Chuck Grassley

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I ask unanimous consent that the Committee on Environment and Public Works be authorized to meet to conduct a hearing on Thursday, May 17, at 9:30 a.m. to receive testimony regarding the following nominees: Linda Fisher to be Deputy Administrator, Environmental Protection Agency; Jeffrey Holmstead to be Assistant Administrator for Air and Radiation, Environmental Protection Agency; Stephen Johnson to be Assistant Administrator for Toxic Substances, Environmental Protection Agency; and James Connaughton to be a Member, Council on Environmental Quality.

Mr. GRASSLEY. Mr. President, I ask unanimous consent that the Committee on Commerce, Science, and Transportation be authorized to meet on the nominations of Michael Powell, Kathleen Abernathy, Kevin Martin, and Michael Copps to be members of the Federal Communications Commission on Thursday, May 17, 2001, at 9:30 a.m.

Mr. GRASSLEY. Mr. President, I ask unanimous consent that the Committee on Armed Services be authorized to meet during the session of the Senate on Thursday, May 17, 2001, at 4:30 p.m., in executive session to consider certain pending nominations.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I ask unanimous consent that there now be a period of morning business with Senators permitted to speak up to 10 minutes each.

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.

Mr. GRASSLEY

Mr. GRASSLEY. For the information of all Senators, the Senate will resume consideration of the reconciliation bill at 9:30 a.m. on Monday. There will be approximately 8 hours for final remarks on the bill and debate on a few amendments. Under the previous order, the Carnahan amendment will be the first vote in a series to begin at 6 p.m. on Monday. Senators may expect numerous votes to follow, including final passage of H.R. 1836, the tax reconciliation bill.

Mr. GRASSLEY

Mr. GRASSLEY. I ask unanimous consent that when the Senate completes its business today, it adjourn until the hour of 10 a.m. on Friday, May 18, for a pro forma session only. No business will be conducted during Friday's session of the Senate. I further ask that, on Friday, the Senate immediately adjourn until 9:30 a.m. on Monday, May 21, and immediately following the prayer, the Journal of proceedings be approved to date, the morning hour be deemed expired, the time for the two leaders be reserved for their use later in the day, and the Senate then resume consideration of the reconciliation bill.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I will take a couple minutes, and then I believe we are done. To respond in a short fashion to what the Senator from Florida said, we have 14 States that have a separate inheritance tax. In addition, the tax due to the State will continue to be paid through the year 2007. The repeal basically happens because we increase the unified credit so rapidly, and this is a direct result of the American taxpayers having spoken by the thousands that they want immediate relief. The President of the United States in his proposal did his death tax repeal with $260 billion. The bill before us does it with $145 billion. The President does not increase the unified credit. So, yes, his plan is a proportionate reduction, but the Senate and the taxpayers wanted immediate relief, and that is why we end up where we are. Obviously, there are problems for some Senators. I respect their objection, but we did it in the best way we could in a compromising fashion, trying to do as much as we could with a lesser amount of money than what the President was trying to do in his tax program, and do it in a bipartisan fashion. As we end this evening's debate, and we will continue it Monday with votes well into Monday evening to finish this bill, I hope I can speak for people who have wanted to see a tax bill passed, and that includes Senator Baucus and me, that we have defeated amendments that have come before this body to change this legislation. If we had taken the second alternative of bringing this bill before this body, that second alternative would have been perhaps--if we had been fortunate--a Republican-only measure that would have been voted on in committee 10-10. I believe a lot of the amendments we defeated today would have been adopted. We brought a bipartisan bill out of committee 14-6. We have had quite a few bipartisan votes today. I hope people who are reflecting upon what they want in a tax bill, if they have what they want without the bipartisan cooperation--when I say ``what they want,'' again I remind everybody this is a work of compromise--more importantly, bipartisan compromise--so nobody has really gotten what they want. But I know there is more of an urgency on my side for the reduction of marginal rates than there is maybe on the other side. It could be that people on my side do not like the 36 percent that I agreed to with Senator Baucus, but looking at some of these votes, and particularly how hard Senator Baucus was working to make sure this bipartisan position won, without that, some of these amendments, and maybe a lot of others, would have been adopted. I say that because there is Friday, Saturday, and Sunday to think about this before we adopt a final bill, and then there is Tuesday and Wednesday--and maybe not even that much time--to work on a conference report with which Senator Baucus is going to be involved. We have to think in terms of what is possible to get through here when it comes out of conference. I don't really know how to end this except to say that we worked hard for 4 months to get where we are. I hope people realize what we have put together has been sustained. We ought to think about that as people who may not be totally satisfied with what we are going to pass in the Senate try to use the rest of the process to gain something that is not doable in the final analysis. I would like to have everybody think between now and when that conference committee has to end sometime not too far down in the future, to be a little bit realistic. I think I have been realistic. I think Senator Baucus has been realistic or we wouldn't be here in the first place. For sure, we wouldn't be here sustaining this mark the way we have. I ask my colleagues, particularly on my side of the aisle, to think of this for the next few days.

Mr. GRASSLEY. Mr. President, the State death tax credit is one of the last vestiges of revenue sharing. The State has a luxury of not having an estate tax and just waiting for a portion of the Federal estate tax to be allocated to the State treasury. What we have tried to do in this mark is, in a fair way, allow the States to review the concerns of their citizens, and if they want to have their own death tax, then any tax paid to the States will be fully deductible on the final return. This will be phased in over the next 5 years, and it will be phased in over the next 5 years until repealed. In fact, the tax money will be paid out over the next 7 years. The States will have plenty of time for their legislatures to meet and decide on a State-by-State level if they want to maintain the death tax. Unlike the House amendment by Congressman Rangel, we did not repeal the credit immediately. But if the Federal Government does not collect the money, it is not ours to share. State death tax credit current law states up to $2.5 million. The rate is 8 percent. Total tax is $146,800. Our relief act before us--the act of 2001--is identical. The top rate of 16 percent is only collected on estates over $10 million. The number of Florida estates, for example, over $10 million is 126. The number of Iowa estates over $10 million is 22. In addition, at the expense of the American taxpayers, the Senator from Florida is taking care of State governments. He postpones the unified credit increase for years. The act before us gives a $3 million credit by the year 2005. The Senator postpones $3 million until the year 2007, and he never reaches $3.5 million or $4 million at the expense of the American taxpayers. So I think it is very important that we take a good look at this. Again, I want to remind everybody that we have tried to--in this estate tax provision of this bill, the phasing out of the estate tax is a controversial issue, even with those of us who have agreed to this bipartisan agreement. But what is not controversial is the way in which this bipartisan portion of our overall legislation, the estate tax provision, was worked out--very carefully, in a nonemotional, nonpolitical way, between Senator Lincoln on the one hand--she is a Democrat--and Senator Kyl on the other hand, being a Republican-- working these things out. And except for those who do not believe there should be any total repeal of the estate tax, even in the year 2001, this was a well-accepted compromise that is in this mark. Obviously, this provision by the Senator from Florida detracts from that. That is why we ask that it be defeated when we vote on it Monday. I yield the floor.

Mr. GRASSLEY. Would the Senator proceed to that right away. Amendment No. 688

Mr. GRASSLEY. I wonder if I could reserve the time on this amendment. The Senator had another amendment he was going to offer.

Mr. GRASSLEY. Mr. President, adoption is the right thing, at least as opposed to foster care. As I have been working on adoption issues for a long period of time, there is one thing I hear from kids who have been floating from one foster home to another, who have been in the system for a long period of time. What they want is a mom and a dad. What they really are saying is they want some permanency. One of the greatest sins of governmental policy is in the adoption and foster care area, where people grow all the way through their teenage years and get to be 18 and are adults and never have a mom and a dad. Every child has a right to grow up in a safe and loving home. I hope my work on the Adoption and Safe Families Act, which succeeded in shortening the time lines for children in foster care, is a major effort towards this goal that we all seek. Included in the Adoption and Safe Family Act was a provision I authored to break down barriers when a family living in one jurisdiction wants to adopt a child in another jurisdiction. I compliment Senator Landrieu. She has been steadfast in her advocacy for adoption. Senator Craig has joined her to make adoption tax incentives a very strong bipartisan objective. I have been pleased to join these two distinguished Senators in the past on efforts they have made in this direction. I don't know what the future holds exactly, but I promised the Senator from Louisiana I would work with her and Senator Craig on their amendment and see what, if anything, we can do. We will have the weekend and Monday to work on that. Hopefully, we can accommodate in some way.

Mr. GRASSLEY. Mr President, Senators Bayh and Snowe have a sincere concern over the long-term fiscal situation of the country. The fiscal discipline of the country's budget is important. I share that goal--fiscal discipline first. The budget approved by a bipartisan majority of the Congress meets the test of fiscal discipline. The trigger is unwise because it undermines the long-term stimulative effect of the tax cut. It makes the tax cut uncertain. The trigger is unnecessary because the pattern of the tax cut follows the pattern of the projected surplus. The lion's share of the revenue loss occurs after 5 years. Finally, if things go south on the projections, you can be sure Congress will raise taxes: Over the last 20 years we have raised taxes in 1982, 1984, 1990, and 1993. Only twice has Congress pushed through a tax cut that became law--1981 and 1997. Conditional tax cuts are not desirable--they do not stimulate workers, investors, and businesses behavior. Let us have certainty in tax relief. The American people, who are taxed at record post war levels, deserve no less.

Mr. GRASSLEY. If we want to speak and raise any questions, that is the only time we have.

Mr. GRASSLEY. Can we reserve our time, Mr. President?

Mr. GRASSLEY. Mr. President, I am going to address the Rockefeller amendment that is before us, and I think I can speak to what the Senator from Michigan, the Senator from Florida, and the Senator from West Virginia have raised as legitimate concerns. I will start over here with the Senator from Michigan. There is as much urgency about taxes as there is prescription drugs and Medicare. We probably haven't had as many hearings this year on Medicare and prescription drugs as we have taxes, but over the last 12 months we have had a lot more hearings in the Senate Finance Committee on Medicare and prescription drugs than we have on taxes. The reason we are having taxes up before prescription drugs is simply that the Tax Code was written in 1916 and there have been a lot of changes to it since then. For the most part, it is a matter of just changing a few words here or there. On the other hand, I have to admit it is complicated by adding a lot of new language. But when you are dealing with the legislation we are dealing with on this tax bill, it is not a complicated item to change the Tax Code to some extent. Maybe a little bit on the estate tax provisions we have here, but otherwise it is a matter of fine-tuning. When it comes to prescription drugs, we are writing a whole new program. The Democrat staff and Republican staff are working on it right now. They are charged from Senator Baucus and me that we want to bring this up by the latter half of July. My staff tells me that it is quite a job for them to do that. I am convinced they will meet that deadline. So it is a matter of doing what we can do now and taking the necessary time to do what is new and to do it right. That is our commitment, to doing it right. There is not a greater urgency in my committee for taxes over prescription drugs. It is just a case of when you can get each done. That is true of a lot of other things we are going to be dealing with as well, trade and Social Security. In the case of being all things to all people, in Iowa you can't be all things to all people. I don't know about Florida. But if I were speaking about all those things you said, the people of Iowa would know I was not telling the truth. Maybe there is something about me; I can't cover up very well. But I have been telling people in Iowa that we are going to have prescription drugs legislation when we hope to get it out of the committee. I have even suggested there are some people in my party who maybe would rather not do anything, put it over to next year, get an election year, get it all caught up--we want to do that on the floor of this Senate this October or November and get it out of the way so it doesn't come into the election cycle. The other thing is resources are part of what the Senator from Florida is talking about and the Senator from West Virginia is talking about. Remember, we are not very far apart on the resources, at least in the budget resolution. My colleague supported and offered--I don't know whether he offered it, but you at least spoke for a $311 billion pot of money that is put aside for Medicare. My amendment was $300 billion. My amendment carried; yours did not carry. It wasn't because the $11 billion one carried or the other did not carry, it was where the source of money was. Mine was from the contingency; yours was from some reduction of the taxes. But you cannot say the resources are not set aside. Is that enough? I don't know. But it is what we have set aside--$11 billion separate from what you thought was enough from what I thought was enough. Frankly, we don't know. It depends on how good you want to do it. If you want to do it the way most of the bills are introduced to make sure there is no less than a 50-percent subsidy, it is very expensive. But if you start it with the idea you are going to have universal access and in the universal access have some ability to pay, there is no reason why you have to have free pharmaceuticals. You ought to have it based on the ability to pay. We will start it with the amount of money we can and start at the bottom of the economic ladder and move up and cover as many people as we can and do it in a way that brings the forces of the marketplace in, some bulk purchasing. There are probably a lot of things I can tell you that ought to be brought into the program to make it so we can provide more prescription drugs at a lower level of cost, both to the taxpayers and to the consumer as well. But we are involved in this. So I think we do not need, either from the standpoint of legislative priorities, from the standpoint of the resources that are set aside, or a commitment on the part of both political parties--maybe not everybody in both political parties--but the commitment of people in political parties to get this job done. I want to make sure everybody understands you do not have to adopt Senator Rockefeller's amendment to make sure prescription drugs are going to get the attention that the last election brought to it. The economics of it are enough, but let's say the ultimate is when both political parties are campaigning on something, it is an issue in the campaign, that that is a commitment to getting something done. So I ask rejection of the Rockefeller amendment based upon what is a commitment on the part of many people in this Congress to move ahead on this issue. I yield the floor.

Mr. GRASSLEY. I move to reconsider the vote.

Mr. GRASSLEY. I will yield myself such time as I consume, and the remainder of the time I will yield to the Senator from Arizona. The Schumer amendment, as I said so many times, fractures the spirit of the bipartisan compromise that occurred in the Senate Finance Committee, which is the reason we can be here doing things in the tradition of the Finance Committee in a bipartisan way. Of course, Senator Schumer has no interest in this bipartisan agreement. It is curious that Senator Schumer would want to work so hard in offering an amendment to improve, in his mind, a bill he is going to end up voting against. Senator Schumer's amendment guarantees that the Federal Government gets to take over 50 percent of the assets a parent wants to pass on to a child. That does not sound like taxation; that sounds like confiscation to me. Senator Schumer claims that his amendment improves the education components in this bill, but in fact the bill's underlying education provisions are sound. Student loan interest deduction, prepaid tuition plans, employer-provided educational assistance, an increase in the education IRA--these are all important measures that will improve access to education. Senator Schumer's amendment will undo a very delicate compromise upon which these provisions rest. It is unwise, it is destructive, and it also should be defeated. I yield to the Senator from Arizona.

Mr. GRASSLEY. Mr. President, the main point I make is those who say this bill does not give any relief to those in the 15-percent bracket have not read the bill: That is, the argument that the 15-percent statutory rate should be reduced to 14 percent; otherwise nobody in the 15-percent bracket benefits. They say the taxpayers in the 15-percent rate bracket are shorted because the statutory rate itself is not reduced as in this amendment from 15 to 14 percent. This argument fails to take into consideration the benefits in this bill that are given to the 15-percent taxpayers. Simple math will show how wrong they are. This 1-percent decrease in the 15-percent rate is less than a 7-percent reduction of the rate itself. It is simple. Just divide 1 percent by 15 percent and come up with the 7-percent reduction I stated. In contrast, and to show there is a reduction in taxes for people in the 15-percent rate, the Joint Tax Committee of the Congress--remember, these are the professionals who are nonpartisan; they are advising Republicans and Democrats alike--say the bill before the Senate provides between 9 percent for some in the 15-percent bracket and 33 percent of relief for the 15-percent bracket taxpayer. It happens that taxpayers in the lower end of the 15-percent bracket received the greatest reduction. That would be 33 percent; those at the upper end received the 9-percent reduction. Of course, this relief is created by the various benefits in the bill targeted toward taxpayers falling within the 15-percent rate bracket. Look at the choice. The amendment on the other side provides a 7- percent decrease. Our bill provides 9 percent to 33 percent of relief. This ought to seem like a very simple decision unless you take the position that we can still do more. Their amendment provides a mere thimbleful of tax relief for 15-percent taxpayers. Their amendment creates a smokescreen to try to fool these Americans into believing they are getting substantial tax relief. Under our across-the-board tax relief package, everyone gets substantial tax relief. No one is left behind. The average benefit is a 9-percent reduction in tax burdens. Those at the lower end income levels get far more than 9 percent. Senator Baucus has said 75 percent of the benefits go to taxpayers making less than $75,000. These are reasons why I hope Members will vote against this amendment. I suggest the absence of a quorum and ask the time be applied equally to both sides.

Mr. GRASSLEY. Under the rules, it would be 1 hour on each side on the Carnahan amendment.

Mr. GRASSLEY. Mr. President, I ask unanimous consent that the pending amendment by Senator Schumer be laid aside and that a vote occur in relation to the amendment at 7:45 p.m. with no second-degree amendment in order prior to the vote. I further ask unanimous consent that the amendment be laid aside following the 5 minutes for Senator Schumer in order for Senator Gregg to offer an amendment and, following that time, the Gregg amendment be laid aside and Senator Carnahan be recognized to offer her amendment.

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

Mr. GRASSLEY. I suggest the absence of a quorum.

Mr. GRASSLEY. I suggest the absence of a quorum.

Mr. GRASSLEY. I yield to the Senator from New Hampshire whatever time he might want right now.