both from those who want a single payer yet, those who want public option yet, and for those who think things ought to be done in an incremental way; and people who think we should not have a bill go through here that doesn't take into consideration what to do about the practice of defensive medicine and correcting that through medical malpractice reform in other words, getting rid of the frivolous lawsuits that get doctors to give patients every test under the Sun because they think that patient may someday sue them. That is just one of many items that people back at the grassroots of Iowa, and I think the grassroots of America, think we ought to be dealing with. Well, there will be a month now to weigh in on these things. There is at least a week or two where we have to have a merging of the Senate HELP Committee bill with the Senate Finance Committee bill. There is still time, as Speaker Pelosi puts together a bill out of three committees in the House. There is an opportunity for democracy to work as it has during all the massive amounts of mail we are getting that we have never gotten before on a single subject and the turnouts at our town meetings and the telephone calls that come in. I think people made an impact, and I am suggesting they can make the same impact on health care reform as they made on the stimulus bill. It didn't get quite the results constituents wanted, but I can tell my colleagues that during a 10-day period of time, 5,000 Iowans called my office on the stimulus bill, and during that period of time about 83 percent were opposed to the stimulus bill. Those calls were coming in from all over the country into everybody's office. As my colleagues remember, the Thursday before the Presidents Day break in February, everybody was being told that constituents would have 72 hours to read the stimulus bill, but an agreement was hastily reached that Thursday before that break and the constituents didn't have 72 hours to read that product, because I think the leadership of this body and the White House were reading the grassroots objections to a $787 billion stimulus bill, and if they waited around for the 72 hours for constituents to read it and it laid around over the week-long break, that it would never have been passed a week later, after the Monday of the Presidents Day holiday. So people are listened to. This is an opportunity for the grassroots of America to speak up. If they speak up in the same way they did on TARP legislation, on stimulus, and they do it on this health care bill, it may make an impact. It may surprise people that Washington does respond to the grassroots of America. It may prove to the American people that representative government does work. What is representative government all about? It is about those of us who were elected being one-half of the process of representative government, and it is our constituents who are the other one-half of representative government. If there is no dialogue between constituents and those of us who are elected, we don't have representative government. This is an opportunity, over the next month, for representative government to work for the people of this country, both for this legislation or people who think this legislation ought to be revised because I don't think we are going to have anybody calling in saying everything in America on health care is OK, but we are going to have a lot of people calling in and saying how they think it ought to be done. There will probably be a great deal of disagreement with a bill that constitutes the most massive involvement of health care in the United States since Medicare and Medicaid, with all its taxes and with all its premiums going up and all the cuts in Medicare that are going to scare the devil out of our senior citizens, et cetera. I hope people will take notice now that all these bills are out of committee and they are coming to the floor because this is serious business. I hope the American population takes it seriously. I yield the floor. I don't see other colleagues ready to speak, so I suggest the absence of a quorum.

Mr. GRASSLEY

Mr. GRASSLEY. Madam President, I ask unanimous consent for Preston Rutledge, Carolyn Coda, Chantal Matin, and Stephen Theulen be granted the privileges of the floor for the duration of the 111th Congress.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, as the Member of the Senate who has worked closely with Senator Baucus over the last 10 years--either he has been chairman of the committee or I have been--I congratulate him on this 11,000th vote. But more important, I thank him for the close working relationship we have had, which I think people back home in our respective States probably don't observe, which is that there is a great deal of bipartisanship that goes on in Congress. I think Senator Baucus and I have established a close working relationship that refutes that everything in Washington is political. I thank him for that close working relationship and, more importantly, I thank him for putting up with a lot of problems I have created for him.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I come before the Senate today to commemorate the 50th anniversary of an Iowa educational organization that has become a household word for Americans entering postsecondary education or the workforce, and which has gained a solid international reputation as well, ACT, Inc. Over those 50 years, this organization has grown to be one of the most significant gateways between secondary education and postsecondary education or the workplace. I would like to describe some of the work this institution has done that has made such an important contribution to American education. ACT was founded in 1959 at a meeting in Iowa's old State capitol on the campus of the University of Iowa. It was launched as the ``American College Testing Program'' by a University of Iowa professor of education, the University of Iowa's registrar, and representatives of 16 Midwestern States. Their goal was to help all students who wanted to attend college find a good match for their interests and abilities, and to help colleges and universities place students into appropriate freshmen-level classes. On November 7, 1959, about 75,000 students took the first ACT assessment. By comparison, in the high school graduating class of 2009, nearly 1.5 million students, or 45 percent of all high school graduates in the Nation, took the ACT. ACT now conducts extensive research designed to help provide solutions to the complex education problems facing the country. For example, they have developed a college and career readiness system for students beginning in middle school and continuing through postsecondary education. This system helps students stay on target to be ready to succeed in college or workforce training programs when they graduate high school, without the need for remedial classes, and monitors their success in postsecondary education once they leave high school. ACT is also involved in researching solutions to the Nation's workforce challenges. For example, ACT developed the National Career Readiness Certificate to confirm that individuals have essential core employability skills. ACT is one of several partners in a new manufacturing skills certification system designed by the National Association of Manufacturers, the Nation's largest industrial trade organization. Furthermore, ACT is helping build bridges between the United States and many other nations to help them improve their education and workforce systems, and to help people in other nations learn the English language. For example, through local partners, ACT conducts a 9-month pre-university program in 13 countries, including China, Korea, Indonesia, Fiji, Australia, New Zealand, Canada, Mexico, and countries in South America. There are more than 30 teaching centers in China. This program prepares students to study in English-language universities in the United States and elsewhere. This contributes to our country's standing in the world. As a nation, we benefit from foreign talent, as students from other nations come to study in U.S. colleges and universities. Individuals who return to their home countries in turn go back with a greater understanding of Americans and our way of life. I offer my congratulations to the over 1,000 Iowa residents employed with ACT, its directors, and other members of its State organizations on their 50-year history of helping people achieve education and workplace success. I look forward to following their accomplishments for many years to come.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I rise today to respond to Bryan Walsh's recent article, published August 31, 2009, in Time Magazine, entitled ``The Real Cost of Cheap Food.'' I ask people to read the article and, as you read it, take into consideration my view of it, which is not very positive. Unfortunately, I see this article as one of the most skewed and one-sided articles I have ever had the opportunity to read, particularly in the mainstream media. This report was far from objective journalism. It seems to me that when people are talking about America's food crisis and how to fix it, it ought to be very intellectually accurate. Before outlining the numerous factual errors the author presents in his article, I will mention that I support organic and sustainable agriculture. In fact, Norman Borlaug, father of the green revolution, from Iowa, is credited with creating a sustainable agricultural system decades ago. And as you may know, the Nobel Peace Prize winner of 1970, Norman Borlaug--the person I just referred to--recently passed away at the age of 95. This article refers to the Niman Ranch. What Niman Ranch and other organic farmers across Iowa and our Nation are doing is to be commended. These producers are providing additional choices to consumers and creating highly profitable small farms which can help sustain rural communities. In fact, the National Agriculture Statistics Service reports that in 2007, 566 organic farms were located in my State of Iowa. That being said, I am disappointed that an information source, such as I referred to by Time magazine, by the author, Mr. Walsh--previously Time magazine was known as a news magazine--has resorted to an inaccurate, incomplete, and unfair reflection of family farmers--I emphasize the word ``family'' in connection with farmers--from across the United States. So I will take a few minutes on the Senate floor to refute a few main points this author has made. First, I wish to discuss how our Nation's farmers are stewards of our land, protecting and caring for their livestock and our environment. Second, I wish to address population growth and the growing demands to produce safe and affordable food. Finally, I will address how both organic agriculture and conventional agriculture serve complementary needs and can coexist in harmony. As everybody in this body knows, I have been a family farmer all my life. Of course, I have to give credit to my son Robin for doing most of the work on the farm and a grandson in that farming operation. One thing you find out as a grandfather, when you have a grandson in a farming operation, is that grandfathers are not quite as important as they used to be. My son Robin and I crop share our land, and we have taken great pride over the years in both caring for our livestock and conserving our natural resources, while producing bountiful corn and soybean harvests. We are not unlike tens of thousands of other farmers across Iowa and this country whose livelihoods depend on taking care of our soil, water, and animals. I give credit to the new occupant of the Presiding Officer's chair, Senator Tester from Montana, for being another family farmer, as well, and being a good caretaker of the environment. With final passage of the Food Conservation and Energy Act of 2008, also known as the farm bill, Congress made one of the largest commitments to conservation this Nation has ever seen. An additional $6 billion in new money was added for working lands programs, such as the Conservation Stewardship Program, the Wetlands Reserve Program, and the Farmland Protection Program. Even on my own farm, we use no till for our beans, minimal tillage for our corn, and we put in wetlands, a waterway and a grass strip, even though we have mostly flat farmland. Robin and I are required to do this. We do it because we know, as stewards of our environment, our farm will benefit in the long run. In other words, it is economically good to be good stewards of the land. It puts money in your pocket. We will be able to then, in the final analysis, pass the operation down to our grandchildren and great-grandchildren. That is one of the main points the author of the Time article, Mr. Walsh, totally misses. He basically demonizes production agriculture. Mr. Walsh implies that the only family farmers in our country are those who live on 30 acres of farmland. But nothing could be further from the truth. Family farmers can operate small farms, but they can also operate large farms. If given the opportunity, they want to be able to pass that farm on to future generations of the family. It makes absolutely no sense to imply that these producers would purposely deplete our resources for a quick buck. There has never been a quick buck in farming, but it can provide, over a lifetime, a rewarding and sustainable lifestyle. I am going to use three charts during my presentation. The first one is going to be used to refute some of the accusations that have been made. Producers around the United States continue to become more and more efficient in their production practices. This chart shows that in the last 25 years, we have been able to produce more bushels of corn with less fertilizer. Now get this. Everybody thinks the commercial and family farmers are pouring on the fertilizer without any care whatsoever about the environment to produce, produce, produce. But that does not make you money, and particularly in recent years with the high increase in the price of phosphorous, potassium, and especially nitrogen, this is absolutely the wrong course to go if you are a farmer who thinks pouring more fertilizer on is going to make you more money. What we show here is, in the last 25 years, we have been able to produce more corn with even less fertilizer. We can see it in the downward trends of nitrogen, phosphate, and potash. We use U.S. Department of Agriculture data compiled by the Fertilizer Institute that nitrogen, phosphate, and potash efficiency is growing in corn production. To put it another way, we are growing more bushels of corn per pound of nutrient applied. This is in direct contradiction to the impression that Time magazine author Mr. Walsh makes with his statements. We know the hypoxia is partly a natural phenomenon, but scientists generally agree that nitrates from agriculture and other manmade factors contribute to it. When the hypoxia zone forms--and most of the time we talk about this in the Gulf of Mexico--it does, in fact, displace fish. But it is particularly unfair to try to quantify impacts on the fishing industry because there is not sufficient data to back up that claim. Technology has allowed farmers to apply the exact amount of fertilizer in the right way so there is not excess. However, even in organic farming, which the author seems to hold in the highest esteem, it uses manure from animals for fertilizer which also contains nitrogen. Soil naturally contains nitrogen that under certain circumstances of too much rain or too much moisture in the ground can eventually get into our streams. That is true whether it is from natural fertilizer or whether it is from commercial fertilizer. Farmers for years have been employing conservation practices such as no till, buffer strips, and wetlands, just like I have on my farm, to prevent soil erosion and to keep runoff from going directly into the waterway. I anticipate, especially under this new farm bill, that these practices will grow. In addition, research is starting to shift on hypoxia issues in regard to the Gulf of Mexico. There is increasing recognition that causes of hypoxia relate strongly to manmade alteration of the entire system, including channelization of the Mississippi, reversal of the Atchafalaya River in Alabama, and extreme loss of wetlands and barrier islands that filter nutrients and protect against storm surges, not solely nutrient issues, as this author would imply. The U.S. Environmental Protection Agency, the EPA, Science Advisory Board has a hypoxia report out indicating that 22 percent of the nitrogen and 34 percent of the phosphorous loads can be attributed to point source rather than agriculture, as far as the hypoxia problem in the Gulf of Mexico is concerned. In addition, the Environmental Protection Agency estimates that over 2 trillion gallons of untreated combined sewer overflow run into our Nation's waterways each year, and the Army Corps of Engineers' projects dump millions of yards of nutrient-rich soil into the Missouri and other rivers for habitat restoration purposes that also contribute. These types of dredging projects in the Missouri River floodplain alone may represent as much as 8 percent of the spring's total phosphorous discharge, leading to problems in the Gulf of Mexico. Technology in corn production in the United States over the last 100 years has been remarkable. From about 1860 to 1930, corn averaged just about 25 bushels per acre. Not until the 1950s through 1980s, when corn breeders began using double-cross and single-cross technology, did we see these great advances in yields of corn. Just in the last 10 years, we have seen increased use of biotechnology which has provided yields over 150 bushels per acre. This author, Mr. Walsh, clearly views biotechnology as a bad thing when, in fact, traits such as drought resistance and nutrient-use efficiency are actually improving corn's performance with less inputs, as demonstrated by this chart. Many of our technology companies are expecting their yield trends to exceed 300 bushels per acre in coming years. For someone such as me who has been farming for 50 years, it is almost unimaginable, but exciting at the same time, to have these projected yields we are hearing. I wish to turn to another chart now. It deals with another issue that is very important for us to understand when we are talking about efficiency of agriculture and reducing pollution. In fact, in 1915, we used 90 million acres--in comparison to about 90 million acres, I think it is more like 87 million acres this year of corn being produced, or 2 years ago, 93 million acres of corn being produced. I am referring to 90 million acres in this picture. In 1915, 90 million acres of cropland in America were simply used to fuel our agricultural production. So let's get it straight. It took 90 million acres of crops just to feed all the horses and all the mules that provided the work and the energy on our agricultural land before tractors were invented. If you add up all the land in the United States being used to produce corn, wheat, and soybeans, it is about 224 million acres today. So less than 100 years ago, we would have been using nearly half the acres in the United States just to feed the draft animals that produced the power to till the soil and to produce those 25 bushels of corn per acre compared to the 150-some bushels per acre now that we will have in the United States this year of corn production. By 2050, it is estimated that the world's population will exceed 9.3 billion people, compared to 6 billion people now. As the world demand for nutrient-rich food and protein continues to grow as both income levels and populations grow in developing nations, America's farmers are ready to answer that call to help feed the increasing number of people around the world, and, most people would tell you today, not by putting more land into production but by getting more from each acre of land as that productivity and yield increase very dramatically, as it has in the past and will continue to into the future. Mr. Walsh of Time magazine attacks animal agriculture throughout this article. His theme is that if an animal doesn't roam free on the western prairie and eat grass, it simply couldn't be healthy or safe to eat. Mr. Walsh cites the Pew Commission on Industrial Farm Animal Production in his analysis of why animals treated with antibiotics produce meat unsafe to eat. However, the American Veterinary Medical Association responded to the Pew report with a lengthy report of its own, which Mr. Walsh conveniently fails to mention, perhaps because the American Veterinary Medicine Association study said: A scientific human/animal nexus, connecting antimicrobial treatments in animals with food-borne or environmentally contracted human disease, has not been proven. Livestock producers take very seriously their responsibility to provide safe and abundant food to the general public. Dairy, poultry, and livestock farmers have made a voluntary commitment to using antibiotics responsibly. By developing responsible-use guidelines, these industries have proactively taken steps to safeguard both human and animal health, and Mr. Walsh makes no mention of that. On issue after issue, I have worked on my main priority: that the policy decisions we make must be based on sound science and not on political ideology. We have seen studies that indicate that the risk of foodborne bacteria on meat increases when antibiotics that help suppress animal disease are removed, actually making our food less safe to eat. Does Mr. Walsh take that into consideration? We only have to turn to our neighbor across the Atlantic to see how a ban on antibiotics has played out. The European Union made a decision to phase out the use of antibiotics as growth promoters over 15 years ago, and in 1998 Denmark instituted a full voluntary ban, which in 2000 became mandatory. After the ban was implemented in 1999, pork producers saw an immediate increase in piglet mortality and post-weaning diarrhea. Dr. Scott Hurd, a former U.S. Department of Agriculture Deputy Under Secretary for Food and Safety and professor at Iowa State University College of Veterinary Medicine, released a study which shows that when pigs have been sick during growth, they have a greater presence of food-safety pathogens on their carcasses when slaughtered. I want to refer to what went on in Denmark with my third and last chart--the effects of banning antibiotics--and we have a Danish model here. It doesn't project very good healthy animal agriculture or safety for the consuming public. If this ban had resulted in improvements to public health--in other words, the ban the European Union put on antibiotics, and particularly in Denmark--suffering consequences such as piglet mortality would make sense. But the science does not back up that positive improvement in public health has occurred as a result of the Denmark ban. In fact, in 2002 the World Health Organization released a study on antimicrobial resistance and could find no public health benefit from the Denmark ban. It is true that overall use of antibiotics in Denmark has declined, but there has been a significant increase in the use of therapeutic antibiotics which are used to treat and control diseases. I think an interesting statistic is that in 2009 the use of therapeutic antibiotics in Danish pigs is greater than what was used to prevent the disease and to promote growth prior to the ban in 1999. So I think it is very easy to see that if you look at the science--and Mr. Walsh conveniently ignores it--the practice in the United States is superior to the practice of the ban in Denmark. We had a 2009 Iowa State University study estimating that production costs would rise by $6 per pig in the first year of a prohibition if a similar ban were imposed in the United States as it is in Denmark. Over 10 years, the cumulative cost to the U.S. pork industry would exceed $1 billion. This would all be on top of the estimated $4.6 billion U.S. pork producers have lost since September 2007 due to a perfect storm of events within that industry. The author, Mr. Walsh, also points to recent recalls in nuts, fruits, and vegetables as evidence that conventional agriculture is harmful and unsafe. What Mr. Walsh chooses to ignore is that salmonella and e. coli are naturally occurring organisms that, with proper handling, processing, and cooking, can be minimized or even eliminated. Organic agriculture is not somehow exempt from being affected by these bacteria, as Mr. Walsh might want us to believe. In fact, one of the main challenges within our food safety system has been the perpetual underfunding of the Food and Drug Administration. I hope the Senate will be able to undertake comprehensive food safety reform yet this year and give very serious consideration and attention to the funding deficiencies of that agency. American consumers demand not only a safe and abundant food supply but also an affordable selection to feed their families nutritious and healthy food. The author fails to recognize that personal choice is part of that equation. Ask any American consumer. While less than 1 percent of agriculture is farmed organically, as he points out, a simple economics lesson would tell us that supply and demand are in direct relationship to one another. In 2008, Americans spent 9.6 percent of their disposable personal income on food expenditures. This has steadily decreased since the late 1920s, when nearly 24 percent of our income was spent for food intake. Our consumers have demanded an affordable food supply, and our agricultural industry has answered that call. Other nations with less developed agricultural industries than the United States spend anywhere from 12 percent to 45 percent of their income on food. At the same time producers have become more efficient and are providing U.S. consumers with lower food costs, the farm share being retained by the producer--in other words, the family farmer--has been decreasing. For example, in the years 2000 to 2006, the farm value share ranged from 5 to 6 percent for cereals and bakery products compared to what is being paid at the retail level. Costs in packaging, processing, and transportation account for most of the cost at the grocery level. Conventional agricultural producers are not getting rich. Instead, they are producing the safest, most abundant, most reasonably priced food in the world for our consumers at a time when their share of the food value is not increasing. Perhaps Mr. Walsh, the Time author, believes we should be spending a higher percentage of our income on food. However, because of the financial situation our Nation is facing, including families out of work and with lower disposable income, citizens would be outraged if suddenly their food expenditure skyrocketed. The Economic Research Service at the U.S. Department of Agriculture reported that total food expenditures for all food consumed in the United States was $1.165 trillion in 2008, a 3.3-percent increase from the $1.128 trillion in 2007. Prices are naturally rising because of the higher cost to do business, including transportation costs. But do we really think it is feasible to see these prices go even higher so that the author, Mr. Walsh, can further promote what I consider a political agenda? Growing all of our food organically will take more land, cost more money to produce, drive prices up, and ultimately make food even less affordable to those in need. I appreciate the opportunities organic agriculture has made possible for farmers in my State of Iowa, and I am sure other Senators would say the same for their own States. It has truly allowed our smallest farmers to flourish and receive a premium for their crops and livestock. It has also promoted gardens and has helped us teach our children where their food comes from. I agree with the author that the gardens of First Lady Michelle Obama and the U.S. Department of Agriculture are bringing more visibility to educating our consumers about where their food comes from. I commend them for highlighting the important issues relating to our health by eating fresh fruits and vegetables. Organic agriculture and conventional agriculture can coexist. Both will be driven by demand, and both provide important choices for the U.S. consumer. Some consumers will shop for locally grown foods, others will shop for the cost effectiveness due to their tight household budgets. It is time--it is time--for Time magazine and Mr. Walsh to start being honest with their readers. The next time the magazine wants to run a story that clearly reflects the author's personal views, it should identify that article as such. I expect the next article Time publishes on agriculture to be better researched and to present a more balanced view. Mr. President, I yield the floor.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President. I, Senator Chuck Grassley, intend to object to the proceeding to the nomination of Alan D. Solomont to be Ambassador to Spain and Andorra at the Department of State for the following reasons. I object to the proceeding to the nomination as I have yet to receive a full response to my letter(s) and document request(s). On June 12, 2009, I sent a letter requesting specific documents from the Corporation for National and Community Service (CNCS). Mr. Solomont is the chairman of CNCS's board of directors. My request called for documents relating to the firing of Gerald Walpin, the former inspector general at CNCS. Despite promises to be responsive under Mr. Solomont's leadership, CNCS has complied with my requests selectively, withholding entire categories of responsive documents and refusing to even provide a log to identify the particular documents being withheld and the specific reasons for withholding them.