Tom Harkin

Mr. HARKIN

Mr. HARKIN. There were no income guidelines. They just gave the money to students to go to college. I point out because it is interesting another little tidbit of history. These students went to college, got out. They made higher incomes--probably the greatest period of productivity, inventiveness, innovations, in our Nation's history and the world's history. The debt in 1945 was 122 percent of our gross national product. By 1981, it had gone down to 33 percent--the lowest point that we had ever had. I think that is because we were riding on the shoulders of those GI's who went to school and got an education and produced this miracle of innovation and inventiveness in America. I think if you look at what has happened since 1981, we have retreated and gone the other way in education. We are making it tougher. As I said, Mr. President, seven times since 1981 we have taken a hit on students, and made them pay more, make it more costly to go to college. What is happening? Our national debt keeps getting bigger and bigger and bigger. I am not saying that is the only cause. There are a lot of other causes. I will say this: Unless and until we invest upfront in education and in higher education and in making sure students can go to college and not be burdened with heavy debts themselves, unless and until we do that, we will never get out of our deficit situation. I do not care what we do around here. You can cut programs, you can cut all the things the Government does, but if our productivity does not stay high, if we do not have the kind of high paying jobs that are going to take us into the next century, forget it. We will not work ourselves out of this debt. Mr. President, I went to college under a direct loan program, as I said. I went up to the window, got a direct loan. I did not have to pay it back for about 9 years. I had the GI bill when I went to law school. I still had the GI bill available to go to law school. I did not have to pay it back. They just gave me money to go to school. Well, I think it is time we learned from that. All I can say is I understand that the Speaker of the House also went to school under that kind of a program. All I can say, if it was good enough for the Speaker of the House, it ought to be good enough for students today. It was good enough for me, it ought to be good enough for students today, too. Here is what is happening in Iowa with the student debt. Right now, this is a percentage of financial aid dollars awarded as loans out of the total financial aid grants and everything, percent as loans. Here at the University of Northern Iowa, at the top, it has gone from slightly over 40 percent to almost 60 percent. This is a regent school, not a private college. Here is Iowa State, which went from about 34 percent to 48 percent, my alma mater. That is from 1991 to 1995, not a long period of time, 3 to 4 years. Here is the University of Iowa, which went from about 28 percent to about 38 percent--again in the last 4 years. So what has happened is that students are taking on bigger and bigger debt loads, all the time making it tougher for them to pay it back. Now, it has another impact. Right now, indebtedness for a student graduating from the University of Iowa last spring is about $11,278; from Iowa State, $14,900; the University of Northern Iowa, $14,681. On average they pay about $170 per month for student loans. You say that does not sound like much. Sure it does. You know what a starting salary for a secondary schoolteacher in Iowa is? About $18,000 a year. That $170 a month they are paying they could be using to buy a home, maybe even to buy a new car, to maybe get their lives going and start building our economy. But no, they be will saddled with more and more debt to pay for their education. Grant aid has declined at our three universities in Iowa. It was 30 percent in 1990, and now is down to 25 percent. Instead of creating more debt per student, why not go after the deadbeats who owe about $50 billion to the U.S. taxpayers in nontax debt? There is a lot of debt out there that people owe the Federal Government. I am not just talking students but a lot of people. We ought to go after those rather than hitting the students. Finally, I just wanted to bring this to an end and close my remarks by showing what it means for an individual. The average loan on a per- student basis at the University of Northern Iowa, our smallest regent school in the State of Iowa, the average loan indebtedness, in 1992 was $2,589. Now it is $4,395 per student basis. When they graduate, the indebtedness will be $14,641. But this is the average debt per student, per year at the University of Northern Iowa; not quite doubled, but pretty darned close to doubling in just the last 4 years. So, yes, the debt of the United States is bad. We have to reduce our deficit and our total debt. We do want to reach a balanced budget. But the way the GOP is going about it with their reconciliation bill, especially how they are hitting students, is going to cause more debt in our country, less productivity, less ability for us to raise our gross national product and get out of this debt. It is almost as if the proponents of our reconciliation bill with all of the cuts they have, taking away the direct loans for students--it is almost like, ``We are in debt, so let's go to debtors prison.'' That is not the answer. The answer is to provide our people in this country with the wherewithal to earn more, make more, climb that ladder of opportunity and success, pay more when they earn more so more revenue comes into the Government, so we are able to make better products and sell better products and compete around the world. That is the way. That is the way out of the mess we are in. This GOP proposal, I must say in all frankness, is a ``stick your head in the sand'' approach to the deficit problems we have in America. The Senator from Illinois has it exactly right. By keeping our commitment to direct student loans, we are [[Page S 15199]] saving a bundle of money. We are making it easier for students to go to college. Beyond that, we have to do whatever we can, I believe, to point out the hidden taxes in the GOP proposal: The taxes on students, the taxes on their parents, and the taxes on the schools. This is a direct hit at education in this country. All for what reason? To reduce the deficit? No. To pay for a big tax break that might amount to about a dollar a day, about a dollar a day for people in upper-income brackets. What a foolish waste of money. If we want to use our money wisely, put it into education. I thank the Senator from Illinois for yielding me this time.

Mr. HARKIN. I thank the Senator from Illinois for pointing that out. That is a good lesson in history. I was unaware of that. What the Senator said, if you took the GI bill, what they gave as a grant to those students to go to college, in today's dollars, it would be $9,400--a grant to go to college. I do not know of any grant program around that is anywhere near that. Pell grants are down to about $2,000, if I am not mistaken.

Mr. HARKIN. Mr. President, I thank Senator Simon for his statement. I want to also thank him for being a great leader on direct lending all these years and especially the statement just made this morning. I might differ one little bit from my friend and colleague from Illinois. I happened to have gone to college in the late fifties, and I remember a program came in under the Eisenhower administration. I did not have it my first couple years of college, but I had it in my last years of college, the National Defense Student Loan Program, a direct lending program. You went to the window and got your money. I always thought it was a great program for a lot of reasons: You got your money right there. There was not a lot of hassle. It was right there at the school. And then when you got out of college, well, if you went in the military, you did not have to pay anything. No interest accrued on the loan during the time you were in college. If you went in the military, no interest accrued during that time or if you went on to school after that. I am quite frank to admit that after college, I spent 5 years in the military and then 3 years in law school. I had a year's grace period after that. So no interest accrued for almost 9 years from the time I graduated from college. For someone like me whose parents had no income at all--my father was on Social Security when I started college, very modest Social Security, we had no assets whatsoever--it was a godsend. So I always thought it was a great program. Then we went to the guaranteed student loan program. Maybe it did work all right for a period of time. But, the banks, frankly, made a lot of money on that. Fine, good, that's their business. But why should we continue doing business as usual when we have a better way of doing it, and the better way of doing it is the direct lending program. The Senator from Illinois started his comments by saying about how the long lines have dwindled. I always say one picture is worth a thousand words. This is at the University of Northern Iowa, one of our regent schools in Iowa. This is a picture last year before we had direct lending. This is the line for students to get their guaranteed student loans and get it processed. These are all the students that are having problems with their loans. I was told the picture does not do it justice, because if you look back to the doorway, the line goes on down the hall. But you get the idea. There is a line of students waiting to get their guaranteed student loans. That was last year. They have now instituted direct lending. Here is the same picture, same place, same financial aid office. No lines at all. No one waiting in line, and that has been the story at all of the schools in Iowa that have used direct lending. We have 38 Iowa schools right now. What I have heard from all of them is just positive comments about how the direct lending program is working. No lines, no hassle, students get their loans, and they are able to get about their business of studying. Earlier the Senator from New Mexico was on the floor talking about the budget. We do have to bring our deficit down. No one is arguing about that. The Senator from Illinois has been a leader in the effort to reach a balanced budget and to get us moving toward a [[Page S 15197]] balanced budget. That is not the debate here. The debate is how we get there, out of whose hide do we take it? Who pays the most? Who sacrifices the most? That is the debate. I am sorry I have to disagree with my friend from New Mexico. He makes it seem as though the debate is whether or not we are going to have a balanced budget. That is not the debate. We all agree on the need to bring down the deficit. The debate is how, who pays, and what is the end result if one group pays more than the other. I daresay that if we are going to take it out of the hides of our students, if we are going to make it tougher on middle-income and below-middle-income students to get a college education, then I daresay that our deficit will not come down, it will probably grow in the future. To get out of the debt we are in, we are going to need the best work force possible, the most motivated, and you are not going to get out of our debt situation, you are not going to lower our national debt by increasing the debt of students in college. The Senator from Illinois--and, again, I commend him--has been a leader in this effort. I might also add, Mr. President, that Iowa State University, my alma mater, was one of the first 104 schools to participate in direct lending. Last spring, Earl Dowling, the financial aid director, testified at an oversight hearing on direct lending. He told the committee that ISU is running a larger loan program with fewer staff. That is not a bad deal. He has been involved in the administration and management of student financial aid programs for 23 years and said, ``Direct lending is the first new program in those 23 years that was such a definite improvement over its predecessor.'' The financial aid director for the University of Northern Iowa, Roland Carrillo, said that direct lending has been a ``resounding success.'' He said, ``* * * there is no question that direct lending is the most efficient method of delivering financial aid dollars to students.'' As the Senator from Illinois pointed out, in the collection of those loans later on, we pay less money under the direct loan program by putting out for competitive bids than we did under the old program. So, again, Mr. President, the direct lending program has worked. It is working well. The last thing we need to do is throw that overboard, in some kind of mistaken idea that somehow this is going to help reduce the deficit. Absolutely not. It is going to do just the opposite. I want to take most of my time, Mr. President, to talk about taxes and about the taxes that are being levied by the GOP's proposal that will be before us here in the so-called budget resolution. There is going to be a lot of talk about cutting taxes. I understand there is a big tax break in that bill. But what is not going to be talked about, and what I want to talk about, are the hidden taxes that are included in that reconciliation bill that will be before us. As I said--and I will keep repeating the argument--the debate is not about reducing the deficit. It is, who pays and how much do they pay, and does it reach a good result in the end? It will be middle-class working families already pinched that will be asked to pay these new hidden taxes, stealth taxes. Most Americans will get less, but pay more, so that a few people on the top can get a tax break. People ask me, Mr. President, to describe what is going on in Washington these days and I say it is not easy to explain it. When ideology gets ahead of common sense, when I see the agenda of these extremists, I have to say they have turned the Nike add slogan on its head. You know, the ad that says, ``just do it.'' I think the new motto for the GOP ought to be, ``just undo it.'' Do not analyze, do not question, do not even have hearings, just undo it. Undo laws that give our seniors quality health care. Undo laws to protect workers on the job, and undo our Nation's commitment to quality education. The GOP says provide more tax breaks for the wealthiest. Pump billions more into the Pentagon--$7 billion more than they asked for. Put education on the chopping block. To that, I say: We have been there, we have done that. We tried that in the 1980's, and it dug us into the biggest debt hole our Nation has ever been in. Let us use some common sense and cut down the spending for the Pentagon. Let us cut the waste, fraud, and abuse. Let us cut the tax breaks. We do not need tax breaks now. I figured it out. It would be maybe a dollar a day, at the most, to people in the upper income brackets. I do not know what they are going to do with that--maybe buy another Big Mac and a Coke. You cannot even get that for a buck anymore. Maybe you can get a giant Coke. In downtown Washington, maybe you can get a cup of coffee. Maybe it will buy an extra cup of coffee a day. That means if we are going to have those tax breaks, we are going to have these hidden taxes on student loans. The budget proposal cuts about $11 billion from student loans. This will result in increased student debt, a new direct tax on schools, elimination of the successful direct lending program, about which Senator Simon spoke. The GOP plan adds an extra $700 to $2,500 of debt per student. How? By eliminating the interest subsidy during the 6- month grace period. People say, well, that is not a big deal, 6 months. Well, it is a big deal. When you are out of school and trying to find a job and jobs are hard to find, and maybe you want to get married and start raising a family, you bet it is a big deal. Well, you say maybe it is a little bit of a hit. This is the seventh time, Mr. President, since 1981, we have increased the cost of student loan programs. It is always just a little bit, a little bit, and a little bit, until finally the straw breaks the camel's back. That is what is happening here. Not only is it more than just a little bit, what is worse about it is that the lower income the student, the higher their debt load. Why? Well, the poorer student borrows the most money, so they have the most debt. They get out of school and have to start paying interest during the grace period, and they have to start paying more money right away than higher income students. What kind of sense does that make? Well, also, the GOP plan adds up to $5,000 in additional costs for families who use the PLUS loan by raising interest rates, and a new Federal tax of 0.85 percent on colleges and universities participating. Well, they say that is not much. But it is a lot when you look at a college in my State of Iowa. Where are these colleges going to get it? They have to pass it on to students. The plan will also force at least half of the schools participating in the direct student loan program out by rolling back the successful program. So we are going to hear a lot about tax breaks. How about the taxes that are in the GOP plan? Taxes on students, taxes on their families, taxes on the schools. All of it added together--you can say, this is a little bit here and here. But you add it all up, and it is a direct assault on higher education, a direct assault on middle and lower- income students having the ability to go to college, and to get ahead and to work and be productive members of society and help us reduce the deficit in our country. Mr. President, I heard a comment a week or so ago in the committee about how students are going to have to sacrifice, too, because we have this big debt and we have to reduce the debt. As I said, we all want to reduce the debt. I think we ought to think about this and look at history a little bit. I know the occupant of the Chair heard me say this because he was in the committee when I said it. I will say it again because it needs repeating and repeating and repeating. Right now, our debt to gross national product is somewhere in the neighborhood of 70 to 75 percent. That is bad. I am not saying that is good. That is bad. It ought to be reduced. As our gross national product goes up, we have to start reducing that debt so that gap widens. Well, we had another period of time when our debt to gross national product was bad. That was after World War II. Our debt was actually greater than our gross national product. Now, did President Truman and the Congress stick their heads in the sand and say, oh, my gosh, our debt is more than our gross national product, so we cannot afford student loans, to send kids to college? No. What they recognized was that the best way out of the debt situation was to send kids to school. So President Truman and the Congress passed the GI bill. [[Page S 15198]] Now, I just might point out, in 1945 our debt was 122 percent of our gross national product. This year it is estimated to be 69.9 percent. I was close, 70 percent. What happened, in 1945, our debt was 122 percent of gross national product. They passed the GI bill. Mr. President, this was not even a loan. They gave the money to them. They built housing all over America, sent the kids to school, and did not ask them to pay back a cent. Did they pay us back? You bet they did.

Mr. HARKIN. I am happy to yield to the Senator.

Mr. HARKIN. It does not make sense.

Mr. HARKIN

Mr. HARKIN. Mr. President, I ask that further proceedings under the quorum call be dispensed with.

Mr. HARKIN

Mr. HARKIN. Mr. President, I could not believe my eyes this morning when I opened up the front page of the newspaper. And here is the headline, Mr. President: ``Gingrich places low priority on Medicare crooks, defends cutting anti-fraud defenses.'' Well, what is this all about, Mr. President? Well, what it is about is the House bill, the House bill on Medicare reform, which I think ought to be titled, ``The Scam Artist Protection Act.'' But, Mr. President, do not take my word for it. Here is a letter dated September 29 from the inspector general's office of the Department of Health and Human Services. It says: However, if enacted, certain major provisions of H.R. 2389-- The House bill. would cripple the efforts of law enforcement agencies to control health care fraud and abuse in the Medicare program and to bring wrongdoers to justice. ``Would cripple their efforts.'' And so the Speaker yesterday says, ``It is all right. No big deal.'' He said that it is more important to lock up murderers and rapists than dishonest doctors. Well, it is important to lock up murderers and rapists. You bet it is. But what does that have to do with Medicare fraud? Talk about using a logic that just about takes all right there. But even more astounding is this quote attributed to the Speaker. When he was pressed on it, he said that they might be willing to negotiate on it. He said--this is a quote attributed to the Speaker-- ``We can be talked out of it if there is enough public pressure.'' I will repeat that: We can be talked out of it if there is enough public pressure. Talked out of what? Talked out of easing the antifraud measures that we now have in the law? I think in that statement is a tacit acknowledgment by the Speaker that they are, indeed, opening the doors to more fraud and abuse in Medicare. But he said if there is enough public pressure, we can change it. If we can slip it through in the dark of night, if we can do it behind closed doors, if we can ram it through in a hurry and the public does not know about it, we will do it. But if the public finds out about it and they put pressure on us, well then, we will change it. Mr. President, I am here to start putting pressure on us. The public ought to put pressure on us, because what has been happening in Medicare is billions of dollars in proportion. The ripoffs, the fraud, the waste and abuse is ongoing and getting worse instead of better, [[Page S 15158]] and the few minimal laws that we have that permit the inspector general's office to go after the crooks in Medicare are now being weakened in the House bill and the inspector general said so. She said it would cripple the efforts of law enforcement agencies to control health care fraud and abuse. Mr. President, I ask unanimous consent to have printed in the Record a letter dated September 29 from the inspector general's office outlining the provisions in the House bill that would, indeed, cripple their efforts.

Mr. HARKIN. Mr. President, over the last several years when I was Chair of the Subcommittee on Appropriations that funded HCFA and Medicare, we held a series of hearings, and I requested GAO to do a number of studies on waste, fraud, and abuse in the Medicare system. What we have uncovered is mind boggling: HCFA paying for 240 yards of tape per person per day--Medicare paying that. Medicare paying over some $200 for a blood glucose tester that you can buy down at Kmart for $49.99. Medicare is paying thousands of dollars for devices that only cost $100. Foam cushions that cost about $50 that Medicare is paying $880 each for. The list goes on and on and on, and we know it is happening out there. We know how medical suppliers are scamming the system, double billing going on. We have documentation. GAO has documented this in the past. Last year, I asked the GAO to do a study just on medical supplies-- just on medical supplies. They started their study in about May or June 1994, and the study was completed in August of this year. They issued their report. GAO went to Medicare and said, ``We want to take a representative sample of bills that you have paid for medical supplies.'' You have to understand, Mr. President, that when Medicare pays a bill for medical supplies, they do not even know what they are paying for, because all of the supplies are put under one code, 270. So Medicare pays a bill, code 270, medical supplies, $20,000. They have no idea what is in there, because they do not require it to be itemized. Imagine that. So GAO went to Medicare, got a representative sample, went behind the code to the suppliers, to the nursing homes, to the hospitals and said, ``OK, we want the itemized account.'' Guess what they found? Now this will knock your socks off. They found that that 89 percent--89 percent--of the claims should have been totally or partially denied; 61 percent of the money spent should never have been paid out--61 percent. Then you ask the question: How much did Medicare pay last year for medical supplies? The answer, $6.8 billion. If you can extrapolate from this sample and say that 61 percent of that money should not have been paid out, you are talking about $4 billion--$4 billion. Maybe we cannot get it all, but could we get $3 billion? I bet we could. How about even $2 billion? We ought to be able to save that. Multiply that over 7 years, which is what we are talking about here, and you can see that is a pretty good chunk of money. And that is just medical supplies, that is just tape and bandages, things like that. We are not even talking about durable medical equipment. We are not talking about the double billing that goes on. That is just one, just medical supplies. It does not include oxygen, and it does not include ambulances, orthotic devices. It does not include durable medical equipment. It is just the bandages, $6.8 billion, and 61 percent should not have been paid. A lot of this is fraud. A lot of it comes about because scam artists know that they can game the system. Why would they do that? Are there not enough penalties? Would they not be afraid of getting caught? The fact is that in 24 States, the inspector general's office does not even have a presence. They are not even in 24 States. Right now, Medicare reviews about 5 percent of the claims. So if you want to scam the system, you want to put in fraudulent claims, your chances are 5 percent that you are even going to be reviewed, and out of the reviews, they may or may not do something based upon that. If you are in one of the 24 States where there is not an inspector general operating, the sky is the limit. That is why fraud is so rampant in the Medicare system today. What the Speaker says is that is fine, that is a low priority. We do have some antifraud legislation on the books, as inadequate as it is right now. The House bill weakens it even further, and the Speaker says that is fine, but he says if the public catches on to it and they put on enough pressure, maybe we will change it. I hope the public does put on the pressure, because we do have to change it. The House will say, well, they put more money into the IG's office, they put $100 million into the inspector general's office. So you give more money into the inspector general, then you put the handcuffs on it by making it so they cannot prove fraud. That is exactly what they have done. Mr. President, we have to not put waste, fraud, and abuse in the back seat, we ought to put it in the front seat. We have to attack that. I do not think it is right, I do not think it is fair for this Congress, for the Speaker of the House to say, ``OK, we're going to double your premiums for the elderly, we're going to double your deductibles, but we're going to let the crooks go, we're not going to crack down on them.'' Oh, yeah, from what I read, they are going to let the doctors off, too. They are not going to have to belly up to the bar. One other item before I finish on fraud. I have another report from the inspector general's office issued just this month in October. Here is what they found: 13 percent of nursing homes have been offered inducements in exchange for allowing suppliers to provide products to patients in their facilities; 17 percent of nursing homes with Medicare-reimbursed products have been offered these inducements. The inducements range from free trial products to cameras, blenders, and diamond rings. Fraud, and yet the Speaker says it is too tough the way it is, we have to make it even less tough. We have to ease up. One other thing, Mr. President, that has disturbed me, came to my attention in the last 24 hours. It has to do with the block granting of Medicaid to the States. The Finance Committee--the Senate Finance Committee, of which I am not a member, but I follow closely what it has done--adopted an amendment offered by a Republican, Senator Chafee, that says, OK, if you block grant it to the States, [[Page S 15161]] we still want to have some guarantees. What do we want to guarantee? We want to guarantee that pregnant women who fall under the poverty line get medical help under Medicaid; we want to guarantee that all children under the age of 12 get Medicaid medical help; we want to guarantee that all disabled continue to get medical help, as they are today. Plus, they want to guarantee that we continue the provisions in law that provide that a spouse does not have to spend all of his or her money down to nothing and give up their income before Medicaid will start paying for their spouse's long-term care in a nursing home. It is called the spousal impoverishment provision. It says you cannot impoverish a spouse simply because his or her husband or wife is in a nursing home. What does it say? It says basically that, minimum, a spouse can keep, I think, a little over $14,000 in assets and can make a little over $1,200 a month. Now, in my view, if a couple saved up all of their lives and they have $50,000 in the bank, and one spouse gets Alzheimer's and cannot be cared for and has to go to a nursing home and the other spouse has to spend that $50,000 until they get to $14,000 and then Medicaid will kick in and start paying, that $14,000 is not a lot of money to have in the bank for a rainy day when you are getting old. So these provisions were left in the Senate-passed Finance Committee bill. It passed, as I understand, by a vote of 17 to 3. I picked up this publication, the National Journal of Congress, dated Friday, October 13, this morning. Here is what it says: ``Thursday, Senator Jay Rockefeller said GOP leaders were trying to undo a compromise that preserved the disabled's right to Medicaid,'' the Associated Press reported. Rockefeller and Senator John Chafee won a 17 to 3 Finance panel vote to keep the Medicaid entitlement for poor children and pregnant women, as well as the disabled. But GOP Governors have protested overly prescriptive and onerous provisions in the bill. Roth said Thursday evening, ``It is a matter that is still open.'' The AP said, ``Sheila Burke, Dole's Chief of Staff, told reporters, ``The disabled will not be an entitlement.'' Chafee and six other moderates wrote Dole, asking him to ``stand fast in your support for at least a minimal level of support provided to our Nation's most vulnerable populations.'' Mr. President, I hope this is not true. I hope this is not true that now the Republicans on the Senate Finance Committee are going to throw out the disabled in our country, that they are going to say, OK, all right, we will keep pregnant women in and children up to age 12, but the disabled, you are out the door, you are not entitled to be covered, we are not going to guarantee you coverage--the most vulnerable of our population, those who are disabled. Mr. President, here is another thing I cannot believe. We got a letter the other day, sent to Senator Dole on October 6, signed by 24 Republican Governors, saying that they wanted the block granting of the Medicaid bill. They supported that, but they said there are some things they do not like. I will read this from the letter of 24 Republican Governors: The bill includes a number of overly prescriptive and onerous provisions that will mitigate against the States' ability to implement reforms. What are those onerous provisions? They are that the Senate Finance Committee, by a vote of 17 to 3, on a bipartisan basis, said you have to cover pregnant women who fall under the poverty line with medical care, you have to provide for children to age 12 who are in poverty, you have to cover the disabled, and you have to have provide against espousal impoverishment. The Republican Governors said that is onerous. I have to ask this, Mr. President. These Governors have said, ``Turn Medicaid over to the States. We will take care of it better than the Federal Government can take care of it.'' What makes you think that these Republican Governors do not care for the disabled, poor, and the women as much as Congress? Well, they cannot have it both ways. If these Republican Governors say they do not want these provisions in there that mandate that they continue to cover the disabled, then are they then saying they want to have the freedom to throw the disabled out? If the Republican Governors are saying they do not want the provision in there that says we will ensure against spousal impoverishment, are they then saying that they, the Republican Governors, are willing to throw that out? Well, if they are not saying that and if the Republican Governors are saying, oh, no, no, no, no, we will make sure we keep provisions against spousal impoverishment, we will cover the disabled, pregnant women, and the children, why do they care if it is in there? You cannot have it both ways. These Republican Governors have shown their hand. If we turn Medicaid over to the States without these provisions, they are going to go cut the disabled, pregnant women, children, and cut back on the provisions against spousal impoverishment. It is right here in this letter, signed by 24 Republican Governors. So I think it is becoming clearer as the days roll by, Mr. President, that on the Medicare side, the Speaker and the GOP are turning a blind eye to the concerns of seniors. But they are giving a wink and a nod to the Medicare crooks. When it comes to Medicare, Mr. Gingrich and his allies are willing to tell the seniors they have to pay more, double their premiums, double their deductibles. They want to take $270 billion out of Medicare and use it for a tax cut for some of the most privileged in our society. Yet, they are not willing to crack down on those that are scamming the system, bilking the system of billions of dollars a year. Oh, no, we do not want to do that. Well, I think the public ought to know about it. I think the public is becoming aware of it, Mr. President. I think the public is now beginning to wake up to the fact that we do not need to cut $270 billion out of Medicare. The head of Medicare said that maybe $90 billion would get us through the next 10 years; $90 billion would provide for the security of the Medicare system through 2006. Think about that. GAO said that 10 percent of Medicare goes for waste, fraud, and abuse. That is about $18 billion a year. Well, $18 billion a year for 7 years is $126 billion, which, over the next 7 years, will go for waste, fraud, and abuse. If we cannot get all the $126 billion, can we get $90 billion of it? We might be able to squeeze enough out of waste, fraud, and abuse to ensure the viability of Medicare at least for the next 10 years. But, no, Republicans say, though, they want $270 billion out of Medicare. Sock it to the seniors, make them pay double for premiums, double for deductibles, and then they will take that money and give a $245 billion tax cut for the most privileged in our society. Not fair, not right. I think the people and the public are beginning to understand that. Now, on the Medicaid side, $187 billion of cuts in Medicaid and then block granted to the States. I think the Senate Finance Committee cast a conscientious vote last week when they said, ``Look, we will block grant to the States but we want to make sure that we cover all pregnant women who are eligible for Medicaid, all children who are eligible for Medicaid, and the disabled.'' Now, I understand that they are willing to throw out the disabled. That is unconscionable--unconscionable that some would be willing to throw out the disabled to say that, ``No, we are not going to cover you. You just go plead your case in the States. Go to the Governors.'' Well, the Governors told us what they wanted to do in their letter. They found those provisions onerous. Mr. President, it is becoming clearer, in Medicare it is the seniors who get hit. In Medicaid, it is the poor. Here it is right here in contrast, Wednesday, October 11, the Washington Post. Here it is. This is it, right here. Two stories, side by side, that tell it all. On the right hand side, it says: ``Leaders Pledge Full Tax Cut By Senate GOP.'' Full $245 billion tax cut. ``Leaders Pledge Full Tax Cut By Senate GOP.'' The story right next to it: ``Working Poor May Pay the High Price for Reform.'' There you go. It cannot be said any better than that. In Medicare, the disabled, if you are disabled, forget it. You will not have any protections. We throw you out. Well, I hope that is a wrong report. I hope everything I have said here today will prove not to be so. I hope that the Senate Finance Committee will not jettison the most vulnerable in our society, the disabled. If they do, if that is what comes here to the Senate floor, [[Page S 15162]] that we have a Medicaid bill--I do not care how it is wrapped up. If it is wrapped up in reconciliation, as you know, we cannot filibuster that under the rules. But if they jettison the disabled, I hope and trust that President Clinton will veto that the second it lands on his desk and say to this country that we are not going to make the most vulnerable in our society, those who have disabilities, pay for the $245 billion tax cut for the most privileged in our society. I yield the floor. Mr. President, I ask unanimous consent that the article be printed in the Record.

Mr. HARKIN. Mr. President, I ask unanimous consent that the letter be printed in the Record.

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

Mr. HARKIN

Mr. HARKIN. Mr. President, on September 13, 1994, after 6 years of gridlock, President Clinton signed the toughest, smartest crime bill in American history. Rejecting the stale political debates that doomed earlier efforts, the Violent Crime Control Act [VCCA] offers a balanced approach to fighting crime--one that combines policing, prevention, and punishment. In 1 year, the VCCA has made a difference. More police are on the beat. ``Three strikes and you're out'' is the law of the land. Interstate domestic violence, stalking and harassing are Federal offenses. Assault weapons can no longer be manufactured. States and cities have more resources to build boot camps. Law enforcement agencies across America have greater tools to implement drug courts, upgrade criminal record histories, and incarcerate violent offenders and keep them off the streets. If we keep the promises we made to the American people 1 year ago when the Crime Act was passed, we will continue to have more police on the streets, more prisons to lock up violent offenders, and fewer neighborhoods where the streets remain empty and doors stay shut. But just as new evidence indicates that violent crime among teenagers and young adults is skyrocketing, this Congress seems ready to break those promises. Unless we act now to stop young people from choosing a life of crime, the beginning of the 21st century could bring levels of violent crime to our communities that far exceed what we now experience. The programs created by the 1994 Crime Act are a critically important component in halting the advance of violence and crime. We need to ask at this critical junction: Will we build on the progress in the fight against crime, or will we let the ground we have gained slip away? The crime control priorities funded in the fiscal year 1996 Commerce, State, Justice appropriations bill offer the Nation a very mixed message in answer to this question. Token programs are saved, but the majority of proven and effective crime prevention efforts are slashed or eliminated then tossed into a block grant with vague promises of being able to achieve similar levels of crime prevention. This structure of priorities seems almost hypocritical for a Congress that is bent on reducing spending by eliminating waste in inefficiency. I share that goal, which is why I believe that crime prevention pays. Crime control costs the American people approximately $90 billion a year. Only a small amount of funding on crime prevention goes a long way in reducing incidences of crime and the costs of crime on our society. On a positive note, the Edward Byrne Memorial State and Local Law Enforcement Assistance Program thankfully survived the slash-and-block attacks on crime control. Law enforcement officials have told me of the success they have had as a result of these funds. Drug enforcement task forces, improved law enforcement technology, the DARE Program, domestic violence intervention and countless other valuable antidrug and anticrime efforts have been possible, in part, through funding available under the Byrne Program. I quote from an officer on the front line in my home State of Iowa, ``The assistance we have received by way of the Edward Byrne grants has been the key to our approach in fighting drug violators.'' On the other hand, the Office of Community Oriented Policing Services [COPS], the cornerstone of the first year of crime fighting efforts, was eliminated by the committee. Under this funding bill that came to the floor, services provided by the COPS Program would have been forced to compete for scare resources with other crime prevention programs such as programs for delinquent and at-risk youth, gang resistance programs and many other community and school-based initiatives to keep kids from turning to a life of crime. The end result of course, would be less money for all crime prevention efforts. Perhaps the most tragic aspect of the proposal to eliminate the COPS Program is the loss of local control. Proponents traditionally argue that block grants increase local control. The crime prevention block grant proposed in the Commerce, State, Justice funding bill does no such thing. This initiative replaces a highly successful program that responds to public desire for an increased police presence with a program that merely gives money to State governments that may keep up to 15 percent before distributing the remainder to local governments. Allowed uses for the funding are expanded to include not just additional funding for more cops on the beat, but also for procurement of equipment and prosecution. This is a significant departure from the COPS Program which funneled the funding directly to the local law enforcement agencies. The COPS Program was created as a Federal-local law enforcement partnership, providing grants to local law enforcement agencies to hire 100,000 new officers. With community policing as its base, the program encourages the development of police-citizen cooperation to control crime, maintain order and improve the quality of life in America. In less than 12 months, this program is ahead of schedule and on target in funding one quarter of the 100,000 cops promised to the American people. As a block grant under the Commerce, State, Justice bill there would be no requirement that even one officer is hired. The block grant approach to crime prevention invites the abuse of funds the COPS Program was created to eliminate, as well as doing away with effective crime prevention programs that worked hand in hand with community policing initiatives set up under the COPS Program. The priorities delineated in the committee bill were misplaced, creating an ineffective response to our Nation's war against crime and a sad departure from the successful efforts started under the 1994 Violent Crime Control Act. I am happy that the COPS Program was restored during floor consideration and would urge my colleagues to continue their support for crime prevention efforts throughout the budget process.

Mr. HARKIN

Mr. HARKIN. Mr. President, as ranking member of the Subcommittee on Disability Policy, I would like to take a few minutes to discuss the applicability of S. 143, the Work Force Development Act, to individuals with disabilities. I would like to compliment Senator Kassebaum, the sponsor of the legislation and chair of the Committee on Labor and Human Resources, and Senator Frist, the chair of the Subcommittee on Disability Policy, for including specific provisions in S. 143 that will enhance our Nation's ability to address the employment-related needs of individuals with disabilities, including individuals with significant disabilities. I am particularly pleased that these provisions were developed on a bipartisan basis and enjoy the broad-based support of the disability community. On January 10, 1995, the Labor Committee heard testimony from Tony Young, on behalf of the employment and training task force of the Consortium for Citizens With Disabilities. CCD urged the Senate to recognize the positive advances made in the 1992 amendments to the Rehabilitation Act of 1973 and to take a two-pronged approach to addressing the needs of individuals with disabilities in our jobs consolidation legislation. I am pleased that the Senate bill adopted this two-pronged approach. Under prong one, S. 143 guarantees individuals with disabilities meaningful and effective access to the core services and optional services that are made available to nondisabled individuals in generic work force employment activities and to work force education activities described in the legislation, consistent with nondiscrimination provisions set out in section 106(f)(7) of the legislation, section 504 of the Rehabilitation Act of 1973, and title II of the Americans With Disabilities Act. The commitment to ensuring meaningful and effective access to generic services for individuals with disabilities is critical. Advocates for individuals with disabilities have often expressed concern that many current generic job training programs such as JTPA have not met the needs of individuals with disabilities. Ensuring access to generic services is critical for many people with disabilities who can benefit from such services. The promise of access to generic services is also illustrated through other provisions in S. 143. The purposes of the bill--(section 2(b))-- include creating coherent, integrated statewide work force development systems designed to develop more fully the academic, occupational, and literacy skills of all segments of the population and ensuring that all segments of the work force will obtain the skills necessary to earn wages sufficient to maintain the highest quality of living in the world. The content of the State plan set out in section 104(c) of S. 143 must include information describing how the State will identify the current and future work force development needs of all segments of the population of the State. The term all is intended to include individuals with disabilities. The accountability provisions in S. 143--(section 121(c)(4)--specify that States must develop quantifiable benchmarks to measure progress toward meeting State goals for specified populations, including at a minimum, individuals with disabilities. Under S. 143, State vocational rehabilitation agencies must be involved in the planning and implementation of the generic system. For example, under section 104(d) of S. 143, the part of the State plan related to the strategic plan must describe how the State agency officials responsible for vocational rehabilitation collaborated in the development of the strategic plan. Under section 105(a) of S. 143, the work force development boards must include a representative from the State agency responsible for vocational rehabilitation and under section 118 of S. 143, local work force development boards must include one or more individuals with disabilities or their representatives. Under prong two the current program of one-stop shopping for persons with disabilities, particularly those with severe disabilities, established under title I of the Rehabilitation Act of 1973, as amended most recently in 1992, is retained, strengthened, and made an integral component of the statewide work force development system. The current vocational rehabilitation system has helped millions of individuals with disabilities over the past 75 years to achieve employment. Since the 1992 amendments, the number of individuals assisted in achieving employment each year has increased steadily. In fiscal year 1994, 203,035 individuals achieved employment, up 5.8 percent from fiscal year 1992, the year just prior to the passage of the amendments. Data for the first three quarters of fiscal year 1995 show a 8.4 percent increase in the number of individuals achieving employment as compared to the first three quarters for fiscal year 1994. In fiscal year 1993, 85.7 percent of the individuals achieving employment through vocational rehabilitation were either competitively employed or self-employed. Seventy-seven percent of individuals who achieved employment as a result of the vocational rehabilitation program report that their own income is the primary source of support rather than depending on entitlement or family members. The percent of persons with earned income of any kind increased from 21 percent at application to 90 percent at closure. The gain in the average hourly wage rate from application to the achievement of an employment outcome was $4.36 per person. Of the individuals achieving employment in fiscal year 1993, their mean weekly earnings at the time of their application to the program was $32.20, compared to $204.10 at closure, an average weekly increase of $164.90. In 1993, the General Accounting Office [GAO] found that an individual who completed a vocational rehabilitation program was significantly more likely than an individual who did not complete the program of working for wages 5 years after exiting the program. In addition, the GAO found that individuals who achieved an employment outcome demonstrated four times the gain in wages compared to the other groups studied. I am also pleased to share with my colleagues the positive impact that vocational rehabilitation is having in my home State of Iowa. During fiscal year 1993-94, 5,717 Iowans with disabilities were rehabilitated through the Division of Vocational Rehabilitation Services [DVRS]. At referral to DVRS, 33 percent have weekly earnings; at closure the rate went to 98 percent. Average weekly earnings rose from $49.94 at referral to $229.45 at closure. In addition, the Iowa Department for the Blind provided 765 blind persons with vocational rehabilitation services. At closure the average weekly income was $352.00. Seventy-three percent of those rehabilitated found work in the competitive labor market, including work in occupations such as psychologist, tax accountant, teacher, food service, and radio repair. Mr. President, as I explained previously in my remarks, under S. 143, title I of the Rehabilitation Act, as amended most recently in 1992, is not repealed; rather it is retained, strengthened, and made an integral component of the statewide work force development system. For example, the findings and purposes section of title I of the Rehabilitation Act are amended to make it clear that programs of vocational rehabilitation are intended to be an integral component of a State's work force development system. Further, the amendments clarify that linkages between the vocational rehabilitation program established under title I of the Rehabilitation Act and other components of the statewide work force development system are critical to ensure effective and meaningful participation by individuals with disabilities in work force development activities. Section 14 and section 106 of title I of the Rehabilitation Act pertaining to [[Page S 14984]] evaluations of the program are amended to make it clear that, to the maximum extent appropriate, standards for determining effectiveness of the program must be consistent with State benchmarks established under the Work Force Development Act for all employment programs. Provisions in the State plan under title I of the Rehabilitation Act of 1973 are also amended to include specific strategies for strengthening the vocational rehabilitation program as an integral component of the statewide work force development system established by the State. A cooperative agreement will be required to link the VR agency with the consolidated system. The cooperative agreement will address each State's unique system and will assure, for example, reciprocal referrals between the VR agency and the other components of the statewide system. The linkages will also assure that the staff at both agencies are adequately and appropriately trained. Most importantly, the linkages must be replicated at the local level so that the local office of the VR agency is working closely with the one-stop center in the community to make a seamless system of services a reality. Many State vocational rehabilitation agencies, including the agency in Iowa, are already involved with efforts to link vocational rehabilitation with other components of the statewide system of work force development. The States that report the most success are those where the vocational rehabilitation agencies are involved in the consolidation efforts at the early planning stages. The other aspect that is critical to ensure success is the replication of cooperative agreements in local communities so that the VR counselors are working closely with the other job training programs in the statewide system. In closing, Mr. President, I strongly support the provisions of S. 143 pertaining to individuals with disabilities. The bill ensures meaningful and effective access to the generic training and education programs. In addition, the amendments to the Rehabilitation Act of 1973 will strengthen and support the involvement of vocational rehabilitation in a State's seamless system of work force development while ensuring the continued integrity and viability of the current program.

Mr. HARKIN

Mr. HARKIN. I just have one question.

Mr. HARKIN. I thank the Senator for yielding me this time off the bill. I did want to support the amendment and be a cosponsor of the amendment because I feel so strongly that Job Corps has done an outstanding job. There have been problems. Yes, there have been problems. I believe that we have addressed those problems. I believe this amendment addresses those problems. But just to arbitrarily close 25 centers around the United States and then to turn this back over to the States with almost no benchmarks at all, I think would be the death knell for Job Corps, and it would be the end of it. Job Corps, as has been stated so many times, I am sure, by people who have spoken on the floor of the Senate here, Job Corps serves our most disadvantaged youth. These are not young people who have gone through high school and gotten good grades, maybe got a job; these are hardcore, unemployed, disadvantaged youths. To close them down would be a big mistake. Despite the disadvantages of the youths that come into this program, the program has succeeded. The last comprehensive study of Job Corps found each $1 invested returns a $1.46. Last year, 73 percent of Job Corps students found jobs or entered higher education after leaving the centers. I challenge any State-run job training program to match that kind of figure. You cannot find it anywhere--73 percent. Now, they may place them, but in the Job Corps center that we have in Iowa, 95 percent of those found jobs with an average hourly wage of $6.20 an hour, and not minimum wage, more than minimum wage. We have a Job Corps center in Denison, IA. I have to tell you, Mr. President, when this thing first started in Iowa, the Job Corps center, they took over an old junior college that had gone under. When it first started in Denison--Denison is a small community, community of about 6,700 people--when they thought about this Job Corps center there and they were going to bring these inner-city kids in and kids who had been on drugs, there was a public outcry, and it just about did not succeed in being located in Denison. Finally, some cooler heads prevailed. They opened it up. And I can tell you, Mr. President, it has so much support in Denison and the surrounding countryside you cannot believe it. I know my friend from Nebraska was saying that we have got to get more local level involvement. You cannot get more local level involvement than what you have in the Denison, IA, Job Corps Center and, I daresay, a lot of other Job Corps centers around the country because they work closely with businesses in the community. They are taught by people with skills in different occupations. They go out and work among people, so they get to understand what it is like to be in the work force. And the people in the Denison area have supported it overwhelmingly since it has come in. Five hundred kids a year go through there. And I might add it is one of the handful of centers that provides child care for students. The child development center there opened in 1993. It allows parents to keep their children with them while they are enrolled in training programs. So a young mother, maybe with one or two kids, can come there, go through the program and keep her children with her. Children from 6 months to 2 years are in a developmental child care program. And at the Denison Job Corps Center, for children 3 to 5, we have a Head Start Program. So, again, it is fully integrated with developmental for early childhood, Head Start, and allow these kids to stay there with their parents. As I said, Job Corps in Denison is the third largest employer. It has 121 full-time employees and a $3.4 million annual payroll. And the center gives back to the community. It makes civic contributions. They built a new press box at the high school athletic field. The kids went out and built it. They contributed to the community. They built a new stage for the Donna Reed Performing Arts Festival that we have annually to commemorate the hometown of Donna Reed. So, again--I do not know--when I hear people say that we need more local involvement, you cannot get more local involvement than what we have in the Job Corps Center in Denison, IA. We talk about turning it back to the States so they do not come to the Federal Government when they get in trouble. The fact is, under the bill, if you turn it back to the States with almost no benchmarks, they would not run to the Federal Government because there is nothing for them to meet. But under the amendment, we set up benchmarks, we set up strict guidelines on drug usage and that type of thing, and we make sure that they meet certain stringent guidelines. So we have, I believe, addressed the problems that we have confronted in some Job Corps centers. I am not going to stand here and say every Job Corps center has been the epitome of correctness and that they have been run right. But to just take a blunt meat-ax approach and cut them out is, I believe, the wrong way to go. I believe this amendment is the right way to go. It solves the problems. It keeps the centers going. It, indeed, closes 10, but not the 25, and it sets up the strict guidelines we need to make sure we do not have these problems in the future. I urge those who want to make sure that we instill in these young people [[Page S 14969]] family values and a work ethic so they can get out of the environment they are in and put them in a new work environment in a community, you cannot beat the Job Corps for what they are doing. It is one of the best investments we have ever made. I certainly hope we do not do away with it, and I support the amendment wholeheartedly.

Mr. HARKIN

Mr. HARKIN. Mr. President, as ranking member of the Subcommittee on Disability Policy, I would like to take a few minutes to discuss the applicability of S. 143, the Workforce Development Act, to individuals with disabilities. I would like to compliment Senator Kassebaum, the sponsor of the legislation and chair of the Committee on Labor and Human Resource, and Senator Frist, the chair of the Subcommittee on Disability Policy, for including specific provisions in S. 143 that will enhance our Nation's ability to address the employment-related needs of individuals with disabilities, including individuals with significant disabilities. I am particularly pleased that these provisions were developed on a bipartisan basis and enjoy the broad-based support of the disability community. On January 10, 1995, the Labor Committee heard testimony from Tony Young, on behalf of the Employment and Training Task Force of the Consortium for Citizens With Disabilities. CCD urged the Senate to recognize the positive advances made in the 1992 amendments to the Rehabilitation Act of 1973 and to take a two-pronged approach to addressing the needs of individuals with disabilities in our jobs consolidation legislation. I am pleased that the Senate bill adopted this two-pronged approach. Under prong one, S. 143 guarantee individuals with disabilities meaningful and effective access to the core services and optional services that are made available to nondisabled individuals in generic work force employment activities and to work force education activities described in the legislation, consistent with nondiscrimination provisions set out in section 106(f)(7) of the legislation, section 504 of the Rehabilitation Act of 1973, and title II of the Americans With Disabilities Act. The commitment to ensuring meaningful and effective access to generic services for individuals with disabilities is critical. Advocates for individuals with disabilities have often expressed concern that many current generic job training programs such as JTPA have not met the needs of individuals with disabilities. Ensuring access to generic services is critical for many people with disabilities who can benefit from such services. The promise of access to generic services is also illustrated through other provisions in S. 143. The purposes of the bill--section 2(b)-- include creating coherent, integrated statewide work force development systems designed to develop more fully the academic, occupational, and literacy skills of all segments of the population and ensuring that all segments of the work force will obtain the skills necessary to earn wages sufficient to maintain the highest quality of living in the world. The content of the State plan set out in section 104(c) of S. 143 must include information describing how the State will identify the current and future work force development needs of all segments of the population of the State. The term ``all'' is intended to include individuals with disabilities. The accountability provisions in S. 143, section 121(c)(4), specify that States must develop quantifiable benchmarks to measure progress toward meeting State goals for specified populations, including at a minimum, individuals with disabilities. Under S. 143, State vocational rehabilitation agencies must be involved in the planning and implementation of the generic system. For example, under section 104(d) of S. 143, the part of the State plan related to the strategic plan must describe how the State agency officials responsible for vocational rehabilitation collaborated in the development of the strategic plan. Under section 105(a) of S. 143, the work force development boards must include a representative from the State agency responsible for vocational rehabilitation and under section 118 of S. 143, local workforce development boards must include one or more individuals with disabilities or their representatives. Under prong two the current program of one-stop shopping for persons with disabilities, particularly those with severe disabilities, established under title I of the Rehabilitation Act of 1973, as amended most recently in 1992, is retained, strengthened, and made an integral component of the statewide work force development system. The current vocational rehabilitation system has helped millions of individuals with disabilities over the past 75 years to achieve employment. Since the 1992 amendments, the number of individuals assisted in achieving employment each year has increased steadily. In fiscal year 1994, 203,035 individuals achieved employment, up 5.8 percent from fiscal year 1992, the year just prior to the passage of the amendments. Data for the first three quarters of fiscal year 1995 show a 8.4-percent increase in the number of individuals achieving employment as compared to the first three quarters for fiscal year 1994. In fiscal year 1993, 85.7 percent of the individuals achieving employment through vocational rehabilitation were either competitively employed or self-employed. Seventy-seven percent of individuals who achieved employment as [[Page S 14841]] a result of the vocational rehabilitation program report that their own income is the primary source of support rather than depending on entitlement or family members.

Mr. HARKIN

Mr. HARKIN. Mr. President, will the majority leader yield?

Mr. HARKIN. Will the majority leader yield?

Mr. HARKIN. I thank the leader for yielding. I just discussed with the chairman of our Labor-HHS committee, Senator Specter, and consulted with our side and on Labor-HHS, with the knocking out of that one provision--and we all know what that is--we can voice vote that in the next 3 minutes. We would be willing to do that. I checked with Senator Specter, and I believe I am representing him correctly. Mr. SPECTER addressed the Chair.

Mr. HARKIN

Mr. HARKIN. Mr. President, I thank Senator Wellstone for his leadership in this area. The SBA Microloan Program really works. It's the most effective welfare to work program we've got. It turns welfare dependents into taxpaying small business people. The Institute for Social and Economic Development in my State of Iowa has been a pioneer in promoting microloans. This organization headed by John Else works with individuals, helping them establish their own businesses. The institute works with them to determine if a concept to establish a business is sound. If so, they help the client establish a sound business plan, teaching them the many skills that are necessary to be successful in a small business. And, they work with the person to secure a loan through a bank or other financial institution. This is time intensive work. But, without this technical assistance, there is no way microloans will produce significant success. Most microloan intermediaries use SBA financing to provide direct loans. In either case, the program really works. I have personally met with a number of people who have used the program. In many cases, they were on AFDC, food stamps, and other Federal assistance when they started. Now, they are operating successful businesses, making a decent living and paying taxes rather than receiving welfare benefits. Through this program, they have been able to turn their lives around. When we talk about helping people get off welfare, this is a mechanism that really works. I believe that technical assistance for this program deserves to be fully funded.

Mr. HARKIN

Mr. HARKIN. The Senator is right.

Mr. HARKIN. Mr. President, I again thank my colleague, Senator Specter, for his kind and generous remarks on my behalf. I want to repay them in kind. Senator Specter is right, we have worked together for many years. We have switched places, majority/minority, but that has not in any way lessened or in any way changed our relationship. It is one of, I think, mutual respect and one in which we have worked together to try to fashion the best bill we possibly could, having been dealt a bad hand. So I commend Senator Specter and his staff for doing the best possible job with the bad hand of cards that was dealt to us. I especially want to draw attention to Senator Specter's efforts to restore funding for rural health care and the health and safety protections for workers, and especially his dogged determination to ensure that we have funding for the Low-Income Home Energy Assistance Program. I also credit my colleague, Senator Specter, for stripping the bill of its many unnecessary and inappropriate legislative riders, matters that ought rightfully to be taken up by the authorizing committees and not by the Appropriations Committee. Unfortunately, the committee did agree to include in this bill an amendment on striker replacement, which has resulted in the situation we find ourselves in today. I reluctantly agreed to this procedure suggested by Senator Dole because I am strongly opposed to the striker amendment and because, on the floor, the bill would have attracted scores of additional extremist legislative riders. So, for the benefit of Senators, what we face right now is a vote on the motion to proceed that will take place at 10 o'clock. That vote, really, is a vote on whether or not we will have within this appropriations bill a rider that says that President Clinton cannot execute his Executive order which bans corporations--and I will get into the details of it later--bans companies having business with the Federal Government, contracts with the Federal Government, from replacing legitimate strikers with permanent replacements. We had a vote on this earlier this year and the vote failed, the cloture vote failed on that vote. So this is the same issue we have before us, whether or not the President can implement his Executive order on striker replacement or whether we will have this rider on the appropriations bill prohibiting that implementation. So, that is what is facing us right now, and that vote will take place at 10 o'clock. Before I yield on the issue of striker replacement to my colleague from Minnesota and my colleague from Massachusetts, let me just say a couple of words about the bill in front of us. As I said, Senator Specter did a commendable job with the bad hand we were dealt, but I think this chart really points out the problems that we have in dealing with education, with health, with workers protection, with summer youth employment, with low-income home energy heating assistance--all of the things that are in this bill that help advance our country educationally, socially, and try to make life a little bit better and give more opportunity to more people. What we say is, over 1992, 1993, 1994, 1995, our allocations and budget authority increased by a little over 10 percent--about 15 percent--over those years. This year, our allocation has dropped back to where we were in 1992 in the House, 1993 in the Senate. So, because of this, we have a bill which cuts adult training programs by $167 million; reneges on our commitment to dislocated workers programs; it eliminates the summer youth employment program; it cuts by 13 percent our efforts to combat waste, fraud and abuse in Medicare; it undermines our battle and fight in the war against drugs by cutting money for safe and drug-free schools. his bill cuts 48,000 children from the Head Start Program. It cuts the Goals 2000 Program well below the level proposed by the President. These are just some of the items that we had to cut and reduce because of the allocation that we had--all in the face of giving the Pentagon, I might add, $7 billion more than they even asked for. The Pentagon gets $7 billion more than they even asked for, yet in programs that are necessary for the health, safety, security, and education of the people of this country, we have cut those $8 billion. That is what we are confronted with. Having said that, Mr. President, I now want to turn to the issue of striker replacement, the issue that is really before us on the vote at 10 o'clock. I know the Senator from Minnesota wanted to speak on this, but let me just set the stage for this. The President issued an Executive order regarding the permanent replacement of striking workers for companies that do business with the Federal Government. The President's action is fully lawful and within his authority and conforms with the practice of previous Presidents, including President Bush, who used this authority twice during his 4 years, and this Congress did not try to strip him of that power. And yet now this Congress wants to strip this President of his lawful right to issue this Executive order. I would yield 5 minutes to the Senator from Minnesota.

Mr. HARKIN. I thank the Senator from Minnesota. Mr. President, I yield 15 minutes to the Senator from Massachusetts.

Mr. HARKIN. Mr. President, I thank the Senator from Massachusetts for his eloquent remarks and for his longstanding and strong support for the working people of this country. There is no one in this Senate and in this Congress who has stood up more over a longer period of time and who has spoken more forcefully and eloquently for the working people than the Senator from Massachusetts. What the Senator just said in his closing remarks regarding the leadership of Thomas Jefferson and John Adams in education really had to bring it home to us again here today what we are doing. Mr. President, again, to repeat for Senators, what we are facing right now is a vote at 10 o'clock on a motion to proceed. I am opposed to that motion to proceed because of the inclusion in the Labor, Health and Human Services appropriations bill of a rider, a rider that says that President Clinton cannot implement his Executive order regarding permanent replacement of striking workers. Mr. President, I strongly oppose this amendment restricting the implementation of President Clinton's Executive order regarding permanent replacements for striking workers. First of all, the President's action is entirely lawful, fully within his authority, and conforms with the practice of previous Republican Presidents in labor issues. And perhaps more importantly, instead of passing such an amendment we should be saluting the leadership of the President in providing a good degree of protection for workers that Congress failed to enact last year in the striker replacement bill. Under the Executive order, American workers in companies doing business of over $100,000 with the Federal Government can finally be assured that they will not be permanently replaced if they go out on strike. While that represents only 10 percent of all contracts, this order will affect 90 percent of Federal contract dollars. The proponents of the amendment to nullify this claim that they are trying to maintain the power of the Congress over this matter. But it is clear that Congress has already acted to give the President this power, in the Federal Property and Administrative Services Act of 1949. We have spoken on this issue and this amendment is just an attempt to second-guess the President on an issue that is fully within his authority. President Bush used the same statutory authority to issue two Executive orders concerning labor. Yet we didn't hear our colleagues on the other side of the isle complaining then. Furthermore, the U.S. District Court for the District of Columbia rejected a challenge to the President Clinton's Executive order on striker replacement on July 31, 1995. Specifically, the court held: First, President Clinton acted within his procurement authority; Second, there is a close nexus between the Executive order and efficient procurement; and Third, Executive Order 12954 does not conflict with the National Labor Relations Act. In other words, the court rejected all of the major arguments that have been made against the Executive order. The President has not abused or exceeded his legal authority--he has the power, given him by Congress in the procurement laws, to deny Federal contracts to employers who use permanent replacements for strikers. In addition, there is no merit to the argument that he has done an end run around the Congress by trying to accomplish what the striker replacement bill had failed to do. President Clinton's Executive order is much more limited than S. 55, and deals only with how the Government chooses its suppliers of goods and services. The order does not attempt to change the National Labor Relations Act or outlaw the use of permanent replacements for strikers. It governs their use only with respect to the narrow class of Federal contractors. Nobody has a right to receive a Federal contract. As one contracting party, we can insist on any conditions we choose. The findings of the Executive order state that prolonged labor disputes adversely affect costs of operations. Employers who want to insist on their right to permanently replace striking workers can do so--they just can't get Federal contracts. The Executive order simply raises the stakes in a company decision, and will hopefully convince some companies to rethink their decision to hire permanent replacement workers. It is too easy for companies to think that they can help their bottom line by taking advantage of their workers. This only says that there is a price that must be paid. Sometimes I wish the majority would go ahead and propose a law banning strikes entirely--it would be more honest than what they are trying to do here, again, today. A right to strike is a right to be permanently replaced. Every cut-rate, cutthroat employer knows they can break a union if they are willing to play hardball and ruin the lives of the people who have made their company what it is. Workers deserve better. Workers aren't disposable assets that can be thrown away when labor disputes arise. When we were considering the striker replacement bill last year, the Senate Committee on Labor and Human Resources heard poignant testimony about the emotional and financial hardships that are caused by the hiring of permanent replacement workers. We heard of workers losing their homes and going without health insurance due to the costs of COBRA coverage, as well as the feelings of uselessness that workers often feel when they are permanently replaced after years of loyal, and efficient service. The right to strike--which we all know is an action taken as a last resort, for no worker takes the financial [[Page S 14445]] risk of a strike lightly--is fundamental to preserving workers' right to bargain for better wages and better working conditions. And recent studies have shown that the stagnation we have seen in middle-class standards of living is closely correlated with the decline of unions, and the loss of meaningful bargaining power. At the same time, workers are losing the benefits that unions were able to negotiate. Since 1981, fewer workers have health insurance, pensions, paid vacations, paid rest time, paid holidays, and other benefits. Without the bargaining power of a union, companies provide these benefits only out of the goodness of their hearts. And without the right to strike--a right that is theoretically guaranteed by law, but that, in fact, is totally undermined by permanent replacements--the unions have no bargaining power either. What does it mean to tell workers, ``you have the right to strike,'' when exercising that right means that you can be summarily fired? This is not about whether a company has to close its doors in the face of a strike. This only concerns the permanent replacement of strikers. Permanent replacements are given special priority in their new jobs--placing new hires above people with seniority and experience. We aren't suggesting that replacement workers can't compete for jobs-- they just should not get special rights, over and above those of the workers who have devoted their lives to the company. As a nation we have a choice--continue down the path of lower wages, lower productivity, and fewer organized workers or to take the option pursued by our major economic competitors, of cooperation, high wages, high skills, and high productivity. If we want to pursue that high skill path, we must do it with an organized work force. We can't do it with the destructive management practices of the past decade such as the threat of hiring replacement workers. Federal contractors must have stable and productive labor-management relations if they are to produce the best quality goods in a timely and reliable way. The use of permanent replacement workers destroys cooperative and stable labor-management relations. Research has found that strikes involving permanent replacements last seven times longer than strikes that don't involve permanent replacements. Using permanent replacements means trading experienced, skilled employees for inexperienced employees who labor at the bottom of the learning curve. For Federal contracts, we don't want the industrial equivalents of rookies and minor leaguers making tires for our next Desert Storm. So, Mr. President, I urge the Senate to oppose this amendment. I think it is a distraction from this important appropriations bill before us. I intend to fight this effort every step of the way, to return the right to strike to at least some of America's workers. Under this Executive order, American workers and companies doing business over $100,000 with the Federal Government can finally be assured that they will not be permanently replaced if they go out on strike. While that represents only 10 percent of all contracts, this order will affect 90 percent of Federal contract dollars. Opponents of the amendment can nullify this, claim that they are trying to maintain the power of Congress. But Congress already gave the President this power in the Federal Property and Administrative Services Act of 1949. The Senator from Minnesota said every President since President Truman has exercised this authority. President Bush used the same authority to issue two Executive orders concerning labor. Yet, we did not hear our colleagues on the other side of the aisle complaining at that time. As the Senator from Massachusetts said, the U.S. district court rejected a challenge to President Clinton's Executive order on July 31 of this summer of 1995. Specifically, the court held, first, that President Clinton acted within his procurement authority; second, there is a close nexus between the Executive order and efficient procurement; and, third, that Executive Order 12994 does not conflict with the National Labor Relations Act. In other words, the court rejected all of the major arguments that have been made against the Executive order. The President has not abused or exceeded his legal authority. He has the power, given by Congress, to deny Federal contracts to employers who use permanent replacements for strikers. In addition, there is no merit to the argument that he has done an end run around Congress by trying to accomplish what S. 55, the striker replacement bill, tried to do and which did not pass here. I might point out again for the record, S. 55 had a majority of votes on the Senate floor, enough to pass, to ban the permanent replacement of strikers. We just could not get the 60 votes to break the filibuster. Again, this order does not attempt to change the RLA or the National Labor Relations Act, or outlaw the use of permanent replacements for strikers. It is used narrowly affecting only Federal contracts. Mr. President, no one has a right to receive a Federal contract. As one contracting party, the Federal Government can insist on conditions, and that is the condition that President Clinton has insisted on, that if you do business of over $100,000, if it is a contract over that amount, you cannot permanently replace legitimate, legal strikers. Mr. President, how much time do we have remaining on this side?

Mr. HARKIN. Yes.

Mr. HARKIN. I will reserve that minute and a half. Mr. SPECTER addressed the Chair.