Fritz Hollings

Mr. HOLLINGS

Mr. HOLLINGS. I thank the distinguished Senator.

Mr. HOLLINGS. That is right, it took 3 days. I will never forget, Henry Fonda was over at the National Theater, and I was sitting right inside the rail with John W. Davis and Mr. Briggs right at the table, and I got Fonda to sit up there with me during the 3 days. He didn't leave. He wanted to hear all the arguments. That was in December of 1952.

Mr. HOLLINGS. Three days, yes.

Mr. HOLLINGS. Mr. President, right to the point. A lot of exercises are going on with respect to Brown v. Board of Education. Most of the comments, of course, are lamenting the fact we have not proceeded too far, or sufficiently, with respect to the integration of public education in America. That misses the point. The point is this decision itself more or less removed the lid off the punch bowl of segregation and allowed all Americans, regardless of race, creed, or color, to become, for the first time, full Americans, full citizens. Yes, if you please, Rosa Parks could know, in not moving from that front seat in the bus, down in Montgomery in 1955 after the 1954 Brown decision, that she was a full citizen, she was a full American. That in and of itself is the real significance of this history-making decision in the last century. It certainly is the most significant judicial decision of that century in that it amended the Constitution and gave us pride, all of us, in full citizenship in this land. I rise because of the emphasis nationally with respect to the Brown case, while the truth is the leading case was from the State of South Carolina. In December of 1952, the arguments before the U.S. Supreme Court, let the record show that Thurgood Marshall, chief counsel for the NAACP, did not argue the Brown case; he argued the Briggs v. Elliott case of South Carolina. This is not to take in any sense away from the Kansas situation, but everyone should realize the State of Kansas had only a 7-percent minority population. People did not understand that. There was a law to the effect that all cities in excess of 15,000 population could either opt for segregated schools or for integrated schools. Under that particular law, it more or less devolved down to where the elementary schools were segregated and the secondary schools were integrated. But it was not a matter of societal significance--so much so that, in essence, the State of Kansas had already decided not even to argue the case before the Supreme Court. They were going to just submit it on written briefs. I speak advisedly. I was not the lawyer in the Briggs v. Elliott case. I was admitted to practice before the U.S. Supreme Court when we made our arguments in December 1952. I was sent at the last minute by Governor James Francis Byrnes, who formally occupied this desk as a Senator, as did John C. Calhoun, and Governor Byrnes said: Fritz, you wrote that 3-percent sales tax for the schools that we enacted in 1951 under his leadership. He said: You know all the elements of the equalization of the teachers' pay, the transportation, and the construction of public schools in South Carolina. You know that issue of separate but equal, how we equalized everything and what we had done to the extent of over 3-percent sales tax to finance it and everything else, so it was real and not just what we intended. He said: You have to go up there with Robert McC. Figg, the active counsel at the local level in Briggs against Elliot, and with John W. Davis, former Solicitor General, candidate for President in 1924. According to Governor Byrnes, a former associate justice who sat on the Supreme Court, the constitutional mind of the legal profession is John W. Davis of West Virginia. I have called him and he is going to make the arguments pro bono for the State of South Carolina that he believes so vehemently in Plessy vs. Ferguson, the 1896 decision of the Supreme Court that enunciated the separate but equal doctrine. That was my participation. Let me go back to the earliest part because that is the real significance of this change in our culture, society, and Constitution. It was back in 1947 that a group in Summerton, SC, which is in Clarendon County, and had gotten together an old, discarded bus. Levi Pearson was the principal mechanic. He fixed the engine and got that bus all ready to go. They went to the school board for a little gasoline money. The school board said: No, we are not giving you any gasoline money. They said: Well, you have it for the White children. They have the money. We have to walk to the Scotts Branch School--which was a 9-mile walk for some of them--down a dirt road. We get this big yellow bus full of White children passing us in the dust or in the rain--whichever of the two. They said: And we just fixed up the bus. It won't cost you anything. They said: No. You folks don't pay taxes and we don't have any money for gasoline for you to have a ride to school. When you hear this, you begin to understand the significance of the change in our society and what we call equal rights under the law. That is somewhere along the ceiling up here. So Pearson got together with Rev. Joseph De Laine. Reverend De Laine was an AME preacher and also a schoolteacher, and later a superintendent. They went up to Columbia and they got the case going. On a technicality, if you please--they found out the plaintiff in the case lived just over the line. His children were attending school in the district where the case was brought, but on a technical thing they had it thrown out. They could always find something to prohibit any kind of relief for the African Americans at that particular time. So Reverend De Laine went and talked, in Columbia, to James M. Hinton, the NAACP director. He said: Look, Reverend, if you go down to Summerton and you get 20 plaintiffs, I can get that lawyer Marshall, up there in Washington, DC, to bring a class action. So Reverend De Laine came back down to Summerton, got the 20 parents, and some 46 children, and that gives the genesis of the famous ``Summerton 66.'' Anywhere you talk, in the African-American community in America, they know of that ``Summerton 66.'' Mind you me, this started 8 years before Rosa Parks. Incidentally, and I am grateful to the Senate, they unanimously endorsed the Congressional Gold Medal for Levi Pearson, for Harry and Eliza Briggs, as well as for Rev. Joseph De Laine. That is one of the reasons why this afternoon, when we are not too busy, I am speaking. I had intended to speak on Monday, which is May 17, the actual 50-year anniversary of Brown v. Board of Education, but I have to be at an event in South Carolina. I do not know that I will get back in time. But be that as it may, it is important that the record be made about these valiant Americans who changed history. When they got there, sure enough, Thurgood Marshall took up the case. Then, as the expression goes, all hell broke loose. I could go into the details, but that is why I speak without notes. I could tell you just when and where and how Reverend De Laine's home was shot, and later it was burned. He escaped to a church down in Lake City some 35 miles away, where, again, his church was burned and he escaped with his life, never to return to the State of South Carolina. They held a warrant out on him for 45 years. He had fired back at the car the first time when they shot his home in order to identify the car, but he never got a chance. They held on to the warrant on him for some 45 years. Harry Briggs, the plaintiff, he ran a filling station there in Summerton. Nobody would buy gas from him anymore. He escaped down to Florida to make a living with his wife. Others who were just dirt farmers there could not, all of a sudden, buy seed to plant. They lost their livelihoods and everything of that kind. I could go down throughout the years. They stuck with it for a good 5- or 6-year period, until that decision was made. Every pressure in the Lord's world was made to try to threaten, coerce, and make them remove their names from that particular petition. But the famous ``Summerton 66''--the 20 parents and 46 kids--stuck with it, and they made history. When I came to Washington, it was on a Saturday morning. Robert McC. Figg, a distinguished lawyer--a Columbia University law graduate--had handled the case at the local level under Judge Waring in the Fourth Circuit Court of Appeals. We came up, obviously, on the appeal of the NAACP and Thurgood Marshall. We got here on a Saturday morning. You will begin to understand what we learned, to our shock, that our Briggs v. Elliott case, the lead case, all of a sudden had been set aside, and the lead case was made Brown v. the Board of Education in Topeka. Roy Wilkins was a friend of the Solicitor General, and they moved the case up because they knew that Kansas was not really disturbed and did not have a strong case one way or the other; it could care less. That was proved by that they were not going to even send an attorney to argue the case. I will never forget, on a Saturday afternoon and evening, Governor Byrnes was on the line with the Governor of Kansas, finally persuading him to send someone. Late on Sunday evening they sent Paul Wilson--an Assistant Attorney General. They did not send the Attorney General or anybody to handle it; they sent the Assistant Attorney General, and we helped brief him over at the Wardman Park. But I am getting ahead of my story. This morning I noticed in the Washington Post a Brown v. Board of Education decision whereby it is quoted that Thurgood Marshall thought that once they had won on May 17, 1954, there would be complete integration within 5 years. Absolutely wrong. False. I know, and the reason I know is because we were at Union Station here in the District. We were having breakfast--that is Dean Figg, who was later the dean of our law school--Dean Figg and myself. And in walked Mr. Marshall. He sat down and they began to exchange stories. Incidentally, they had the highest respect for each other. They got along. I will never forget when they were hanging a portrait of Jimmy Byrnes over in the Supreme Court, and Figg came in the doorway and Associate Justice Marshall hugged him and almost lifted him off the floor. And all the other Justices wondered what in the world was going on. They thought the world of each other. Thurgood Marshall turned and said: Now, Bob, let's assume I have won the case. How long do you think before there will be any real integration? And I will never forget it. Figg said: Thurgood, you are not going to like my answer, but it is going to be a good 25 years before there is any real integration. Marshall looked at him and said: No, you're wrong. It will be nearer 50 years. And here we are today, 50 years later, where the Scott's Branch School in the Briggs v. Elliott case is still 95-percent segregated. When that decision came out on May 17, we had 16 private schools in my little State of South Carolina. Now we have 372 private schools. Do you know why charter schools, tax credits, all that there malarkey is coming along? That is the drive to finance segregation. That is all it is. And they all know it. But you don't see that printed. We ought to test this to see how the schools can work. I wish they would go back to Horace Mann, when the greatness of America was public education, where all people of all classes and creeds were all put together, and they came and studied and graduated together and became one strong society. That is why I cosponsored the draft, yes, on the inequality of those who have to serve, but more than anything else, the strength of the draft itself in the building of America. There was another story that some will say is not politically correct, but I will never forget Marshall turned to Figg, and he said: By the way, Bob, you know--at that time they were referred to not as African Americans--that Negro family in Cicero, they are having near riots and everything else like that. So he said: Do you know what I had to do? I had to go down to Springfield and see Governor Adlai Stevenson. I got Governor Stevenson to send that family back to Mississippi for safekeeping. And he said: But for Heaven's sake, don't tell anybody that. That will ruin me. I said: Thurgood, don't tell anybody I am eating breakfast with you. I will never get elected to another office. I was a young Speaker pro tempore back over 50 years ago in 1952. Now we Democrats are begging to eat breakfast with African Americans, but not then. Oh, no. You folks in this Chamber have to understand the changes that have come about over America. But be that as it may, when we left that morning after breakfast, we found out that they had moved that case up for known reasons, and we had to fight all weekend to get Wilson. And Wilson teed off on Monday morning as the first argument in Brown against the board. He literally shocked the other side because he made a splendid argument. There were 3 days of arguments. Fred Vinson was the Chief Justice at the time. All of the lawyers were talking about the value of association under the Vinson decision of Sweatt v. Painter and making appeals, knowing that the court would once again confirm Plessy v. Ferguson. Governor Byrnes, incidentally, told me: Don't worry about that case. I have talked to some friends up there. He wouldn't want to say he talked to the Court. He said: I talked to some friends, and we will win that case. And there is no question that they probably would have. But what happened was that a few months later, Chief Justice Vinson passed away and Earl Warren was appointed Chief Justice. That changed history because Warren said: Come back and don't argue. So Warren made us come back, reargue not separate but equal, but the fundamental that segregation in and of itself was unconstitutional. So we went back and we reargued that case. On May 17, a unanimous court decision came down which changed America. There is no question in my mind that was for the good. I had my doubts at that particular time. Still as a young southern politician, I said: Good gosh, how are we going to do this? Well, it is very interesting. Thurgood Marshall, Bob Figg, Roy Wilkins, the NAACP lawyers, they all got together. And the Court, on May 17, said: desegregate with all deliberate speed. So Wilkins and Marshall had agreed to this--they said what we will do is the first year we will integrate the first grade. The second year we will integrate the first grade again, and of course the second grade is already integrated, then on up the line over a 12-year period, and we will have, with all deliberate speed, all the elementary grades integrated, beginning with the little ones playing together. That was Marshall's answer to Felix Frankfurter when Frankfurter asked him: What happens when you have won your case? What happens? He said: Well, the little children, if Your Honor please, who play together and go off to separate schools will come back and play together, and they will have freedom of choice. They can go to whatever school they want. What we are trying to remove is the State-imposed separation of race in public education. Our Constitution and the law of South Carolina, unlike Kansas, which was local option, our Constitution and law required separate but equal. We had it all worked out until the lawyer up in New York for the NAACP said: No, sir. We are not going to be given our constitutional rights on the installment plan. And the rest is history. We had the white citizens councils on the one hand. We had Martin Luther King, Jr., and burn baby burn on the other hand. And we literally had some 20 years--Malcolm X and everything else of that kind--of trauma, upset, burning here in Washington. I will never forget the riots in 1968. It has been quite a history over that period of time. What has happened is not integrated public education. That is agreed to. But it really made legitimate Rosa Parks and everybody else coming south, the freedom riders and everything else like that. For the first time officially everyone became a full citizen under the Constitution and under the law in America on May 17, 1954. So we made a lot of progress in the United States since that time. It was done through the valiant effort of the Summerton 66 that literally lost their lives--one was attributed to having lost his life as a result of the discord. But whatever it might be, Reverend De Laine could not return to South Carolina. The United States Senate and the House of Representatives unanimously have agreed now to present them the Congressional Gold Medal. It had been my hope that next Monday afternoon, May 17, we would have a ceremony in the Rotunda, but we will look forward to the time later this year when we can honor Reverend De Laine, Harry and Eliza Briggs, and Levi Pearson, who really understood the Constitution in America better than this particular Senator, who at that time was only a fledgling Democratic politician. That is the history. I will be glad to go into it sometime with my colleagues about some of the arguments made. I yield the floor.

Mr. HOLLINGS

Mr. HOLLINGS. Madam President, I ask unanimous consent I be allowed to extend my remarks of 20 minutes as in morning business.

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, I recently wrote a guest column on ``Why We're in Iraq'' for The State in Columbia, SC. I want to share it with my colleagues, and ask that the May 7 article be printed in the Record. The article follows. ``Why We're in Iraq'' (By Ernest F. Hollings) With 760 dead in Iraq and more than 3,000 maimed for life, folks continue to argue over why we are in Iraq--and how to get out. Now everyone knows what was not the cause of this war. Even President Bush acknowledges that Saddam Hussein had nothing to do with 9/11. Listing the 45 countries where al Qaeda was operating on Sept. 11 (70 cells in the United States), the State Department did not list Iraq. Richard Clarke, in ``Against All Enemies,'' tells how the United States had not received any threat of terrorism for 10 years from Saddam at the time of our invasion. On page 231, John McLaughlin of the CIA verifies this to Paul Wolfowitz. In 1993 President Clinton responded to Saddam's attempt on the life of President George Herbert Walker Bush by putting a missile down Saddam's intelligence headquarters in Baghdad. Not a big kill, but Saddam got the message: Monkey around with the United States and a missile lands on his head. Of course there were no weapons of mass destruction. Israel's intelligence, Mossad, knows what's going on in Iraq. It is the best. It has to know; Israel's survival depends on knowing. Israel long since would have taken us to the weapons of mass destruction if there were any, or if they had been removed. With Iraq no threat, why invade a sovereign country? The answer: President Bush's policy to secure Israel. Led by Richard Perle, Paul Wolfowitz and Charles Krauthammer, for years there has been a domino school of thought that the way to guarantee Israel's security is to spread democracy in the area. Wolfowitz wrote: ``The United States may not be able to lead countries through the door of democracy, but where that door is locked shut by a totalitarian deadbolt, American power may be the only way to open it up.'' And on another occasion: Iraq as ``the first Arab democracy . . . would cast a very large shadow, starting with Syria and Iran but across the whole Arab world.'' Three weeks before invasion President Bush stated: ``A new regime in Iraq would serve as a dramatic and inspiring example for freedom for other nations in the region.'' Every president since 1947 has made a futile attempt to help Israel negotiate peace. But no leadership has surfaced among the Palestinians that can make a binding agreement. President Bush realized his chances at negotiation were no better. He came to office imbued with one thought--re- election. Bush felt tax cuts would hold his crowd together and spreading democracy in the Mideast to secure Israel would take the Jewish vote from the Democrats. You don't come to town and announce your Israel policy is to invade Iraq. But George W. Bush, as stated by former Secretary Paul O'Neill and others, started laying the groundwork to invade Iraq days after inauguration. And, without any Iraq connection to 9/11, within weeks he had the Pentagon outlining a plan to invade Iraq. He was determined. President Bush thought taking Iraq would be easy. Wolfowitz said it would take only seven days. Cheney believed we would be greeted as liberators. But Cheney's man, Ahmed Chalabi, made a mess of the de-Baathification of Iraq by dismissing Republican Guard leadership and Sunni leaders, who soon joined with the insurgents. Worst of all, we tried to secure Iraq with too few troops. In 1966 in South Vietnam with a population of 16.5 million, Gen. William C. Westmoreland with 535,000 U.S. troops was still asking for more. In Iraq with a population of 24.6 million, Gen. John Abizaid with only 135,000 troops can barely secure the troops, much less the country. If the troops are there to fight, they are too few. If there to die, they are too many. To secure Iraq we need more troops at least 100,000 more. The only way to get the United Nations back in Iraq is to make the country secure. Once back, the French, Germans and others will join with the United Nations to take over. With President Bush's domino policy in the Mideast gone awry, he keeps shouting ``War on Terror.'' Terrorism is a method, not a war. We don't call the Crimean War, with the Charge of the Light Brigade, the Cavalry War. Or World War II the Blitzkrieg War. There is terrorism in Ireland against the Brits. There is terrorism in India and in Pakistan. In the Mideast, terrorism is a separate problem to be defeated by diplomacy and negotiation, not militarily. Here, might does not make right--right makes might. Acting militarily, we have created more terrorism than we have eliminated.

Mr. HOLLINGS

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

Mr. HOLLINGS. Mr. President, I call up my amendment No. 3134 and ask the clerk to report.

Mr. HOLLINGS. I thank the distinguished Chair. Mr. President, the underlying bill gives a 5-percent domestic manufacturing deduction to the manufacturing industry. Of course, that is woefully insufficient. My amendment would provide a full 9-percent domestic manufacturing deduction. The underlying bill slowly phases in the domestic manufacturing provision over a 5-year period, but instantly it gets the full effect of the overseas industry, the outsourcing. They immediately get some tax breaks over the period of the bill covering some 39, almost 40 billion bucks. Can you imagine that? Here is a bill entitled--this is the committee report--the Jump-Start Our Business Strength, JOBS, Act. It jump-starts the jobs in Shanghai and Guadalajara and not in Philadelphia, PA, I can tell you that right now. What my amendment does is provide the right incentives. It eliminates the tax breaks for corporations that have moved American jobs offshore and gives those tax breaks to the employers of jobs in America today. I wish to thank, first, the distinguished ranking member, Senator Baucus, of our Finance Committee and his outstanding staff. They have been very helpful in trying to make this amendment not only relevant but budget neutral. I am not sure about its budget neutrality, but I am told now we do have a relevant amendment. If we have to get into the arcane discussion with respect to budget neutrality, I will be glad to join it. I want to get to the point. We are still in a post-World War II culture, what they call up here an environment or pedigree. What happened was, after World War II, we had our finest hour with the Marshall plan. We sent money overseas. We sent expertise overseas. We sent equipment overseas. In the cold war, capitalism defeated communism. It worked. All during that almost 50-year period since World War II, we all enjoyed it because we fudged when it came to trade. We treated fair trade more or less as foreign aid, but we knew what we were doing. We had to sacrifice a certain amount of our industry, our jobs, our economic strength to prevail in this cold war. Now what has occurred is the competition has regeared, they have rebuilt, they have industrialized, and they have become outlandishly competitive. And here amidst a trade war, we hear those in the national Congress running around and saying: Woo, we might start a trade war; free trade, free trade, I am for free trade, when they know free trade is like dry water. There is no such thing. If you trade, you are trading something, you are swapping an article with various countries, free trade, but we know that is not going to come to pass. The example we set of a capitalistic free market and our endeavor in the last 50 years, the Japanese did not follow suit. They have the financing, they have the subsidies, they have the nontariff barriers, and we have yet to get into downtown Tokyo with American sales. Come on, quit kidding each other. It worked that way for Japan. Korea followed. And now China is following the same Japanese pattern of restricted and competitive trade, not free trade. Today we are in real trouble. We are losing jobs like gangbusters overseas. We have lost 68,000 jobs in the little State of South Carolina in the last 3 years, over 3 million jobs nationally. I can tell you, 58,000 of those jobs are our textile jobs, and they are not going to be replaced. You can put all this statistical information from the Federal Reserve and Greenspan about how we are creating jobs, but they are not coming to South Carolina. As Abraham Lincoln said some years ago: The dogmas of the quiet path are inadequate to the stormy present. As our case is new, we must think anew, we must act anew, we must disenthrall ourselves, and then working together we can save our Nation. That is the reason for this amendment. One does not put up an amendment to this finance bill with hope. The chairman of the Finance Committee knows there are not going to be any amendments. But we might be able to disenthrall our colleagues because the country has to develop a competitive trade policy in order to subsist and survive. I can point out survival in the very beginning of this Nation started with Alexander Hamilton. Of course, I will not read the book--Ron Chernow's ``Alexander Hamilton.'' They will not give me that much time, but I recommend to everyone this particular edition. You will find the mother country, England, prevented manufacture in the Colonies, later the United States of America. In fact, they arrested and jailed anyone with any manufacturing talent who would move from England to the Colonies. We had a veritable struggle in the earliest days, and we had just barely 1 hour of freedom when the mother country said: Under this David Ricardo doctrine of comparative advantage, we will trade with you what you produce best and you trade back with us what we produce best. As a result, Alexander Hamilton wrote his famous treatise, ``Report on Manufacturers.'' I will not read that and put it in the Record, but I will say in a phrase exactly what Hamilton told the Brits: Bug off. He told the Brits, we are not going to remain your colony, shipping you our timber, iron ore, rice, cotton, indigo, and natural resources, and importing the manufactured articles and remaining a banana republic; we are going to build up our own manufacturing. It caused me to listen to our friend Akio Morita, the former head of Sony. Some 20 years ago in Chicago, while lecturing third world countries, he said you have to develop a strong manufacturing sector in order to become a nation state. Then he pointed to me and said: Senator, that world power that loses its manufacturing capacity will cease to be a world power. It is economic strength that counts in this terrorism war. It is diplomacy. It is negotiation. It is not military strength. We have to disenthrall ourselves and realize when we are going around talking about we might start a trade war, it was Hamilton himself and the United States of America some 228 years ago that started the trade war. The very first bill--well, Pat Moynihan used to correct me on that. He said the first was a resolution for the United States Seal. So let's say the second bill that passed this Congress in its history on July 4, 1789, was a tariff bill, protectionism, a 50-percent tariff on 60 different articles. We started a trade war. When Abraham Lincoln was President, they were going to build a transcontinental railroad. They said, we are going to get the steel from England. President Lincoln said, we are going to build our own steel plants, and he put import restrictions on that British steel and we built the steel plants. When Franklin Roosevelt was President in the darkest days of the Depression, we did not practice any comparative advantage. He put on the most successful initiative ever with import quotas and subsidies for America's agriculture. That farm crowd that is now heading up our Finance Committee gets $180 billion worth of all kinds of subsidies. Then they run around here and tell this poor little textile Senator, protectionism, protectionism, you are going to start a trade war. We do not get a subsidy. We do not have those things the farmers have. I favor what the farmers have, I say in the same breath. I vote for it because I think it is a very successful program. President Eisenhower, in the mid-1950s, put on oil import quotas. Yes, John F. Kennedy--I sat there with Andy Hatcher and we would grind out the mimeograph machine--and we got the seven-point Kennedy textile program of restrictions on textile imports in 1961. Who else other than Ronald Reagan, the best of the best, he put import quotas on steel, machine tools, semiconductors, motorcycles. Last night, I was near Myrtle Beach and they told me there were 100,000 motorcyclists--I think I ran into 99,000 of them out on the highway-- but do my colleagues remember what old Ronnie Reagan did? He started a trade war of motorcycles. He put a 50-percent import tariff on motorcycles. Harley Davidson now has recovered its health and we have them all running up and down the beach at Myrtle Beach, SC. So do not come now and tell me about starting a trade war. We have had that trade war and we know simply and clearly what happens. I want to read starting on page 20 of ``Theodore Rex'' by Edmund Morris, because this is so interesting. I will read what protectionism did at the turn of the century, this is under Teddy Roosevelt, when we did not have an income tax. For the first 100 and some years, we financed this great United States of America with protectionism. I am trying to get that through so this crowd will wake up and quit pulling off this charade of the multinationals, because that is who we are facing. We are facing the U.S. Chamber of Commerce, the Business Roundtable, the National Association of Manufacturers, the Conference Board, the United Federation of Independent Businesses. The newspapers make a majority of their money on retail advertising and grind out this free trade, free trade, do not let us start a trade war. Well, here is what the trade war gave us: This first year of the new century found her worth twenty- five billion dollars more than her nearest rival, Great Britain, with a gross national product more than twice that of Germany and Russia. The United States was already so rich in goods and services that she was more self-sustaining than any industrial power in history. . . . More than half of the world's cotton, corn, copper, and oil flowed from the American cornucopia, and at least one-third of all steel, iron, silver, and gold. Here we are having trouble manufacturing steel. We were exporting one-third of the world's steel. Even if the United States were not so blessed with raw materials, the excellence of her manufactured products guaranteed her dominance of world markets. Current advertisements in British magazines gave the impression that the typical Englishman woke to the ring of an Ingersoll alarm, shaved with a Gillette razor, combed his hair with Vaseline tonic, buttoned his Arrow shirt, hurried downstairs for Quaker Oats, California Figs and Maxwell House coffee, commuted in a Westinghouse tram (body by Fisher), rose to his office in an Otis elevator, and worked all day with his Waterman pen under the efficient glare of Edison light bulbs. ``It only remains,'' one Fleet Street wag suggested, ``for [us] to take American coal to Newcastle.'' Behind the joke lay real concern: the United States was already supplying beer to Germany, pottery to Bohemia, and oranges to Valencia. As a result of this billowing surge in productivity, Wall Street was awash with foreign capital. Carnegie calculated that America could afford to buy the entire United Kingdom, and settle Britain's national debt in the bargain. For the first time in history, transatlantic money currents were thrusting more powerfully westward than east. Even the Bank of England had begun to borrow money on Wall Street. New York City seemed destined to replace London as the world's financial center. Well, in the year 2004, we are broke. We have come from the greatest creditor nation to the greatest debtor nation. The Japanese are financing over $460 billion of my deficit. The Chinese are financing my debt--not me financing any other country like we started with protectionism. The Chinese have over $200 billion of my deficit. We will end up this year in September, in a few short months, with a deficit that will approximate $700 billion. We are spending around $2 billion a day more than we are taking in. Can you imagine that? In the early 1980s when I talked about budget matters, I spoke about how it took us 200 years of our history to get to $1 trillion in debt. The cost of the Revolution, the Civil War, Spanish-American War, World War I, World War II, Korea War, Vietnam War--it took us 200 years and the cost of all the wars to reach a $1 trillion debt. In the last 3\1/2\ years--because we don't want to pay for our war and want to give tax breaks instead--we have already piled up $2 trillion in debt; $2 trillion in the last 3\1/2\ years. This crowd has to sober up. We have to get hold of ourselves. We have to disenthrall ourselves and we have to start competing. Remember, it is our standard of living. That is the most frustrating thing around here. Here we add on these requirements: the minimum wage, Social Security, Medicare, Medicaid, plant closing notice, parental leave, safe working place, safe machinery, the old age act, the discrimination act, and this act and that act--all of that goes into the cost of production. It is not just the minimum wage; it is our high standard of living. Every Republican and every Democrat favors clean air and clean water. So we are not going back on our standard of living. So fundamentally we have to protect, and that is the fundamental role of Government. I will never forget when we swore in President Ronald Reagan for his second term. It was inclement weather and we did it in the Rotunda. He raised his hand to preserve, protect, and defend. We came back and we were debating trade, and we said: Oh, we don't want to protect, we don't want to protect. The fundamental oath that we take as public servants is to protect. We have the Army to protect us from enemies without, the FBI to protect us from enemies within. We have Social Security to protect us from old age, Medicare to protect us from ill- health; clean air, clean water--antitrust laws to protect the freedom of the market. We can go right on down the list. Are we going to pass a wonderful high standard of living and then run around like ninnies hollering: Wait a minute, wait a minute, free trade, free trade. We don't want to start protectionism--they get that garbage from the Business Roundtable and the U.S. Chamber of Commerce. I talk as one having received all of their awards. In 1992, I was man of the year of the National Chamber of Commerce. By 1998 they were sending out leaflets against me. So I speak advisedly. That crowd is not any longer interested in Main Street America. They are interested in Main Street Beijing. That is where you make the money, and the country can go to hell as far as they are concerned. So it is our duty to protect the economy and open up the markets and everything else like that. Don't tell us more about retrain, retrain, retrain. I continually hear that. Oh, we have to retrain. I went through another little town yesterday, Andrews, SC. It brings to mind Oneida. I brought that plant in. They make little T-shirts. They closed to go to Mexico. At the time of closure they had 487 employees. The average age was 47 years. We have done it, Senator, your way. We have retrained them and we have 487 highly skilled computer operators. Are you going to hire the 47-year-old highly skilled computer operator or the 21-year-old highly skilled computer operator? You are not going to take on the retirement, the pension cost of the 47-year-old. You are not going to take on the health cost of the 47-year-old. You are going to get the 21-year-old. So don't tell me about retraining. We have the most productive economy--that is what Alan Greenspan says. He is sobering up himself. He came down here with this administration saying we were paying down too much debt. ``We are paying down too much debt.'' He sanctioned all these tax cuts. Now he says debt and deficits matter, and he is worried about interest rates now and everything else of that kind, and paying bills. It is time we speak out as much as we can, early on, so we will know exactly where we stand. Where we stand is that we have to reorganize-- begin to organize, I should say--our trade effort, not just the Department of Commerce, but a Department of Trade and Commerce. I have been serving for almost 38 years on what was originally the Committee of Foreign and Interstate Commerce because article I section 8 says that Congress--not the President, not the Supreme Court--but the Congress of the United States shall regulate foreign commerce. But, instead, it is over in the hands of a deep six group known as the Finance Committee. What they do is they work out their little deals. You might get a stadium, you might get a courthouse, you might get any kind of visions of sugarplums dancing in their head. Forget about trade. They put on fast track. After they make their deal, the vote is fixed. Then it comes to the floor of the most deliberative body that cannot, under fast track, deliberate. And we enjoy it. We have tied our hands with fast track because we don't want to take the responsibility. That is what the polls will tell you: Don't say you are for or against, just say you are concerned. So we say we are concerned and we keep getting reelected and the country goes to hell in an economic hand pot. I can tell you right now we are in real trouble, and we have to disenthrall. What happens is that we need to organize a Department of Trade and Commerce, take that special Trade Representative, put it under that Secretary, do away with the International Trade Commission, which is a fix. You can find the damage done by the International Trade Administration over in Commerce. Then you go over to the Commission and they find out--oh, there is never any injury because you have growth. The GNP now is 3 or 4 percent, so there is no injury. So we keep sending the jobs out of the country like gangbusters, and we ought to do away with that particular fix of the Finance Committee. Then come in and get an Attorney General--an assistant, let's say, to enforce the trade laws. Many a trade lawyer in this city has gone all the way to the Supreme Court and found out that, well, politically it is set aside. It was that way in the Zenith case, when they were gathered around the Cabinet table and President Reagan walked in and he said: I have to take care of Nakasone. We are going to have to reverse that decision, after 3 years and millions of dollars of legal costs. So we ought to put in, like we have for antitrust, like we have for equal employment--we have to put in an Assistant Attorney General to enforce those laws, get the Customs agents, and finally when we get right down to it, do like the others do, play their game. If you are going to sell it here, you have to make it here. Isn't that wonderful? That is exactly what China really controls. They said, if you want to sell it here you have to make it here. I haven't gotten them that far along, I am just trying to flex their minds so we will get away from this trade war and protectionism nonsense, so we can put in a competitive trade policy and save our industrial backbone. Mr. President, how much time do I have remaining? My distinguished colleague from Florida, Mr. Bob Graham, wants to be heard.

Mr. HOLLINGS. Yes.

Mr. HOLLINGS. Good.

Mr. HOLLINGS. Mr. President, I ask for the yeas and nays on the amendment.

Mr. HOLLINGS. Mr. President, I yield whatever time I have to the distinguished Senator from North Dakota.

Mr. HOLLINGS. Mr. President, how much time is remaining on this side?

Mr. HOLLINGS. Mr. President, I yield 8 minutes to the distinguished Senator from Florida.

Mr. HOLLINGS. Let me yield at this time to the proponents and the distinguished leadership of our Finance Committee. I retain the remainder of our time.

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, I take it we will be voting on a resolution with respect to the Saddam prison. It strikes me, what I have just heard in the last few minutes, as a typical copout from responsibility. We hide the deficit. We do not pay the costs of the war. We hide behind all these other things. Now all we have to do is remove the building, and if they cannot be aware of it, they will not care. This thing happened in January. What we have on foot is the exact ``torture-gate,'' I guess you would call it. From January to May, we have not heard anything about it. This Senator has not heard anything about it. Now we have all of these ``whereas'' clauses, and this is what Saddam did, and it did not bother us. We did not put in a resolution about it. In fact, we went there and spent good money to clean it up and we put a prison there. Maybe after we take some responsibility, then maybe this kind of resolution would be in order. The first act and the first reaction officially of the Senate is going to be, let's tear down the building. The building is not at fault. It is the people in the building who are at fault. I will not be able to vote for this nonsense. I have never seen a crowd that absolutely will not accept responsibility for the war, for the costs of the war, the cost of government, and now the responsibility here. Their first reaction is a lot of ``whereas'' clauses about Saddam and nothing about us, other than that is not our way of life, and everything else of that kind. Let's find out that is not our way of life by fixing some responsibility in this Government. Once that is done, bring on the ``whereas'' clauses about Saddam's prison. I suggest the absence of a quorum.

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

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, this year many of our colleagues are seeking the NASCAR vote, but I think it would be wise if each member in this body, instead, sought out the NASCAR heart. My neighbors in South Carolina are Pattie and Kyle Petty. In May 2000, the Pettys faced a terrible tragedy, as their young son, Adam, the next great racing hope in the family, died during a practice session. Pattie and Kyle didn't retreat after that, but have worked ever since to bring Adam's dream of a camp for chronically ill children to reality. Many NASCAR drivers, owners, sponsors, and fans have contributed, and the Victory Junction Gang Camp will open its doors in June. I bring to the attention of my colleagues the following article from the April 23 USA Today, outlining the good work of the Petty family and I ask that it be printed in the Record. The article follows: [From USA TODAY, Apr. 23, 2004] Legendary Racing Family Hopes To Turn Corner kyle petty helps make his son's dream a reality (By Chris Jenkins) As a race car driver, Kyle Petty can't hope to match the success of his father and grandfather. As an executive, he can't hope to compete with NASCAR's mega-teams that have millions more to spend on the best cars, drivers and mechanics. As a father, he can't hope to put his son's death in a racing accident nearly four years ago completely behind him. But Petty does hope, and he seems to radiate hope to those around him through his sincere nature and gentle, quick wit. Other drivers might be better at turning left on the racetrack. They don't have his gift for turning life's negatives into positives. ``No matter how bad your day is, when you see Kyle, your day's better,'' driver Tony Stewart says. ``He tells you a silly joke that makes you laugh or something that makes you feel better.'' Petty, 43, gets angry--furious, actually--when he and his cars don't measure up. And he recently woke up crying in the middle of the night, missing his son, Adam. But in the right-hand column of Petty's emotional ledger is the camaraderie he feels with others in the NASCAR community, optimism that his family's team eventually will return to victory lane and, above all, the completion of Adam's dream: a $20 million-plus retreat for chronically ill children. ``I've always been incredibly optimistic that as bad as it is, it's got to get better,'' Petty says. It would be easy to dwell on what might have been. Had Adam Petty lived, many in NASCAR believe his electric talent and sponsor-friendly personality would have driven the Petty Enterprises team back to the prominence it once enjoyed. Petty doesn't allow such thoughts: ``If you do, you'll just go crazy.'' Kyle's father, seven-time NASCAR champion Richard Petty, 66, says it took years for Kyle's upbeat personality to resurface. ``It took him a long time to get over it,'' Richard says, pausing to reconsider his use of the phrase ``over it.'' ``Not to get over it. To get it beside of him instead of in front of him.'' Says Stewart: ``I think when you see what Kyle's been through as a person, a lot of people at that point would kind of retreat and kind of put themselves in their own little hole and shut themselves out from the rest of the world. ``With Kyle and (wife) Pattie, it's just the opposite. He's such a positive person that you can't help gravitate toward people like him and you want to be surrounded by people like him.'' ``Camp'' a misnomer A tour of the Victory Junction Gang Camp, a retreat in rural Randleman, N.C., for chronically ill children, revealed two minor flaws. The first is in its name: A ``camp'' has shoddy log cabins, leaky canoes and a slimy pond. This place feels more like a trendy suburban subdivision. There are new buildings--a theater, a gym, a pool and more--trimmed in bright colors and stainless steel, resort-quality guest cottages and medical facilities where volunteer doctors will care for campers' special needs. The second flaw, pointed out by Kyle and Pattie Petty, is a bent pedestrian bridge girder that was rammed by an errant delivery truck. It's March, three months before the camp is to open. This setback doesn't seem to be stressful. Instead, the Pettys laugh, reminded of the time Adam, at 15, accidentally mangled the family van by running into an overhang at his grandfather's house. Fond stories about Adam, the only one of the Pettys' three children who seriously pursued a driving career, still waft through the garage. Once he was spotted carrying a briefcase around the infield, an accessory not often associated with drivers. Bystanders couldn't let that oddity pass without comment, so they asked him what he was carrying. Grinning, he opened the briefcase to reveal a hairbrush and some gum. For Kyle, almost anything can trigger memories. ``The way the sun shines, the way you see a car on the racetrack,'' he says. ``I'll hear somebody holler, say a name and turn around expecting to see Adam standing there. And it just tweaks you just right. And it hurts you. And it just breaks your heart. ``And I'm not the only person in this boat, believe me. There's plenty of other families out all over this country who have lost kids. I'm sure they all feel the same way.'' Adam died in May 2000 during a practice session at New Hampshire International Speedway. NASCAR officials determined that he died of a neck injury, the same type that would kill Dale Earnhardt nine months later. Drivers now are required to wear safety collars that help prevent neck injuries, and the wall Adam hit is covered with an impact-absorbing barrier system. Kyle Petty doesn't blame NASCAR. He knows it might sound odd to outsiders, but being around racers offers ``a lot of comfort.'' The camp embraces racing as its theme. Used race cars will be suspended from the cafeteria ceiling. An obstacle course is built from tires. One building looks like a giant race car--Adam's car. ``Racing is all Adam knew,'' Petty says. Often when something is done in someone's memory, it is said he or she would have wanted it this way. In Adam's case, this is literally true: After helping his sponsor, Sprint, promote a product that allowed kids in different hospitals to communicate, Adam became determined to do something else for those kids--even if, as his grandfather says, that meant offering to sign over the rights to his winnings for the next 20 years to a loan officer if he'd lend Adam the money to build a camp. But the project never got rolling until after his death. ``Most 19-year-old kids (are) looking out for themselves,'' Richard says. ``And he was, don't get me wrong. But he had feelings for other kids, too. So that just inspired us that much more, that it was his idea originally. We're going to do it come heck or high water.'' NASCAR and many of its drivers, team owners and sponsors have chipped in for the camp, which will welcome its first group in June; Stewart has pledged to raise at least $1 million. Fans have donated money and time. Nursing home groups have sent box loads of handmade teddy bears and quilts, gifts to campers. The project is personal to rookie driver Brian Vickers, who befriended Adam and the other Petty children, brother Austin, 22, and sister Montgomery, 18. All four grew up attending the same home-schooling classes from a tutor. Vickers isn't comfortable talking about Adam and doesn't mention the significant donation he's quietly making to the camp. Asked if Adam was talented enough to become a star, Vickers looks at the floor and says, ``Yeah.'' Team loses ground Most of today's big-time racing teams have moved into gleaming buildings designed to attract tourists and impress sponsors in suburban Charlotte. Then there's Petty Enterprises' humble jumble of white shacks in Randleman, a town short on stoplights and long on religious radio programming. Founded in 1949 by Kyle's grandfather, NASCAR pioneer Lee Petty, then made famous by Richard, the team has won 268 races and 10 NASCAR championships. Most of that success came before the NASCAR boom of the 1990s. When corporate America began waking up to the popularity of NASCAR in the late 1980s, Richard was past his prime, though he'd drive until 1992. Other teams were winning races, so they landed big sponsors. Having more money allowed those teams to develop technology to make their cars faster. The Pettys fell behind; they've won three races since 1984, none since '99. Adam was supposed to change that. When he died, the promise of a young driver who could rally crewmembers and attract sponsorships died with him. ``We had a lot of stuff lined up around how we were going to do his career and stuff like that,'' Richard says. ``So when the accident happened, everything just went into limbo. For six months or a year there, we just basically survived.'' Today the team, which fields cars for Kyle and journeyman Jeff Green, 41, has funding from Georgia-Pacific and General Mills, plus associate sponsors. It's significant money (exact amounts are not disclosed), but nowhere near what marquee teams command. But the team's problems might not all be financial. Years ago it was common for drivers to run teams. As the business of racing became more complex, other teams added layers of management. Today Petty is the only driver with a major team who has extensive executive responsibilities. ``Definitely, he tries to handle way, way too much,'' says Robbie Loomis, who worked for the Pettys before becoming Jeff Gordon's crew chief in 2001. ``He's good at about everything, but when you get stretched so thin and get pulled in so many directions, it's hard to tell what direction to go in.'' Petty says he enjoys being busy but concedes that the return of Dale Inman, the crew chief for Richard Petty's championship teams, is making his job easier. Although Inman is 67 and can't offer much in the way of technical advice, Petty says Inman's presence helps crewmembers believe the team can win. Petty compares it to Joe Gibbs returning to coach the NFL's Washington Redskins. Although Petty says this isn't his last season as a driver, Loomis says Petty's retirement could be the first major step toward a team resurgence. When Petty stops driving and focuses on running the team, Loomis says, ``You're going to see a whole new Petty Enterprises.'' The team is improving slowly; Petty's recent 12th-place finish at Las Vegas Motor Speedway was cause for mild celebration. The lack of research-and-development money continues to show, as Petty and Green finish in the bottom half of the field most of the time. Though nice guys, as the saying goes, might finish last, that doesn't mean they have to like it; a disappointing race can transform Petty from friendly to fierce. But his outbursts aren't without perspective and don't last long. ``I can deal with how we run a lot better, sometimes, because of Adam,'' Petty says. ``Because nothing is as bad as Adam, no matter what. I can go to the racetrack, run dead last. I can go to the racetrack, not make the race. That's still not the worst day.''

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, this week the citizens of Nebraska lost a legend with the passing of Governor Frank Morrison, and I rise to recognize my plain-spoken friend of 45 years. When I was Governor of South Carolina, Frank became Governor of Nebraska, and I have admired him ever since. We spoke earlier this spring, and his mind was as sharp at age 98, as it was at age 58. When I think of Frank I think of a man who knew how to get results. He was a progressive Governor, but also a fiscally conservative one. He implemented many changes, insofar as creating an educational television network and a statewide employee retirement system that modernized state government. We will miss him, as we miss his wife Maxine, who just passed away last month. My wife, Peatsy, joins me in extending our deepest sympathy to their family.

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, John Palms, the former president of the University of South Carolina, will be honored this week with Mepkin Abbey's newly established Wisdom Award. All of us in the Senate would be a little wiser ourselves to read the following article from the April 10 Charleston Post and Courier, on Dr. Palms. He is an inspiration to all that the American dream is alive and well. I ask that the article be printed in the Record. The article follows. [From the Charleston Post and Courier, Apr. 10, 2004] John Palms--Nuclear Physicist Leads the Way in Science, Education, Religion and the World Stage (By Judy Watts) ``Learning humanizes character and does not permit it to be cruel'' is the University of South Carolina motto. The words also epitomize John Palms' philosophy, not only as the former USC president, but as a physicist and a human being. Although his formal training is in nuclear physics, his life events have given him an educated perspective on physics' ambiguous nature, both in the weapons he designed and in the research, which had medical applications. As president of two universities, he fulfilled his destiny as an educator who believed in building not only well-educated people, but also people of character. On April 24, Palms will be presented with Mepkin Abbey's newly established Wisdom Award, given for a lifetime of achievement based on the highest human aspirations. Since his years as a cadet at The Citadel, Mepkin Abbey has been a personal touch-stone, a place where he has been able to focus and center his life. John Palms has come a long way from the little dutch boy who fled a Hitler-terrorized Europe with his family.

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, less than 1 year ago, we wrapped up work on the port security bill that was signed into law as the Maritime Security Act of 2002, MTSA. That act mandated and outlined changes that are needed to shore up security in our ports, and established for the first time a system to coordinate, plan and implement port security at U.S. seaports. While this was landmark legislation, much still needs to be done with respect to the implementation of the requirements mandated by this law. I am very dissatisfied with the current Administration's disinterest in paying for port security, and would point out that we are approaching a crisis, as Federal mandates are being rolled out for security without Federal support. I have tried over and over to focus the attention of the Administration on this crucial need and pushed to no avail in the Senate to get the resources necessary to address this problem. But to date, I have gotten little support. In addition to appropriating much needed funds for port security, it has become apparent that keeping up with security needs at our ports is an ever evolving task, and that we may have to refocus our efforts and push harder to ensure that we coordinate our policies and maximize the limited resources that we have in this area. Today, in order to keep up with these needs, I am introducing the ``Maritime Transportation Security Act of 2004'', along with Senator McCain, and Senator Breaux. I am pleased to have worked on this with Senator McCain, the Chairman of our Committee, as I often remark, while he has no coastline, he has worked with those of us who do have ports to work on these crucial port security issues. I am also pleased to introduce this legislation with Senator Breaux, for he has truly been one of the leading advocates of the importance of maritime shipping and the merchant marine in the U.S. Senate. He has done invaluable work for us on the Commerce Committee, and is a true expert in the field. He will be sorely missed for his expertise on all maritime issues, although I am sure, that in the future, he will still be the Captain of some small boat, yacht, or maybe even a ship. Even though the Coast Guard, Customs and other agencies charged with the implementation of these measures have aggressively taken initial steps necessary to set up our future structure for seaport security there is still much to do, and effective action needs to occur to help coordinate and crystallize security policies and objectives. The Maritime Transportation Security Act of 2004 would attempt to mandate a coordinated Federal approach to several areas of concern in port security. It would also attempt to set performance standards for certain areas in port security and add a few enhancements to last year's legislation. Most importantly the bill would require a user fee to be established to help pay for the port security mandates. Specifically, this bill would impose in rem liability to secure payment of penalties and fines under the Act and to help ensure compliance with the security requirements imposed by the MTSA. The bill would also include provisions to increase security in waterside cargo areas, and ensure that cargo contents of imported marine cargo containers would be required to be cleared within 5 days of entering a U.S. port, or alternatively removed after 5 days without being cleared, to a regulated warehouse where it would be opened and reviewed to verify its contents. This would in no way change any claim to possession of the goods. Importantly, the bill would require DHS to evaluate the policies and practices of sealing empty containers. According to the Federal Maritime Commission, over 4 million containers were imported into the United States empty. At a recent hearing, a representative from the ILWU longshoremen's union pointed out that treatment of empties and the sealing practices of these containers varied from locale to locale. This bill would require an analysis of current practices at U.S. ports in order to determine what steps need to occur in order to make sure that the transport of empty containers does not present a threat of terrorism, and whether a Federal policy is justified in this area. The bill would require the Administration to produce a coordinated plan for collecting, analyzing, and disseminating maritime intelligence information collected by Federal agencies on ships, cargo, crew members and passengers. This intelligence is used to determine which ships, cargo, or crew warrant further inspection. This section of the bill requires further development of a maritime intelligence system to collect and analyze information concerning the crew, passengers and cargoes carried on vessels operating in waters under the jurisdiction of the United States. This mandate essentially restates existing law since it appears that the agencies have actually grown further apart since the passage of the Maritime Transportation Security Act. The provision in this bill would require a plan on how the Administration will coordinate collection and analysis of maritime information, and how agency personnel might be co-located to maximize resources and coordinate analysis. This plan must also indicate when long range vessel tracking will be integrated into this intelligence information. Additionally, the plan would require the government to analyze private sector resources to evaluate how they could be used to help monitor and differentiate legitimate moves of trade from those actions and players that are more suppositious. The Federal Government does not have a lot of experience monitoring commercial maritime activity, and I believe they will have to employ private sector expertise to assist in this endeavor. The report shall also consider the abilities of the Department of Navy to collect and analyze commercial maritime information. The U.S. Navy probably has the most resources dedicated to the evaluation of commercial shipping activities, but are precluded from sharing this information. In light of our need for better information on commercial shipping, this policy has to be reevaluated. A maritime intelligence system needs to be set up to work together so that Federal agencies, State, local and the private sector can coordinate their law enforcement activities. Maritime intelligence on commercial ocean shipping is currently gathered by the Coast Guard, Customs, INS, and other agencies such as the Federal Maritime Commission under separate systems. Only the Coast Guard and the Navy currently work together. We lag far behind in this area, and each agency is operating independent of others. We are not getting the full picture of what is happening out there. It is crucial that we have the best information available so that we can target our relatively limited resources with maximum efficiency. Further, the information has to be disseminated in a fashion to maximize its utility, while still protecting that information which needs to be kept confidential. Collection and analysis of commercial maritime information is a key element of our port security that needs more focus and has to be addressed if we are to adequately protect our Nation. Importantly, the bill will require the Administration to come up with cargo security plans to evaluate targeting systems to determine whether they are effective in deterring and protecting against potential acts of terrorism from cargo. In the event that targeting is inadequate protection, DHS would be required to increase the amount of cargo being non-intrusively inspected or x-rayed by two over the next year. The bill would also require the consolidation of intermodal cargo security programs that have the same security goals while establishing criteria and performance goals for these security programs, which are currently operating completely independent of each other, and require certain other cargo security program enhancements. Voluntary cargo security programs are not the answer to the important problem of securing our Nation from terrorist attacks. Firm standards and goals must be in place to ensure that items that we know we don't want in marine containers are not actually in marine containers. The legislation will also require a report on the amount of actual inspections that are being done at foreign seaports. While the Container Security Initiative was rolled out with great fanfare to work with foreign ports to inspect cargo before they get to U.S. ports, the question remains whether we are actually getting much bang for the buck. The fundamental question that needs to be addressed is whether foreign nations have been willing to use their security screening equipment for our benefit, and to what degree have they been willing to screen cargo for the benefit of our Nation. The legislation will require a report to determine whether this program needs adjustment, or is a cost-effective measure to ensure safe cargo movements into the U.S., and to update us on the progress in the installation of a system of radiation detection at U.S. ports. Additionally, this legislation will redirect our efforts to help ensure that we can verify that security is in place to prevent an act of terrorism, and not place us in a position of having to rely on documentation and the attestations or documentation of third parties in order to determine whether we need to take actions to protect the public. The Administration has not even started to implement the certification program required to certify ``secure systems of transportation,'' 46 U.S.C. 70116, and they must get going on this vital initiative. Otherwise, it would only take one good liar to breach our system of defense. Although I understand we cannot inspect every piece of cargo, we have a credible system in place to actively increase cargo inspections, and implement a system that would ultimately allow us to reopen U.S. ports to commerce, in the event of an attack. Additionally, the bill also would require a report from the Coast Guard on the benefits of utilizing joint operational centers at United States seaports to implement area security plans. This report should incorporate lessons learned from the three centers that have already been established, such as ``Operation SeaHawk'' in Charleston, SC, and consider which security programs could be effectively fused into these joint operational centers. The Commandant of the Coast Guard would be required by this bill to report on the effectiveness of these centers for port security and determine if it would be beneficial and cost effective to establish centers in additional areas that pose a significant security risk, and to utilize them to implement area security plans. The bill will also make sure that port security grants are reviewed and approved, as was mandated under the terms of the MTSA, and all grants are subject to the review of the Coast Guard Captain of the Port, the regional Maritime Administration representative, and other Transportation Security Administration security officials as well as other DHS security experts, before the grants are approved. This grant program is not open-ended, it is intended to help the private sector and State and municipal governments achieve compliance with Federally approved facility plans and area maritime security plans, and the changes to the statute will ensure that the grant program operates the way we intended it to operate. The bill also requires the Maritime Administration and the State Department to evaluate existing foreign assistance programs to determine whether the existing aid programs can be utilized to help foreign nations achieve compliance with the international standard set for port security. The MTSA requires the Coast Guard to set up a mechanism to review the practices of foreign ports to ensure that they have implemented adequate security measures, and ultimately, they can take steps that would result in the closure of commerce from ports in non-compliance with international security standards. It is in the best interests of everyone potentially impacted by such a policy implication, if we review our foreign aid programs to determine whether aid can be used to implement the necessary security measures. The bill also requires the Maritime Administration to work with the Federal Law Enforcement Training Center, FLETC, and other DHS port security agencies such as TSA, Coast Guard and Customs to determine how to supplement their training programs to include a greater familiarization with commercial maritime practices. Port security law enforcement is much different in the aftermath of September 11, and officials involved in regulation and policing shipping will now have to approach it from a different perspective, and to be able to identify anomalies and irregularities, in order to best focus our limited police resources over an immense volume of trade. It is my understanding that the Maritime Administration has been utilizing resources at the U.S. Merchant Marine Academy and working with FLETC to formalize port security training. I think that this change will help our Federal agencies bolster their existing training programs, and achieve a greater understanding of potential security issues that could arise, and will be a healthy addition to work already done by the Maritime Administration and FLETC. The bill rewrites the DHS mandate to conduct research and development, and would require the Science Directorate within DHS to be more accountable to Congress for those actions they are taking to develop the types of technology necessary to address security at our seaports. Importantly, the bill also requires the Coast Guard to evaluate the security risks and policies very carefully of nuclear facilities on or adjacent to navigable waterways to ensure that we have security policies in place to prevent acts of terrorism from occurring from on or under navigable waterways. Most nuclear facilities are on or adjacent to navigable waterways, and I want the Coast Guard to exercise the highest degree of security in their treatment of these facilities and the threat posed as a result of maritime commerce or the proximity to navigable waterways. Most importantly, this bill attempts to address the fundamental issue that will face the nation as we implement the MTSA--will sufficient funding be in place to assure that our ports and agencies will robustly pursue security, or we will have to rely on sham security programs, or efforts severely restricted by funding that result in de minimus or desultory security efforts. When the Senate and House conferenced on the port security bill in the fall of 2002, the Senate conferees insisted on establishing direct funding for port security programs through a user fee, identical to the airline security fee, which would help defray the significant costs for the new port security mandates. The Administration declined to dedicate any resources for port security, and they declined to support the Senate's user fee. Unable to reach agreement with the House conferees and the Administration, I agreed to authorize just the necessary funds, but the President was required by law to report to Congress within 6 months on a funding proposal to assist States and their ports in complying with security mandates for Federal security plans. That report has never been prepared and is 9 months overdue. When the President's budget for FY 2004 came out, after the U.S. Coast Guard had estimated that it would take $7.4 billion of funding in order to comply with the port security requirements, there was no funding for port authority compliance in that year's budget resolution. I offered an amendment to the FY 2004 Budget Resolution which was unanimously accepted to add $1 billion to help defray the first year costs of port security--ultimately it was dropped from Conference. Two weeks later, the President was presented with a direct opportunity to fund port security programs: Congressional consideration of his emergency supplemental appropriations bill to pay for the war in Iraq and bolster homeland security. Again, the Administration funding request included no funding for port authorities to help them comply with the Federal mandate, so I offered an amendment to add $1 billion to the supplemental specifically to help ports meet the new security mandates. Despite unanimous approval in the Senate 3 weeks earlier, the amendment was opposed by the Administration and defeated on the Senate floor on a straight party line vote. Last year, I made another effort to address the port security funding inadequacies during consideration of the FY 2004 Homeland Security Appropriations bill. Again, the Administration proposed no funding for port security grants in their 2004 request, so I offered an amendment to the bill to direct $300 million specifically to port security grants without increasing the overall cost of the bill. The Administration opposed the funding increase, and the amendment was defeated largely along party lines with only three Republicans supporting the amendment. Until this year's budget the President has not requested one dime specifically for port security. He has opposed efforts to mandate the funds be raised from the users of the system, and this year's budget request is for only $46 million. Despite opposition from the White House, Congress has directed appropriations that have resulted in grants of $450 million to ports to help ensure compliance with the Federal security mandates, and so I know that this issue is an area of major concern. Ultimately, the funding issues must be addressed, and this bill proposes a user fee to pay for the costs of compliance of port security. I had considered the possibility of authorizing the Administration to either generate funds for port security via a user fee, or alternatively mandate that funds be directly transferred from funds collected by Customs duties, but because of jurisdictional issues determined not to do so. The maritime industry supports this approach, and I am not opposed to this approach, but want only to ensure, that one way or another, we have the necessary funding in place to set up the system of port security that this nation deserves. Simply put, there is just too much at stake to hope that security emerges. This bill seeks to continue the work to correct the security and terrorism prevention needs at our maritime borders. There is much to be done and there is a continued need for government and industry cooperation. This bill works on some of that need, yet the major need is funding for port security, which I hope that we will be able to address in the Senate very soon. I ask unanimous consent the text of the bill to be printed in the Record.

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, less than 1 year ago, we wrapped up work on the port security bill that was signed into law as the Maritime Security Act of 2002, MTSA. That act mandated and outlined changes that are needed to shore up security in our ports, and established for the first time a system to coordinate, plan and implement port security at U.S. seaports. While this was landmark legislation, much still needs to be done with respect to the implementation of the requirements mandated by this law. I am very dissatisfied with the current Administration's disinterest in paying for port security, and would point out that we are approaching a crisis, as Federal mandates are being rolled out for security without Federal support. I have tried over and over to focus the attention of the Administration on this crucial need and pushed to no avail in the Senate to get the resources necessary to address this problem. But to date, I have gotten little support. In addition to appropriating much needed funds for port security, it has become apparent that keeping up with security needs at our ports is an ever evolving task, and that we may have to refocus our efforts and push harder to ensure that we coordinate our policies and maximize the limited resources that we have in this area. Today, in order to keep up with these needs, I am introducing the ``Maritime Transportation Security Act of 2004'', along with Senator McCain, and Senator Breaux. I am pleased to have worked on this with Senator McCain, the Chairman of our Committee, as I often remark, while he has no coastline, he has worked with those of us who do have ports to work on these crucial port security issues. I am also pleased to introduce this legislation with Senator Breaux, for he has truly been one of the leading advocates of the importance of maritime shipping and the merchant marine in the U.S. Senate. He has done invaluable work for us on the Commerce Committee, and is a true expert in the field. He will be sorely missed for his expertise on all maritime issues, although I am sure, that in the future, he will still be the Captain of some small boat, yacht, or maybe even a ship. Even though the Coast Guard, Customs and other agencies charged with the implementation of these measures have aggressively taken initial steps necessary to set up our future structure for seaport security there is still much to do, and effective action needs to occur to help coordinate and crystallize security policies and objectives. The Maritime Transportation Security Act of 2004 would attempt to mandate a coordinated Federal approach to several areas of concern in port security. It would also attempt to set performance standards for certain areas in port security and add a few enhancements to last year's legislation. Most importantly the bill would require a user fee to be established to help pay for the port security mandates. Specifically, this bill would impose in rem liability to secure payment of penalties and fines under the Act and to help ensure compliance with the security requirements imposed by the MTSA. The bill would also include provisions to increase security in waterside cargo areas, and ensure that cargo contents of imported marine cargo containers would be required to be cleared within 5 days of entering a U.S. port, or alternatively removed after 5 days without being cleared, to a regulated warehouse where it would be opened and reviewed to verify its contents. This would in no way change any claim to possession of the goods. Importantly, the bill would require DHS to evaluate the policies and practices of sealing empty containers. According to the Federal Maritime Commission, over 4 million containers were imported into the United States empty. At a recent hearing, a representative from the ILWU longshoremen's union pointed out that treatment of empties and the sealing practices of these containers varied from locale to locale. This bill would require an analysis of current practices at U.S. ports in order to determine what steps need to occur in order to make sure that the transport of empty containers does not present a threat of terrorism, and whether a Federal policy is justified in this area. The bill would require the Administration to produce a coordinated plan for collecting, analyzing, and disseminating maritime intelligence information collected by Federal agencies on ships, cargo, crew members and passengers. This intelligence is used to determine which ships, cargo, or crew warrant further inspection. This section of the bill requires further development of a maritime intelligence system to collect and analyze information concerning the crew, passengers and cargoes carried on vessels operating in waters under the jurisdiction of the United States. This mandate essentially restates existing law since it appears that the agencies have actually grown further apart since the passage of the Maritime Transportation Security Act. The provision in this bill would require a plan on how the Administration will coordinate collection and analysis of maritime information, and how agency personnel might be co-located to maximize resources and coordinate analysis. This plan must also indicate when long range vessel tracking will be integrated into this intelligence information. Additionally, the plan would require the government to analyze private sector resources to evaluate how they could be used to help monitor and differentiate legitimate moves of trade from those actions and players that are more suppositious. The Federal Government does not have a lot of experience monitoring commercial maritime activity, and I believe they will have to employ private sector expertise to assist in this endeavor. The report shall also consider the abilities of the Department of Navy to collect and analyze commercial maritime information. The U.S. Navy probably has the most resources dedicated to the evaluation of commercial shipping activities, but are precluded from sharing this information. In light of our need for better information on commercial shipping, this policy has to be reevaluated. A maritime intelligence system needs to be set up to work together so that Federal agencies, State, local and the private sector can coordinate their law enforcement activities. Maritime intelligence on commercial ocean shipping is currently gathered by the Coast Guard, Customs, INS, and other agencies such as the Federal Maritime Commission under separate systems. Only the Coast Guard and the Navy currently work together. We lag far behind in this area, and each agency is operating independent of others. We are not getting the full picture of what is happening out there. It is crucial that we have the best information available so that we can target our relatively limited resources with maximum efficiency. Further, the information has to be disseminated in a fashion to maximize its utility, while still protecting that information which needs to be kept confidential. Collection and analysis of commercial maritime information is a key element of our port security that needs more focus and has to be addressed if we are to adequately protect our Nation. Importantly, the bill will require the Administration to come up with cargo security plans to evaluate targeting systems to determine whether they are effective in deterring and protecting against potential acts of terrorism from cargo. In the event that targeting is inadequate protection, DHS would be required to increase the amount of cargo being non-intrusively inspected or x-rayed by two over the next year. The bill would also require the consolidation of intermodal cargo security programs that have the same security goals while establishing criteria and performance goals for these security programs, which are currently operating completely independent of each other, and require certain other cargo security program enhancements. Voluntary cargo security programs are not the answer to the important problem of securing our Nation from terrorist attacks. Firm standards and goals must be in place to ensure that items that we know we don't want in marine containers are not actually in marine containers. The legislation will also require a report on the amount of actual inspections that are being done at foreign seaports. While the Container Security Initiative was rolled out with great fanfare to work with foreign ports to inspect cargo before they get to U.S. ports, the question remains whether we are actually getting much bang for the buck. The fundamental question that needs to be addressed is whether foreign nations have been willing to use their security screening equipment for our benefit, and to what degree have they been willing to screen cargo for the benefit of our Nation. The legislation will require a report to determine whether this program needs adjustment, or is a cost-effective measure to ensure safe cargo movements into the U.S., and to update us on the progress in the installation of a system of radiation detection at U.S. ports. Additionally, this legislation will redirect our efforts to help ensure that we can verify that security is in place to prevent an act of terrorism, and not place us in a position of having to rely on documentation and the attestations or documentation of third parties in order to determine whether we need to take actions to protect the public. The Administration has not even started to implement the certification program required to certify ``secure systems of transportation,'' 46 U.S.C. 70116, and they must get going on this vital initiative. Otherwise, it would only take one good liar to breach our system of defense. Although I understand we cannot inspect every piece of cargo, we have a credible system in place to actively increase cargo inspections, and implement a system that would ultimately allow us to reopen U.S. ports to commerce, in the event of an attack. Additionally, the bill also would require a report from the Coast Guard on the benefits of utilizing joint operational centers at United States seaports to implement area security plans. This report should incorporate lessons learned from the three centers that have already been established, such as ``Operation SeaHawk'' in Charleston, SC, and consider which security programs could be effectively fused into these joint operational centers. The Commandant of the Coast Guard would be required by this bill to report on the effectiveness of these centers for port security and determine if it would be beneficial and cost effective to establish centers in additional areas that pose a significant security risk, and to utilize them to implement area security plans. The bill will also make sure that port security grants are reviewed and approved, as was mandated under the terms of the MTSA, and all grants are subject to the review of the Coast Guard Captain of the Port, the regional Maritime Administration representative, and other Transportation Security Administration security officials as well as other DHS security experts, before the grants are approved. This grant program is not open-ended, it is intended to help the private sector and State and municipal governments achieve compliance with Federally approved facility plans and area maritime security plans, and the changes to the statute will ensure that the grant program operates the way we intended it to operate. The bill also requires the Maritime Administration and the State Department to evaluate existing foreign assistance programs to determine whether the existing aid programs can be utilized to help foreign nations achieve compliance with the international standard set for port security. The MTSA requires the Coast Guard to set up a mechanism to review the practices of foreign ports to ensure that they have implemented adequate security measures, and ultimately, they can take steps that would result in the closure of commerce from ports in non-compliance with international security standards. It is in the best interests of everyone potentially impacted by such a policy implication, if we review our foreign aid programs to determine whether aid can be used to implement the necessary security measures. The bill also requires the Maritime Administration to work with the Federal Law Enforcement Training Center, FLETC, and other DHS port security agencies such as TSA, Coast Guard and Customs to determine how to supplement their training programs to include a greater familiarization with commercial maritime practices. Port security law enforcement is much different in the aftermath of September 11, and officials involved in regulation and policing shipping will now have to approach it from a different perspective, and to be able to identify anomalies and irregularities, in order to best focus our limited police resources over an immense volume of trade. It is my understanding that the Maritime Administration has been utilizing resources at the U.S. Merchant Marine Academy and working with FLETC to formalize port security training. I think that this change will help our Federal agencies bolster their existing training programs, and achieve a greater understanding of potential security issues that could arise, and will be a healthy addition to work already done by the Maritime Administration and FLETC. The bill rewrites the DHS mandate to conduct research and development, and would require the Science Directorate within DHS to be more accountable to Congress for those actions they are taking to develop the types of technology necessary to address security at our seaports. Importantly, the bill also requires the Coast Guard to evaluate the security risks and policies very carefully of nuclear facilities on or adjacent to navigable waterways to ensure that we have security policies in place to prevent acts of terrorism from occurring from on or under navigable waterways. Most nuclear facilities are on or adjacent to navigable waterways, and I want the Coast Guard to exercise the highest degree of security in their treatment of these facilities and the threat posed as a result of maritime commerce or the proximity to navigable waterways. Most importantly, this bill attempts to address the fundamental issue that will face the nation as we implement the MTSA--will sufficient funding be in place to assure that our ports and agencies will robustly pursue security, or we will have to rely on sham security programs, or efforts severely restricted by funding that result in de minimus or desultory security efforts. When the Senate and House conferenced on the port security bill in the fall of 2002, the Senate conferees insisted on establishing direct funding for port security programs through a user fee, identical to the airline security fee, which would help defray the significant costs for the new port security mandates. The Administration declined to dedicate any resources for port security, and they declined to support the Senate's user fee. Unable to reach agreement with the House conferees and the Administration, I agreed to authorize just the necessary funds, but the President was required by law to report to Congress within 6 months on a funding proposal to assist States and their ports in complying with security mandates for Federal security plans. That report has never been prepared and is 9 months overdue. When the President's budget for FY 2004 came out, after the U.S. Coast Guard had estimated that it would take $7.4 billion of funding in order to comply with the port security requirements, there was no funding for port authority compliance in that year's budget resolution. I offered an amendment to the FY 2004 Budget Resolution which was unanimously accepted to add $1 billion to help defray the first year costs of port security--ultimately it was dropped from Conference. Two weeks later, the President was presented with a direct opportunity to fund port security programs: Congressional consideration of his emergency supplemental appropriations bill to pay for the war in Iraq and bolster homeland security. Again, the Administration funding request included no funding for port authorities to help them comply with the Federal mandate, so I offered an amendment to add $1 billion to the supplemental specifically to help ports meet the new security mandates. Despite unanimous approval in the Senate 3 weeks earlier, the amendment was opposed by the Administration and defeated on the Senate floor on a straight party line vote. Last year, I made another effort to address the port security funding inadequacies during consideration of the FY 2004 Homeland Security Appropriations bill. Again, the Administration proposed no funding for port security grants in their 2004 request, so I offered an amendment to the bill to direct $300 million specifically to port security grants without increasing the overall cost of the bill. The Administration opposed the funding increase, and the amendment was defeated largely along party lines with only three Republicans supporting the amendment. Until this year's budget the President has not requested one dime specifically for port security. He has opposed efforts to mandate the funds be raised from the users of the system, and this year's budget request is for only $46 million. Despite opposition from the White House, Congress has directed appropriations that have resulted in grants of $450 million to ports to help ensure compliance with the Federal security mandates, and so I know that this issue is an area of major concern. Ultimately, the funding issues must be addressed, and this bill proposes a user fee to pay for the costs of compliance of port security. I had considered the possibility of authorizing the Administration to either generate funds for port security via a user fee, or alternatively mandate that funds be directly transferred from funds collected by Customs duties, but because of jurisdictional issues determined not to do so. The maritime industry supports this approach, and I am not opposed to this approach, but want only to ensure, that one way or another, we have the necessary funding in place to set up the system of port security that this nation deserves. Simply put, there is just too much at stake to hope that security emerges. This bill seeks to continue the work to correct the security and terrorism prevention needs at our maritime borders. There is much to be done and there is a continued need for government and industry cooperation. This bill works on some of that need, yet the major need is funding for port security, which I hope that we will be able to address in the Senate very soon. I ask unanimous consent the text of the bill to be printed in the Record.

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, I am pleased that the Senate passed S.733, the Coast Guard Authorization bill of 2003, which I cosponsored. I am hopeful that the Senate can work quickly with the House and pass a final bill in both houses in the near future. The Coast Guard has always taken on an impressive array of tasks that are important for our security, for the protection of our resources, and for the safety of our mariners. After the tragic events of September 11, 2001, we have asked the Coast Guard to take on even more in the area of maritime security, while asking them to continue to carry out their traditional missions as effectively as before. This legislation provides authorizations for Coast Guard's Fiscal Year 2004 and Fiscal Year 2005 budgets, and also includes important new authority for the Coast Guard to better carry out its missions. While the President's budget request for these two years provided some increases, it was still far from adequate to ensure that the Coast Guard will be able to carry out all that we demand of it. Thus, I am particularly pleased that I had the support of the Committee on Commerce, Science, and Transportation in adding to the Fiscal Year 2004 authorization $491 million in authorizations not requested by the President. For Fiscal Year 2004, the bill authorizes approximately $7.032 billion. This is a 15-percent increase for the Coast Guard's budget over what Congress appropriated last year, and about 5 percent above the President's request for fiscal year 2004. The bill includes authorizations of $246 million in Fiscal Year 2004 for port security not requested by the President, including $100 million for operating expenses, to cover the increases in operating tempo that the Coast Guard has experienced over the past few years, $70 million for analyzing port security plans, and $36 million for three additional Marine Safety and Security Teams. These additional amounts are essential to the security of our ports and waterways, and of our maritime transportation industry. For Fiscal Year 2005, the bill authorizes approximately $7.787 billion, a 10-percent increase over Fiscal Year 2004 authorized and enacted levels, including for port security operations. This is $327 million greater than the President proposed, over 4 percent higher than the President's request. I have also been a firm supporter of the need to provide the Coast Guard with the tools it needs to get the job done. The Coast Guard needs to upgrade its core assets, in particular, its aging fleet of cutters. The Integrated Deepwater Program is the Coast Guard's program for achieving these upgrades, and the President has not requested sufficient funding in its budgets to even keep this program on its original track. I therefore strongly support the inclusion of an authorization of $702 million for this program in Fiscal Year 2004, which is $202 million above the President's budget request, and $708 million in Fiscal Year 2005, or $30 million over the President's request. These increases will allow the program to get back on its original schedule. At the same time, I have significant concerns with respect to how well the Coast Guard is managing this procurement, and whether the unique method for procurement utilized by the Deepwater Program will be able to achieve the stated goals of minimizing costs and providing operational effectiveness. The Deepwater project is the single largest procurement program that the Coast Guard has managed to date. The Senate has voiced concerns about this program on numerous occasions over the past few years. A GAO analysis of the Deepwater project published in May 2001 entitled ``Coast Guard: Progress Being Made on Deepwater Project, but Risks Remain'' highlighted risks with the project, including concerns with the Coast Guard's ability to control costs by ensuring competition among subcontractors, and the Coast Guard's ability to effectively manage and oversee the acquisition phase of the project. GAO has identified the Deepwater Program as a ``high risk'' procurement. GAO recently produced a new report on this subject, entitled ``Coast Guard's Deepwater Program Needs increased Attention to Management and Contractor Oversight.'' The report's major conclusions indicate that there is a need for significant improvement of the program and its oversight by the Coast Guard. First, GAO found that over a year and a half into the Deepwater program, the Coast Guard has not put into place the key components needed to provide adequate oversight of the prime contractor. For example, the Coast Guard had not even agreed on specific criteria to measure the contractor's performance, yet awarded the contractor nearly the total amount possible as a bonus for the first year of the contract. Second, GAO found that there is no clear, transparent and predictable opportunity for competition of the subcontracts under the Deepwater program. While the prime contractor uses the ``open business model'' to decide whether to ``make or buy'' Deepwater assets, this guidance is a philosophy--not a formal process with clear criteria and specific decision points--that encourages, but does not require competition. In fact, over 40 percent of the funds obligated to the first-tier subcontractors, Lockheed Martin and Northrop Grumman, have either remained with those companies or been awarded to their subsidiaries. Perhaps most disturbing, according to Deepwater officials within the Coast Guard, it is unrealistic to believe that the Coast Guard would change contractors after the first five years of the program. Thus, there is little incentive for the prime contractor to achieve the performance goal of minimizing total ownership costs. This obviously could have serious implications for the American taxpayer. I have also long been concerned that the Deepwater Program meets not only the letter but the spirit of our Buy America laws. A number of the subcontractors that have either received awards under the Deepwater Program, and/or are included in the contractor's proposal, make all or most of their parts overseas. Buy America was intended to ensure that the U.S. Federal government, including the U.S. military, did not contribute to the loss of American manufacturing jobs, yet here we have a major acquisition program for our 5th branch of the military, the U.S. Coast Guard, that appears to be doing just that. As a result of concerns about the program, the Commerce Committee included in S. 733, as reported, a requirement that the Coast Guard provide a report to Congress which would include an analysis of the prime contractor's performance in meeting the two key goals of providing operational effectiveness and minimizing total ownership costs. However, based on this latest GAO report, and the need to ensure that Buy America is fully implemented, additional Congressional oversight of this major procurement is clearly warranted. Unless there are significant changes to the way business is conducted on this contract, there will be enormous problems in the future that may, in the long run, undermine this program. (At the request of Mr. Daschle, the following statement was ordered to be printed in the Record.)

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, I am likewise pleased that the Senate will pass this important authorization bill for the Coast Guard. I look forward to working with Senator McCain and the other members of the conference committee to reach a final consensus bill that we can adopt in both houses.