Orrin Hatch

Mr. HATCH

Mr. HATCH. Thank you. I was among the members of the committee who expressed the view that while I believed we were reporting a very sound bill, further improvements should be considered. I very much appreciate your willingness to work with me and other Senators and very much appreciate your commitment.

Mr. HATCH. I agree with my colleague, further improvements should be considered to key provisions of the bill, including damages, postgrant review, inequitable conduct defense, and venue. Let me just say a few words about the need to make further reforms to the inequitable conduct defense. I commend Senator Leahy for working to develop an effective solution to the problem of the inequitable conduct defense during committee deliberation in July. No doubt he has done a good job in initiating this process. We certainly share many perspectives on how to reform this area of the law, but I believe more must be done to change the use of this defense as an unfair litigation tactic. I know some have opposed any meaningful changes in this area because of how it would affect the generic pharmaceutical industry. As a coauthor of the Drug Price Competition and Patent Restoration Act, informally known as the Hatch-Waxman Act, I certainly understand the generic drug industry, but S. 1145 is an innovator's bill. Unless we promote and protect a structure that fosters a strong and vibrant environment for innovators, there will be fewer and fewer drugs for the generics to manufacture--and all, including patients, will suffer. Much like Senator Leahy, my staff and I have met with many interested stakeholders and individuals about these provisions, and they have stated that further refinements to these four key provisions would garner even greater support of S. 1145. I firmly believe that compromise on each of these provisions is achievable, and I know that my good friend from Vermont would agree.

Mr. HATCH. I agree with your intentions and applaud your plan. I stand ready to work with you and each of our colleagues. I also agree that this should not become an excuse for further delay or for doing nothing. Unfortunately, some would like to play political football with this bill to pursue other agenda items. Make no mistake: this bill is far too important and should not fall prey to such partisan tactics from either side. The Senate has a tremendous opportunity and responsibility to further strengthen our Nation's competitiveness through meaningful patent reform.

Mr. HATCH

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

Mr. HATCH. Mr. President, on numerous occasions in the FISA debate, we have seen dramatic fear mongering. Many individuals, particularly on partisan blogs, are spreading misleading and malicious information in order to incite fear of alleged governmental activities. This bill should not include text which panders to people who believe in imaginary Government conspiracies. There is such a thing as irrational fear of Government. Let's not forget, our Government did not kill thousands of innocent Americans on September 11. Our Government did not kill hundreds of people in car bombings in U.S. embassies in Kenya and Tanzania. Our Government did not kill 191 people in the Madrid train bombings. Our Government did not kill 52 people in the London train bombings. Our Government did not kill 202 people in suicide bombings Bali, Indonesia. The indisputable fact is terrorists have committed heinous attacks on Americans and have pledged themselves to conduct more. It is not politics of fear to acknowledge this. If we bury our heads in the sand and pass legislation that ignores these risks, we make ourselves and all our people more vulnerable. I will not stand by and see Congress pass laws which could create vulnerabilities for our people, vulnerabilities which expose our families and our friends to danger. Let me tell you what our Government does to protect us. It hires the finest men and women of this great country to utilize their skills to help prevent these types of attacks. Our job in Congress is to make sure these people who have sworn to defend us have the necessary tools to try and prevent terrorist attacks. What they don't need are laws with ambiguous language, as has been proposed, making their jobs more difficult. One of my colleagues previously stated: The authority in this bill greatly expands the Government's ability to conduct surveillance of foreign targets. How in the world he can make that statement, I don't understand. The only great expansion I see in this bill is judicial jurisdiction. In fact, I am amazed we don't rename the bill the unlimited expansion of judicial authority act. We have advocated so much new responsibility for the Foreign Intelligence Surveillance Court that I wonder whether people realize that court is composed of only 11 judges. Where is this great expansion in surveillance authority that has been argued on the floor? Since FISA was passed in 1978, the Government has been able to target terrorists overseas. This bill amends FISA so we can continue to target foreign terrorists when they utilize communications over a wire, not just communications over radio or satellite. This does not sound to me like a great expansion. Maybe that is why the Government has continued to say FISA needed to be ``modernized,'' not that it needed to be greatly expanded. There is, however, a key expansion in the bill. It is a statutory warrant requirement when targeting U.S. persons, regardless of who they are, what they have done or where they are located. Notice I said U.S. persons, not U.S. citizens. This idea may sound great to everyone, but we should realize, with eyes wide open, what this means. We have heard some individuals claim the Government could use the power of the Protect America Act to spy on innocent Americans. We have heard the fear mongering that the Government can spy on innocent Americans when they travel overseas. We have heard all about American families on vacation overseas in the Caribbean or in Europe. We have even heard our Government could spy on American military members who are overseas defending our country. I find these scare tactics not only ridiculous but extremely offensive. They walk a fine line in seemingly questioning the integrity and the judgment of these fine men and women who work for us and who don't have a political agenda, who have dedicated their professional lives to prevent catastrophic attacks on Americans. Do we think our intelligence analysts are sitting around waiting for the Smith family to go on their family vacation to Italy so they can tap their cell phones? Give me a break. To imply that our country's intelligence analysts are more concerned with random innocent Americans than foreign terrorists overseas is a slap in the face to the people who protect our Nation. Our Government is focusing their attention on terrorists who wish us death, not on innocent Americans. When some decry the lack of statutory protection for Americans overseas in the Protect America Act, I wonder if they realize the 1978 FISA law itself provides no statutory protections for Americans overseas. Yet we have called that the gold standard all these years. I would, however, tell my colleagues that Americans overseas are protected by the most important document in the history of our great Nation, and that is the U.S. Constitution. The fourth amendment to the Constitution provides protection from unreasonable search and seizure. That is the question. Is it always unreasonable for the Government to target an American overseas without a court order? Of course not. I would suggest the process that has worked for 26 years is the best approach. It is Executive Order 12333. Since 1981, the Government could only target Americans overseas if the Attorney General determined via probable cause that the American was an agent of a foreign power. Do we think an intelligence analyst is going to disregard an executive order and wiretap innocent Americans overseas? Of course not. Now, with the policy change included in both the Intelligence and Judiciary bills, I want to give an example of how this provision will apply in real life. Adam Gadahn is an American citizen from Orange County, CA. He is also one of the FBI's most wanted terrorists now believed to be living overseas. He has been indicted for treason and providing material support to al-Qaida. Here is what he said: The streets of America shall run red with blood . . . casualties will be too many to count and the next wave of attacks may come at any moment. He has appeared on multiple al-Qaida propaganda tapes. Here is another quote: The magnitude and ferocity of what is coming your way will make you forget all about September 11. Here is something that should make all Americans scratch their heads. Before September 11, the Government would not need a warrant to target this criminal. After September 11, the Government would not need a warrant to target Gadahn. But after this bill is signed, the Government will be required to get a warrant to target Gadahn. This bill does require that. Let's explain that one to the American public. Would a warrantless interception of Gadahn's communications be ``unreasonable'' under the fourth amendment? Of course not. But we are requiring something that even the Founding Fathers did not--a warrant for all electronic searches of U.S. persons. Now I understand the administration is willing to accept a modified version of this amendment that does not include unintended consequences. It is yet another example of how far this proposal goes to satisfy determined detractors who never seem to be satisfied that we are doing enough to ``protect'' innocent Americans. I am also amazed at the false descriptions floating around the Internet of the program which the President described on December 17, 2005, during a radio address. We have all heard the terms: ``warrantless wiretapping'' or ``domestic spying.'' But let's look at what the President actually said during his radio address on December 17, 2005. This is what he said: In the weeks following the terrorist attacks on our Nation, I authorized the National Security Agency, consistent with U.S. law and the Constitution, to intercept the international communications of people with known links to al Qaeda and related terrorist organizations. Before we intercept these communications, the government must have information that establishes a clear link to these terrorist networks. Now I do not see anything in this statement about domestic spying. I thought the definition of the word ``domestic'' was pretty clear. If the program intercepted communications in which at least one party was overseas, not to mention a member of al-Qaida, then it seems fairly obvious that the calls were not domestic. Here, as shown on this chart, is a call from the United States of America to overseas; or a call from overseas to the United States of America. Is that a domestic call? I hardly think so. Is this such a hard concept to grasp? The last time I flew overseas, I did not fly on a domestic flight. I flew on an international flight. ``Domestic spying'' may sound catchy and mysterious, but it is a completely inaccurate way to describe the terrorist surveillance program. Why don't the partisan blogs describe it as ``international spying''? Isn't that a more accurate description? I guess accurate descriptions take a back seat to terms which incite fear and distrust in our Government. Since so many are so interested in the opinion of the FISC, or the Foreign Intelligence Surveillance Court, on these matters, I wish to draw attention to a recent decision. On Tuesday, the Foreign Intelligence Surveillance Court denied a motion by the ACLU for release of court records related to alleged NSA surveillance programs. This FISC opinion was publicly released, which is only the third time in the entire history of the FISC in which this has occurred. Given the rarity of this event--this issued public opinion that denied a motion by the ACLU for the release of court records related to alleged NSA surveillance programs--I want to highlight a few sentences from that ruling: [T]he identification of targets and methods of surveillance would permit adversaries to evade surveillance, conceal their activities, and possibly mislead investigators through false information. Public identification of targets, and those in communication with them, would also likely result in harassment of, or more grievous injury to, persons who might be exonerated after full investigation. Disclosures about confidential sources of information would chill current and potential sources from providing information, and might put some in personal jeopardy. Disclosure of some forms of intelligence gathering could harm national security in other ways, such as damaging relations with foreign governments. All these possible harms are real and significant, and, quite frankly, beyond debate. Now, that is in re: Motion for release of court records of the U.S. Foreign Intelligence Surveillance Court, December 7 of this year. I think we can all agree this is a vitally important public opinion from the FISA, and I commend it to my colleagues. Regardless of how we came to this moment, it is time to do what is right for our country. The time has come for us to work together. We all know it is going to take bipartisan support to get this legislation passed. Let's represent our constituents with our heads held high, knowing we are doing our very best to balance the necessity for protections of civil liberties with the need to keep American families safe from deadly attacks. We owe our people this much. I hope we can continue to work, as the Intelligence Committee did, in a bipartisan way to resolve these very difficult problems. I have to say that the 13-to-2 bipartisan approach is one of the highlights of this year. It is probably the best example of bipartisanship we have this year. I have to tell you, to try to change that with some of the language from the Judiciary Committee--where it was a pure partisan vote on both sides--to try to change that is not the way to do it. So I hope our colleagues will realize that in the Intelligence Committee, in a bipartisan way, we have worked together to come up with the ways of solving these very technical and difficult problems, and to do so in the best traditions of the intelligence community, in the best traditions of gathering intelligence information, and in the best traditions of protecting our country that this country has ever known. Frankly, I compliment the distinguished chairman of the Intelligence Committee, the distinguished vice chairman of the Intelligence Committee, and my fellow Senators on the committee, Democrats and Republicans, who were willing to put partisanship aside and pass that bill 13 to 2 out of that committee. Mr. President, I notice my dear friend from Florida is desirous to speak on the floor, so I will withhold my further remarks and turn the time over to him. I yield the floor.

Mr. HATCH. Mr. President, will the Senator yield on that point?

Mr. HATCH. Mr. President, I thank my colleague for his kind remarks. He was one of the Senators who helped to put this bill together, and a distinguished Senator at that. Would the Senator agree with me that should this bill pass, it would be one of the best illustrations of bipartisanship in this whole Congress so far?

Mr. HATCH. Mr. President, I have listened very closely to the remarks of my dear friend from Connecticut. I have a lot of respect for him. However, it was an easy thing for 13 members of the Senate Select Committee on Intelligence to vote to grant retroactive immunity to companies that patriotically adhered to legal letters to provide the means whereby we might be able to protect citizens in this country and perhaps all over the world. Because of that work, we have been able to protect this country in ways that most people will never know because this area is one of the areas that we don't talk about. It is, this whole area, highly classified. We can talk about the law here. Close inspection of the lawsuits against the telecoms reveals dubious claims. The plaintiffs have confused speculation for established facts. This is dangerous and the continuation of these lawsuits could lead to serious consequences for our national security. It is very simple--Congress should not condone oversight through litigation. A quick scan of what plaintiffs seek in many of these cases should send a chill down our spine. They are not, as many are suggesting, simply saying: ``You went along with the President's Terrorist Surveillance Program, now give us money.'' Rather, the lawsuits seize on the President's brief comments about the existence of a limited program to go on a fishing expedition of NSA activities. But this is really worse than a fishing expedition; this is draining the Loch Ness to find a monster. Sometimes what you are looking for just doesn't exist. The lawsuits represent irrational fears of Government conspiracy, and seek to expose classified information, regardless of who is harmed in the process. We all realize that the sources and methods our intelligence community utilizes to conduct surveillance are highly classified. The risks that classified details could be revealed through these lawsuits are severe. Remember, the very point of these lawsuits is to prove plaintiffs' claims by disclosing classified information. Our enemies have tough decisions to make regarding how they communicate. They can't stay silent forever, and they have to weigh the need to communicate against the chance that their communications are intercepted. Given this, they are carefully watching us and reading every proceeding to see how our government collects information. If they think they see a weakness in our collection capabilities, they will certainly try and take advantage of it. Given the legitimate problems that these lawsuits pose, the Senate Intelligence Committee adopted a bill which will alleviate them. The committee worked in a bipartisan manner to craft an immunity provision that met the needs of Congress, the Government, and the American people. In an overwhelmingly bipartisan tally, the committee voted to include retroactive immunity for service providers that were alleged to have cooperated with the intelligence community following 9/11. Senators from both sides of the aisle, after careful consideration, came to this conclusion. Make no mistake, this was the right conclusion. It was the right conclusion for the Intelligence Committee, and it should be the right conclusion for the full Senate today. Our Senate Intelligence Committee has already noted that the intelligence community cannot obtain the intelligence it needs without the assistance of these companies. It goes without saying, companies in the future will certainly be less willing to assist the Government if they face the threat of extremely costly lawsuits each time they are alleged to have provided assistance. The companies will shy away. Their attorneys will scour future Government requests, feverishly looking for any technicality to avoid compliance. And even if these private attorneys approve future participation, the company will have to listen to cautious stockholders, whose financial interests will undoubtedly make them adamantly opposed to situations which could lead to any financial risk or exposure. But let's be clear: The telecoms are not threatening anyone. They are not saying ``do this, or we will never help you again.'' But, they don't need to say these things for us to understand the obvious. If the financial foundations of these companies crumble due to frivolous litigation, they will rebuild it to withstand future Government requests that may again lead to their collapse. Now some have asked a valid question: If the companies did not break the law, why do they need immunity? Quite simply, the Government's assertion of the state secrets privilege prevents these companies from defending themselves. This assertion by the Government is absolutely essential, as the possible disclosure of classified materials from ongoing court proceedings is a grave threat to national security. Simply put, you don't tell your enemies how you track them. This is why the NSA and other Government agencies won't say what they do, how they do it, or who they watch. Nor should they! To confirm or deny any of these activities, which are at the heart of the civil lawsuits, would harm national security. We should not discuss what our capabilities are. Given the necessity for the state secrets privilege, the drawback is that the companies being sued are forbidden from making their case. In fact, the companies cannot even confirm or deny any involvement in the program whatsoever. They have no ability to defend themselves, and that is after patriotically doing what has to be done to protect each and every citizen in this country. Ordinarily, these companies would be able to address allegations and make their case. However, the classified nature of the topic means the companies are not free to do so. They cannot even have discussions with shareholders or business partners. But we need to remember, lawful silence does not equate to guilt. There is no guilt here. These are companies that cooperated with the Federal Government in helping us track terrorists to protect our citizens. The identities of any company that assisted the Government following the attacks of September 11 are highly classified. While there have been numerous allegations, they are nothing more than accusations. If the identities of these companies are revealed and officially confirmed through litigation, they will face irreversible harm: harm in their business relations with foreign governments and companies and possible harm to their employees both here and abroad, who are truly soft targets for terrorist attacks. My admiration and respect for the companies that did their part to defend Americans is well known. As I have said in the past, any company that assisted us following the attacks of 9/11 deserves a round of applause and a helping hand, not a slap in the face and a kick to the gut. When companies are asked to assist the intelligence community based on a program authorized by the President and based on assurances from the highest levels of Government that the program has been determined to be lawful and necessary, they should be able to rely on those representations. For those who argue we need a compromise, let me be clear: We already have a compromise. The Government certainly wanted more than what is represented in this Intelligence Committee bill. And they did not get all they wanted. I think they should have. The chairman of the Senate Select Committee on Intelligence stated the following in the Intelligence Committee report: This immunity provision is not the broad and vague immunity sought by the administration. The committee did not endorse the immunity provision lightly. It was the informed judgment of the Committee after months in which we carefully reviewed the facts in this matter. The Committee reached the conclusion that the immunity remedy was appropriate in this case after holding numerous hearings and briefings on the subject and conducting a thorough examination of the letters sent by the U.S. Government to the telecommunications companies. That is after numerous top-secret Intelligence Committee hearings. The immunity provisions in this bill are limited in scope. Not everyone will be happy with them, and that is the whole point. I, for one, wanted to see more protections for companies and Government officials in this bill. But I am willing to accept a compromise. My colleagues should be willing to do the same. We are not all getting what we want. We are getting what the public needs for its protection. I will continue to oppose any efforts to weaken the Rockefeller-Bond immunity provision. For nearly 2 months, Congress and the public have had the ability to review the immunity provisions in this bill. Today we are hearing a great deal about how the Intelligence and Judiciary Committees handled the immunity provision. So let's look at how they voted. The Intelligence Committee rejected an amendment to strip immunity from the bill, 12 to 3, and the committee voted to favorably report the bill, including the immunity provision, 13 to 2. In addition, the Judiciary Committee rejected an amendment to strike the immunity provision from the bill, 12 to 7. What do all those votes have in common? They supported immunity and they were bipartisan. How many times are we going to hear about alternatives to S. 2248 which simply do not address the problem? How many trial balloons are going to be released? The first alternative we heard was the Government should indemnify the companies following possible adverse rulings in the cases. There are myriad reasons why this option was lacking. The idea of indemnification apparently was not well received, as we now hear very little discussion of it. So let us call indemnification the first trial balloon to pop. The next alternative we heard was the Government should be substituted in place of the companies being sued. But this alternative was full of problems, given that there is no way to remove the companies from the litigation. Remember, it is their very conduct that is in question. In order to try to prove their claims, plaintiffs will continue to seek discovery, including: document requests, depositions, interrogatories, technical data, trade secrets, proprietary company information and confidential, secret and highly classified information and the list goes on and on. Obviously, the companies would still face many burdens of litigation, even though they are not parties because the Government is substituted for them. This idea has also been skeptically viewed and the Judiciary Committee on Thursday rejected an idea in a resounding 13 to 5 bipartisan vote. So let's call Government substitution the second trial balloon to pop. Now we are hearing another alternative which would dramatically expand the jurisdiction of the Foreign Intelligence Surveillance Court, and utilizes ambiguous terms such as ``objectively reasonable belief.'' The FISA Court was not created to review classified programs or the conduct of private companies. This new proposed alternative would completely revise the mission of the FISA Court, putting them in a role they have not had in their nearly 30 years of existence. This judicial expansion should be the third trial balloon to pop. How long are we going to entertain inadequate alternatives and appease fringe political groups? Is it not time that we embrace the bipartisan compromise that puts the interest and safety of Americans over political interests? How long will it take? Are we willing to take that stand? Let me also take a few minutes to unequivocally state my opposition to the Judiciary substitute. One of the basic requirements of any FISA modernization proposal is we should not have any provisions which could be interpreted as requiring warrants to target foreign terrorists overseas. Quite simply, foreign terrorists living overseas should never receive protections provided by the fourth amendment to the Constitution. The Constitution never contemplated that. One of the controversial provisions added in the Judiciary Committee relates to ``reverse targeting.'' Reverse targeting is the practice of targeting a foreign person when the real intention is to target a U.S. person, thus circumventing the need to get a warrant for the U.S. person. Reverse targeting has always been unlawful, in order to protect the communications of U.S. persons. Now, contrary to what most people believe, the legal definition of ``U.S. person,'' is not limited to U.S. citizens. See this chart: What is a U.S. person? An ``alien lawfully admitted for permanent residence,'' a ``corporation which is incorporated in the United States.'' Now, that is according to 50 U.S.C. 1801. The U.S. person definition includes aliens lawfully admitted, legal residence, legal permanent residence. A U.S. person is also defined as a business incorporated within the United States. From an intelligence-gathering standpoint, reverse targeting makes no sense. From an efficiency standpoint, if the Government was interested in targeting an American, it would apply for a warrant to listen to all the American's conversations, not just his conversations with a terrorist overseas. But let's not let logic get in the way of a good conspiracy theory. Even though reverse targeting is already considered unlawful, a provision is included in the Intelligence bill which makes it explicit. This provision is clearly written and universally supported. However, the Judiciary Committee passed an amendment by a 10-to-9 partisan party-line vote which altered the clear language of that provision. Now, where before the provision said you cannot target a foreign person if the purpose is to target a U.S. person, the new language adds the ambiguous term ``significant purpose.'' Now, words have meaning and in this context have very serious meaning. If this amendment becomes law, an analyst would now have to ask himself this question when targeting a terrorist overseas: Is a ``significant purpose'' of why I am targeting this foreign terrorist overseas the fact that the terrorist may call an airline in America to make flight reservations or a terrorist with a green card living in the USA? If the answer is yes, then the language in this amendment would require the analyst to get a warrant to listen to that foreign terrorist overseas. Now, if there is one thing we can all agree on, it is we should never, ever need a warrant to listen to a foreign terrorist overseas. The ambiguous and unnecessary text of this amendment should not be left up to judicial interpretation. Enactment of this amendment could lead to our analysts seeking warrants when targeting any foreign terrorists, since the analyst may be afraid he or she is otherwise breaking our new law. Now, remember, the Intelligence Committee spent months working on a bipartisan compromise bill. This amendment I have been talking about was not in the Intelligence bill. So people should assume the Judiciary Committee spent a great deal of time debating this amendment, right? Wrong. The Judiciary Committee spent 7 minutes debating this amendment before it was adopted, again, on a 10-to-9 partisan vote, party-line vote. Let me repeat that. Seven minutes on something that is this important. The Intelligence Committee spent months coming up with a compromise that the leaders of the intelligence community say is the minimum--minimum--they need to have. We are enacting national security legislation, and it is our responsibility to ensure this bill does not lead to unintended consequences which provide protections to terrorists. This provision is one example of an amendment adopted by the Judiciary Committee which could and probably would, if it were enacted, harm national security. It also serves as yet another reason why we should not support the Judiciary substitute or any aspect of it. I am a member of both committees. In fact, I believe I am probably the longest serving member on the Intelligence Committee. The Judiciary bill includes provisions that could weaken national security. Why are we thinking of handcuffing ourselves? We should not blindfold our intelligence agencies, spin them around to disorient them, and then send them out to find terrorists. We are not playing pin the tail on the donkey. We are legislating on national security, and the stakes are too high to allow legal loopholes in the Judiciary substitute to go forward. Now, I am not alone in this view, as the Executive Office of the President today released a statement of administration policy which stated: If the Judiciary Committee substitute amendment is part of the bill that is presented to the President, the Director of National Intelligence, the Attorney General of the United States, and the President's other senior advisers will recommend that he veto this bill. Mr. President, I ask unanimous consent that letter be printed in the Record.

Mr. HATCH. To my distinguished colleagues, I urge you to support the bipartisan Rockefeller-Bond compromise bill, one that has been superbly debated within the Intelligence Committee and has been carefully thought out. It provides protections to civil liberties and ensures that technological changes do not outpace our laws. I wanted to personally pay tribute to the distinguished Chairman of the Intelligence Committee and the distinguished Vice Chairman. They know what they accomplished in the Intelligence Committee was very important, and it should be followed by us on the floor. We cannot even begin to talk about some classified issues on this floor. We cannot even begin to talk about the dangers that will come from going beyond that bill that passed 13 to 2 in the Senate Intelligence Committee. I refuse to place our country at risk. I refuse to do anything that would make our country be at risk. I suggest to you that if we follow the Judiciary Committee bill, I think we would be doing exactly that. Mr. President, I reserve the remainder of my time, and I yield the floor.

Mr. HATCH

Mr. HATCH. Yes, this legislation is only meant to change the name of the single institute within NIH and to have no other effect on the NIH or its organization.

Mr. HATCH. Mr. President, I am hopeful we will approve tonight a bill I have authored with Senators Mikulski, Enzi and Harkin, The Eunice Kennedy Shriver National Institute of Child Health and Development Act. This act will change the name of the National Institute of Child Health and Development to the Eunice Kennedy Shriver National Institute of Child Health and Development. Our bill honors a truly great American who has played a unique role in advancing children's health, and particularly in shaping how we treat individuals with intellectual disabilities. Few Americans have ever played such a profound role as Ms. Shriver has played in her life and it is entirely fitting that we rename NICHD on her behalf.

Mr. HATCH

Mr. HATCH. Mr. President, I would like to take just a moment to talk about the cloture vote on the Energy bill today. I have worked very closely with my good friend, Senator Baucus, the chairman of the Senate Finance Committee, to restructure the energy tax provisions in a way that reflects a more balanced energy policy. I have consistently opposed the energy tax package up to this point. I voted against the proposal in the Senate Finance Committee because I believed it did not reflect a balanced energy policy. Rather, it imposed new taxes on our Nation's oil companies, while doing too little to address one of our Nation's most pressing energy needs: our lack of domestic refining capacity. I also voted against cloture on the energy proposal on the Senate floor in June before it was sent to conference, or what should have been a conference on the proposal. So many of us were not even afforded the courtesy of basic Senate procedure, and that was appalling. Thus, when the bill came back from the House with a House amendment earlier this month, I voted against cloture once again. It was my understanding that when cloture failed, solid commitments had been made to ensure the minority would be included in the formulation of a bill that would really address some of the very real energy problems we have in this country. Based on this understanding and as a senior Republican on the Senate Finance Committee, I worked with my colleagues on the Finance Committee to improve the tax package. To the credit of Chairman Baucus and several members on both sides of the aisle, significant and important modifications were made to the tax portion of the Energy bill. The new tax provisions included in this bill take some important steps toward balancing this bill in a way that will benefit U.S. consumers. The new severance tax on offshore production in the Gulf of Mexico had been dropped from the revised bill. This move alone restored more than $10 billion toward the effort to increase our domestic production of oil, provision to extend for 3 years a tax incentive that I had originally sponsored to increase refining capacity. Senator Baucus also dropped a tax increase on natural gas lines, which restored over $500 million to our natural gas infrastructure. Finally, a provision that would provide incentives for the conversion of hybrid electric vehicles to plug-in hybrid vehicles was included. This restored an important aspect of my legislation known as the FREEDOM Act, or S. 1617. To say this bill is perfect would be an enormous stretch. I believe the tax package was improved, but it could still be a whole lot better. However, given the realities of Congress, I believed the more balanced tax bill was worthy of my support. Also of great concern, this bill would apply new Davis Bacon requirements to energy production activities. Expansion of Davis Bacon is poor public policy and absolutely terrible energy policy. Now that cloture has failed and it is apparent the Energy bill cannot proceed, I encourage my colleagues to remove these provisions prior to any additional votes on an energy bill. I believe these provisions are one of the main reasons this bill is unable to secure enough support to proceed.

Mr. HATCH

Mr. HATCH. Mr. President, today I rise in reluctant opposition to the amendment offered by my friend, the gentleman from Iowa. Our Nation has been blessed with a judicial system dedicated to the principle of the rule of law. Each one of us no matter how: rich or poor; strong or weak; big or small; receive equal justice under the law. In part, that is one of the reasons why our national competition policy is framed in general, universal terms. Specifically, the Sherman Act prohibits every ``contract, combination or conspiracy, in restraint of trade;'' and the Clayton Act prohibits all acquisitions whose effect ``may be substantially to lessen competition.'' There are many instances, where we have diverged from these principles, even for good cause. However, in many of these instances we have encountered numerous difficulties and our economy harmed by unexpected consequences. One need only look at correcting legislation that the chairman of the Antitrust Subcommittee, Senator Kohl, recently offered eliminating railroad antitrust exemptions. Senator Kohl believes, with a great deal of merit, that many shippers are being charged exorbitant prices to transport their goods by the railroads. In fact, the Antitrust Subcommittee, of which I am ranking Republican member, received a letter, as part of the subcommittee's hearing into railroad antitrust exemptions, from several States' attorneys general that discussed how foreign corporations are very reluctant to invest in new American manufacturing facilities if the proposed location of these facilities is serviced by only one railroad. Senator Kohl's solution to this problem is to eliminate the special antitrust exemptions granted to railroad mergers. Indeed, many Senators have argued for the repeal of the McCarran- Ferguson Act. As my colleagues know the McCarran-Ferguson Act exempts the business of insurance from Federal antitrust laws when and to the extent that business is regulated by State law. These Senators believe that certain insurers took advantage of the McCarran-Ferguson exemption to implement a collective agreement to raise insurance prices on gulf coast residents still recovering from Hurricane Katrina. Clearly, there is evidence of unattended consequences when special provisions are permitted in antitrust law. That being said, there is a substantial difference between railroad antitrust exemptions, McCarran-Ferguson exemptions and creating new agriculture antitrust guidelines as called for by the Grassley amendment. I thoroughly recognize that the market relationship between the producer and the food packer desires special attention. However, the underlining concern is well founded: special antitrust rules for specific industries can have profound undesirable consequences and violate one of our national competition policies fundamental tenants: that antitrust law should be framed in general, universal terms. So the question I believe that we should be asking is if the remedy to this situation is additional, special legislation, or greater enforcement? Currently, the Department of Justice has devoted considerable effort to investigate agricultural mergers but the time might be coming where we need to increase those resources for the Department. Perhaps the creation of a new Deputy Assistant Attorney General, whose responsibilities are solely to investigate agriculture mergers, is the correct path. My trepidations of industry-specific rules, such as those called for by the Grassley amendment, are that they are likely to create legal difficulties. First, industry-specific rules add to the danger of inconsistent enforcement across industries. Second, industry-specific rules introduce additional uncertainty, since it will not always be clear in which industry a particular product should be classified, and thus not clear which legal standard will apply. Finally, has shown that once you enact industry-specific rules other industries and constituency groups will request there own special antitrust rules. So what should we do? Do we maintain our national competition policy which is framed in general, universal terms, or should we embrace through industry-specific enactments. Well let's look at the record. During a period of ever increasing complex laws and regulations having general and simple rules makes antitrust law more understandable to both the legal and business community. The general language of current statutes provides courts and enforcement agencies valuable flexibility to incorporate the latest developments in business and economic learning. It should also be noted that, where industry-specific factors are important to reaching a correct decision in a particular case, the agencies and the courts are already fully authorized to consider those factors under current law. In particular, current antitrust principles can address issues of buyer power that have concerned some observers of agricultural mergers. One should also remember that congressionally created Antitrust Modernization Commission concluded that ``the basic framework for analyzing mergers followed by the U.S. enforcement agencies and courts is sound.'' Therefore, I oppose Senator Grassley's amendment. Senator Grassley has a well-deserved reputation for standing up for and defending the American farmer. I agree that we must be vigilant in ensuring that the Department of Justice and Federal Trade Commission are diligent in enforcing antitrust laws--but those laws should be for all American economic endeavors, not fragmented as all too many of our laws have become.

Mr. HATCH

Mr. HATCH. Mr. President, I rise today to speak in honor of Representative Henry Hyde, who, as we all know, passed away last Thursday. I believe all those who knew Henry will remember him for his sincere moral convictions and his dedication to the country. Representative Hyde was born in Chicago in 1924. He graduated from Georgetown University, where he was a standout on the basketball team that made it all the way to the 1943 National Championship game. He went on to obtain a law degree from Loyola University. Henry was in the Navy during World War II, serving in combat in the Philippines. After the war, he served for more than 20 years in the Naval Reserve, eventually obtaining the rank of commander. In 1974, he was elected to the House of Representatives where he would represent the citizens of the Sixth Congressional District of Illinois for 22 years. During his time in the House, he became known as a steadfast proponent of the rights of the unborn, authoring the Hyde Amendment, which, to this day, ensures that Federal taxpayer funds are not used in the performance of abortions. He was also a stalwart supporter of our Nation's military and firm believer in the need to uphold the rule of law. Henry and I had the distinct privilege of having our chairmanships of the House and Senate Judiciary Committees overlap for a substantial period of time. We worked together on numerous pieces of legislation and I always enjoyed the passion and energy he brought to every issue. Henry was a very capable legislator and a man of deep convictions. Last month, President Bush honored Representative Hyde by awarding him our Nation's highest civilian honor, the Presidential Medal of Freedom. During the ceremony, which Henry could not attend due to his declining health, the President described Henry as a ``powerful defender of life, a leading advocate for a strong national defense, and an unwavering voice for liberty, democracy, and free enterprise around the world.'' While there were times that Representative Hyde found himself in the middle of divisive and fiercely partisan debates, I don't think that anyone would doubt that he always sought to stand behind his principles and to do what he believed was best for our country. I want to express my deepest condolences to Representative Hyde's family and my thanks for his years of service to our great Nation. He will be sorely missed.

Mr. HATCH

Mr. HATCH. Mr. President, I rise today to speak in honor of Utah State Senator Ed Mayne, who, after a 9-month battle with lung cancer, passed away on the morning of Sunday, November 25. I speak on behalf of many citizens of my State who, over the years, had grown to respect Senator Mayne's support for American workers and his dedication to the State of Utah. Senator Mayne was born in Magna, UT, in 1945. He graduated from Granger High School in West Valley City and played football for 2 years at Snow College in Ephraim, UT. In the mid-1960s, he got a job working on the track gang for Kennecott Copper in the Bingham Canyon mine. It was then that Senator Mayne became involved in organized labor. In his early years at Kennecott, he became active in the local chapter of the United Steel Workers of America, quickly becoming the president of Local 485. In 1977, he became president of the entire chapter and, later that year, at the age of 32, he was named president of the AFL-CIO of Utah. He was, at that time, the youngest AFL-CIO chapter president in the country. In 1994, Ed was elected to serve in the Utah State senate and was in the midst of his fourth term when he died. Throughout his time in the senate, he remained dedicated to improving the lives of workers and, while he had strong personal ties to organized labor, he was committed to serving both union and nonunion workers alike. He also devoted himself to serving poor people in Utah, working to, among other things, maintain State Medicaid benefits and to protect low-income borrowers from the exploitation of predatory lenders. Ed Mayne was somewhat of an anomaly in Utah. He was a tried and true Democrat in one of the most Republican States in the country. However, even the most conservative Utah Republicans never doubted Ed's convictions, even when we disagreed with his position on certain issues. He left an indelible mark on the State of Utah and was a good example for all of us, Republicans and Democrats, who aspire to serve the public. I had known Senator Mayne for his entire career in the Utah State senate. We disagreed with each other on many occasions, but there was never any animosity or hatred, just respect and friendship. We also agreed on several things and I cherished the opportunities I had to talk to him about pressing matters facing the State of Utah and sharing ideas of how to fix them. The sentiments shared at Ed's funeral summarize our relationship very well when the eulogizer mentioned that Ed and I were very close friends and we liked each other very much. That is truly the way I felt about Ed. I express my deepest condolences to Senator Mayne's family and my thanks for his years of service to the great State of Utah. I am grateful to have known such an outstanding public servant.

Mr. HATCH

Mr. HATCH. Mr. President, the AMT was initially designed to catch about 155 people who were not paying taxes but were immensely wealthy and getting all kinds of income every year. Today, there are 4 million people who are paying the AMT. If we don't do something about it, there will be 25 million tomorrow. To be honest with you, because we have delayed so long, we are going to be in a bind as far as even getting the software done, the paperwork done, the IRS work done to be able to give people their refunds this next year because of the delay we have had. I respect the distinguished chairman of the committee. It has been a very difficult committee to manage, and he has done as well as anybody I can imagine. We need to fix the alternative minimum tax, the AMT. There is no argument in this chamber about that. If we fail to act, 25 million Americans might have to write checks to Uncle Sam for thousands of dollars. So we agree on fixing the AMT. But the devil is in the details, and I cannot support a plan that prevents a tax increase on millions of Americans by raising taxes on others. Congress never anticipated having anywhere near this level of AMT revenues to begin with, so we should not be raising taxes permanently to make up for that phantom lost revenue. We are well past time for serious action on the AMT. Almost 3 weeks ago, I came to the floor to discuss the financial and political ramifications of Congress' failure to fix the AMT. We had a crisis then. It is worsening by the day. Even if we were to patch the AMT today, the American people will suffer from our inaction. We have known that the AMT train was coming down the tracks all year. This failure to act is setting new standards for ineptitude. Three weeks ago, the failure to patch the AMT was merely creating uncertainty for millions of Americans who would be subject to it if we dropped the ball. Three weeks later, these poor folks are barely the half of it. Now billions of dollars in tax refunds risk being delayed because of inaction. On November 26--11 days ago the chairman of the IRS Oversight Board sent a letter to the chairman and ranking member of the Senate Finance Committee. His grim assessment of the situation is worth our review. The filing season is expected to start on January 14, but that date is now in jeopardy. IRS computer programs are set to process tax returns under current law. The IRS cannot flip a switch and process millions of tax returns in January, when Congress changes the law on Christmas Eve. According to the IRS Oversight Board, the IRS would be able to start processing tax returns within 7 weeks of the enactment of an AMT patch. So if we were to enact an AMT patch today, tax filing season would start almost 2 weeks late. That delay would lead to 6.7 million delayed tax returns and $17 billion in delayed refunds. What if we delayed the start of tax season 1 more week? Then we are looking at 15.5 million delayed tax returns and $39 billion in delayed refunds. Push it back another 2 weeks--37.7 million delayed tax returns and $87 billion in refunds delayed. Many Americans actually look forward to getting their W-2 in the mail. Their employer withholds too much money from their paycheck every year, and the W-2 allows them to file a return and get that money back. And now with electronic filing, Americans are able to get those refunds even more quickly. Utahns depend on their refunds. They count on their refunds. Undermining that confidence is much worse than a lump of coal in a stocking. We are now in the Christmas season. I am sure that the movie ``Christmas Vacation'' will be on television soon. That movie contains a lesson that we should all heed. In that movie, Clark Griswold, assumes he is going to get his annual Christmas bonus. That Christmas bonus is as reliable as a weekly paycheck. And when that bonus did not come, he--flat--out--went--nuts. The political philosophy of Clark Griswold is one that I would commend to my colleagues. It is one shared by the American people. If you mess with my family's financial security, you better watch out. The Senate's failure to patch the AMT in a timely fashion is going to delay millions of tax refunds, and we should not be surprised when the American people--like Clark Griswold--go nuts. Right now, Americans are likely making decisions about the Christmas gifts they are going to buy, at least partially, based on their tax refund. They assume they are getting that tax refund. And they assume they are getting it on time. Further delay is no longer acceptable. Yesterday on the floor, Republicans were blamed for holding up passage of an AMT patch. That is funny. When Republicans were in the majority, we managed to pass an AMT patch early in the year, no later than May 11. We did it without permanent tax hikes to pay for 1-year AMT fixes. We did it without including special interest giveaways, and we did it without delaying tax refunds. Democrats did tell us yesterday on the floor that they are the party of change. On the AMT at least, they seem to be succeeding. To fix the AMT they propose raising taxes. To pass important tax extenders they are raising taxes. And their efforts have now jeopardized the tax filing season and refunds for the hard working Americans who depend on them. When times change, they sure do change. We are about to have a vote on the AMT. I support AMT relief. I support AMT repeal. But I will not support this fake tax relief. I am not the only one. The Democrats' plan to fix the AMT with permanent tax increases ought to fail. And for good reason. We should not be paying for temporary tax cuts with permanent tax increases, nor should we be putting the economy at risk by passing unnecessary tax hikes. When this episode is over, we need to get down to the real business of fixing this AMT so we can get Americans the tax refunds they expect and the tax relief they deserve.

Mr. HATCH

Mr. HATCH. Mr. President, I rise today to speak in honor of a friend of mine, Mr. George Osmond, who, on Thursday, November 6, passed away. While most people will likely remember George as the patriarch of one of our Nation's most famous entertainment families, he should also be remembered as a great humanitarian and entrepreneur. George was born in 1917 in Star Valley, WY. As a young man, in 1941, he enlisted in the Army and served honorably during World War II. In 1944, he was stationed at the U.S. Army's General Depot in Ogden, UT, where he met his wife, Olive May Davis. George and Olive were married in December 1944 and had nine children, eight boys and one girl. To most, George's early professional life was quite normal. He began his career selling real estate and life insurance. He later took a position as the Ogden Postmaster. During that time, his sons began to study music; George taught them to sing barbershop and helped them get invitations to perform at community events. His family first entered the national spotlight when four of his sons, Alan, Wayne, Merrill and Jay, formed a quartet known as ``the Osmond Brothers'' and began performing at Disneyland and on The Andy Williams Show. Over the years, seven of his nine children would perform a variety of music styles all over the world. All counted, the Osmond family has recorded 142 albums, selling 100 million copies with 51 gold and platinum recordings. George, himself, worked as the manager of his children's music careers, working to make sure they remained grounded and focused on the importance of family. One of the lesser known facts about the Osmond family is that two of the Osmond children, the oldest sons Virl and Tom, were born deaf. While these two sons were never music performers, they were closely involved with their father's charitable efforts, working with him to establish The Osmond Foundation, which later became the Children's Miracle Network. The Children's Miracle Network is now headquartered in Salt Lake City and has, to date, raised more $3 billion, which is distributed directly to a network of 170 hospitals. These funds are raised specifically for children's hospitals, medical research and community awareness of children's health issues. It is the largest organization of its kind in the world and is, in addition to their many children and grandchildren, George and Olive Osmond's greatest legacy. Mr. President, I knew George Osmond for many years. He was, above all else, devoted to his family and a man of integrity. I thoroughly enjoyed the opportunities I have had over the years to work with him and his family on several charitable endeavors. George was truly a remarkable man who leaves a long legacy here with us in his passing. I want to express my deepest condolences to George's family and thank them for their wonderful example of service.

Mr. HATCH

Mr. HATCH. Mr. President, I rise today to discuss the U.S.-Peru Free Trade Agreement, FTA. As my colleagues are aware, I am a strong proponent of free trade, having voted for every trade agreement that has been negotiated during my 31 years in this body. Despite that fact, I have concerns over some recent changes to the Peruvian agreement and, more specifically, the deal that was struck between the administration and the congressional Democrats on May 10. Specifically, the changes to the intellectual property rights, IPR, and labor chapters of this agreement will, I believe, become more relevant when we as a nation begin to negotiate future free-trade agreements with deserving nations. It is my sincere hope that I am wrong and that we will not in the near future face serious challenges to our national labor laws as a result of this agreement. Unfortunately, we will not have to wait, however, to realize the devastating effects that the new trade deal will have on our IPR concerns. The labor chapter of the U.S.-Peru Free Trade Agreement could put U.S. Federal and State labor laws at significant risk. Several provisions of the labor chapter of the U.S.-Peru trade agreement create an unacceptable risk that the United States will be required to change important provisions of U.S. Federal and state labor law or be subject to trade sanctions. Given that the purpose of the May 10 agreement was to ensure that Peru adopted strong labor provisions, not the United States, Congress's implementation of this agreement should provide an explicit safe harbor for U.S. labor law. Peru FTA requirement to adopt ``fundamental labor rights'' puts right-to-work, freedom of association and other major U.S. labor provisions at significant risk. Article 17.2 of the Peru FTA requires both Peru and the United States to ``adopt and maintain in its statutes and regulations, and practices there under, the following rights as stated in the International Labor Organization ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up (1998) (ILO Declaration) where it affects trade between the countries. These rights are freedom of association, recognition of collective bargaining, elimination of forced/compulsory labor, effective abolition of child labor, prohibition of worst forms of child labor, and elimination of employment discrimination. The Peru FTA does not provide any definition of these fundamental rights, leaving the interpretation of what constitutes ``freedom of association'' or ``collective bargaining'' to a dispute settlement panel appointed by the U.S. and Peruvian Governments. Given the agreement's reference to the ILO declaration, it is widely expected that such a dispute settlement panel would in fact look at and rely at least partially on the standards of the relevant ILO core conventions associated with these rights, much as the ILO does each year in its followup reports required by the ILO declaration. The recent push by House Democrats to have Peru enact very detailed changes to its treatment of--contract laborers as part of its implementation of the agreement an issue not specifically addressed in the Peru FTA-- confirms the wide range of issues subject to this chapter. The United States, which has only ratified two of the eight ILO core conventions, faces substantial risk that a panel will find that U.S. labor law violates the Peru FTA, requiring the U.S. to change its law or face trade sanctions. Key U.S. laws subject to that risk include: State right-to-work rules, which standard labor market analysis and several other countries, such as Canada, find imposes an improper restraint on the ability of workers to bargain collectively or to strike, as nonunion workers have the authority to vote on whether to strike; U.S. prohibitions on the admission to unions of persons connected with the Communist Party or the Klu Klux Klan given that ILO standards require the admission of all applicants; U.S. prohibitions in the National Labor Relations Act, NLRA, on the inclusion of supervisors in union, which is required by ILO conventions; Exclusive bargaining rights provided under the NLRA, which are in conflict with ILO standards requiring minority unions be allowed to function; Various Federal and State laws that place reasonable and balanced limits on the right to strike, which are in conflict with the ILO conventions' prohibition on virtually all restrictions on the right to strike; U.S. laws permitting the permanent replacement of striking workers, which the ILO has indicated may pose a risk to the effective enforcement of the right of collective bargaining when it occurs on an extensive basis; Fair Labor Standards Act minimum age of 14 and state laws where there are no minimum ages for children working in agriculture contravenes the ILO minimum age convention; and Lack of equal remuneration or comparable worth rules. The Peru FTA is likely to require State labor law changes as well. By requiring the adoption of these rights at the Federal level, the Peru FTA in combination with the U.S. Constitution's Supremacy Clause, Article VI, section 2, is also expected to require any changes made at the Federal level to preempt conflicting State law. As a result, State right-to-work rules or lower minimum age standards would face significant risk of being overturned by dispute settlement panels. The Peru FTA requires parties to promote migrant worker rights. Annex 17.6 requires the United States and Peru to engage in a wide range of capacity building work. While much of it could be useful, its obligation to promote migrant rights, without regard to the legal status of a migrant, creates a troubling requirement that the United States would be promoting rights for illegal immigrants at odds with Congress's direction. For years, I have been a steadfast supporter of fair intellectual property laws that are appropriately enforced. The Constitution itself provides for the creation of intellectual property, and it has been the process used by brilliant U.S. innovators to develop, market, and sale groundbreaking new products for years. In the sea of red trade deficits we have faced for so many years now, IP and the innovative U.S. products that use its protection have been one of the few areas where the U.S. has a trade surplus. Traditionally, trade agreements have strengthened American innovation abroad. However, with the newly renegotiated text found within the U.S.-Peru FTA's IPR chapter, we see that we have walked back from the rigorous IPR protections found in previous agreements in favor of weakened provisions. These changes mainly affect one of America's most productive industries, that of pharmaceuticals. The U.S.-Peru FTA weakens IP protection in three ways: First, the agreement does away with patent linkage. Linkage requires a country, before it approves a generic medicine for sale, to ensure that the brand-name medicine is no longer under patent. Without linkage, governments can help facilitate patent infringement. Linkage doesn't hinder access to medicines, and it is not about compulsory licensing. It is about protection of basic patent rights. The proposed changes replace this simple enforcement procedure with a complex one. I don't see what that accomplishes. Second, the changes shorten the period of data exclusivity for innovative medicines, authorizing a shorter period than we require here in the United States. This change is not only unfair to U.S. innovators but devalues the incentive for launching new drugs in developing countries. Here is why. In developing countries, it is often difficult to enforce patent rights. But data protection is effective and relatively easy to administer. It often provides the only real protection biopharmaceutical companies have when they invest significant resources to launch new products. You take away the protection and you take away the incentive to launch. It is hard enough to get companies to launch medicines quickly in these countries because the markets are so small. If you shrink data protection, you effectively shrink the market even further. Finally, the new template no longer requires countries to add time to patent terms for pharmaceuticals to make up for undue delays in marketing approval or patent grant. We require patent restoration here in the United States, so why not abroad? Because, critics argue, patent terms are long enough as they are. But without patent term restoration, we actually go the other direction. Without patent term restoration, the effective patent term could actually shrink significantly. From what I understand, the Democrats insisted on the changes to the IPR chapter in order to grant greater access to medicines for developing nations. What is ironic to me is that these changes will do just the opposite. All of these changes were ostensibly part of an effort to promote access to medicines to poor people. A noble goal. But what is so absurd about this is that the changes may actually have the opposite effect and harm U.S. competitiveness in the process. Why would we backtrack on IPR? Some may say that we are rich enough so that we can afford to give away the fruits of our ingenuity. But that is like saying we are rich enough to voluntarily close down our factories so that our competitors can have a chance. We don't have that luxury. Some say backtracking on IPR is necessary to help the poor and sick. That, too, is wrong. IPR is all about incentives. If you protect IPR, then people will have a stronger incentive to develop new and innovative products and bring them to market faster. If you don't protect IPR, then those incentives are greatly diminished. Here is what we might expect with weak IPR protection: There would be less incentive to launch products early in developing countries. Innovative companies would have less reason to show up when their technology could immediately be copied and sold by others who made no contribution to the R&D. If there were fewer brand-name launches, there would be fewer generics. As brand-name medicines go off patent, generic medicine companies can rely on the safety approvals and market secured by the research-based companies, making more generics available to more people. Without the brand-name company securing the safety approvals and creating the market, fewer generics can enter the marketplace, and fewer people will get the medicines they need. As a result, the poor would not have access to the newest and most effective medicines. It is easy and convenient to use IPR as a scapegoat for poor health care systems. The reality is that access to medicines is helped, not hindered, by strong IPR protections. Problems in access to medicines are most often due to other factors, such as poor infrastructure, taxes, tariffs, an ineffective health care system, and different government funding priorities. By pointing at IPR, we divert attention from these much more critical problems. In sum, the changes we have foisted upon Peru are harmful not only to U.S. interests, but also to the very interests they purport to serve. I applaud the USTR and her staff on their hard work in negotiating this agreement, especially in the area of intellectual property rights. However, I know there are several Senators in this body who represent States that contain numerous innovative companies that benefit from strong intellectual property laws and enforcement. While the overall agreement strengthens American IPR, it does so in a way that is not as vigorous as agreements in the past. Millions of jobs across the country depend on these laws. I know firsthand that many countries around the world would like nothing more than to see the U.S. intellectual property laws and enforcement diminished. Why? Because they want to exploit us. They want to be able to steal our inventions. They want to be able to ripoff our best and brightest ideas. They want our taxpayers to fund billions of dollars of extremely important research and then take it from us for free. I have been assured by the administration that the issues that I have raised today will never become a problem for the United States. While I am confident that my concerns remain valid, I am unwilling to stand in the way of the President's trade agenda. The Peruvian trade agreement will provide needed trade benefits to many Utah businesses that exported $7.7 million worth of goods in 2006, not to mention the overall benefit of the agreement to the U.S. economy as a whole. Therefore, I will reluctantly vote for the U.S.-Peru FTA before us today. However, I will not give up on improving future trade agreements in the critical areas of labor and intellectual property rights.

Mr. HATCH

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

Mr. HATCH

Mr. HATCH. Mr. President, I rise today to discuss the pending crisis of the American taxpayer. The cause of this crisis is the failure of Congress to deal honestly with the alternative minimum tax, or AMT. Debate over what to do about the AMT has become a yearly ritual on Capitol Hill. As a member of the Finance Committee, I fully understand this ritual. But this year, we are dragging our feet, and the more we delay, the more likely it is that millions of Americans will get socked with an unexpected tax bill next year and millions more will have their refunds delayed. Now it appears we are not going to address the AMT until December. Failure to address the AMT promptly on our return will be a pretty terrible Christmas surprise for the families impacted by congressional ineptitude, but it will certainly be a surprise they will never forget. I can see it now: Surprise, you need to write a check for $3,000 to the IRS by April 15. That is right up there with: Surprise, you have been served. Yet Congress delays. Congress fiddles. This is grossly irresponsible. According to Secretary Paulson and the Department of the Treasury, unless we fix the AMT, 25 million taxpayers will be subject to it in 2007. That is 21 million more than in 2006. And 25 million other taxpayers will face delays in the processing of their returns and receiving of refunds. In my home State of Utah, the Joint Tax Committee estimates we will jump from 19,000 AMT filers to 150,000 AMT filers. This is simply unacceptable. Most of the taxpayers who are at risk have not planned for the eventuality of AMT liability. After all, year after year, like clockwork, the Republicans controlled Congress and they passed AMT relief. We are already too late to avoid some problems. The IRS warned Congress that unless we fixed the AMT by early November, there would be serious delays in the processing of tax returns. We are now pushing toward Thanksgiving. Secretary Paulson has made clear that based on historical filing patterns, enactment of an AMT fix in mid to late December could delay issuance of approximately $75 billion in refunds-- that is with a ``b,'' a billion dollars, 75 of them. That is 25 million tax refunds delayed. It is always a bad idea for Members of Congress to get between their constituents and their tax refunds. Yet here we are. How did we come to this particular pass? The story of the AMT should be a case study for limited Government. Give Congress long enough, and it will find a way to mess things up. In 1969, the press reported that 155 high-income Americans paid no Federal income taxes in 1966. That was found out in 1969. Congress came to the rescue, creating an alternative minimum tax that would make sure all Americans paid their fair share. The AMT would prevent tax avoidance by disallowing certain credits and deductions. As if it is not bad enough figuring out one tax system, now many Americans would have to complete their tax a second way--once under the traditional income tax and once under the alternative minimum tax. And naturally the tax that gets paid is the one which is highest. Still, this AMT was originally meant to apply to a small number of filers--155. That is 155 out of almost 300 million people. Today, it is a menace threatening millions of Americans. Absent changes, estimates show that by 2010, nearly 89 percent of all married couples, with two children, earning between $75,000 and $100,000 will be hit by the AMT. Make no mistake about it, elected officials are responsible for that train wreck--and, I might say, on both sides of the aisle. In 1986, Congress failed to index the AMT exemption for inflation. In 1993, a Democratic Congress and President Clinton took us a bit further down the road toward this fiscal debacle. They raised the 24- percent rate on the first $175,000 of the alternative minimum tax. They raised that taxable income to 26 percent. The rate on income in excess of $175,000 was raised to 28 percent. Republicans in Congress attempted to right the ship. In 1999, we passed a provision repealing the AMT in its entirety. Done. Finito. Vaya con dios, AMT. Had President Clinton signed this bill, we would not be having this debate today. Millions of Americans would not be staring down the barrel of an unfair and unplanned-for tax hike. But we all know how this story ended. President Clinton vetoed the bill. This was the coup de grace. And so the AMT would continue to haunt us, growing bigger and more destructive every year since then. The tax cuts of 2001 and 2003 only further emphasized the insidiousness of the AMT. These tax cuts promised tax relief to middle- class families and economic growth. Yet, as the economy grew and income rose, more and more middle-class families fell into the AMT trap. Economic growth, income growth, tax cuts, and a failure to index the AMT for inflation created one costly cocktail for millions of families. So there you have it. Congress manages to take a tax designed to target a handful of super-rich tax avoiders--155 people--and 40 years later, millions of middle-class families are being hit by that tax. For what it is worth, this experience should give pause to any American who wants to hand management of the Nation's health care system over to the good people on Capitol Hill--us good people on Capitol Hill. Nonetheless, since 2001, Congress has patched the AMT. In layman's terms, on a yearly basis we have increased the AMT exemption. The result is that fewer Americans have an AMT liability greater than their liability under the ordinary income tax. These patches have done the trick. They have prevented the AMT from hitting even more families. Republicans dutifully passed that patch as sure as the sun rising in the morning. Now, don't get me wrong, a yearly patch is no substitute for what we tried to do during the Clinton years, and that was to completely repeal the AMT, which I have been advocating for many years. Only complete repeal will remove the uncertainty faced by millions of Americans with potential AMT liability. And as is on full display this year, that uncertainty is growing. The problem now is the insistence by my colleagues on the other side that we follow the so-called pay-go rules. Under a Democratic Congress, any tax cuts must be paid for. Now, let me translate that for you. This Democratic Congress is going to raise your taxes, and to pay for the AMT, a Democratic Congress is going to have to raise a lot of your taxes. Under pay-go rules, if Congress passes a provision that reduces revenues to the Treasury, it must make up the balance from somewhere else. This is true even if the provision does not cut taxes but merely prevents a tax increase from hitting middle-class American families. The Democratic Congress is proud of these rules. These rules supposedly demonstrate a commitment to fiscal responsibility. But, as some wags have suggested, the Democrats misnamed their rule. It should be more accurately called tax-go, not what it has been--pay-go. You see, in the hands of a Democratic Congress, the way to balance the books after a tax cut is never to cut spending; it is always to raise taxes. You have to love the logic. We are going to cut taxes by raising taxes. This is a public policy of robbing Peter to pay Paul. Now, you don't have to take my word for it. This is what Congressman Tim Mahoney, a Florida Democrat, had to say: You want to reward people for taking risks. How about budget cuts to make government more efficient? We need to show people we are good managers and stewards of their money. I've been here 10 months and I haven't seen one proposal to cut spending. Now, I think that about hits the mark, and that is a Democrat speaking about Democrat rule in the House of Representatives and the Senate. Now, for the Democrats--most of them--fiscal responsibility means one thing: raising your taxes. They have a one-page playbook, and with the AMT fix passed by the House last week, they ran that play right down the throats of the American people. Touchdown, Democrats. Unfortunately, the American people are the big losers here. A 1-year patch for the alternative minimum tax costs $50 billion. For 2 years, we will need to come up with $135 billion. Permanent repeal of the alternative minimum tax will now cost us $872 billion. Oh, if we had just had President Clinton sign into law the repeal of AMT that we passed through both Houses of Congress back then. But let's just start with the 1-year patch. In order to pay for this $50 billion 1-year patch--or a tax increase, in other words--the House had to come up with $50 billion in tax increases. One of the most talked about tax hikes in that bill involves treating carried-interest income, currently taxed as capital gains, as ordinary income. This is an old-school soak-the-rich play, honed before the adoption of the forward pass. I think for this one the Democrats pulled out FDR's playbook. Go after private equity managers, raise taxes on the 50,000 people nationwide earning carried interest, and keep taxes level for the 23 million people whose financial security is jeopardized by AMT. Never mind the fact that this could create perverse disincentives for one of the engines of our current economic growth. Never mind that it would reduce risk-taking in venture capital firms and real estate partnerships and other entities that create jobs and economic growth. Never mind the fact we are paying for a 1-year AMT tax by permanently raising taxes--your taxes. No, what is really pathetic about this proposal is that the Democrats who support this want to permanently raise taxes to pay for revenue we never thought we would have in the first place. People, this is phantom revenue. We were never going to collect this money. We never wanted to collect this money. But with a twisted sense of fiscal responsibility, we are now going down the road of permanently increasing taxes to make 1-year offsets on money we never thought we would have. And that is because we are unwilling to cut spending in this Congress today. Now, this is some seriously warped tax policy. The House majority leader sees these misguided tax hikes as a model of virtuous statesmanship--``Raising revenues takes political courage.'' If that is true, then the House Democrats are the Spartans of tax hikes. In the end, I doubt we will raise taxes to pay for AMT relief. I certainly hope we will not do that. I understand why the Democrats feel the need to blame someone else for this problem. While Americans everywhere could be hit by the AMT, it really is the high-tech States--represented primarily by Democrats-- that will suffer the most if Congress fails to act. All States will suffer, but the ones that will suffer the most are the blue States. Taxpayers in California, Connecticut, Maryland, New Jersey, and New York filed 44.2 percent of all AMT returns last year, and I think that figures in it a lot. This disparity is only growing. If Congress does not fix this problem, in States such as Connecticut, Maryland, and New Jersey, nearly 25 percent of current filers will be forced into paying the alternative minimum tax. Absent alternative minimum tax relief, New York would have 1 million additional AMT tax filers this year compared to last year--1 million more. In California, the number of new AMT filers would increase by 1.7 million. I don't mind these Robin Hood-like approaches to blue States, if that is what they want to do by electing people who do this to them. I think they have a right to do that. But I will bet money that they do not want that type of thing to happen to them. These individuals and families, who are going to now be sucked into the AMT tax, never thought they would be subjected to the AMT and so they did not withhold accordingly. The worst case scenario, then, is that they will actually have to cut checks for thousands of dollars come April. Let's not forget the 25 million lower income taxpayers who are facing long delays in getting their refunds because of the slowness of the Congress and the inability of Congress to get this done. This would be devastating, it will be devastating, unless we can change this. Yet we continue to dither. The answer is easy: Repeal it, just do it, get rid of it already. But Democrats do not seem to be inclined to do the sensible thing. They want to let the AMT linger and fester. Year after year, repeal will become even more expensive and the Democrats, armed with their pay-go rules, will have to find a way to balance the books when they do repeal it. What do they propose? How will they offset the nearly $1 trillion that AMT repeal or reform will cost? If you look closely enough, you can just make it out on the horizon--the mother lode, the mother ship, the mother of all tax reforms, according to my dear friend over in the House, the chairman of the Ways and Means Committee. We are close friends but, boy, he called it right, the mother of all tax reforms. AMT relief is at the center of the central Democratic proposal for tax reform. While this tax reform is going nowhere right now, make no mistake about it, this is what we have to look forward to, from a Democratic Congress and White House. My friend from New York, the chairman of the Ways and Means Committee, has a way of getting what he wants. He is smart--I think he is brilliant, personally--he is persistent, and he knows how to cut a deal. I know. I have worked with him on a number of things. I have great admiration for him. And this mother of all tax reforms is his baby. But as much as I love my friend Congressman Rangel, this is one ugly mother. This mother is not friendly or funny like Lucille Ball. She is a bit creepy, as a matter of fact, as you can see. Actually, she is a bit scary. That is frightening. At times, she is downright unstable. This may be hard to see on the television cameras here, but she looks pretty unstable to me. And she is coming to get the middle class. This mother promises to get rid of the onerous AMT. By repealing AMT, mother claims she will provide tax relief to millions of middle-class families. But mother is really only out for mother. Of course, that relief is not real relief, since we never intended those families to pay the AMT in the first place. Calling this tax relief is like someone getting ready to hit you in the head with a hammer, deciding not to hit you, and then telling you that he is doing you a favor. What she gives with one hand, this mother takes away with the other, by assuming the 2001 and 2003 tax cuts, so essential to our economic growth, will expire. The mother ship already comes fully loaded with the largest tax increase in history. Allowing the 2001 and 2003 tax cuts to expire would dwarf even that. This is not a recipe for happy taxpayers, this is bitter and unnecessary medicine. The majority of Democrats in the Congress seem prepared to make the American taxpayer take the dose. You can see, it is not very tasty. We do not need to go down this track. To borrow from an old movie, we should ``Throw Momma''--this mama--``From The Train.'' It would be a real mistake to continue the practice of paying for fake, temporary tax cuts with real and permanent tax hikes. Contrary to the assertions of some of my colleagues on the other side of the aisle, the only responsible and the only realistic action we can take is to repeal the AMT in its entirety right now. We should do so without raising taxes. We are going to have a debate in the next few years over fundamental tax reform and we are going to have debates over fundamental health care reform. We should do so without the specter of the AMT hanging over this Chamber. I urge my colleagues to repeal it in its entirety, right now, without raising taxes. You cannot be fiscally responsible without being fiscally honest. This phantom income should play no part in broader debates over tax reform. At the very least, we should not pass permanent tax hikes that would have ugly economic ramifications in order to pay for 1 year of AMT relief. We are putting off disaster 1 more year by doing that, at a cost of $50 billion in tax increases. There are some ways we can do this. There are no good ways we can do this. But I know one thing, the worst way is to do it by increasing taxes to pay for it, and stifling the economy that has enough on its plate with the high cost of energy, to mention one item. To go to approximately 24 million people from 155 people is more than absurd. That is where we are going. If we take this mother of all tax reforms seriously, and if we were able to pass that--and I hope we are not--I have to say there is going to be a great increase in taxes, a great stifling of the economy, and much more difficulty for this country in the coming years. One reason I am giving these remarks is I know there are people on the Democratic side who do not like this, who are responsible and who do want to do what is right, who basically know there are no good options here. Raising taxes is one of the worst options we can do. I appeal to them to stand up now and not let this happen because if it does, this economy is going to pay a tremendous price. I think in the end, as bad as it will be no matter what we do, there are better ways of doing this than increasing taxes, doing it the way that has been suggested. Mr. President, I suggest the absence of a quorum.

Mr. HATCH

Mr. HATCH. Mr. President, today I join with Senators Rockefeller, Lott, and Kennedy to introduce the Medicare Quality Improvement Modernization Act of 2007, S. 2396. As background for my colleagues, Medicare's Quality Improvement Organization, QIO, program has been in existence for 35 years. The program's intent has always been to assure that Medicare's beneficiaries receive high quality medical care. The program has undergone a steady evolution. What began as a program that called attention to hospitals and physicians whose care deviated from the norms of medical practice has morphed into one that seeks to help physicians, hospitals, nursing homes and other providers develop systems to improve their quality of care. The program has changed as the definition of quality changed. When Medicare's peer review program was initiated, high quality care for a Medicare beneficiary was simply not to be among the unfortunate few whose medical care deviated from the norms of local medical practice. Fortunate for them, however, quality today is the routine adherence of providers to nationally accepted standards of care. The legislative changes we propose for the QIO program reflects an ever-advancing definition of quality medical care and a focus on helping providers obtain it. The QIO program has three functions. First, the program reviews the medical care of beneficiaries who have complaints about their care and provides the beneficiaries opinions. Second, the program supports intensive work with practitioners, nursing homes, managed care plans and hospitals to develop delivery systems that improve the quality of their care. Third the program publicly reports system-level performance measures. The bill I introduce today is faithful to the results of a congressionally-mandated review of the QIO program reported in February, 2006. In that review, the IOM concluded ``The QIO program provides a potentially valuable nationwide infrastructure dedicated to promoting quality health care.'' For example, the QIO program is responsible for a substantial part of the National Healthcare Quality Report published by the Agency for Healthcare Research and Quality. The IOM report called for changes in the QIO program. Its principal findings and recommendations were that the local QIO boards are heavily physician-dominated with little consumer representation. Existing legislation requires specific levels of physician involvement, an outmoded board structure. Also, the QIO functions should be harmonized with other federal quality Initiatives. It found that the QIOs were ``. . . restricted from contracting with health care providers in its state for technical assistance or review services similar to those covered by its core Medicare contract.'' The IOM committee concluded that QIOs would be able to serve more providers and expand their function beyond Medicare beneficiaries to the entire healthcare system if they could contract for services to supplement their CMS funds. The Committee also recommended removal of restrictions on public access to the QIO's findings. For instance, beneficiaries have been unable to review the results of investigations that they requested. The IOM recommended that beneficiary reviews be removed from the local QIOs. The IOM committee concluded that Congress and the secretary of DHHS and CMS should improve program management by enhancing the contracting process and improving communication with the QIOs. The legislation I propose seeks to strengthen the QIO's infrastructure to fit with an ever-tightening standard of quality in medicine, believing that doctors and hospitals want to do the right thing but also that patients should have their say. Many of the changes recommended by the Institute of Medicine's experts and accepted by the experts at CMS do not require statutory change, but some do. Some program modifications are sufficiently critical to Medicare's beneficiaries, that while statutory language may not be required to affect them, a Congressional mandate is needed to assure them. First, the Quality Improvement Organization Modernization Act of 2007 specifies that the Quality Improvement Organizations offer education, instruction, and technical assistance to providers, practitioners, and Medicare Advantage plans. It incorporates plans and providers in urban, rural, and frontier areas and providers that treat racial and ethnic minorities. Second, our bill strengthens the review process for individual Medicare beneficiaries. The QIOs must actively educate beneficiaries of their right to bring any concerns to the QIOs. The QIOs must work with providers who are reviewed to correct deficiencies where they exist and to improve communication with patients where they do not. The bill specifies that the findings of the review must be disclosed to the beneficiary requesting the review but not before giving the provider an opportunity to respond to the findings. The review functions are left with the local QIOs and not delegated to other entities to perform. The bill specifies that the findings of reviews may not be used in medical malpractice litigation, otherwise the QIOs would serve more to screen cases for litigation than they would to improve the quality of care. Third, in order to be certain that the QIOs are appropriately judging the severity of the errors they find and appropriately recommending sanctions to the Secretary, the Office of Inspector General will contract for an audit of 10 percent of one year's QIO reviews during each 5-year contract period. Fourth, program administration is strengthened and its goals focused. The program's scope of work must incorporate the priorities of local stakeholders. A strategic advisory committee will advise the Secretary on program goals, on program performance, and on harmonization of the QIO's quality functions with other federal and non-federal quality initiatives. The GAO is instructed to report on implementation of program changes 1 year after the first 5-year contract period following enactment of this legislation. The adequacy of funding allocated to the QIOs for local initiatives has been in dispute among the QIOs. Congress is to receive an independent report about the adequacy of QIO financing before the initiation of each contract period. The contracting process is strengthened by mandating timely contracting with the QIOs by CMS and by lengthening the contract period from 3 to 5 years. All QIOs must bid competitively every 5 years. Fifth, local boards have been physician-dominated with little consumer representation. Our bill eliminates the requirement that QIOs must be physician sponsored organizations. Our bill improves local QIO accountability by strengthening the authority of the Secretary over board structure and function. It authorizes the Secretary to ensure that non-physician quality experts and qualified consumers are given appropriate representation on state QIO boards. It authorizes the Secretary to ensure that the board structure is appropriate, that the compensation of board members and executives is market-based and that conflict of interest among board members is mitigated. Sixth, as the QIOs focus more of their energies on working with providers to improve quality the demand for their services in this endeavor exceed their resources. For example, the number of doctors requesting help from the Utah QIO in selecting information technology for their offices far exceeds the resources available to it from its CMS contract. Our bill allows a QIO to contract with a provider or organization if it meets one of several requirements. Among them are that the QIO must receive no more than 5 percent of its revenue from a single provider or organization, or if the contracting organization is subject to review by the QIO, conflict of interest must be mitigated by using an out-of- state QIO to perform the reviews that the local QIO would otherwise perform. The QIO program differs from other Federal health care quality programs in that it does not just measure quality; it works with providers to attain it. The Medicare Quality Improvement Organization Act of 2007 strengthens the rights of beneficiaries, strengthens the administration of the program and the contracting process, provides for more accountability of contractors, and focuses the program on creating quality systems. I urge my colleagues to join with me in strengthening the QIO program. It is one of the cornerstones of the quality initiative not just for Medicare but for all Americans.

Mr. HATCH

Mr. HATCH. Mr. President, following the unauthorized public disclosure in 2005 of what has become known as the Terrorism Surveillance Program, numerous lawsuits were filed against electronic communication service providers for their alleged participation. Currently, more than 40 lawsuits are pending, which collectively seek hundreds of billions of dollars in damages. Let me repeat that figure, hundreds of billions of dollars. For myriad reasons which I am going to discuss, these service providers alleged to have participated deserve a round of applause and a helping hand, not a slap in the face and a kick to the gut. The amount of misinformation concerning this issue is staggering. Given that this dialogue involves highly classified details, there are many things that simply can't be discussed. However, the committee report for the recently passed FISA modernization bill, S. 2248, from the Senate Select Committee on Intelligence is public, and contains very pertinent information. The report mentions that as with other intelligence matters, the identities of persons or entities that provide assistance to the U.S. Government are protected as vital sources and methods of intelligence. Details of any such assistance can not be discussed. However, the committee report does mention that beginning soon after September 11, the executive branch provided written requests or directives to U.S. electronic communication service providers to obtain their assistance with communications intelligence activities that had been authorized by the President. During consideration of FISA modernization legislation, the Intelligence Committee examined classified documents relating to this issue. The committee, in an overwhelmingly bipartisan tally, voted to include retroactive immunity for service providers that were alleged to have cooperated with the intelligence community in the implementation of the President's surveillance program. Senators from both sides of the aisle, after careful consideration, came to this conclusion. Make no mistake, this was the right conclusion. It was the right conclusion for the Intelligence Committee, and it should be the right conclusion for the Judiciary Committee, when it considers this bill tomorrow. Given the astounding amount of misinformation in the public domain concerning the Terrorism Surveillance Program, it is not surprising that these lawsuits are filled with false information and baseless allegations. Some have asked a valid question, if the companies did not break the law, why do they need immunity? Quite simply, the Government's assertion of the state secrets privilege prevents these companies from defending themselves. This assertion by the Government is absolutely essential, as the possible disclosure of classified materials from ongoing court proceedings is a grave threat to national security. Given the necessity for the state secrets privilege, the drawback is that the companies being sued are forbidden from making their case. In fact, the companies cannot even confirm or deny any involvement in the program whatsoever. They have no ability to defend themselves. Ordinarily, these companies would be able to address allegations and make their case. However, the classified nature of the topic means that companies are not free to do so. They can't even have discussions with shareholders or business partners. But we need to remember, lawful silence does not equate to guilt. Another point not mentioned nearly enough is that the Government cannot obtain the intelligence it needs without the assistance of telecommunication companies. This means that our collection capabilities are dependent on the support and collaboration of private businesses. If retroactive immunity is not provided, these private businesses will certainly be extremely hesitant to provide any future assistance to our intelligence community. This could have a crippling effect on the security of millions of people in our society; thus, it's simply an unacceptable outcome for the safety and security of our Nation. Any hesitation from companies to provide assistance with future Government requests could be disastrous. This could affect not only our intelligence community but domestic law enforcement efforts. The next time a child is kidnapped, and law enforcement needs help with communications, would that situation allow any hesitation from the service provider? If your son or daughter was missing, would you stand for any lack of cooperation from companies? Do we want endless teams of private company lawyers second, third, fourth, and fifth guessing lawful orders to compel their assistance? This is not the only problem with not including retroactive immunity. As the duration of these lawsuits increases, so does the chance that highly classified sources and methods of our intelligence community will be unnecessarily and unlawfully disclosed. Our enemies are acutely aware of these proceedings, and are certainly attempting to gather information previously unknown to them. The potential disclosure of classified information also puts the personnel and facilities of electronic communication service providers at risk. Given all of the tremendous harm and damage that will occur by not passing a form of limited liability, I am amazed at the number of individuals who fail to grasp the seriousness of the issue before us. To those who purport to oppose immunity in any form, I would hope that they take the time to actually read the bill. For those unable to tear themselves away from their favorite partisan blog, I am going to quickly tell you what the immunity provision says, and what it does not say. Remember, this bill passed 13-2 in the Intelligence Committee. A civil action may be dismissed only if a certification is made to the court certifying that either (1) the electronic service provider did not provide the alleged assistance, or (2) the assistance was provided after the 9/11 attacks, and was described in a written request indicating that the activity was authorized by the President and determined to be lawful. Furthermore, this certification has to be reviewed by the court before a civil action can be dismissed. It does not provide for immunity for Government officials. It does not provide for immunity for criminal acts. Instead, it is a narrowly tailored provision that strikes a proper balance. This point can't be overlooked; the immunity provision in the current bill has absolutely zero effect on the numerous lawsuits pending against Federal Government agencies. These cases will go on, with their questionable constitutional challenges, with no impact from this bill. Some Senators have suggested that indemnification or substitution would be possible solutions. Let me be perfectly clear, neither one is appropriate or acceptable in this situation. The Intelligence Committee considered both of these ideas, and rejected them for good reason. Indemnification, where the Federal Government would be responsible for any damages awarded against the providers, is not advisable since the providers would still be parties to the lawsuits, and thus the suits would continue with the consequences of disclosure and discovery. Not only does this further the likelihood of disclosure of classified material, but the companies will face serious damage to their business reputations, relationships with foreign countries, and stock prices. This is extremely unfair, if handled improperly. Substitution, where the Government would litigate in place of the service providers, is not a viable solution since all of the same concerns just mentioned still apply. Even though the providers will not be parties to the litigation, discovery will still apply. Don't we realize that having the Government fund unnecessary litigation is a tremendous waste of taxpayer dollars? The Government does not magically create dollars, it taxes hard-working Americans. When it comes to funding, who do we think the Government is? To say that the Government should pay is to say that our mothers, fathers, brothers, sisters, sons, and daughters should have money forcefully taken from their paychecks to fund frivolous lawsuits. This is Alice in Wonderland, and down the rabbit hole we go. Finally, for those who love to expound the catch phrase ``warrantless wiretapping'' to assert some theory of illegality, I encourage you to carefully read the fourth amendment. Contrary to any other assertion, the fourth amendment does not always require a warrant and is based on the reasonableness of searches. While the phrase is meant to scare people, ``warrantless wiretapping'' in this instance is perfectly legal and constitutional. Immunity is an appropriate remedy. It is just. It is necessary. It is imperative for the continued success of our intelligence gathering. While reasonable minds can disagree about political topics, this issue requires disciplined logic, not political hyperbole. I hope that people keep the following facts in mind when considering this topic. The program did not involve interception of domestic to domestic phone calls. The President and the highest levels of the executive branch determined the program to be lawful and conveyed this fact repeatedly in writing to service providers. The electronic service providers' participation was vital to the security of our country. Lives have been saved by this program. The companies were called on to support a lawful program that was vital to the security of our country. Do the companies require thanks or appreciation? No, but they certainly do not deserve illegitimate and false criticisms that affect their financial well being. A grateful public should certainly appreciate the critical assistance the companies alone can provide for the public's defense. These companies are quite possibly facing irreversible harm to their business reputation and cannot defend themselves due to state secrets. This debate has far too many Monday morning quarterbacks, applying their revisionist history to best represent their political mantra. I strongly urge all of my colleagues to support the limited immunity provided for in S. 2248. Any company that has done its part to provide for the protection of American families deserves protection in return. If not, the next time we reach out for a helping hand, we will be the ones who receive a slap to the face. And really, who could blame them? I yield the floor.

Mr. HATCH

Mr. HATCH. Mr. President, today we approved the Conference Report on the Improving Head Start for School Readiness Act of 2007--H.R. 1429. I applaud the good work of all involved. I particularly want to commend Chairman Kennedy and Senator Enzi, as well as Chairman Miller and Representative McKeon on the House side for their collective work on this important bill. Head Start is a national program promoting school readiness through educational, health, nutritional, and social services. Currently, Head Start serves over 900,000 low-income children and their families in approximately 1,600 programs run by public and private agencies. As a whole-child, whole-family program, Head Start prepares children for what we hope will be a lifetime of learning. I want to recognize and commend our Head Start programs in Utah. They do an outstanding job, and I believe this legislation will go a long way to providing additional support for them. I have appreciated their input during this long process. I have been struck by some of the stories shared by our Head Start people in Utah. I remember hearing from one of our Head Start Directors that a number of children have never held a book before entering the program. When they are handed their first book, many don't know how to open it. Entering Head Start swings wide the doors of learning and opportunity and exposes young children to the reading and learning process. I have also heard stories of Head Start children who were suffering from major medical problems that would not only threaten their ability to learn but their very lives. One of the great characteristics of the Head Start program includes the identification and treatment of several medical conditions, many problems can be detected and treated before they become serious learning impediments. The Improving Head Start for School Readiness Act of 2007 not only reauthorizes the program, it greatly improves and strengthens it. This bill will enable more low-income children to get into the Head Start program. Utah has only been able to serve just over 50 percent of its eligible children. This bill provides for the expansion of Head Start and Early Head Start in States, like Utah, serving fewer than 60 percent of eligible children. This bill strengthens the accountability of Head Start programs and improves the overall quality of Head Start grantees, as they will be reviewed every 5 years. It clarifies and strengthens the role of the governing board in the oversight of the program. It also respects the priority role of parents and family through the collaborative role of the policy councils and operations of the Head Start programs. Through this legislation, the Head Start workforce is strengthened, as goals have been established for education standards for Head Start teachers, curriculum specialists, and teacher assistants. It requires Head Start teachers to have in-service training every year and ensures professional development for all Head Start staff working directly with children. The Improving Head Start for School Readiness Act of 2007 strengthens coordination and collaboration of the program by aligning services with State early learning standards, providing professional development opportunities for Head Start staff, and promoting partnerships with other agencies. Because I believe that education is best done at the local and State levels with appropriate Federal support, I am pleased that under this bill, states will designate a State Advisory Council that will closely address the education and care of children from birth to school entry. I strongly support the authorization for Centers of Excellence to designate model exemplary Head Start programs in every State. One of the concerns expressed by many of us as we started this process years ago, was the challenge of strengthening the academic portions of Head Start. Under this bill, Head Start agencies will use scientifically based measures to support learning and program evaluation. Recommendations of the National Academy of Science study on Developmental Outcomes and Assessments for Young Children will be incorporated. Although the National Reporting System was intended to improve the program, it was found to be time-consuming and unwieldy for Head Start programs, and without demonstrated benefits. That reporting system has been eliminated under this bill. In order to educate every child in our country, we must prepare them. Many pre-school children, particularly those who are disadvantaged, would have learning difficulties long before they entered elementary school. This bill will help these young, vulnerable, and teachable children develop the necessary early reading and math skills to be successful in school. It will address their health and nutritional needs, and it will provide important socialization. It also engages and empowers parents, and benefits us as a Nation. I was proud to have worked with my colleagues on the Senate Health, Education, Labor, and Pensions Committee to get this bill through the legislative process, and I was pleased to see it pass unanimously today.

Mr. HATCH

Mr. HATCH. Mr. President, I rise to speak concerning the Mortgage Cancellation Relief Act, S. 1394. In previous Congresses, I have introduced this legislation to provide immediate tax relief to homeowners adversely impacted by the recent downturn in the Nation's housing markets. However, this Congress, I am pleased to join my friend and colleague from Michigan, Senator Debbie Stabenow, as a cosponsor of S. 1394. She was on the floor earlier this morning, and she had the opportunity to address this bill. I want to thank her for her continued interest in this issue. I agree with her that it is well past time for Congress to act on this legislation. There are a number of positive things I can say about S. 1394. It is a bipartisan bill. It is sound tax policy. It is good economic policy. And it treats those who have been impacted by housing declines fairly in their time of need. As I mentioned, Senator Stabenow introduced this bill in May. The President recommended a similar proposal in August. However, the one not-so-positive thing I can say is that it is not law. We are now into November. And despite all of the positive aspects of S. 1394, it has still not been reported by the Finance Committee or debated on the Senate floor. The problem addressed by this legislation has its roots in the housing market. In September, overall home sales slid 8 percent from the month before. Single-family sales slowed to the lowest pace in nearly 10 years. Inventory is going up. At the end of August, there was a 9.6-month supply of homes. At the end of September, there was a 10.5-month supply of homes on the market. So supply is up, and demand is down. A high school senior, barely paying attention in his economics class, could tell you the result. The result is a buyer's market. The median home price is down 4.2 percent from the year before. With the dip in the housing market has come a corollary decrease in new home construction. According to one recent estimate, construction spending on all new homes fell by 22 percent in 2007. The decline was even greater for single family homes--25 percent. With another 4 percent dip in 2008, residential construction spending will be down to $254 billion in 2008 from $384 billion in 2005. While this is not good news for the Nation's builders, at least it tells us that the U.S. housing market is functioning rationally. As the supply of housing tightens, demand and prices will once again go up. This leads many economists to believe that housing markets will turn the corner sooner rather than later. In the meantime, however, we have a deadly economic mix of declining housing prices, interest rate volatility, and adjustable rate mortgages that are beginning to reset. When this convergence of events takes place and is followed by a certain unnecessarily punitive and totally unfair provision in our Tax Code, life becomes even more burdensome for some of our most vulnerable families and communities. Let me explain why. Adjustable rate mortgages are a product that provides an opportunity for millions of families to achieve home ownership. Because they pose less risk to lenders, these mortgages can be a more affordable product that allows families to purchase homes while assuming the risk that interest rates will increase. Yet because of the easy availability of adjustable rate mortgages, some people took out very high mortgages and according to the Wall Street Journal, there are 17 percent adjustable rate mortgage holders who cannot make their payments on time. We are currently witnessing how well private industry will be able to handle this problem on its own. The Nation's largest mortgage lender, Countrywide Financial, announced that it is modifying the terms of $16 billion in adjustable rate mortgages. Thirty thousand have already restructured their loans, and Countrywide intends to contact 52,000 borrowers to see if they would like to restructure their loans as well. Still, the declines in the Nation's housing markets have left two groups particularly vulnerable. First, there are those who sell their homes for less than the outstanding amount of the mortgage. Second, there are those who are unable to make their mortgage payments and suffer foreclosure. As I mentioned earlier, the Tax Code effectively kicks these folks while they are down. The Internal Revenue Code defines income very broadly. And when lenders forgive mortgage debt in a short-sale or a foreclosure, the borrower has technically received taxable income. Yet this is phantom income, and it makes little sense to have these financially vulnerable families getting a form 1099 and an increased tax liability for income they never received. This makes little sense as public policy. And it is inequitable as tax policy. Section 121 of the Internal Revenue Code allows the exclusion of up to $250,000--or $500,000 on a joint return--of gain on the sale of a home. Few people realize gains in excess of this statutory exclusion. And for those who do, those gains are taxed at lower capital gains rates. Yet if a family is in such a dire financial situation that it is losing its home or selling it at a loss, the phantom gain on these transactions is taxed at ordinary income rates. With adjustable rate mortgages being reset, growing housing inventory, and declining housing prices, too many people will be getting a 1099 form in the mail telling them that they owe income taxes on this debt forgiveness. This is not the way it ought to be. Our legislation would remedy this problem by excluding this debt forgiveness from gross income. There is precedent for this. Congress provided similar relief in the wake of Hurricane Katrina. Given the ramifications of housing market declines, we should extend this needed relief to all Americans who find themselves receiving this kind of phantom income. Yes, we would forgo some tax revenue by making this simple, fair, and commonsense change to our tax laws, but the House has found a reasonable offset that is supported by the housing industry so the net effect to the Federal budget should be zero. As I stated earlier, it is time to act. I am not sure what the delay is. The drop in the housing market and the problems with adjustable rate mortgages are no longer breaking news. It has been nearly 6 months since this bipartisan legislation was introduced. It has been over 2 months since the President indicated he supported this legislation and wanted to get it signed into law. This Congress seems to have ground to a halt. You can hear crickets chirping on the Senate floor lately. To say we are too busy to address this important legislation is simply false. The lack of quick action on this legislation is no longer acceptable. I urge my colleagues to support S. 1394 and for the Senate to pass this legislation as soon as possible. Families in need and vulnerable communities demand that we act.

Mr. HATCH

Mr. HATCH. I ask unanimous consent that Jesse Baker, a Federal Government detailee, be granted the privileges of the floor for the remainder of this session.