Chuck Grassley

Mr. GRASSLEY

Mr. GRASSLEY. Madam President, I wish to take an opportunity to make a few comments and respond to some of the statements that have been made by individuals on the other side of the aisle who are opposed to this bill. I know a lot of people on the other side of the aisle favor this bill and that is why we have been able to get to the place where this legislation is coming up again. So my remarks are made toward and in response to those who oppose this legislation, not those who have been helping us move it along. For instance, I heard there were claims that the Class Action Fairness Act has never been considered before, that there have not been any hearings or markups on this legislation. Clearly, these Members have not been talking to the Senator from Wisconsin, Mr. Kohl, who has worked hard with me since the 105th Congress. Clearly, critics didn't pay any attention to what I had to say last night in my opening statement or, for that matter, many of the statements made by my colleagues on the long history of this legislation. To the contrary, Congress has been considering this Class Action Fairness Act for several years. Small businesspeople who are paying for this irresponsible tort system we have in America would tell you they have been paying dearly too long and that this legislation is long overdue. One might even find some big companies saying that. But there is no free lunch in America. Somebody is paying when there are frivolous lawsuits. Somebody is paying when lawyers are getting paid too much and when consumers are getting too little. It is a cost to the economy, and we ought to do something about irresponsible costs to our economy. My colleagues may remember--or they may not remember or we would not have heard these comments today about this legislation--as I indicated in my opening statement last night, both the House and Senate have convened hearings on class action abuse and the need for reform. Are we hearing there have never been hearings held? On what planet are those Senators living? The House has passed similar versions of the Class Action Fairness Act since the 105th Congress and have done it, by the way, with very strong bipartisan support. In the Senate in the 105th Congress--this is the 108th Congress. We can go back to the 107th, the 106th, and the 105th Congresses when there was work done on this legislation. At that time, I held hearings on class action abuse in the Judiciary Committee's Administrative Oversight and Court Subcommittee. In the 106th Congress, my subcommittee held another hearing on class actions, and the Judiciary Committee marked up and reported the Class Action Fairness Act, two Congresses ago. In the last Congress, the 107th, the Judiciary Committee held a hearing on class action abuse. And in the 108th Congress, the Judiciary Committee marked up the bill. Any Senator who says we have not had hearings on this legislation has not been in the Senate very long or they do not have very good staff helping them or they are not doing anything themselves. The bill we are considering is also compromise legislation that we worked out in a bipartisan way, a continuation of the bipartisan spirit of this legislation that is exemplified by the work of Senator Kohl now for over four Congresses. We did this with Senators Schumer, Dodd, and Landrieu since the cloture vote failed last October. While the bill numbers may have changed for the Class Action Fairness Act, we have been working on it now for the fourth Congress. If people think just because we change the title of a bill we ought to have another hearing, that is just an excuse for stalling. If they do not like the bill, vote against it. But let's move something along that needs to be moved along, and there is a consensus in this body that it ought to be done. I heard this morning claims that the Class Action Fairness Act would deny people the ability to file class action lawsuits. That is just plain not true. We do not take away claimants' ability to file in State court. All we do is modify the rules to allow removal to Federal court for class actions that fit certain criteria within this bill, and most often that is when there is a national implication of the class action suit, or it is not limited to a single State. It is in no way mandatory in our legislation that these cases need to proceed to the Federal court. Moreover, the claims that we have heard this morning and this afternoon that the Federal courts do not certify class actions are not true either. The Federal courts certify class action cases all the time, and the claimants win their suits in the Federal courts and it is often seen as a forum of preference. A recent Federal Judiciary Center study found that it was more likely for a class action to be certified in Federal court than in State court. There simply is no foundation, then, for the allegation that Federal courts are less capable of deciding these kinds of cases than State courts. Simply, that does not meet the commonsense test. It also is not true that it will take longer for Federal courts to decide class actions. The Federal courts have more resources to decide these cases than State courts. In fact, we have the same Federal Judicial Center study indicating that State courts are much more likely than Federal courts to sit on class action lawsuits. Also, I want to restate that we have made significant changes to the bill to ensure that truly local class actions stay in State court. This is the local controversy exception that was worked out to bring on other Democratic Senators who did not like certain aspects of the bill but wanted the bill to pass and said they would help us get it passed. Those Senators who wanted that local class action exemption, that the class action stay in State courts, were Senators Schumer, Dodd, and Landrieu. Earlier, some of my colleagues indicated that local issues, such as the PCP leak made famous in the Erin Brockovich case, or suits brought by nursing home residents would be required to be heard in Federal court. Again, this is not true because of the compromise that we crafted with these other Senators and included in the bill that is now before us. So it is not true that if you have your case heard in Federal court, you will get no justice. That is an outrageous statement and, quite frankly, an insult to the Federal judiciary. The Class Action Fairness Act does not close the courtroom door to anyone. Congress has studied this issue, and Congress has found that there are many problems that need to be considered. That is why we have been working on this steadily for so many Congresses. A number of studies have come out indicating there are serious abuses of the class action system. There have been numerous editorials and articles that support this bill. It is a bipartisan bill. So I think we ought to move on. The Senate is functioning as the Senate ought to function. As I said last night, nothing gets done in the Senate that is not bipartisan, and when it comes to an issue of partisanship, if 41 Senators stand against it--and that is quite a minority in this Senate--nothing gets done. We had that vote last October, 59 votes, 1 short of the supermajority to move on, but enough to bring a halt to the consideration of this legislation, because nothing happens in this body unless there is strong bipartisan support. After that cloture vote, we spent last fall working with Senators on the other side of the aisle to get above that 60. So if there is a situation where one Senator is still not satisfied, do we shut down the whole Senate, or where we maybe even have 10 Senators not satisfied? What more do we have to do to get over that customary rule in the Senate of 60 votes to stop debate to get to finality? For sure, if we get to a cloture of 60 votes and end up with 70 votes or 75 votes, are not the people trying to stall this legislation somewhat embarrassed by wanting to shut down the whole legislative process? So we have worked to get over that magic hurdle, and when we get over that we will have plenty of votes. Remember the vote we had through April and May on what we call the FSC/ETI bill, or the JOBS bill, the bill I called creating jobs in manufacturing? We took 15 days over about 2 months to get that legislation passed. It passed 92 to 5. There were all sorts of games being played with it on matters totally unrelated to the underlying legislation, all in the interest of preserving minority rights. Well, I think this bill has met that test, and we ought to move on. We still have a few people who do not want to move on, and that is a sad commentary, because when one plays by the rules of the game, it seems to me that people who do not get their way have to quit crying in their beer and suck it in, suck it up and move on. That is what I am asking my colleagues on the other side to do, suck it up and move on. Let the Senate work. It has worked. This legislation is proof that it is working. I yield the floor.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, Senator Baucus and I are pleased to announce the introduction of legislation to extend cost-sharing assistance to qualifying individuals for the Medicare Part B premium through September 2005. Qualified Individuals are a vulnerable population with income between 120 percent and 135 percent of the federal poverty level and limited assets. It is estimated the monthly Medicare Part B premium will be around $75 in fiscal year 2005. Let me put this into real numbers, this extension will provide over $900 dollars of annual assistance to Medicare beneficiaries who earn less than $12,600 per year. In the Medicare discount drug card program, Congress has targeted this same population with the transitional assistance program. These same seniors are eligible to receive $600 in assistance on their Medicare-approved drug card both this year and next. We need to extend this program, and the President agrees. An extension is part of his fiscal year 2005 budget. It does not seem right for us to assist these Medicare beneficiaries with some of their health care costs and relinquish our assistance in other areas. This program has been in existence since 1997 and has been extended every year thereafter because it targets help to low-income Medicare beneficiaries. I urge Congress to act on this important legislation.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, Senator Baucus and I are pleased to announce the introduction of legislation to extend cost-sharing assistance to qualifying individuals for the Medicare Part B premium through September 2005. Qualified Individuals are a vulnerable population with income between 120 percent and 135 percent of the federal poverty level and limited assets. It is estimated the monthly Medicare Part B premium will be around $75 in fiscal year 2005. Let me put this into real numbers, this extension will provide over $900 dollars of annual assistance to Medicare beneficiaries who earn less than $12,600 per year. In the Medicare discount drug card program, Congress has targeted this same population with the transitional assistance program. These same seniors are eligible to receive $600 in assistance on their Medicare-approved drug card both this year and next. We need to extend this program, and the President agrees. An extension is part of his fiscal year 2005 budget. It does not seem right for us to assist these Medicare beneficiaries with some of their health care costs and relinquish our assistance in other areas. This program has been in existence since 1997 and has been extended every year thereafter because it targets help to low-income Medicare beneficiaries. I urge Congress to act on this important legislation.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, for our leader, I ask there now be a period of morning business with Senators speaking for up to 10 minutes each.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I rise today to praise the Senate for the passage of the African Growth and Opportunity Acceleration Act of 2004 which was completed before we adjourned for the Fourth of July recess. The House of Representatives passed the legislation on June 14, 2004, and it was imperative the Senate quickly follow suit. The passage of AGOA is great news for Africa. Since AGOA was first enacted in 2000, investment in Africa is up, and trade from Africa is up. Because of the Africa Growth and Opportunity Act, many African families can now feed their children. For the first time there is a new sense of hope in many countries. Many provisions of the Africa Growth and Opportunity Act were set to expire this year. This created an environment of uncertainty, which as leading to investment flight and lost opportunities. Passage of this bill will help people in Africa reap the full benefits of the program. It is encouraging that this bill received such strong bipartisan support in the House and Senate. Trade can be a powerful tool of growth, and I am pleased that the majority of my colleagues share this view. Although passage of this bill is a great step forward, there is still a lot of work to be done. For example, the United States is currently negotiating a free trade agreement with members of the Southern African Customs Union. This will include the nations of South Africa, Botswana, Lesotho, Swaziland, and Namibia. Completion of this agreement will help foster trade and investment in the region, which could lead to a new period of sustained economic growth. For trade to work, it has to be two-way street. Foreign aid and preference programs are always a short-term answer. For long-term growth, Africans must work hand-in-hand with the United States to open markets both in Africa and around the world. History proves that the most economically advanced nations are those that embrace free trade and free markets. Too often, unduly high tariff barriers in developing countries hinder the trade and investment that is so vital to economic growth. I want to help create a climate of sustained prosperity in Africa, so we can eliminate poverty and provide hope for a better future. Passage of this bill is a good first step. I hope we can continue our work with the African people to help advance both our economies and build toward a brighter, more prosperous future. I would now like to take a minute and thank my staff who helped bring this legislation into realization. First and foremost is my staff director and chief counsel, Kolan Davis, for his leadership and loyalty. I would like to thank Everrett Eissenstat, my chief international trade counsel, for his hard work as well as that of the rest of my trade team, including Stephen Schaefer, David Johanson, Zach Paulsen and Dan Shepherdson. I must not forget to mention Carrie Clark--now Carrie Clark-Philips--who competently covered this issue for me before leaving the Committee. And finally, I want to thank the ranking member on the Finance Committee, Senator Baucus, and his able trade staff of Tim Punke, Brian Pomper, Shara Aranoff, Sara Andrews, John Gilliland and Pascal Niedermann, for the work they did in getting this bill compelted. I look forward to seeing the President sign this legislation into law quickly, so we can continue to work with the African nations in furthering economic progress. I thank the Senate for the bipartisan nature extended in the passage of this important legislation.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I ask unanimous consent the Senate proceed to immediate consideration of Calendar Nos. 585, 586, and 587, en bloc.

Mr. GRASSLEY. I ask unanimous consent the resolutions be agreed to, the preambles be agreed to, and the motions to reconsider be laid on the table, all en bloc.

Mr. GRASSLEY

Mr. GRASSLEY. I object to further proceedings on the measure at this time in order to place the bill on the calendar under the provisions of rule XIV.

Mr. GRASSLEY. I understand there is a bill at the desk that is due for its second reading.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, if there is no further business to come before the Senate, I ask unanimous consent that the Senate stand in adjournment under the previous order following the remarks of the Senator from Delaware, Mr. Carper, for as much time as he may want to Use.

Mr. GRASSLEY

Mr. GRASSLEY. I move to reconsider the vote and I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I ask unanimous consent that when the Senate completes its business today, it adjourn until 9:30 a.m. on Wednesday, July 7. I further ask unanimous consent that following the prayer and the pledge, the morning hour be deemed expired, the Journal of proceedings be approved to date, the time for the two leaders be reserved for their use later in the day, and that the Senate then begin a period of morning business for up to 60 minutes with the first 30 minutes under the control of the Democratic leader or his designee, and the final 30 minutes under the control of the majority leader or his designee; provided that following morning business the Senate resume consideration of S. 2062, the class action bill.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I am pleased that Majority Leader Frist has called up the Class Action Fairness Act. I have been working on this bill since the 105th Congress, so I think it is about time the Senate completes action on this bill. My colleagues will recall that in October of last year Senator Frist brought this bill to the floor, but we were not able to proceed to the bill because of filibuster, and we lost the vote on cloture on the motion to proceed by just a one-vote margin. A supermajority of 60 votes was needed. We had 59 votes which, obviously, means that last fall we had enough votes to pass the legislation but could not get around the filibuster. When you are up against a filibuster, you have to work out issues because nothing in the Senate gets done that is not done in a fairly broad bipartisan way. Since then, I have worked in good faith with Senator Hatch, chairman of the Judiciary Committee, and our lead Democratic cosponsors, Senator Kohl and Senator Carper, to modify the bill to address a number of concerns raised by their colleagues on the Democratic side, Senators Dodd, Landrieu, and Schumer. These Senators are now satisfied with the changes we made to this bill. We reintroduced the legislation this year as S. 2062. So the bill before us goes even further in terms of compromising on the issues than were brought before the Senate last October--enough action, I hope, that we can get to finality within a few days. As many colleagues may already know, this bill has gone through many changes and mostly changes to accommodate the minority in the Senate, a few Democratic Senators. I have worked in good faith with my colleagues on the other side of the aisle to bring people together and to address valid concerns to increase support for this bill, especially to get over the hurdle of the supermajority of 60 to get to stop debate and get to finality. To tell you the truth, Mr. President, I really didn't think we needed to make any changes in this class action bill that we originally introduced this Congress--in other words, last year. I thought then, and I think now, that the original introduction was a pretty good bill. But, of course, being a pretty good bill in my judgment doesn't mean it has enough votes to get that supermajority and get the compromise that is necessary to get to finality. So in order to move the class action bill forward, I did my best to listen to the issues raised and to make modifications to the bill where there was room for compromise. Yet S. 2062 still retains the goals I wanted to achieve and other cosponsors wanted to achieve; that is, to fix some of the more egregious problems that we are seeing in the class action system, and to provide a more legitimate forum for nationwide class action lawsuits. The deal we have struck is a very carefully crafted compromise that should not need any further modifications. So I am asking my colleagues to withhold offering amendments to avoid disrupting the balance we have achieved. I also hope we will not see a lot of nongermane amendments offered to this bill--meaning nothing to do with this legislation. Under the rules of the Senate, they can be offered but they are very distracting. We ought to keep our focus upon the class action system reform. Instead, we should focus on the germane amendments, get this bill done, and move on. We should not get all caught up in message amendments that will do nothing but play politics and delay all the hard work that we put into this bipartisan compromise bill. So I hope we can pass this bipartisan class action bill without changes and without any further delay. The reality is that the class action system is broken and we should do something about it. The current class action system is rife with problems which have undermined the rights of both plaintiffs and defendants. Class members are often in the dark as to what their rights are, with the class lawyers, driving the lawsuits and the settlements, with their interests as much in mind as those of members of the class. Class members receive court and settlement notices in hard-to- understand legalese. The notices are written in small print and in confusing legal jargon so class members often do not understand their rights or, more importantly, the consequences of their actions with respect to the class action lawsuit of which they are a part. Furthermore, many class action settlements only benefit lawyers, with little or nothing going to the members who have been harmed. We are all familiar with class action settlements where the members get a coupon of little or no value, and the lawyers get all the money available in the settlement agreement. We know that is not protecting the consumers of America. In addition, the current class action rules are such that the majority of the large nationwide class action lawsuits can only proceed in State court when they are clearly the kinds of cases that should be decided in our Federal courts because they have nationwide implications. At least these class action lawsuits should have had an opportunity to be heard in Federal court because usually they are the cases that involve the most amount of money, citizens from all across the country, and issues of nationwide concern. Why should a State court or a county court be deciding these kinds of class action cases that are going to impact people all across our country? Those cases ought to be decided in a Federal jurisdiction. This present system has never made sense to me. To further compound the problem, the present rules are easily gamed by unscrupulous lawyers who steer class action cases to certain State- preferred courts where judges are quick to certify a class and approve settlements with little regard to class members' interests and the parties' due process rights. We have heard of class action lawyers manipulating case pleadings to avoid removal of a class action lawsuit to Federal court, claiming that their clients suffered under $75,000 in damages, in order to avoid the Federal jurisdiction amount threshold in existing law. We have also heard of class action lawyers crafting lawsuits in such a way to defeat the complete diversity requirements by ensuring that at least one named class member is from the same State as one of the defendants, even if every other class member is from a different State. These are only a couple of the gamesmanship tactics that we hear lawyers like to utilize to bring down an entire class action legal system. The fact is, many of these class action cases are just frivolous lawsuits that are cooked up by lawyers to make a quick buck, with little benefit to class members whom the lawyers are supposed to be representing. This is a real drag on the economy. Many a good business is being hurt by frivolous litigation costs. Unfortunately, the current class action rules are contributing to the cost of businesses across America and particularly hitting hard small businesses that get caught up in the class action web. Too many frivolous lawsuits are being filed and too many good companies and consumers are having to pay for lawyer greed. We need to restore some commonsense reform to our legal system, and this legislation does it. It should have been done years ago. So my colleagues understand, then, why Senator Kohl of Wisconsin and I originally joined forces several Congresses ago--too long ago--to do something about these runaway abuses, and the only thing standing between us and success several years ago was the powerful influence of personal injury lawyers within our political system. The Class Action Fairness Act will address some of the more egregious problems within our class action system, and it will, at the same time, preserve class action lawsuits as an important tool to bring representation to the unrepresented. I remind my colleagues of all the time that was spent working on finding a fair solution to the class action problem. For the past four Congresses, Senator Kohl, Senator Hatch, and others have joined me in studying the abuses in the class action system and working to solve these problems. Over the years, both the House and Senate Judiciary Committees have convened numerous hearings on these class action abuses and, more importantly, highlighting the need for reform. The House passed similar versions of class action bills in several Congresses with very strong bipartisan support. In the Senate, in the 105th Congress, I held a hearing on class action abuse in the Judiciary Committee's Administrative Oversight Subcommittee. In the 106th Congress, my subcommittee held another hearing on class action, and the Judiciary Committee, at that time, marked up and reported out our class action legislation. The Judiciary Committee held a hearing on class action abuse again in the 107th Congress and again in this 108th Congress. The Judiciary Committee marked up the bill which is before the Senate. Chairman Hatch, Senator Kohl, and I worked closely with Senator Feinstein to make sure that more in-State class actions stayed in State court. That was a compromise to garner a little more bipartisan support at that time. We also worked closely with Senator Specter, albeit a Republican but a person who had some questions about this legislation, to make sure that his concerns relative to class actions were addressed. The bill was approved by the Judiciary Committee with solid bipartisan support. Late last year, we worked with Senators Schumer, Dodd, and Landrieu to address concerns they raised and to get them on board. Those Senators joined us in the introduction of the numbered bill before us, S. 2062, in February of this year in a bipartisan show of support for class action reform. I wanted to elaborate on the history of this bill so my colleagues were aware of the tremendous amount of time, over almost a decade, that Congress has spent studying the problem with our class action system and all the work and compromises that we put into this bipartisan bill to hopefully now get it passed. I will highlight some of the changes that we made to the bill to increase bipartisan support since Senator Kohl and I introduced the first Class Action Fairness Act several years ago. The bill, as was originally introduced, did several things. It required that notice of proposed settlements in all class actions, as well as all class notices, be in clear, easily understood English and include all material settlements and the terms of those settlements, including amount and source of attorney's fees. Mr. President, you should not have to be a lawyer to understand what you are suing about and what your cause is and what is going to happen to attorney's fees and other issues in the settlement. Presently, it is pretty complicated to understand that situation. Because plaintiffs give up their right to sue by joining a class action, they have a right to understand the ramifications of their actions in joining a class. Then our bill required that State attorneys general, or other responsible State government officials, be notified of any proposed class settlement that would affect the residents of their States. We included this provision to help protect class members because such notices would provide State officials with an opportunity to object if the settlement terms were unfair to the citizens of their particular State. Somebody at the State level ought to be reviewing that for the populations of their States. Our bill also requires that courts closely scrutinize class action settlements where the plaintiffs only receive a coupon or some other noncash award while, as I have said before, the lawyers get the bulk of the money. Our bill required the Judiciary Committee to report back to Congress on the best practices in class action cases and how to best ensure fairness of class action settlements. Finally, the bill allowed more class action lawsuits to be removed from State court to Federal court. The bill eliminated the complete diversity rule for class action cases but left in State court those class actions with fewer than 100 plaintiffs, class actions that involved less than $5 million, and class actions in which the State government entity, like the attorney general--well, no that is not right--where a State government entity is a primary defendant. Our bill still does many of these things, but we have made a number of modifications to get broader bipartisan support. In the Judiciary Committee last year, we incorporated the Feinstein amendment, which would leave in State court class action cases brought against a company in its home State where two-thirds or more of the class members are also residents of that State. We also incorporated changes to address issues raised by Senator Specter relative to how mass actions should be treated under the bill. In our negotiations in late 2003 with Senators Schumer, Dodd, and Landrieu, we made numerous changes. I am only going to mention a few of those important compromises reached. Examples: We made changes to the coupon settlement provisions in the bill, providing that attorneys fees must be based either on the value of the coupons actually redeemed by class members or the hours actually billed in prosecuting the case. We deleted the bounties provision because of concern that it might harm civil rights plaintiffs. We deleted provisions in the bill that dealt with specific notice requirements because the Judicial Conference has already approved similar notice requirements to the Federal Rules of Civil Procedure. To address questions about the merry-go-round issue, we eliminated a provision dealing with the dismissal of cases that failed to meet rule 23 requirements so that existing law continues to apply. We deleted a provision allowing plaintiff class members to remove class action because of gaming concerns. We placed reasonable time limitations on appellate review of remand orders in the bill. We clarified that citizenship of proposed class members is to be determined on the date plaintiffs file the original complaint or when plaintiffs amend that complaint. We made modifications to the Feinstein compromise that I have already referred to and to the class actions language referred to. We clarified that nothing in the bill restricts the authority of the Judicial Conference to promulgate rules with respect to class actions. Finally, we crafted a new local class action exception which would allow class actions to remain in State court if, No. 1, more than two- thirds of the class members are citizens of the forum State; No. 2, there is at least one in-State defendant from whom significant relief is sought by members of the class and whose conduct forms a significant basis of the plaintiffs' claims; No. 3, principal injuries resulting from the alleged conduct or related conduct of each defendant were incurred in the State where the action was originally filed; and lastly, no other class action asserting the same or similar factual allegations against any of the defendants on behalf of the same or other persons has been filed during the preceding 3 years. We did this to ensure that truly local class action cases, such as a plant explosion or some other localized event, would be able to stay in the State court where the harm took place. So we have made significant concessions to get our Democratic colleagues on board the Class Action Fairness Act. They have been telling us they are ready to support the bill and to get it passed. Both sides have been asking the leader to bring up this bill. Now that we have an agreement to proceed to the bill, hopefully no partisan politics will be played and we will get down to business and finally get this job done. It is time to make real progress on the class action bill and get it passed. Again, I want to remind my colleagues that we crafted a carefully balanced bill that consists of all of these compromises and more that I have mentioned. I believe we have done a pretty good job of addressing legitimate concerns with the bill, and I am hopeful we will not see lots of amendments to disrupt this compromise. I urge my colleagues to refrain from offering nonrelevant amendments, amendments that have nothing to do with this bill, because this is a bill that should not be bogged down with everyone's pet project, for which the Senate is so famous. All of our hard work of forging a bipartisan compromise bill should not go down the drain. The bottom line is class action reform is badly needed. Both plaintiffs and defendants alike are calling for change. The Class Action Fairness Act will help curb many problems that have plagued the class action system. The bill will increase class member protections and ensure the approval of fair settlements. It will allow nationwide class actions to be heard in the proper forum--the Federal courts--but keep primarily State class actions in State court. It will preserve the process but put a stop to the more egregious abuses. It will also help to put a stop to the frivolous lawsuits that are a drag on our economy and especially harmful to small business. Now that we have worked out a delicate compromise, we should be able to get this bipartisan bill done without any changes. A lot of my colleagues listening will say: Well, the gall of the Senator from Iowa to say that we have such a perfect bill before the Senate that we should not have any amendments. Well, over the course of several years, this has been a bipartisan bill in sponsorship. We developed more broad bipartisan consensus last year to get this bill out of committee. We just about had enough consensus to move the bill, one vote short of a supermajority, last October, of 60 votes, to move this bill. Then there were further compromises made to get over that hurdle. You can quantify in this body, what it takes, as a measure of bipartisanship. It is whether you get that 60-vote supermajority to stop debate and to get to finality. That is where the power of the minority comes into play in this body. They can say they need further compromise to move this bill to finality. We did that between last October and now. Some people do not want class action reform and they have a right to vote against it. But it seems when the Senate process has worked to bring about the necessary votes, and those necessary votes are gotten by the proper bipartisan compromises being worked out, then we ought to be able to let the Senate work its will. The rights of the minority have been protected. Have the rights of every last Senator been protected? No. But if we had to wait for that to happen, no bill would pass. But if it did pass, it would pass by a 100-to-0 margin. We are there. Hopefully this bill will pass the way it has been worked out and be done in a short period of a few days. We do not have a lot of time to spend on it. Of course, that works to the advantage of those who do not want anything because they represent the interests, they would say, of the consumers, and I don't doubt that is what they are concerned about. But they are also, intended or not, representing the interests of the selfish personal injury lawyers who want to play games with picking this county in this State, or that county in that State--some Podunk county where they can win their case. It would be OK if that case were only pertinent to the people of that State, but you find this forum shopping with national implications. Something of national implication should not be decided in one Podunk county in one State but should be decided by our Federal courts. I yield the floor.

Mr. GRASSLEY. Yes. I yielded the floor, but if you want me to hold the floor----

Mr. GRASSLEY. Yes.

Mr. GRASSLEY. Mr. President, if I could say this before I yield the floor, and I am going to yield the floor right away, first of all, I appreciate the statement by the Senator from Delaware. He may have missed it, but sometime in my remarks tonight I made some commentary about his efforts to help work a compromise and bring up issues that were very important to get settled in order to move to finality. Also, Mr. President, I want to tell you as well as other Members of this body, this bill is where it is because of the urgency Senator Carper has put on this legislation, to get it passed, because he knows of the need. He also understands the need of bipartisanship. I hope I have given him proper credit in this way. So many times as we Senators do, we go to breakfasts or lunches to speak to groups that are interested in legislation, and they are always asking us about this bill or that bill. More often than not, particularly when I am talking to small business groups, I am often asked about when are we going to get class action reform. I say, under certain circumstances we will get it. Sometimes people compliment me because I was the prime sponsor of this legislation. But I say at every one of these meetings, they need to thank Senator Carper whenever they see him, because no person in the Senate is trying move this bill along and do it in a bipartisan way, no one more than Senator Carper. I can say to Senator Carper, I thank him very much for what he has done and I yield the floor.

Mr. GRASSLEY. Yes. I guess I didn't understand that was part of my responsibility. I will do that right away.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, tomorrow, following morning business, the Senate will resume consideration of the class action bill. The majority leader stated this morning that it is his desire to consider related amendments to the pending class action bill and finish the bill in a reasonable timeframe. It is our hope that progress can be made on the bill during tomorrow's session. Again, to reiterate, this is a bipartisan bill, and I would encourage Senators to show restraint in offering nonrelevant amendments.

Mr. GRASSLEY

Mr. GRASSLEY. I appreciate that my colleagues on the Senate Agriculture Committee have worked collaboratively on the Medicaid provision, which is under the jurisdiction of the Senate Finance Committee. I am pleased that we were able to work out a provision which may help more children who are eligible receive free or reduced price breakfasts and lunches. I commend my colleagues for their good work on this important legislation. I agree with my colleagues, Senators Cochran, Harkin, and Baucus, that this Medicaid amendment will not authorize States to share Medicaid information other than that which is necessary to verify a child's participation in Medicaid or his or her family income. USDA Interpretation of Section 32 Funding in the 2002 Farm Bill

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I rise today to express my opposition to Senator Byrd's amendment to Section 1052 which would cap the number of U.S. military personnel and civilian contractors operating in Colombia at 500 and 500, respectively. I support the current committee language that increases the caps to 800 and 600, respectively, because it will enhance our efforts to help the Uribe administration stop the flow of drugs from their country and into ours. The situation in Colombia is at a critical point. We must ensure that it continues to move in the right direction. Colombia is a strong ally and major trading partner of the United States and is critical to the stability of the Western Hemisphere. It is also the home of three major terrorist organizations that derive about 70 percent of their funding from the production and distribution of cocaine, nearly half of which ends up on our streets. Their violent activities are a result of the need to maintain their narcotics trade, which has resulted in the social and economic instability of the country and the region. President Uribe has shown a strong commitment to ending the drug trade in Colombia by the end of his administration in 2006. I am extremely encouraged by his successes in drug eradication and his efforts to strengthen democracy and the rule of law. In 2003, coca production was down 21 percent and opium poppy was down 10 percent from the previous year. So far this year, the number of hectares of coca eradicated and the number of drug seizures are up from last year. We must continue this success that is needed to maintain domestic and international support for the eradication program. In Colombia, narcotics trafficking and terrorist acts have made it one of the most dangerous places in the world. Last year, Vice President Francisco Santos-Calderon testified before the Senate Drug Caucus that more than 8,000 acts of terror were committed against the Colombian people over the previous 5 years, including over 30,000 violent deaths during each of those years. However, since the vice president's testimony, there have been significant reductions in the numbers of homicides, assassinations, kidnappings and other terrorist acts. I am encouraged by these numbers and know that these changes are very encouraging to the people of Colombia. Our counter-narcotics efforts in Colombia include military funding for equipment, training and education programs for Colombian military personnel. Raising the existing personnel caps will allow additional U.S. personnel to be made available to train Colombian personnel, and will enhance their ability to conduct their counter-narcotics missions. We have a window of opportunity here that we need to take advantage of. The United States must be willing to help the Colombian government reach this goal. I strongly urge my colleagues to oppose this amendment and ensure an adequate number of U.S. personnel available in Colombia.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, in the 21st century, advances in medicine are allowing Americans to live longer than ever before. Today, the average American will live to be over 76 years old. As the collective age of society increases, so does the need for increased help, care, and support, as long-term illnesses and the frailties of age become the rule, not the exception. Faith in Action volunteers play a crucial role in ensuring that help is there for neighbors in need. Faith in Action is a nationwide, interfaith coalition that works to help people with long-term health needs or disabilities maintain their independence by providing assistance with daily activities. Funded by the Robert Wood Johnson Foundation, Faith in Action boasts 100,000 nationwide volunteers serving over 200,000 care recipients. Through Faith in Action, Americans of every faith--including Catholics, Protestants, Hindus, Jews and Muslims--work together to improve the lives of their neighbors in need. Faith in Action volunteers help others maintain their independence by doing simple things: watering flowers, shopping for groceries, taking people to the doctor, and simply listening. Sometimes they open doors that people can't open on their own. In my home State of Iowa, over 2,100 dedicated volunteers work in local programs to contribute approximately 315,000 volunteer hours per year--a service valued at nearly $5.2 million. But the value of Faith in Action is measured not by dollars and cents. Nor is the value measured by the number of volunteers, or the number of hours donated. The real value of Faith in Action is measured by the warm smiles of gratitude that line the faces of those whose lives have been enriched by the kind touch of a stranger. Fred Jones is a man who knows firsthand the value of Faith in Action. Fred lives with his wife in the rural farmhouse where he was born, on the outskirts of Parnell, IA. Fred is, by any measure, a big man-- standing 6 feet 2 inches tall and weighing over 200 pounds. Twelve years ago, Fred had a major stroke--a stroke that left half of his body paralyzed, and left Fred confined to a wheelchair in a home not built with wheelchairs in mind. After the stroke, Fred's wife did not want to put him in a care facility and dreaded the thought of leaving the home where he was born. So at 76 years old and without any help, Mrs. Jones assumed the burden of lifting Fred up and down the 6-inch step from the front door of their home to the sidewalk below. When Faith in Action was notified of the situation, the dedicated staff found resources to pay for the materials and a volunteer to install a wheelchair ramp for the elderly couple. Now Mrs. Jones is able to maneuver her husband in and out of their home with ease. Fred can now go to church, enjoy the sunshine, and watch his grandchildren play. As an Iowan and a Member of Congress, I greatly appreciate the selfless acts of charity done by Faith in Action volunteers and I look forward to even greater accomplishments in the years to come.

Mr. GRASSLEY

Mr. GRASSLEY. There is a big problem with Senator Biden's amendment. Before I go into the problem with Senator Biden's amendment, let me say I agree with his concerns about the size of future Iraq funding packages. I am concerned about the Federal deficit we are facing on the horizon. But we also have to realize we are in war. You do not go to war unless you go to war to win. If you go to war, you go to war to win. You put all the resources behind the men and women that it takes to win that war. You do not put their life in danger on the battlefield. It may sound like we do not care about future generations, but you don't worry about deficits. If we worried about deficits in World War II, Hitler would have been in New York City. The Japanese would have been in California. They would not have stopped at Pearl Harbor. We decided we were going to win that war, and we put all the resources behind it. For only the first time since Pearl Harbor, we have been attacked. On September 11, 3,000 Americans died. We decided we were going to defend America. We decided we were going to fight not on American soil, we were going to fight on the soil of the people who harbor the terrorists who attacked America on September 11. We are going to go to war to win. We are going to put the resources behind our men and women. We are not going to take any chances. I don't find any fault with anyone who talks about deficits. Only if they are so concerned about deficits that they do not care if we win the war and protect Americans, and the Constitution gives our Government that responsibility. We also found, as a result of the war, being attacked in America, that the economy went into the tank. Out of 2.5 million jobs supposedly lost in this recession, 1 million of those jobs were lost 3 months after September 11, 2001; not because of the economy but because of war and the public not being certain what would happen in the future. So we had tax cuts to revive the economy. We have a strong economy. A strong economy produces more resources so we can fight the war and win the war. The economy is growing. Federal revenues, as a result of these tax cuts, returned to their average levels, where they have been for 50 years, 18 to 19 percent of gross domestic product. We fought the Vietnam war and the Persian Gulf war during that period of time. So 18 to 19 percent of GDP for Federal taxes seems to be a level that does not hurt the economy. In fact, the economy grows, and it is a level of taxation that people have accepted. It is producing the results we need to bring in more revenue to close the gap so that we do not have big budget deficits in the future. On the point of taxes and the point of the budget gap, I note that Senator Biden's amendment contains no dedication of the revenue from raising taxes to any kind of fund that is oriented toward the war. In other words, the amendment simply raises taxes for more spending. The implication is on a Defense bill it will go to defense efforts. When we hear about sacrifice, I am not sure I hear sacrifice. Let's spend less for domestic programs so we can give more to support our men and women in uniform. In World War II there were efforts to curtail domestic expenditures. We put all of our efforts behind our men and women but not, raise taxes, more spending, bread and butter at the same time. I also point out there are two sides to the Federal ledger. One is the revenue side. That is what we take in from the people who work in our factories, our offices, and our farms across America. The other side of the ledger is the spending side. My friends on the other side focus exclusively, as my good friend from Delaware has, on the tax side. They look only to taxpayers to put our fiscal house in order. I agree with the goals of reducing the deficit, but I don't intend to hurt the economy through higher taxes and put a damper on the economy. I want the economy to grow. The economy is growing. What sort of a signal would raising taxes send? Lower taxes one year, raise them the next year. How do you get investment that way? I disagree that it is all right to look only at the tax side of the ledger. Indeed, the Senate approved a bill a little over a month ago that included $170 billion in revenue offsets. Republicans, working with like-minded Democrats, have been willing to exercise fiscal discipline, especially when it comes to closing corporate loopholes and curtailing tax shelters. I digress for a moment on the subject of offsets. I notice with some amusement a story in Congress Daily A.M. dated last month, May 18. The story noted the special alchemy in the Finance Committee work in formulating offsets. The article went on to quote anonymous lobbyists who were frustrated with the Finance Committee production of offsets. As a matter of fact, the tax staff at the Finance Committee happens to be the only committee personnel putting in work to generate offsets to raise revenues, and doing it in a fair way for corporations taking the advice of big tax firms, big investment bankers, big accounting firms, working together, to think of some miraculous tax loophole that is not legal to avoid taxation. That is cheating. We are going after the cheaters and bringing in that revenue. The record is clear. We found plenty of revenue raisers. I ask the full Senate, who was the last Democrat to propose any savings on this spending side? All we have to do is look at Senator Santorum's ``spendometer,'' that thermometer he has of red ink that adds up every Democrat amendment being offered on budgets and otherwise. We know where the pressure to spend is. How can we in good conscience propose those billions and billions of dollars of expenditures--mostly for domestic programs, not to win the war in Iraq--and then complain about budget deficits? Not a single spending cut is being proposed by those on the other side. Maybe back in the mid-1990s, but we have to go back many years. All I see is spending increases. So if those on the other side want to claim to be fiscal disciplinarians, let's see entries on the spending side of the ledger. To have credibility, you cannot just go to the American people and ask for more money. You know, if I could ever get a reasonable tax increase, and have people on the other side of the aisle tell me how high taxes had to go to satisfy their appetite to spend money, I might just scratch my head and say: Well, maybe we ought to do it if we could get a consensus that is as high as taxes are going to go, and we don't have to worry about them going any higher. But I have never seen that you could raise taxes high enough to satisfy some people in this body who want to spend money. I am also concerned about the degree to which taxpayers finance reconstruction in Iraq on a blank-check basis. I first raised this concern almost a year ago. We ought to be very careful about the structure of future aid packages. Now I will speak specifically about Senator Biden's amendment. He says he is seeking to offset the President's war-funding request with a tax increase. As I noted above, the text of the amendment simply raises taxes for more spending. There is no connection between taxes raised and Iraq funding. Let's take a look at the tax increase. For 2001, the top rate was reduced to 38.6 percent. In the 2003 tax bill, we reduced the top rate to 35 percent. Senator Biden's amendment would raise that top rate back to 36 percent. The premise of the Biden amendment seems to be that taxpayers in the top bracket are solely Park Avenue millionaires. They clip coupons, bring in the money, get out their cigars, lean back in their chairs, and enjoy life. Well, the facts are somewhat different. According to the Treasury Department, about 80 percent of the benefits of the top rate go to taxpayers with small business ownership. Now, we have had some debates about the definition of ``small business.'' Some on the other side define ``small business'' as only those businesses with taxable income below, say, $320,000. To those folks, a local chain of shoestores, if it makes over $320,000--no matter how many folks it employs--is the same, in their category, as the Nordstroms or the J.C. Penneys. Those of us from the heartland know that the definition of ``small business'' does not cut off at, say, $320,000. It depends upon whether the business is locally owned. It depends on whether the business finances its growth from its own earnings. Conversely, to folks from small towns, like me, big businesses are generally the companies that finance themselves through big, massive bond borrowing or through the stock market. The reason the distinction is important for public policy issues, such as the level of taxation, is that we value local or regionally based businesses. The folks who own those businesses are from that community. They go to the local church. They support the local Little League. Small business, as I see it, is a stabilizing yet very dynamic social force in these communities and makes America what it is today. So when I talk about small business, I am not going to use any artificially low level of taxable income. I am going to use a commonsense definition of what small business is. There is too much at stake to demagog the definition. When we are considering tax policy, and specifically the tax rate applicable to business, we have really two categories. The first category is the regular big corporation. Virtually all big businesses, that is, publicly traded companies, are taxed under the regular corporate rate schedule. Small business income is generally taxed at the individual or personal level. In most cases, the owner of the small business puts the income of the small business on his or her personal tax return. As a practical matter, then, the individual tax rate is the rate paid by that small business. The corporate tax rate, with some exceptions in the case of some older, smaller corporations, generally applies to big business. The relationship between the top individual rate and the top corporate rate has a bearing on our policy toward small business. If the top individual marginal rate is higher than the top corporate marginal rate, then we as a society are sending a very bad and negative signal about small business, and even to small businesses that exist. Before 2001, the top marginal rate for small business was 39.6 percent. Guess what. If you were a big corporation, the top rate was 35 percent. We had a penalty against small business. When you look at the difference, it was a 15-percent penalty against small business--before we changed the tax law last year. So it was a 15-percent small business penalty. That was the law. That was our Federal tax policy bias against small business. In 2001, a bipartisan majority of this Senate, including almost one- fourth of the Democrats voting with us, voted to gradually equalize the top marginal rate between small business and big business, recognizing that penalty as being unfair, being anti-entrepreneurial. Starting last year, for the first time in many years, the top rate, 35 percent, is the same for Fortune 500s as it is for successful small businesses. Senator Biden's amendment would take the first step to restore and perhaps even enhance the 15-percent penalty on small business. With all the appetite for taxing and spending around here, rest assured, small business would be facing even higher taxes in the future because, as I said, you cannot raise taxes high enough on the other side of the aisle to satisfy the appetite to spend money. I do not quarrel with the notion that taxpayers in the top bracket make incomes starting in the range that has been stated of $320,000. A lot of these successful small business owners make figures like that. But keep in mind, that figure represents the total net income of those small businesses. Successful small businesses are those that purchase the equipment and hire the new workers. I would ask my friends on the other side, those friends who are so eager to raise taxes--and not all are--why they are all so reluctant to cut spending and eager to increase spending, to focus on the effects of their policy on small business, the effects of their policy on entrepreneurship in America, because small business creates 80 percent of the jobs in this country. Why, at this time, with a recovering job market--1.2 million jobs created this year--would we want to put a damper on the economic recovery by raising taxes on the very people, the very businesses, the very small businesses, that create 80 percent of the new jobs? Last month, the Senate, by a vote of 92 to 5, approved a bill designed to cut the top marginal tax rate for small business manufacturers yet again to 32 percent. Senator Biden's amendment would go the other way and hammer our small business manufacturers. Anyone voting for Senator Biden's amendment is, in effect, saying they support raising taxes on small business manufacturers. A vote for the Biden amendment is a vote to raise the top marginal tax rate on small business manufacturing from the 32 percent in the JOBS bill that we just passed to 36 percent. That is a tax increase on small business of 13 percent--13 percent. Is that the direction we want to go in a recovering economy, in a job-creating economy? Is there something wrong with the economy that is growing now, with 1.2 million jobs in the last 6 months? Why would you want to dampen that? Finally, I do not want you to take my word for this. I am just a public official. I would like to have you listen to what small business folks are saying. I would like to have you take a look at this chart. The chart is a copy of a letter from the three principal small business grassroots organizations. The first organization is the National Federation of Independent Business or NFIB. The second one is the Small Business Legislative Council, and the third organization is the Small Business Survival Committee.

Mr. GRASSLEY. I am going to read the second paragraph of this letter. Accelerating income tax relief: Approximately 85 percent of small businesses file their tax returns as individuals. An increase in tax refunds means small firms will have more resources and more capital to put back into growing their businesses. A series of studies by four top tax economists examined the effect of tax rate cuts on sole proprietors. Their results indicate that a 5 percent point cut in rates would increase capital investment by about 10 percent. And, they found that dropping the top tax rate from 39.6 percent-- -- Where it was up until the year 2001---- to 33.2 percent would increase hiring by 12.1 percent. What these small business groups said was their tax policy priorities included a reduction in the top marginal rate. It is right there in their letter. Now let's think about this. As the small business folks say in their letter, there is a link between tax relief, economic growth, and jobs. We have seen the evidence of that linkage over the last year or so. Check out the economic statistics. The tax relief kicked in, the economy started growing, and jobs started coming back--1.2 million jobs in the last 5 or 6 months. Why would we want to reverse the course? Some would speculate that for the minority party, it is good politics for the economy to go into the tank. Raise taxes as the economy is coming back, and you stifle economic growth. If economic growth is stifled, then jobs disappear. If jobs disappear, then voters will throw out the President and his party. I am not that cynical. I don't believe some of the opposition would want to put short-term political advantages over the economic well- being of their constituents. But it does make you wonder. To sum up, a vote for the Biden amendment is, clearly and simply, a tax increase. How high do taxes have to go to satisfy the appetite on the other side of the aisle to spend money? I don't know. But this is a start. It is a tax increase during an economic recovery. It is a tax increase on the folks who create the jobs in America, our hard-working small business owners. For those reasons, I obviously ask Members to reject the Biden amendment. I yield the floor.

Mr. GRASSLEY. I ask unanimous consent for 3 more minutes.

Mr. GRASSLEY. Mr. President, do I have 20 minutes?