Orrin Hatch

Mr. HATCH

Mr. HATCH. I reserve the remainder of my time.

Mr. HATCH. Mr. President, I have not felt really great about taking on some of my colleagues and irritating people on my side of the aisle. I always try to support the leadership in everything. And, I think I have a very good reputation for doing that. But there occurs in all of our lives--at times--issues that transcend the everyday important issues we face in the Senate on a daily basis, and this is one of them. Regardless of what happens here today, this issue is not going to go away. I think it is time for people to wake up and say, hey, look, this is an idea whose time has come. We must take care of these kids who cannot take care of themselves. The problem in this body, and the problem with the Federal Government, is that oftentimes we provide programs for all kinds of people who can take care of themselves, but will not. Yet, we do not take care of people who truly cannot take care of themselves, but would if they could. Children's health care should not be a political issue. This is not a Democrat issue. It is not a Republican issue. I admit that when I first read the Kennedy-Kerry bill, I could not support that bill as drafted. The bill provided a new Federal bureaucracy along with $50 billion in new entitlement spending. That bill provided extensive Federal mandates along with extensive Federal accountability and review provisions imposed on the States. It was simply unacceptable and provided far too much Federal intervention. I do not mean to find fault with my colleague, the Senator from Massachusetts, because he too has taken a stand on this issue and has been willing to come to the center in a bipartisan way to work with me to resolve these problems. But that bill was totally unacceptable to me and I know it would have not garnished nearly the support my bill has received. My bill is substantially different than the Kennedy-Kerry bill. My bill provides a block grant funding mechanism to the States which are given maximum flexibility to administer the program. The States set their own eligibility standards. And, the program is strictly voluntary. No new massive Federal or for that matter State bureaucracy is necessary since my bill builds on existing State programs or private sector initiatives. There is no funding mechanism because we already have a system in place to collect the excise tax on tobacco products. We would make those tax revenues available to the States much like we make matching funds available to the States through the Medicaid program. States would not have to hire massive new numbers of bureaucrats. The States basically operate the program in a manner consistent with existing children's programs or in ways that best meet the needs of the citizens. States will have the flexibility to contract with health insurance companies to develop new and innovative insurance products for children. In spite of some of the comments that have been made by those who oppose my bill, States can contract with private health insurers and/or health care providers such as community health centers to carry out the mission of this program. I want to give States even more flexibility in implementing the CHILD bill. I am open to further suggestions and refinements in the bill. In that respect, I have challenged my colleagues on both sides of the aisle alone with the Nation's Governors to help me in that effort. If there is a better way of doing this, then I am willing to discuss other proposals and make construction changes to the bill. My willingness to improve my bill extends to the funding mechanism as well. I ask my colleagues to show me a better way of funding this program. I cannot think of a more just way of funding the program than with an increase of 43 cents on the tobacco tax. In 1955, a pack of cigarettes cost 23 cents. The excise tax was 8 cents or 34 percent. Today a pack of cigarettes costs $1.80 to $2.30. The excise tax today is 24 cents, under 10 percent. Does it not seem fair and reasonable to ask the tobacco industry to help finance this program particularly in view of the health implications of tobacco use? The fact of the matter is that tobacco use is the single largest preventable cause of death. It is the largest preventable cause of illness in our society. Four out of five lung cancer victims in our country get cancer due to smoking. There are 51 million smokers in our country, 3 million of whom are teenagers. And, everyday 3,000 more teenagers begin to smoke, half of whom will become nicotine addicts by the time they are 18 years of age. As my colleagues know, currently the so-called global settlement negotiations are on-going between the tobacco companies and the States regarding the litigation against tobacco manufacturers. I have had the opportunity to review the arguments on both sides of the issue and I note that arguments have been made against any increases in tobacco prices on the belief that States will lose revenues. It seems to be that we should be spending more time worrying about the health of our citizens than the tobacco revenues going into State treasuries particularly when these revenues are marginal in comparison to health care costs States assume from smoking related illnesses. Now, look, we can put this issue off and we can play procedural games, but this issue is not going to go away. I think virtually everybody in the Senate has strong feelings about this issue although there are legitimate differences of viewpoint. Of all the arguments made against my bill, I think the one that is particularly false is that my bill creates a new entitlement. I am perhaps more dismayed by that charge because my bill specifically states that no new entitlement is establish by this legislation. I succeeded in persuading my cosponsor, Senator Kennedy, to agree to the nonentitlement provision in this bill which clearly states that: Nothing in this title shall be construed as providing an individual with an entitlement to assistance under this title. Moreover, State participation is totally voluntary. There is nothing in the bill that would establish an entitlement to the CHILD Program, but yet that has been one of the principal arguments against the measure. I guess any bill that has real winning power could be called an entitlement program. Any good program that actually works I guess should be called an entitlement even though these programs have to face the authorization and appropriations process which the CHILD bill is also subject to face. It is unbelievable this these kinds of arguments have been made. This is a voluntary program designed to be attractive to States. Does that make it an entitlement program? Does that somehow convert it into an entitlement program? It seems to me there are legal and programmatic distinctions between entitlement programs such as Medicare and the child development block grant program. I remember when the Child Development Block Grant Program came before the Senate. Many Senators including those in my party were opposed to it. Ironically, that bill passed the Senate unanimously and almost everybody claims credit for it because it has been a successful block grant program for the States. The States set their own standards which is precisely what my bill provides. I think we ought to wake up and do what is right here. Look, it is a fair characterization to say that this is a choice between Joe Camel and Joey. I am not just saying that because it is cute and gimmicky. I say that because it is true. I think the industry that causes much of the illnesses has an obligation to be of some help here. This is not a broad-based tax. The only people who pay this tax are those who smoke cigarettes and use tobacco products. In all candor, I trust my colleagues will keep this in mind. This issue is not going to go away. I understand that the leadership is going to file an amendment to my amendment. Fine. We will look at their amendment and see what it is. I hope it is a constructive amendment that will get us to what we are trying to do. However, these arguments that $16 billion is all that is needed are simply inaccurate. My bill is something we ought to do. These are the children who come from families of the working poor. It is very difficult for them to help themselves. I think of the billions of dollars we spend on people who can help themselves but will not. If we cannot do this, then what can we do? I am prepared to yield back the remainder of my time.

Mr. HATCH. I yield 5 minutes.

Mr. HATCH. Could we make a few closing remarks?

Mr. HATCH. I understand that we still have 20 minutes.

Mr. HATCH. I am prepared to yield back.

Mr. HATCH. Mr. President, I know there are some others who would like to speak on our side. But I really think everybody knows what is involved here. I am prepared to yield back the balance of my time if the other side is and go to a vote, let this thing be resolved at this particular juncture any way Senators decide to do it. Mr. KENNEDY addressed the Chair.

Mr. HATCH. Mr. President, I thank my colleague from Massachusetts, and also the vice chairman of the Budget Committee. I was very interested listening to the Senator from New Hampshire, his journey from 10.5 million unfunded children, down to the 3.2 million he says are truly uninsured. First off, the Senator says that 3.7 million are Medicaid eligible.

Mr. HATCH. Mr. President, I understand well the procedural objections of the distinguished Senator from New Mexico to this amendment. He argues that there is no way to be absolutely certain that the Finance Committee will levy a tobacco tax. In a narrow legal sense that is certainly true. Well, to that assertion I simply respond that this is not some hinky-dinky little technical amendment. Everybody here knows what is involved here. We are having one of the most important debates in this Congress. It may be the most important debate that occurs during this session of Congress. We are debating in public. We all know what the stakes are. It is our children versus Joe Camel, nobody doubts that, nobody has any problem with that. In fact, even in the purpose clause of the amendment, it says financed by an increase in the tobacco tax. So it is there. Make no mistake about it, the question is clear today. History can be made today if our amendment is agreed to. The Finance Committee would have no practical other choice but to pass the cigarette tax to finance this. Of course, there is no legal requirement to bind their actions but sometimes political and moral forces cannot be resisted by mere legal technicalities. If we prevail today, there is no political way to turn back. That is why so many people are so nervous today. This vote may be the most important vote we cast this year for the future of our children. Let us face it. The people out there are watching. And they are going to hold us accountable, especially those 72 percent of the public, according to the Wall Street Journal-NBC poll who support our bipartisan approach. It is Joey versus Joe Camel, and no procedural nicety can obscure this reality. And everybody here knows it. So that is what it is coming down to. There are $135 billion in total tax cuts, gross tax cuts in this budget agreement. And the fact is, that this is a public health vote much more than a tax vote. Tobacco is the No. 1 cause of premature death in this country. And that is costing our country literally tens of billions of dollars annually by our own Government estimates. GAO is the one who has given us the figure of 10 million children here who do not have adequate health insurance, 3 million of whom do not even know they qualify for Medicaid. This money in this bill will help those 3 million children, perhaps. But I have to say, in order to get to $16 billion they had to cut the DISH. That is going to be a loss to children. So we are talking about taking care of the other 7 million children that are involved according to the GAO. My amendment does direct the Finance Committee to come up with $30 billion more in revenues. We want this to be done with the tobacco tax increase; and it is the only way it will be done. That is the only way you can adjust the budget to accommodate a tobacco tax increase. If the Finance Committee refuses to back the tax, then it will be they, not us, who have thwarted the will of 72 percent of the American people who support this amendment. I would like to point out nothing in the bill binds any committee to adopt any policy. Many committees may consider changes we have not anticipated here today. We have to do the best by providing clear direction on the floor. And if that guidance is not followed we will have to deal with that with subsequent reconciliation and tax bills. So this charge ignores the real issue. The proponents of our amendment, the Hatch-Kennedy amendment, are making a public choice to help kids at the expense of the tobacco industry. You can try to gild the lily any way you want, but that is the situation here. Big tobacco is fighting back. Who are we going to be with? Are we going to be with the kids or are we going to be with tobacco? That is strictly the issue. I reserve the balance of my time. Mr. KERRY addressed the Chair.

Mr. HATCH. Mr. President, 72 percent of all adults responded that they favor this proposal and only 24 percent were opposed; 67 percent of all men approved of this proposal and 76 percent of all women were in favor. The results were remarkably consistent throughout each geographic region in the United States, across age groups and, indeed, income groups. The point is simple. This is an idea whose time has come. So to those who believe there is a better way to go, I earnestly solicit your views. Indeed, I will make an offer to every Member in this body. I want to work with each of you and with our leadership to address this issue in a responsible way. If changes need to be made, if we need to move toward a middle ground in order to get a proposal enacted, I will be an advocate for these changes. It is for this reason that Senator Kennedy and I initiated our discussions on this issue several months ago. The fact is that Senator Kennedy and I approach issues like these from vastly different ends of the political spectrum. That perhaps is what strengthens the product of our discussions on those issues, the fact that we can find common ground. I believe we desperately need to find that bipartisan common ground on an issue like child health insurance, an issue which matters to so many of all of our constituents. I think one of the lessons we have learned in the last 18 months is that the American public believes Congress is unnecessarily politicizing issues and sandbagging legislation in areas which beg for action. Children's health is an obvious example. I caution my colleagues not to be ashamed to work in a bipartisan manner. Working across the aisle and knitting together political coalitions in order to get things done is an element of leadership, and I think it is what the public expects of all of us. I think that our approach is a true bipartisan partnership. Public health leaders back this approach. Six former Cabinet Secretaries of HHS or its predecessor, HEW, representing all Presidential administrations back to the Nixon administration support our amendment. I thank Secretaries Elliot Richardson, David Mathews, Joseph Califano, Richard Schweiker, Otis Bowen, and Louis Sullivan for their support and leadership in moving this legislation. I also want my colleagues to know that former Surgeons General C. Everett Koop, Julius Richmond, Paul Erlich, and Jesse Steinfield are backing this effort. Today is the time for we politicians to take the advice of these leaders in public health and vote to increase the tax on tobacco users in order to help children. Indeed, the budget compromise and the child bill plus the public's heightened sense of concern about the perils of tobacco are coming together to present a rare and historic opportunity for our society to help children get health insurance, further discourage tobacco use, especially among our young people, and target a sizable $10 billion for deficit reduction. This is a unique time, and we should make the most of it. I believe that we can and should strengthen Medicaid and create a new program for those children from working families who are not Medicaid eligible. That is what our amendment is intended to do. I will not use up all our time. Let us just keep this simple. Vote for Joey, not for Joe Camel. I reserve the remainder of my time.

Mr. HATCH. I understand that. Mr. HATCH addressed the Chair.

Mr. HATCH. On the Senator's time.

Mr. HATCH. I will be glad to yield to the Senator.

Mr. HATCH. That is correct.

Mr. HATCH. I will.

Mr. HATCH. This is not the Kennedy amendment. This is the Hatch- Kennedy amendment.

Mr. HATCH. It is basically geared to get us to that point. Yes. Mr. HATCH addressed the Chair.

Mr. HATCH. I am prepared to accept the Senator's amendment.

Mr. HATCH. I am prepared to yield back my time. I might add, I am prepared to accept the Senator's amendment.

Mr. HATCH. How much time does the Senator want?

Mr. HATCH. Let me just end it this way. I think the President and the people in the White House have caved here, people who we had every reason to believe would be supportive of kids' health. Let me say, the Washington Post framed the issue in its editorial page just yesterday. They said, ``This is a vote against the harmful effects of tobacco, in favor of children's health, in favor of State decision-making, and in favor of fiscal discipline. How many times do they get one like that? They ought to vote aye.'' I hope Senators will vote against the motion to table, and in favor of our amendment. Mr. DOMENICI addressed the Chair.

Mr. HATCH. Mr. President, how much time remains on both sides on the amendment itself?

Mr. HATCH. Mr. President, under our amendment, $18 billion in program funding will go to the Labor Committee and $2 billion to the Finance Committee to be added to the $16 billion already in the budget resolution. That means that each committee will get $18 billion to work on complementary programs to help the poor and the near poor. We will have to work out the legislative language. I hope it will be like the CHILD bill that we have worked so long and hard to make a possibility. But what we are voting on today, if and when we do, is the right to have enough funding moneys to take care of these kids who are the poorest of the poor families not on Medicaid who cannot do it otherwise. Of all the criticisms of our bill, I am perhaps most dismayed by the charge that this bill creates an entitlement. In sharp contrast to last year's Kennedy-Kerry bill which was an entitlement, I succeeded in persuading my cosponsor Ted Kennedy, one of the most liberal Members of the Senate, to agree to the following provision: Nonentitlement.--Nothing in this title shall be construed as providing an individual with an entitlement to assistance under this title. Don't words mean anything anymore? Moreover, not only does this bill make clear it is not an individual entitlement program, participation is clearly voluntary on the part of the States. In fact, even if an individual is eligible under the State's own eligibility criteria, section 2822(d) of the bill ensures that there is not a requirement for any subsidy to the individual should there be insufficient program funds available. This can be contrasted with programs such as Medicare or Medicaid, which guarantee we will pay for the services of every eligible beneficiary. In fact, the bill states specifically that. Some have interpreted the language that states: Shall ensure that children's policies are available to all eligible children in the State and that each eligible child has the opportunity to enroll for coverage under such policies. as an entitlement. It is true that a State that chooses to participate by negotiating a contract with one or more insurers must make sure that children in the State can get that policy. What good is health insurance availability if those who need it don't have at least the opportunity to get it? However, there is no requirement that the State subsidize that policy in any way unless the State chooses to do so by the eligibility criteria it sets. And there is no requirement that the insurance policy be available to nonsubsidized children at the price negotiated by the State for the subsidy program. To be fair, some may object to this provision, but it is in no way an entitlement. Again, the State chooses whether or not to participate, as does any individual insurer. Finally, the point has been made that the bill would increase Federal mandatory spending by $20 billion over the next 5 years. That is true. This provision was inserted to made certain that the revenues generated by the companion legislation (S. 526) which increases the tobacco excise tax would be used to fund the CHILD bill and not for some other program. If there is a better way to write that language to make clear it is not an entitlement, I am open to suggestions. I find it curious that many of my colleagues have been arguing against the fact that my bill calls for mandatory spending, calling the mandatory nature of that spending the equivalent of an entitlement. Yet, the budget resolution we debate today includes funding for a mandatory capped grant program to States. If ``mandatory'' equals ``entitlement''--which I believe it does not--then the bipartisan budget agreement establishes a new entitlement. But we all know that is not the case.

Mr. HATCH. I will take a minute and then the distinguished Senator from Massachusetts will take the other. I have to say, this was a constructive debate. I think we all learned a lot about children's health and more importantly about the political process. You know, it is tough work trying to spend money for kids. I have been accused of being a Democratic pawn here today. So I find it amusing that several of our ``yes'' votes have been quietly converted to ``noes'' this afternoon by some of the biggest and best lobbyists there are. And I am not speaking of the tobacco industry. There is no way of knowing, but I think we would have won this one if we had it at the scheduled time at 11:30. We will leave that discussion for a later date. How much time does this Senator have?

Mr. HATCH. Oh, sure.