Judd Gregg

Mr. GREGG

Mr. GREGG. If Senator Rockefeller is ready, why not have the Senator proceed and then we will go to the Senator from Missouri.

Mr. GREGG. And Senator Coburn.

Mr. GREGG. Does the Senator want to outline who he thinks is speaking next?

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

Mr. GREGG. It is my understanding that we are now going to Senator Byrd, then Senator Ensign, and then going back to the other side.

Mr. GREGG. Mr. President, I just want to note that the exchange, which was very informative, between the Senator from Arizona and the Senator from Oklahoma was in relationship to the Defense bill, and we are on the deficit reduction bill. Those items which the Senator from Arizona raised--he certainly has a legitimate right to raise them--are not applicable to this bill but applicable to the Defense appropriations conference report. This bill actually reduces the deficit by $40 billion, which is a very positive event.

Mr. GREGG. I will object.

Mr. GREGG. The Senator from North Dakota has risen and spoken, obviously, with enthusiasm and energy about his position. But I think that there are a couple of points which need to be made. First of all, on this Byrd issue, the Byrd trade rule issue, let us talk about what that really is. Where did it come from to begin with? It came in the middle of the night. It was put in an appropriations bill a few years ago. Who does it benefit? It benefits a very few specific industries in this country that get the windfall from an unfair trade practice. In other words, what happens under this rule is that $3.2 billion is paid to a few specific industries. In fact, one specific company got 39 percent of the funds up until this year. Who would get it if it were not in place? The American taxpayer would get that money. That money would go to the Treasury. It is not about cutting that money out of the budget; it is about having that money flow to the Treasury so the American taxpayer has the right to that money so it can be used either to reduce the debt or it can be used for programmatic activity that is necessary, such as national defense, instead of having it be a special interest event which goes to benefit very few industries in this country and a very specific number of companies within those industries. Quite honestly, I would not be surprised if some of those companies did not have some sort of headquarters in this building right here that get that $3 billion. In addition to that, this $3.2 billion, because of the insistence of a couple of Members in this Senate, has been kept in, so it is still flowing to those specific companies. So the taxpayer is still not getting the benefit of that money that the taxpayer should get. Prospectively, the rule has been changed, as it should be changed. Why should it be changed? Well, the Senator from North Dakota sort of passed over this a little quickly. The WTO ruled against us. It said: You cannot give that money to specific industries and specific companies. It said: You cannot do that. Maybe the Senator from North Dakota does not want us to be a member of the WTO, but we are a member of the WTO. We use the WTO aggressively to try to defend our trade interests around the globe. They are the arbiter. They are the ones we go to when something goes wrong and our companies get maltreated. So it is a little hard to say to the WTO: We want to use you to enforce a dumping procedure against Japan, China or Singapore, but when you find that we have violated the World Trade Organization's laws because we are giving money specifically to one or two companies in this country in violation of those laws, well, you cannot do that. You cannot tell us how to do things. So what does the WTO do? The WTO now assesses fines against other American companies--I think it totals to something over $100 million annually--which American products, produced in this country, are now having to pay, which make those products less competitive, because we continue to violate the WTO and give this money, instead of to the taxpayers of America, instead of putting it in the Treasury where it should be, thus reducing the debt, to a couple of companies that have the influence to get it across this floor. I do not find a whole lot of persuasiveness in the argument of the Senator from North Dakota on this point, but he won. The $3.2 billion is going to flow out of the door to specific companies, in violation of WTO rules, will stay in place, and other American manufacturers will be prejudiced because they will be hit with a fine by the WTO, which is a legitimate fine. The second point the Senator makes is, he says, Oh, we are cutting the subsidies to students. I think he said $12 billion. That also is inaccurate. There is no reduction of subsidies to students. In fact, we expand the programs, the Pell grant program, and we create a new program for math and science. What we do is what we should do, and we need to do it before the end of the year, and that is we reduce the windfall that is coming to lenders because of the way the rules are presently set up. That is $12 billion. Again, I wouldn't be at all surprised if some of those lender companies had clearinghouses down in the Cayman Islands that he is complaining about. But he is defending them now because he is saying we should not make that change. If, by the end of this year, we do not change the rules as to how we calculate the lender activity to students in this country, lenders will get I think it is a $7 billion windfall. It might be more, actually. It does not go to the students. It will not help the students. All it does is help a group of lenders because the law is structured in a way which basically benefits them. We tried to change it. We were not able to permanently change it last year, but we now do have the permanent change in this bill. And, by the way, it was bipartisan. That proposal, because it is so obviously fair and the right thing to do, was reported out of the HELP Committee unanimously. This alleged $12 billion event that the Senator from North Dakota has decided to highlight as a corporate subsidy to the disadvantage of students is just the opposite. We are cutting a corporate subsidy to advantage students. The only debate between myself and Senator Kennedy, who was actually supportive to the policy relative to the reduction of the subsidy to the lenders, is how the money that is raised from that subsidy should be spent. We believe it should go to debt reduction, and we believe it should go to the expansion of student loans. He wants more money to student loans. We want to have a balance and we have a balance. On both those policy points, the Senator from North Dakota, in my humble opinion, has misrepresented the character of the bill--$3.2 billion is flowing to special corporations for a special interest benefit under this bill. It should be going to the taxpayers. But the policy which energized that is at least being changed so at least prospectively that is not going to happen, and other companies in this country that are being fined by the WTO because of violations of the WTO standard will actually have that relief in the outyears. And the subsidies which, if we do not act before the end of this year, are flowing to corporate lenders are going to be moved over to students, to benefit students, or to deficit reduction. I yield to the Senator from Oklahoma.

Mr. GREGG. Mr. President, we are going back and forth. And I think there was a tacit understanding Senator Salazar would be next.

Mr. GREGG. I move to amend the unanimous consent request as follows: That we call up the PATRIOT Act which is pending at the desk, have 2 hours of debate, and go to final passage.

Mr. GREGG. Mr. President, we are going have a series of speakers. I wish to respond quickly to the point of the Senator from Massachusetts on a couple of areas. First, the purpose of the deficit reduction bill is to slow the rate of growth of entitlement programs. It is a net bill. In this bill, there are very major initiatives, especially in the area of education, which are new and fully paid for. There is $40 billion in debt reduction, but the actual reductions in the bill exceed that by a considerable amount. The new programmatic activity which is fully paid for in the student area is $9 billion of additional funds for student activity. The Senator from Massachusetts says we should have the best and the brightest have an opportunity to participate and go to good colleges. We agree with that. In fact, we are doing something about it. We are following the proposals of John Adams, a Massachusetts individual of note who helped our country get started and who considered public education and education generally to be the essence of how the American dream is going to be fulfilled. He was totally committed to a meritocracy. We are essentially saying in this bill, by creating this new program called SMART, if you are a low-income student and you are focusing on math and science, we are going to give you a lot of help. If you can perform well in those two areas, you are going to get an opportunity to really succeed in this country. But we are going to give you the support you need to succeed. We are going to give you $4,000 a year on top of your Pell grant, on top of scholarships, on top of your borrowing capabilities. You are potentially getting $4,000 a year in college if you study math and science and have a low income. We forgive $4 billion in student loans. We are going to reduce student loan taxes and fees by $4 billion, and we are going to provide $1.9 billion of loan forgiveness for people who go into special areas that we consider important, specifically teaching, primarily in these special education areas. This bill structures a $17,500 loan forgiveness program for people who go into special education teaching. We recognize special education teachers are, first, needed, and second, they are put under tremendous stress. If we can encourage people to go into that field, we want to. This bill has some very good policy in the area of education. Sure, it isn't as strong as what left the Senate, which was actually worked out within the HELP Committee. That happened with the House. The House was zero, we were at eight, and we ended up essentially at four. This so-called compromise in that $4 billion is a lot of good initiatives in the area of the SMART Program. I yield to the Senator if he has a question. For the purposes of a question, I will yield time off his time, of course.

Mr. GREGG. Reserving the right to object.

Mr. GREGG. Mr. President, that is a good outline. I note that if Members want to speak, it would be nice if they would give us a call and tell us they want to speak, and we will make sure they have time to speak. We want to make sure everybody has the time they need to get their points across. Do I understand that the Senator is yielding time off the bill on his side to Senator Chambliss?

Mr. GREGG. My understanding is that Senator Specter asked to speak as in morning business; am I incorrect in that?

Mr. GREGG. Mr. President, I yield whatever time Senator Chambliss uses.

Mr. GREGG. Reserving the right to object, is it the Senator's position that if the unanimous consent request was amended to be a 1- year extension, the Senator would support that unanimous consent request?

Mr. GREGG

Mr. GREGG. Mr. President, the executive branch agencies have many programs to recognize performance and talent. In the legislative branch, we too often take personal effort and hard work for granted. Unfortunately, the Senate does not possess many ways to recognize excellence, and thank the people who make this institution function so well. Today, I would like to take a little time to mention something that is not debatable. I think this is simply stating something that all Members, on both sides of the aisle, know only too well. In the three years that Dr. Douglas Holtz-Eakin has been Director of the Congressional Budget Office, he has led with dedication and integrity. He has provided the Members of Congress with impartial analyses of a wide array of budgetary and economic issues. He has never hesitated to meet with Members and staff regarding any issue. Douglas has always approached his responsibilities with enthusiasm and a desire to make sure that the information CBO provides leads decisionmakers to create better public policy outcomes. Douglas Holtz-Eakin is the sixth Director of the Congressional Budget Office. He was appointed to that position on February 4, 2003; following an 18-month stint as chief economist for the President's Council of Economic Advisers. During his tenure, he has certainly made an impression on CBO; leaving behind a legacy that Congress will benefit from for years to come. He has strengthened and improved the transparency of CBO's analytical methods by convening an annual Director's Conference to bring in outside experts to assist the agency in tackling complex economic issues. He also has enhanced the publication production effort by publishing background papers that explain CBO's models and methods, working papers that discuss new analytical developments and improvements, and issue briefs that communicate analyses in a concise manner for those unable to commit the time to more indepth research. Dr. Holtz-Eakin has devoted a great amount of attention to improving the clarity of CBO's work to make it more accessible to policymakers, professional analysts, and the public. Under Doug's guidance, CBO extended its modeling and analytic capacity; most notably in the critical areas of dynamic analysis and long-term microsimulation. CBO also has begun to apply the tools of modern financial analysis to improve budgetary and economic cost measures. Prior to his appointment as CBO Director, Dr. Holtz-Eakin already had a remarkable career, distinguishing himself in academia and as a public servant. He is a trustee professor of economics at the Maxwell School of Syracuse University, where he also served as chairman of the Department of Economics and as associate director of the Center for Policy Research. He held positions as editor of the National Tax Journal, associate editor of the Journal of Human Resources, and as a member of the editorial board for Public Budgeting & Finance, Economics and Politics, Journal of Sports Economics, Regional Science and Urban Economics, and Public Works Management and Policy. Earlier in his career, he held academic appointments at Columbia University and at Princeton University. Since 1985, he has served as a faculty research fellow and research associate for the National Bureau of Economic Research. He has been a consultant to the New Jersey State and Local Expenditure and Revenue Policy Commission, the State of Arizona Joint Select Committee on State Revenues and Expenditures, and the New York State Office for the Aging. He also has served as the Executive Director, Tax Study Commission, New York State Assembly. Dr. Holtz-Eakin's remarkable career in public service will not end with CBO. He will continue making positive contributions to public policy research as the next Paul A. Volcker fellow in international economics and as the director of the Maurice R. Greenberg Center for Geoeconomic Studies at the Council on Foreign Relations. The council is a nonpartisan research organization that is national in scope and global in its reach. Doug's quick wit and sense of humor will be sorely missed in the Halls of the Capitol and on the fourth floor of the Ford House Office Building. We wish him good luck in his new endeavors and are grateful for his contributions and work on our behalf. He leaves behind a first- rate professional staff with high morale, testimony to his excellence in leadership. We wish him well.

Mr. GREGG

Mr. GREGG. Mr. President, pursuant to section 313(c) of the Congressional Budget Act of 1974, I submit for the Record a list of material in the conference agreement on S. 1932 considered to be extraneous under subsections (b)(1)(A), (b)(1)(B), and (b)(1)(E) of section 313. The inclusion or exclusion of material on the following list does not constitute a determination of extraneousness by the Presiding Officer of the Senate. To the best of my knowledge, S. 1932, the Deficit Reduction Act of 2005, contains no material considered to be extraneous under subsections (b)(1)(A), (b)(1)(B), and (b)(1)(E) of section 313 of the Congressional Budget Act of 1974.

Mr. GREGG

Mr. GREGG. 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. GREGG

Mr. GREGG. I ask the Senator from Maryland how much time he wishes to speak?

Mr. GREGG. Mr. President, I renew my request.

Mr. GREGG. Mr. President, I suggest the absence of a quorum.

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

Mr. GREGG. Mr. President, we are now on the deficit reduction conference report. We have 10 hours of debate, 5 hours equally divided. I know my colleague from North Dakota wants to speak tonight. Just for the edification of our membership, we will run some time off the clock tonight--I think about 2 hours--and then come back tomorrow and continue the debate and hopefully wrap this up tomorrow. This bill is a culmination of a lot of work done in the Congress, by the President, and by the Members of the Republican Party, to try to put some discipline into the fiscal accounts of the Federal Government. This bill represents the first time in 8 years that the Federal Government has attempted to control the rate of growth in entitlement spending. People who watch this debate understand this issue, but just to frame it again, Federal Government spending is divided into basically three different areas. There is interest on debt, which we have virtually no control over. There is the discretionary spending, otherwise known as the appropriations process, which means every year we spend a certain amount of money. It is really up to us how much we spend, and it is for specific programs. The majority of it goes to the defense spending, but other money goes to education, it goes to environmental issues, it goes to highways--things for which every year we appropriate, saying we are going to spend this much. We can change that number arbitrarily from year to year, and we do. The third element of Federal spending is called mandatory entitlement spending. This spending occurs as a matter of law because certain people have come to certain situations in their life which allows them to receive a benefit from the Federal Government. They may be veterans who have served us well; they, therefore, get benefits. They may be persons of low income who need assistance, especially a child in a low- income family who needs assistance. They may be a retired citizen who paid into Social Security, who gets health care under Medicare, or a low-income person who gets health care under Medicaid, especially nursing care. These are entitlements. They make up the vast majority of Federal spending. Discretionary spending only makes up 30 percent of the Federal accounts, and half of that is defense spending. Entitlements are also the fastest growing part of the Federal Government. We know because the baby boom generation is going to retire, and spending on entitlements, specifically on Social Security, Medicare, Medicaid, the health care accounts especially, is going to increase radically over the next generation's 30 years as the baby boom generation begins to retire. It is estimated today by the Comptroller General that there is a $44 trillion--that is trillion dollars with a ``T''--$44 trillion unfunded liability, which means we don't know how we are going to pay for it. The obligation is in place already for the cost, primarily for health care programs for retired people who are going to be the baby boom generation. The practical effect of having that high an obligation out there and unpaid for is our children are going to have to pay the price. The practical effect of that is our children and our children's children, these wonderful young people who work here as pages, when they become earners and have kids of their own are going to have to pay so much to pay for programs which are already on the books to support our generation, the baby boom generation, they are essentially not going to be able to have as high a quality of life as we have. They are not going to be as comfortable in sending their kids to college, buying a car, buying a home, or just doing the day-to-day activities of life because they are going to have to pay a huge tax burden for our generation, unless we do something about it. That is what this bill is about. For the first time in 8 years, the Federal Government has stepped up and said: We are going try to do something--the Republican side of the aisle--about this huge burden we are going to put on our children through entitlement accounts by addressing those accounts. We have been aggressive on the discretionary side. We have essentially frozen nondiscretionary spending, but on the entitlement side it continues to grow at a dramatic rate. This bill is a step, really more than a toe, but putting our whole foot up to our ankle in the water of trying to control entitlement spending, mandatory spending. It amounts to almost $40 billion in savings in Federal spending. If this bill passes, it will reduce the debt of the Federal Government which will be passed on to our children by $40 billion. That is a big number. It is a big number in New Hampshire, and I know it is a big number in the State of every Member of this Senate. In the context of overall Federal spending, regrettably it is not as big a number as I would like, but it is still a big step forward on the road toward fiscal responsibility, and it is the first attempt to do this in 8 years. And this is an important point to stress. This is the only opportunity any Member of this Senate is going to have in this session of this Congress to try to control spending, to try to reduce the debt of the Federal Government. We are going to hear a lot of talk from the other side saying: Well, you have a tax relief bill out there which is being reconciled, and it is twice the size of the spending restraint here. The tax bill isn't being voted on tonight or tomorrow; the deficit reduction bill is being voted on tonight or tomorrow. If you want to reduce the deficit, if you want to reduce the debt of the Federal Government, reduce the costs that will be passed on to our children and our children's children, this is your opportunity to do it. If you want to vote against the tax relief bill, go ahead. I note as an aside that the tax relief bill has as its major function commitments to programs which I think have vast support across this Congress. In fact, I have heard other Members on the other side of the aisle say: Why aren't we passing a patch to the AMT so 20 million people do not fall under the alternative minimum tax? That is $30 billion of the tax bill. Why aren't we extending the deductibility of State and local sales taxes? That is a big chunk of the tax bill. Why aren't we extending the R&D tax credit, which causes us to create jobs in this country by giving entrepreneurs an incentive to go out and invest in R&D? We are hearing that from the other side of the aisle. The majority of the items in the tax relief package of $70 billion are items which have very broad support in this Congress--Democratic and Republican support. So it is a bit of a straw dog--in fact, it is a very large straw dog, maybe a Newfoundland straw dog--to claim that extension of the tax bill for some reason, the majority of which is supported on both sides the aisle, is somehow reducing the effort on the deficit in this bill. The two don't have that much relationship, and furthermore the tax bill already has broad support on the main elements of it. The only ones at issue are dividends and capital gains, which do not even impact this year or next year because that part of the tax relief package doesn't kick in until 2009 or 2010. This is it, folks. It is your one chance as Members of Congress, as Members of the Senate, to actually do something about the debt we are going to pass on to our children. You have an opportunity to reduce that debt by almost $40 billion. In addition, I would note, there is a net number, the $40 billion. There are initiatives in this bill which are fully paid for which make a lot of sense and which are pretty good policy. We decided to put them in after we had saved money to pay for them. For example, the Pell Grant Program is expanded dramatically to low- income kids. This is a program to encourage low-income children who are especially interested in math and science to be successful in our schools. We know it is the seed corn for our productivity and our competitiveness as a Nation to promote math and science skills. There is an expansion of Medicaid to low-income children. About 1 million--over 1 million--needy kids today who are low income, who do not have health coverage will get health coverage. There are efforts in this bill to assist the people in the gulf coast, significant efforts. It would be very hard, I would think, if I were from the gulf coast to vote against this bill because there is a tremendous amount of funds being focused on the gulf coast, to address the needs of the gulf coast in the area of education and in the area of Medicaid. Literally billions of dollars, all paid for. In addition, there is money for LIHEAP, $1 billion. Those from cold regions of the country know because of the runup in the price of gas and oil it will be very hard for a number of low-income families to make it through the winter. They will have to make some tough choices. We want to fund the low-income energy assistance program. This bill does it; it pays for it with spending reductions. In addition, there is significant and positive welfare reform language which the Governors are asking for, bipartisan governorship is asking for, as well as Medicaid reform language--again, with bipartisan, strong support from the Governors--giving the Governors more flexibility and allowing them to deliver more service to more low- income people at less cost. This bill has a lot of good policy in it as well as saving $40 billion. It is the first and only opportunity--not the first opportunity because we voted on it a few times--the last opportunity to cast a vote to save $40 billion and not pass the debt on to our children. It is a positive bill. I hope my colleagues will support it. I yield the floor.

Mr. GREGG

Mr. GREGG. Mr. President, I ask unanimous consent that when the Senate completes its business today, it adjourn until 9:45 a.m. on Tuesday, December 20. I further ask 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, the Senate then resume consideration of the conference report to accompany S. 1932, the omnibus deficit reduction bill, with 8 hours of debate equally divided remaining.