Tom Harkin

Mr. HARKIN

Mr. HARKIN. Mr. President, in recognition of the 50th anniversary of the Foreign Agriculture Service of the U.S. Department of Agriculture on March 10, Senator Cochran and I are today submitting Senate resolution to honor that agency's many achievements over the past half century. During the 83d Congress, President Eisenhower recognized that the productive capacity of the U.S. agricultural sector was outstripping the food and feed needs of our domestic economy. In order to assist American farmers and exporters in identifying, capturing, and maintaining overseas markets for our food and fiber, and thus boost the sector's earnings, Secretary Ezra Taft Benson established the Foreign Agriculture Service, FAS, by memorandum on March 10, 1953. The next year with the passage of the Agriculture Act of 1954, P.L. 83-690, agricultural attaches were transferred from the State Department to the new agency. The mission of FAS is to serve U.S. agriculture's international interest by expanding export opportunities for U.S. agricultural, aquaculture, and forest products and promoting world food security. Since its inception, the agency has assisted in expanding U.S. agricultural exports from less than $3 billion in 1953 to projected exports valued at $57 billion for 2003, in nominal dollars. In addition to providing in-country services and market analysis for the key importing countries in the agricultural attache corps, FAS, through headquarters staff, conducts trade and food aid programs and works with staff from other USDA agencies to analyze world market trends. While the agency is not solely responsible for our large gains in exports over the past five decades, no one could argue it has not provided a crucial assistance in that effort. I salute the work of past and present FAS employees and look forward to their contributions in the future.

Mr. HARKIN

Mr. HARKIN. Mr. President, imagine a world with cars that spew out no smog, no toxic emissions, and no greenhouse gases. The only thing that would come out of the tailpipe would be water pure enough to drink. Imagine a world in which we don't import a drop of Mideast oil, because clean, domestic, renewable energy sources meet all of our needs. Imagine a world in which we don't need to worry about a terrorist strike on our large nuclear power plants, or a storm causing a blackout over a large region, because we get all of our electricity from small distributed generators on farms and in buildings throughout the country. Sound too good to be true? The technology to do this, using hydrogen energy and fuel cells, is out of the labs and being tested on our streets and in our buildings today. For those of us who have been working for many years to bring this vision into reality, that is very exciting. But we still need a major effort to bring the costs down and commercialize the technology. And there is remarkable bipartisan agreement on the need for government action. A couple years ago we were fighting for scraps of funding. Now the President has proposed $1.7 billion over 5 years toward getting hydrogen fuel cell vehicles on the road. The Senate energy bill last year, before it died in conference, included tax incentives for stationary fuel cells, fuel cell vehicles, hydrogen vehicles, hydrogen fueling infrastructure, and hydrogen fuel. But we are still too timid to bring about the fundamental shift to the hydrogen economy. The Department of Energy is working toward a go- no go decision by the car companies by 2015, and mass production of vehicles by 2020. But the car companies themselves have been talking about commercial vehicles by 2010. We need a bolder, more comprehensive plan. That's why I am introducing the Hydrogen and Fuel Cell Energy Act of 2003. This bill addresses three critical requirements to bringing hydrogen energy and fuel cells into commerce, and start gaining their environmental and security benefits, as soon as technically feasible. First we need a technological push. We need better fuel cell stack components to reduce costs and improve longevity. We need lighter, more efficient ways to store hydrogen on-board vehicles. In the long term, we need cheaper ways of converting renewable energy to hydrogen fuel. This bill reauthorizes the Matsunaga Act, which established the Federal hydrogen energy research program. It updates the language and sets clearer priorities. It expands the authorization to cover fuel cell research and development as well, to reflect the technical and bureaucratic reality that research on fuel cells--the most efficient, flexible, and cleanest way to use hydrogen energy--has become inextricably linked to research on hydrogen energy. It supports work on domestic and international codes and standards, to work through a major regulatory barrier to working with combustible hydrogen and to making all the infrastructure pieces fit together. It includes a specific mandate to do public education on hydrogen and fuel cells and to do university training in critical skills needed in the industry. And it increases funding levels over the next few years to accelerate progress in pre-commercial technologies. Second, and perhaps most important right now, we need a near-term demand pull. As long as the fuel cells and hydrogen appliances are made by hand, they will remain very expensive. But it's also expensive to build the factories to build them more cheaply. We need support to get industry over that initial cost hump. The first step is large demonstration programs that serve a dual purpose: they provide a realistic test of how the laboratory technologies work in the real world, and they provide funding for pre- commercial prototypes of the technologies, including starting to build a hydrogen fueling infrastructure. The Hydrogen and Fuel Cell Energy Act authorizes several new, large demonstration programs: The main demostration program would provide over $1 billion over 7 years for demonstrations of the full range of fuel cell applications and associated hydrogen infrastructure. These demonstrations would include fleets of fuel cell passenger vehicles, fuel cell buses and farm vehicles, stationary fuel cells in houses and commercial buildings, and portable fuel cells such as auxiliary power units in trucks. A second, closely related program, would provide hydrogen fueling infrastructure over major transportation corridors and entire regions, and then demonstrate hydrogen-powered vehicles that are not tethered to a single pump. Early demonstrations, at least, would likely use vehicles that burn hydrogen; these are similar to gas-electric hybrids that you can buy today, but run on hydrogen rather than gasoline. These vehicles provide most of the benefits of fuel cell vehicles at a fraction of the current cost. They are not as good as fuel cell vehicles in the long term, they are less efficient, less flexible, and produce a little pollution, but would move us a long way toward the goal and would provide a good large-scale test of a hydrogen fueling system. A third program would demonstrate hydrogen and fuel cell technologies in foreign countries. Hydrogen energy could have an early application in places where a competing fossil fuel infrastructure is not already well-developed. And assisting this application is in our national interest in order to promote global development without causing global warming and other harmful environmental effects, and to increase the global market for American hydrogen and fuel cell technologies. The last program would focus on emerging technologies for production of hydrogen from renewable resources. Two approaches show particular promise for clean, efficient production of hydrogen at this time. Biorefineries make hydrogen and other products from biomass. And in ``electrofarming'' the hydrogen is produced and used on the same farm. The hydrogen might be made by growing and reforming biomass, from wind energy, or from farm waste; it could be used in farm vehicles and equipment and for heat and electricity in farm buildings. All these demonstration programs would be conducted using competitive merit review of funding proposals from a wide variety of companies and organizations, and they would require cost-sharing from awardees. Third, we need to show there will be a market for commercial hydrogen and fuel cell technologies in the long term. The Federal Government can do this by buying early commercial products and by providing incentives to others to do so, in recognition of their public benefits. The bill includes Federal purchase requirements for both zero emission vehicles and stationary fuel cells. The vehicle requirements are similar to Federal fleet requirements for purchase of alternative fuel vehicles. They would require zero emission vehicles, most likely hydrogen fuel cell vehicles, to make up an increasing percentage of Federal fleet vehicle purchases up to 75 percent. Alternative fuel vehicles with very low emissions, such as hydrogen hybrid vehicles, would get partial credit. For stationary fuel cells, the bill would require modifying energy efficiency regulations for Federal buildings to presume use of fuel cells to power new Federal buildings and to encourage their use in older buildings. The bill also provides a broad array of tax incentives for stationary and portable fuel cells, hydrogen and fuel cell vehicles, hydrogen fueling infrastructure, and hydrogen fuel. These incentives are similar to those that have been proposed in the CLEAR Act on alternative fuel vehicles, in previous bills on stationary fuel cells, and in last year's energy bill. However, this bill makes some important changes. It makes all the tax credits tradable so that government agencies and non- profit organizations can use them as well as consumers and private companies. It increases the credit for hydrogen fueling infrastructure to recognize the cost of making the hydrogen on-site, not just pumping it. It adds an additional incentive for hydrogen from renewable resources to encourage a transition to a sustainable hydrogen system. And most importantly, it extends the tax credits so the industry will know the incentives will be there when they are needed--when real commercial products are available. Finally, the bill ensures effective coordination and oversight of the expanded Federal hydrogen and fuel cell energy activities, with a new interagency task force to coordinate activities, a revamped technical advisory panel, and periodic outside review by the National Academies. These measures will require a significant Federal investment in our energy future. But with these measures we can use hydrogen and fuel cell technologies to turn into reality a vision of cars that don't pollute, of power that won't go out, and of feeling less dependent on an area of the world where we are fighting the second war in recent years. It is time to take these steps now.

Mr. HARKIN

Mr. HARKIN. Mr. President, in the early 1990s, a large number of U.S. companies began a process of switching their defined benefit pension plans to cash balance plans. Many of the employees whose pension plans were to be altered drastically weren't told and didn't notice that they were essentially going to be working for years without earning any more benefits. Their not knowing was viewed as a key benefit by management. And the retirees were furious. As Keith Williams with Watson Wyatt Worldwide and Amy Viener with William Mercer, two firms that put together these plans in 1998 said at an Actuaries conference: Mr. Williams: I've been involved in cash balance plans five or six years down the road and what I have found is that while employees understand it, it is not until they are actually ready to retire that they understand how little they are actually getting. Ms. Viener: Right, but they're happy while they're employed. One of the most abusive practices in cash balance conversions is known as ``wear away.'' Older workers see nothing added to their pensions as the value of the pensions is frozen, often for many years, until it reaches the lower value of the new pension plan. At the same time younger workers are getting their pensions increased. In my view, this is clearly age discrimination and bad pension policy. In 1999, I introduced a bill to make it illegal for corporations wear away the benefits of older workers during conversions to cash balance plans. I offered my bill as an amendment. Forty-eight Senators, including 3 Republicans, voted to waive the budget point of order so we could consider this amendment. We did not have enough votes then, but I believe the tide is turning. After that vote, more and more stories came out about how many workers were losing their pensions. In September of 1999, the Secretary of the Treasury put a moratorium on conversions from defined benefit plans to cash balance plans. That moratorium has been in effect now for over three years. In April of 2000, I offered a sense-of-the-Senate resolution to stop this practice, and it passed the Senate unanimously. But last December, the Treasury decided to end that moratorium. The Department proposed a regulation that will allow hundreds of companies, many employing thousands of workers each to go forward with conversions that will allow for the wear-away of the current benefits of people across the country. This plan is breathtaking in its audacity. In a time when people have lost their life savings to market downturns and corporate duplicity, they are looking at changing the rules so that employers can once again bolster their bottom line by shifting funds from the pensions they promised their workers. I will not stand by and let it happen. There are over 800 age discrimination complaints currently pending before the EEOC based on cash balance conversions. How many more will there be if we again start allowing companies to make these abusive conversions? I want to make it very clear: I am not opposed to all cash balance plans. Some cash balance plans can be very good. What I oppose is the unilateral decision of a company being able to change their plans and stop contributing to older employees' pensions while benefits are given to newer employees. That is what this issue is all about. It is fairness. It is equity. I know discussion of pension law can become very convoluted. But in essence, what some of these companies have been doing to these workers is nothing less than sheer thievery. They are able to save millions, in some cases hundreds of millions of dollars, by converting their plans, robbing workers who have been loyal and hard working, robbing them of their rightful claims on future benefits, It is not right. It is not fair. There is one thing that has distinguished the American workplace from others around the world. We have valued loyalty. At least we used to. That is one of the reasons pension plans exist--the longer you work somewhere, the more you earn in your pension program. Obviously, the longer you work someplace, the better you do your job, the more you learn about it, the more productive you are. We should value that loyalty. If companies are able to wear away the benefits of the longest serving workers, what kind of a signal does that send to the workers? It tells workers they are fools if they are loyal because if you put in 20 to 25 years, the boss can just change the rules of the game, and break their promise. It tells younger workers that it would be crazy to work for a company for a long time, that it's best to hedge your bets and move on as soon as it is convenient. This destroys the kind of work ethic we have come to value and that we know built this country. But some of these cash balance conversions counter all of that. Her is an analogy. Imagine I hire someone for five years with a promise of a $50,000 bonus at the end of five years of service. At the end of three years, however, I renege on the $50,000 bonus. But the employee has three years invested. Had they known that the deal was going to be off, perhaps they would not have gone to work for me. They could have gone to work someplace else for a total higher compensation package. Is that the way we want to treat workers in this country, where the employer has all the cards and employees have none, and employers can make whatever deal they want, but can change the rules at any time? That is why I am introducing this legislation. It is simple. It says that you have to give older, longer serving employees a choice, at retirement, when their pension plan is converted to a cash balance plan to get the benefits earned in the old plan instead. It also says that employers must start counting the new cash balance benefits where the old defined benefit plan left off, instead of starting the cash balance plan at a lower level than an employee had already earned. In the March 3, 2002 issue of Fortune magazine, Janice Revell said of the possible impending flood of cash balances conversions: ``Brace yourself for a very un-fairy-tale ending to this tory. Millions of American workers are sure to see a large slice of their retirement income go up in smoke. It may not happen right away, but the groundwork is being laid right now.'' I urge my colleagues in the Senate to join me in cosponsoring this measure, so that we can stop the flood before it starts.

Mr. HARKIN

Mr. HARKIN. I object.

Mr. HARKIN

Mr. HARKIN. Madam President, I was not in the Chamber prior to the last vote, and there was an objection to having an extra minute so I could make some comments on the vote just held. I thank the Senators for rejecting the McCain amendment for a number of reasons, but most importantly because the biggest item in that proposed amendment was funding to begin to complete the National Animal Disease Laboratory located in Ames, IA. I point out that this National Animal Disease Laboratory is fully authorized, specifically authorized. It has been peer reviewed. The USDA developed all the lands, and it is being built on an expedited basis to get it completed as soon as possible. It is a national animal disease laboratory in Ames. It is not an Ames lab, it is not an Iowa lab. Think about it like NIH. The National Institutes of Health is located in Maryland, but it is not a Maryland facility. It is a national facility. You can look at it like the Centers for Disease Control and Prevention in Atlanta, GA. That is not a Georgia facility; it is a national facility that just happens to be located in Atlanta. The same is true of the National Animal Disease Laboratory. It is a national laboratory that is located in Iowa. I think in speaking of the Centers for Disease Control, we could also think of the National Animal Disease Lab as sort of the animal counterpart to the Centers for Disease Control and Prevention. Just as the Centers for Disease Control and Prevention is there nationally to help prevent or stop any kind of an infectious outbreak that might occur among humans, whether it is anthrax or smallpox or SARS or whatever it is, the job of the CDC is to get in there, contain it, stop it from infecting more people. The National Animal Disease Laboratory has the same function for animals. It is there to prevent, to stop infectious outbreaks among animals, infectious outbreaks that could devastate entire herds or entire populations of animals in this country, as we saw what happened with the mad cow disease in Great Britain. The National Animal Disease Lab would be charged with the responsibility, if there is any kind of bioterrorist outbreak or you had an animal infectious disease that could be transmitted to humans, the National Animal Disease Lab would be there to stop it, contain it, and keep it from spreading. That is why it is so important at this time to make sure we complete the National Animal Disease Lab as soon as possible. I thank my colleagues on both sides of the aisle for their support in defeating the McCain amendment that would have drastically cut back on our ability to get the National Animal Disease Lab completed as expeditiously as possible. I yield the floor and suggest the absence of a quorum.

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

Mr. HARKIN. I ask unanimous consent that the order for the quorum call be dispensed with.

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

Mr. HARKIN

Mr. HARKIN. Mr. President, I am very pleased that the Finance Committee has moved the important provisions of this bill to the Senate floor and I urge that the bill be passed. The current Tax Code does not adequately deal with the special circumstances that some in our military face. One of the most important provisions, in my view, is providing for an above-the-line deduction for overnight travel expenses of National Guard and Reserve members. I have taken a personal interest in a provision included in this measure that provides that descendants of current or former active military personnel may be members of veterans organizations. Without this provision, many local veteran posts which operate food operations will find themselves having to pay unrelated business income taxes as the portion of service to members falls. A large share of the local posts in Iowa are very small operations and this would be a real burden. I introduced legislation in the last Congress and this one which has been included in the bill and I appreciate the inclusion of this provision. Lastly, I want to discuss the inclusion of a provision that will effectively prevent very rich individuals from reducing their taxes by renouncing their U.S. citizenship. I cannot stress too strongly how disgusting I find this group's behavior. Their number is small, but their cost to the Treasury is significant. The Joint Tax Committee has estimated the savings of this provision at $700 million over 10 years. Back in 1996, I became very interested in this issue and introduced legislation on the subject. Senator Monynihan took the lead in the Senate and we passed solid legislation at that time. Unfortunately, the House resisted the provision and successfully proposed a mechanism which has proven to be grossly inadequate. The Joint Tax Committee staff issued an extensive report on this issue earlier this year with considerable cooperation from the GAO and the Treasury. The report found that ``there is little or no enforcement of the special tax and immigration rules applicable to tax-motivated citizenship relinquishment and residency termination.'' It went to say, ``The Joint Committee staff believes that a key reason for inadequate enforcement of the alternative tax regime is the inability to obtain necessary information from individuals.'' With appendices, the report is over 500 pages in length. But it comes down to a simple point: A small number of people continue to evade U.S. income taxes by turning their back on our country because of the weakness of the 1996 provisions. That should stop today. In both this Congress and the last, I introduced legislation with Senator Stabenow to effectively prevent very rich individuals from reducing their taxes by renouncing their U.S. citizenship. It is a companion to a measure introduced by Congressman Charles Rangel in 2002. The Joint Tax Committee now estimates that it saves $700 million. The savings to the Treasury are important and the reality that people are able to save on their fair share of taxes by turning their back on our country is in some ways even more important. I call them Benedict Arnold. Under current law, for 10 years after a U.S. citizen renounces his or her citizenship with a principal purpose of avoiding U.S. taxes, the person is taxed at the rates that would have applied had he or she remained a citizen. In reality, the tax is nominally on a broader based of income and on more types of transactions. In addition, if the expatriate dies within 10 years of the expatriation, more types of assets are included in his or her estate. Unfortunately, the reality is that taxes are very often not paid. Once a person has expatriated and removed U.S. assets from U.S. jurisdictions, as the Joint Tax Committee report notes, it is extremely difficult to enforce the current rules, particularly for an entire decade after the citizenship is renounced. The measure I introduced simply provides that the very act of renouncing one's citizenship triggers the recognition of tax. So, rather than collecting tax every time an asset is sold over the next decade, my bill treats all of the assets of an expatriate as having been sold the day prior to when the person renounces their citizenship. The taxes are due up front rather than over time. In regard to estate taxes, rather than attempting to collect the tax from the estate of an expatriate not in U.S. jurisdiction, my measure taxes the inheritance of an heir who remain in the U.S. in such a way as to remove any tax benefit from the renouncement of citizenship. Revenue of $700 million from these very few former citizens is a significant amount of money that must be made up by loyal Americans in the form of higher debt or taxes that Americans will face. Last year, the Senate passed this measure as a part of the Armed Forces Tax Fairness Act but, unfortunately, the House opposed this provision. I am hopeful that the Senate will strongly resist any effort to weaken these provisions in any way. This is a matter where the Senate should insist that the loopholes be completely closed. It is an area where lobbyists for the Benedict Arnolds should have no success in their efforts to escape their tax obligations.

Mr. HARKIN

Mr. HARKIN. I ask unanimous consent the reading of the amendment be dispensed with.

Mr. HARKIN. Mr. President, I have an amendment at the desk. I ask for its immediate consideration, amendment No. 396.

Mr. HARKIN. I ask unanimous consent that the reading of the amendment be dispensed with.

Mr. HARKIN. Mr. President, what we have is a very unfair system on reimbursement for beneficiaries. Here is a chart that shows the national average is about $5,490 per beneficiary in reimbursement. There are 34 States below that. My State of Iowa is $3,000 per beneficiary per year; New Mexico, $3,700. You can see all these States down here; we pay the same taxes, we pay the same Medicare taxes as every other State, yet Iowa receives $4,300 per beneficiary less than the top State in the Nation. All this amendment does is it provides $25 billion over 10 years to the Finance Committee to bring up these States. It does not take from the States at the top; it only adds to the States at the bottom, and even some of the States at the top will be helped because it helps the rural-urban inequity. So some of the States at the top that have rural areas will actually benefit, but this brings up the bottom States.

Mr. HARKIN. Mr. President, I have an amendment I send to the desk and ask for its immediate consideration.

Mr. HARKIN. Mr. President, what this amendment will do--it does not add any money. It simply restores these programs. It would be $2.2 billion the first year, $24 billion over 10 years, offset by a reduction in the tax cut. All it does is simply restore the programs. I assume some of these will be restored as we go through the process. But if we don't have it in the budget, that means we are going to take it out of title I, we are going to take it out of special education, and other areas. Let's put the money in there now to pay for these programs.

Mr. HARKIN. Mr. President, the budget resolution before us eliminates 46 important education programs, programs such as rural education, dropout prevention, arts education, the Carol M. White Physical Education for Progress, Gifted and Talented, Ready To Learn, the National Writing Project, Parental Assistance Information Centers, a number of them--46 programs that have been broadly supported by both the House and the Senate on the Republican and Democratic sides. These are programs that go to meet certain specific kinds of needs like rural education, where small schools do not have the wherewithal to get in grants. They do not have the economies of scale. They have specific transportation needs.

Mr. HARKIN

Mr. HARKIN. I ask for the yeas and nays.

Mr. HARKIN. Mr. President, my amendment simply holds the size of the tax cut to $350 billion. Any tax cuts beyond $350 billion would have to be offset under my amendment or they would face a budget point of order requiring 60 votes. Many colleagues may say, wait a minute, I thought that was what the underlying amendment does. The underlying amendment still allows for $940 billion in tax cuts in the future. It does reduce down to $350 billion the amount of tax cut under reconciliation, but it still allows for $600 billion more in tax cuts. My amendment says $350 billion, and cap it at that. No more. Any tax breaks beyond that would either have to be offset or it would require 60 votes to overcome a point of order. It is very simple. It is a cap of $350 billion on tax cuts.

Mr. HARKIN. I ask for 1 minute.

Mr. HARKIN. Mr. President, I have a second-degree amendment at the desk.

Mr. HARKIN. Mr. President, this amendment is as phony as a $3 bill. It provides for 2 years of funding for the Individuals with Disabilities Education Act and then you drop off the face of the Earth. And it gets the money from--where? It gets it from nowhere. It is play money. Later on, I will have an amendment that will really fund that. I have been working on an amendment with the Senator from Nebraska that will really put the money in there and get us fully funded for the Individuals with Disabilities Education Act by 2011. It will not be funny money, and it will not fall off the face of the Earth in 2 years like the Gregg amendment. I ask for defeat of this amendment.

Mr. HARKIN. Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.

Mr. HARKIN

Mr. HARKIN. Mr. President, my thoughts and prayers are with Iowa families who have loved ones serving their country in the Middle East. When faced with the difficult and sometimes terrible duty of war, the men and women of our armed services have never let us down. We have the best trained soldiers, the best technology, and the best military commanders in the world. I have full confidence in their performance. My hope is for a swift conclusion and a lasting peace in the entire region. It is also my deep hope that innocent civilians in Iraq and the rest of the Middle East suffer a minimum of harm. I know the views in the country have been divided as to the need for and the wisdom of this war. Right now, we need to support the men and women who are serving this country. This war and the reconstruction work that follows will not be easy and many of our troops may bravely face risks. They are doing their duty and sacrificing for our security. We need to keep them all in our thoughts and prayers and be fully behind them. That is something on which we can all agree. Right now, over 3,200 Iowans are serving: 2,200 in the National Guard, 1,760 are overseas, and over 1,000 in our Reserves here and abroad. We are proud of our Iowa, that Iowans are protecting our homeland. In my home State of Iowa, I know there have been some concerns about our vulnerable areas in this time of Washington. I want Iowans to know I will be working with my fellow Senators to ensure our homeland is protected. As our Governor, Tom Vilsack, said today, it will take the resources of our Federal Government to keep our communities safe. I intend to work to make sure Iowans and all Americans have the protections we need here at home.

Mr. HARKIN

Mr. HARKIN. If I could have 2 minutes.

Mr. HARKIN. I thank my colleague. (The remarks of Mr. Harkin are printed in today's Record in the debate on S. Res. 95.)