Chuck Hagel

Mr. HAGEL

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

Mr. HAGEL. Mr. President, I understand under a previous agreement the Senator from Minnesota wishes to offer an amendment. I will withhold further comments until the Senator from Minnesota has had an opportunity to propose an amendment. I yield the floor.

Mr. HAGEL. Mr. President, I rise today with my colleagues, Senators Pryor, Alexander, Landrieu, Craig, Dole, Murkowski, Voinovich, and Stevens, to offer an amendment to H.R. 6, the Energy Policy Act of 2005. This amendment incorporates two bills I introduced earlier this year, the Climate Change Technology Deployment Act and the Climate Change Technology Deployment in Developing Countries Act. Taken together, these bills propose a comprehensive, effective U.S. global climate change policy. The climate change debate is not a debate about who is for or against the environment. No one wants dirty air, dirty water, prolonged drought or declining standards of living for their children or grandchildren. We all agree on the need for a clean environment and stable climate. The debate is not about whether we should take action but, rather, what kind of action we should take. A sound energy policy must include sensible and effective climate policies reflecting the reality that strong economic growth and abundant clean energy supplies go hand in hand. The amendment my colleagues and I are offering is comprehensive and practical. Bringing in the private sector, creating incentives for technological innovation, and enlisting developing countries as partners will all be critical to real progress on global climate policy. This amendment seeks to do exactly that, by authorizing new programs, policies, and incentives to reduce greenhouse gas intensity. It focuses on expanding clean energy supplies, enhancing the role of technology, establishing partnerships between the public and private sectors and between the U.S. and developing countries. Innovation and technology are the building blocks for an effective and sustainable climate policy. This amendment uses greenhouse gas intensity as a measure of success. Greenhouse gas intensity is the measurement of how efficiently a nation uses carbon-emitting fuels and technology in producing goods and services. It best captures the links between energy efficiency, economic development, and the environment. The first section of this amendment supports establishing domestic public-private partnerships for demonstration projects that employ greenhouse gas intensity reduction technologies. These provisions are similar to those of title XIV of H.R. 6 but are tied more directly to climate policy. This plan provides credit-based financial assistance and investment protection for American businesses and projects that deploy advanced climate technologies and systems. Federal financial assistance includes direct loans, loan guarantees, standby interest coverage, and power production incentive payments. We are most successful in confronting the most difficult and complicated issues when we draw on the strength of the private sector. Public-private partnerships meld together the institutional leverage of the Government with the innovation of industry. This amendment directs the Secretary of Energy to lead an interagency process to develop and implement a national climate technology strategy developed by the White House Office of Science and Technology Policy. It establishes an executive branch Climate Coordinating Committee and Climate Credit Board to assess, approve, and fund these projects. The second section of this amendment provides the Secretary of State with new authority for coordinating assistance to developing countries for projects and technologies that reduce greenhouse gas intensity. Current international approaches to global climate change overlook the role of developing countries as part of either the problem or the solution. That is, at best, unrealistic and shortsighted. According to the Congressional Research Service, China is already the world's second largest consumer of oil, with its demand projected to more than double over the next 25 years. It is estimated that coal- burning emissions by China alone, over the next 25 years, would be twice the emissions reductions that would be achieved if all nations that ratified the Kyoto Protocol met their obligations. China and other developing nations will not be able to achieve greenhouse gas reductions until they achieve higher standards of living. They lack clean energy technology, and they cannot absorb the economic impact of necessary changes to reduce emissions reductions. New policies will require recognition of the limitations of developing nations to meet these standards and the necessity of including them in future emission- reduction initiatives. This amendment works with those limitations by supporting the development of a U.S. global climate strategy to expand the role of the private sector, develop public-private partnerships, and encourage the deployment of greenhouse gas intensity reducing technologies in developing countries. Further, this amendment directs the Secretary of State to engage global climate change as a foreign policy issue. It directs the U.S. Trade Representative to identify trade-related barriers to the export of greenhouse gas intensity reducing technologies and establishes an interagency working group to promote the export of greenhouse gas intensity reducing technologies and practices from the United States. Finally, the amendment authorizes fellowship and exchange programs for foreign officials to visit the United States and acquire the expertise and knowledge to reduce greenhouse gas intensity in their countries. The action we take must be as comprehensive as possible in order to be effective in reducing international greenhouse gas emissions. That means any climate change initiatives we adopt must capture the links between energy use, the environment, and economic development in a global context. Climate change does not recognize national borders. It is an international issue. It is a shared responsibility for all nations. Focusing on solutions that are too narrow may resolve one problem just to create or exacerbate another problem somewhere else in the world. Consider, for example, the U.S. manufacturing sector. According to one recent study written for the National Association of Manufacturers, this sector accounts for some 15 million jobs in the United States, producing everything from semiconductors to food products. It is a cornerstone of our economy, and it is the largest consumer of energy in our country. Rising energy costs and shrinking supply, especially of natural gas, are already a factor in the loss of U.S. manufacturing jobs today. These rising costs, in part a result of regulations and other self- imposed limitations, contribute to a less competitive position for U.S. companies around the world--just as the world economy is becoming increasingly more and more competitive. Some of these companies are going out of business. Others are going offshore to locations with lower costs and more accessible energy sources. In the end, long-term success will come from stimulating increased energy efficiency and new lower carbon systems, not from actions that set up a system to continually constrain energy supplies. There are viable policy options for protecting the environment without sacrificing economic performance in manufacturing and other sectors here in this country or in other nations. That will involve ensuring adequate supplies of energy at globally competitive prices. By promoting new energy supplies and clean energy technologies, we could potentially add millions of new jobs and improve our economic performance, as well as the economic performance of all nations, increasing all standards of living across the globe, assuring more stability and secure living environments around the world, with less conflict, less war around the world. At the same time, there are policies under discussion today that would restrict energy supplies either now or in the future. These policies would hurt our economic performance without necessarily improving environmental quality. Too often, such policies are considered in isolation of other real-life factors instead of comprehensively and internationally. America's climate policy needs to be a comprehensive policy that captures the links between our energy use and our economic and environmental well-being. That will mean expanding the availability of cleaner fuels and improving the efficiency of our energy use and production through new technologies. Right now, fuel substitution possibilities are limited, and the rate of innovation is not fast enough to keep pace with our demand. Natural gas supplies in the U.S. are constricted. No new nuclear powerplants have been constructed in many years. Renewables are promising but not at an adequate level of development for the needs of our growing dynamic economy. Achieving reductions in greenhouse gas emissions is one of the more important challenges of our time. We recognize that. In developing a sound energy policy, however, America has an opportunity and a responsibility for global climate policy leadership. But it is a responsibility to be shared by all nations. Mr. President, I look forward to working with my colleagues; the Bush administration, which has done a significant amount in dealing with this issue, especially in market-based, technology-driven projects; the private sector, from which innovation comes; the public interest groups that help focus our attention; and America's allies--American's allies--key to any achievable climate change policies. I look forward to working with all of these individuals, institutions, bodies, and nations to achieve a climate change policy that is workable, sustainable. By harnessing our many strengths, we can help shape a worthy future for all people in the world. I encourage my colleagues to review this amendment, and I ask for their consideration and support. Mr. President, I thank you and yield the floor.

Mr. HAGEL. Mr. President, it is. I thank the chairman.

Mr. HAGEL. I yield as much time as the chairman needs.

Mr. HAGEL. I say to the chairman, I am waiting for one additional sponsor.

Mr. HAGEL. Yes.

Mr. HAGEL. Mr. President, how much time do I have remaining?

Mr. HAGEL. Mr. President, let me summarize the Hagel-Pryor climate change amendment. This amendment offers a comprehensive voluntary approach to addressing the issue of climate change by connecting domestic and international economic, environmental, and energy policies. It takes a market-driven, technology-based approach to climate change by using public-private partnerships to meld together the institutional leverage of the Government with the innovation of industry. With that, I ask unanimous consent that all time be yielded back.

Mr. HAGEL. I thank the Chair and yield the floor.

Mr. HAGEL. I move to reconsider the vote.

Mr. HAGEL. Mr. President, I suggest the absence of a quorum, and I ask unanimous consent that time that elapses during the quorum call be charged equally to all sides.

Mr. HAGEL. Mr. President, I extend the time of the Senator from Ohio by another 3 minutes if that would assist the Senator.

Mr. HAGEL

Mr. HAGEL. Mr. President, I further ask consent that Eric Loewen of my staff be granted floor privileges during consideration of the Energy bill.

Mr. HAGEL

Mr. HAGEL. Mr. President, I rise to congratulate Michael Walsh of Omaha, NE, an outstanding student and young history scholar whose National History Day project has been chosen out of half a million in America to be presented today at the White House Visitor Center. Michael's documentary, ``Let the Word Go Forth: JFK's New Frontier,'' highlights President Kennedy's unique ability to communicate effectively with both Americans and leaders throughout the world, especially during the Cuban missile crisis, a critical time in America's history. His project shows that young Americans can take important historical events and share them with us in an interesting and educational way. Michael is a student at Lewis and Clark Middle School in Omaha. National History Day is a unique approach to teaching and learning history in our Nation's classrooms. It allows students to create exhibits, documentaries and performances by using their critical thinking and research skills in the subject of history. This year marks the 25th anniversary of the National History Day organization. All of Nebraska is proud of Michael's commitment to scholarship. This young Nebraskan understands that history shapes our future and influences the world we live in today. I ask my colleagues to join me and all Americans in honoring Michael Walsh and all students who participated in National History Day.

Mr. HAGEL

Mr. HAGEL. Mr. President, I rise this morning to wish the U.S. Army happy birthday. It was 230 years ago today, June 14, 1775, that the Continental Army of the United States was born. Over the past 230 years, millions of men and women have served in the oldest branch of our Armed Forces. Their honor, courage, sacrifice, and service are woven into the culture of this great, country. The principles of duty, honor, and country have been the foundation of our Army and of our country. Their honor, their courage, their sacrifice, and service are woven into the culture of this great Nation. It is America. Every generation of Americans who have served in the U.S. Army, from the Continental Army to our fighting men and women serving today in Iraq and Afghanistan, have been shaped by these principles, have molded lives in ways that are hard to explain. Just as the U.S. Army has touched our national life and history, it has touched the lives of citizens of the world. The U.S. Army has protected American values of liberty, freedom, and democracy and made the world a more secure, prosperous, and better place for all mankind. It is only appropriate we recognize the monumental contributions of this great institution, contributions to America and the world. On this 230th birthday of the U.S. Army, we also recognize and thank those who have sacrificed and served. We thank their families. Their examples are an inspiration to those who have had the privilege to serve in the U.S. Army. They will continue to inspire future generations. On this, the 230th birthday of the Army, I say happy birthday to the Army. In the great, rich tradition of the U.S. Army, and as a proud U.S. Army veteran, I proclaim my annual Senate floor ``hoo-haw.'' I yield the floor.

Mr. HAGEL

Mr. HAGEL. Mr. President, I ask unanimous consent that Mark Hegerle, a staff member with Senator Talent, be granted floor privileges during the consideration of the Energy bill.

Mr. HAGEL

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

Mr. HAGEL. Mr. President, I ask unanimous consent that I be allowed to speak for 5 minutes as in morning business.

Mr. HAGEL. Mr. President, thank you. I yield the floor. I suggest the absence of a quorum.

Mr. HAGEL

Mr. HAGEL. Mr. President, on Friday, Nebraska lost one of the most dominant political figures in our State's history. Former two-term Governor and three-term U.S. Senator Jim Exon passed away in Lincoln at the age of 83. Many in this Chamber today served with him and knew him well. Those who served with Jim Exon remember a serious and dedicated public servant who enjoyed life and loved his State. Jim's voice was strong, and he spoke clearly and directly. No one ever had to guess where Jim Exon stood. As a Governor and a Senator, he fought for balanced budgets and restrained Government spending. In the Senate, from his seat on the Armed Services Committee, he was a passionate advocate for a strong national defense. As a member of the Commerce Committee, he was a protector of our natural resources, and he had the foresight to author the Communications Decency Act. Mr. President, today, when politics is too often a race to the lowest political common denominator, Jim Exon was a very effective leader, a partisan leader who always played it straight. He never lost an election. He won five statewide elections in Nebraska, more than any other Nebraskan. Under Jim Exon's leadership, the Democratic Party became the dominant party in Nebraska for 25 years. Anyone who knows Nebraska understands what a remarkable accomplishment that was. He did it by listening to the people. He did it by being a leader. I was Jim Exon's replacement in the Senate in 1996. Over the last 9 years, I came to know him well and respect his judgment. We did not always agree, but I always appreciated the opportunities I had to visit with Senator Exon on a wide range of issues. A child of the plains and a veteran of World War II, he is part of a generation of Americans who understood leadership, sacrifice, and war. In his later years, Jim Exon had much to say. And I had an opportunity to listen. The voice and wisdom of Jim Exon and his generation is slipping away from us at a time of unparalleled change in our world. Just as with Jim Exon, while this great generation is still with us, we need to listen closely to them. I did listen to Jim Exon. As a small businessman, two-term Governor and three-term Senator, James Exon, along with his wife Pat, served his State, his Nation, and this institution with distinction. He will be missed by the Nebraskans he served so well and loved so much.

Mr. HAGEL

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

Mr. HAGEL

Mr. HAGEL. Mr. President, on behalf of Senators Bingaman, Cantwell, Burns, Inouye, Johnson, Dole, Boxer, Landrieu, Alexander, Snowe, Clinton, Reid, Cochran, Burr, Isakson, Hatch and Reed, I am proud to submit this Senate Resolution which designates August 16, 2005 as ``National Airborne Day.'' This date marks the 65th anniversary of the first official jump by the Army Parachute Test Platoon. On June 25, 1940, the War Department authorized the Parachute Test Platoon to experiment with the potential use of airborne troops. The Parachute Test Platoon, which was composed of 48 volunteers, performed the first official Army parachute jump on August 16, 1940. The success of the Platoon led to the formation of a large and successful airborne contingent that has served from World War II until the present. The 11th, 13th, 17th, 82nd, and 101st Airborne Divisions and numerous other regimental and battalion size airborne units were also organized following the success of the Parachute Test Platoon. In the last 65 years, these airborne forces have performed in important military and peace-keeping operations all over the world, including Operation Iraqi Freedom, and it is only appropriate that we designate a day to salute the contributions they have made to our Nation. Through passage of ``National Airborne Day,'' the Senate will reaffirm our support for the members of the airborne community. I would like to thank Airborne veterans and Airborne units for their tireless commitment to our Nation's defense and for the ideals of duty, honor, country they embody. Airborne!

Mr. HAGEL

Mr. HAGEL. Mr. President, I ask unanimous consent that I be allowed to speak as in morning business for the purpose of introducing legislation. My time would be charged against Senator Santorum's time.

Mr. HAGEL

Mr. HAGEL. Mr. President, when I began my first campaign for the U.S. Senate in 1995, I published a booklet entitled ``Where I Stand.'' I wrote it because the first obligation of a candidate is to tell voters what you believe. In that booklet, I wrote: The Social Security system must be preserved, protected, and improved. We have made this covenant with our senior citizens. However, the long-term future of the Social Security system is in peril. If we do not get this issue resolved soon, this Nation faces an entitlement disaster, eroding the trust between grandchildren and grandparents. We must explore every option in order to fix and strengthen our Social Security system. This will require bold leadership. A decade later, those words still define my position on Social Security. Social Security has been one of the most important and successful Government programs in the history of America. Almost every American family over the last 70 years has been touched by Social Security. In signing the Social Security Act of 1935, Franklin Roosevelt said: None of the sums of money paid out to individuals in assistance or insurance will spell anything approaching abundance. But they will furnish that minimum necessity to keep a foothold, and that is the kind of protection Americans want. A fundamental point that President Roosevelt made was that Social Security was not intended to replace the personal responsibility of individuals saving for and preparing for their own retirements. Social Security was never intended to be a substitute for a retirement or savings plan. It is a safety net for people. Social Security is an insurance contract that protects the most vulnerable in our society from falling into poverty. But Social Security is actuarially unsustainable with its present commitments to future generations. Today, I am introducing comprehensive Social Security reform legislation. I began my day in Nebraska this morning with some of the people who would be most affected by my bill--America's next generation. It is their generation that will be asked to sustain the future of Social Security. My generation, the baby boom generation, has been the largest and most productive workforce in the history of man. The impending retirement of the 77 million-strong baby boom generation will impact every aspect of our economy, Government, and society--Medicare and Medicaid, health care, our workforce, and our competitive position in a world filled with countries much younger than ours. The next generation of Americans will respond to these challenges as every generation of Americans has responded to challenges--with innovation and hard work. However, my generation has a moral obligation to ensure that future generations do not have to bear an increasingly heavy burden of providing retirement resources for future generations. That is why we must reform Social Security. It is a 1935 model trying to operate in a 21st century world. It will soon be incapable of delivering the promises and resources that it was built to provide 70 years ago. Last week, in testimony before the House Budget Committee, Federal Reserve Chairman Alan Greenspan urged Congress to act on modernizing entitlement programs sooner rather than later. He warned that, unless we act now to meet the huge unfunded liabilities facing our entitlement programs, there will be severe economic consequences for our Nation. Chairman Greenspan is right. America's largest entitlement programs--Social Security, Medicare, and Medicaid--are on a trajectory that cannot be sustained. For fiscal year 2006, the Congressional Budget Office tells us that 64 percent of the $2.5 trillion Federal budget will be obligated to mandatory spending, of which 42 percent is for Medicare, Medicaid, and Social Security. Those are tax dollars that are committed--money that cannot be used for anything else. Each year, the percentage of the Federal budget obligated to funding entitlement programs grows larger and larger. The current unfunded liability for Social Security over the next 75 years--this is the horizon that the Social Security Administration uses to calculate benefits and expenditures--is $3.7 trillion. That means over the next 75 years, we are obligated to make the commitments of the retiree benefits a reality. Yet we have $3.7 trillion of debt. We don't know where and how we are going to get that $3.7 trillion. We are now $3.7 trillion in debt in the current obligations over the next 75 years for Social Security. Medicare's unfunded liability is nearly $28 trillion. These liabilities are in addition to America's current national debt of $7.5 trillion. Medicare costs are growing faster than any other Government or entitlement program. As we see health care costs continue to rise, coupled with the growing number of retirees, it will only continue to put more and more pressure on our Federal budget and squeeze out money for important discretionary Government programs such as education, roads, parks, and housing. Last Congress, we passed an enormous expansion of Medicare. I voted against it. I thought it was bad policy and would add hundreds of billions of dollars to an already unsustainable program. I am supportive of efforts to reopen the Medicare reform bill and fix it. But for political reasons, I doubt that will happen soon, although we will be forced to deal with it in the future. The Social Security system is not in crisis today, but there is clearly a crisis on the horizon. In 2018, more money will be paid out of Social Security than comes in. In 2042, the Social Security trust fund will be insolvent. Beyond the next 75 years, there is only a black hole of unfunded liability for future generations. The longer we do nothing, the more difficult it will be to protect Social Security and the promise our Government made to future generations of Americans. This reality is daunting, but there is good news in all of this. The system can be fixed. It is within our power to preserve the Social Security net for this Nation. It has been done before. In 1983, President Reagan worked with congressional Democrats and Republicans to make tough choices and extend the life of Social Security. Dealing with this problem now means less dramatic and difficult choices later. The earlier we confront the reality of the coming crisis, the more options we will have to come up with a wise and sustainable course of action. Allow me to now lay out the main points of the Social Security reform bill that I will introduce today. My bill would ensure the vitality of Social Security for future generations. There are no easy choices to fix the demographic challenges and realities facing Social Security. Understanding this, we must make choices that address the problem responsibly and fairly. My bill would make changes to Social Security only--only--for those Americans under the age of 45. No American age 45 or older will see a change in Social Security or their benefits. For Americans under 45, my bill would provide the option of voluntary personal accounts. Providing personal accounts is good policy for both the long-term viability of Social Security and for individuals. Government should be about empowering individuals and enhancing personal freedoms and their futures. Personal accounts help do this for those under 45. My bill would continue to provide a guaranteed Social Security benefit from the Social Security trust fund. Under my plan--under any plan--Americans still need the security of knowing that the portion of their Social Security benefits that comes from the traditional Social Security system will be guaranteed. My bill will continue to guarantee survivor and disability benefits as they currently are. Social Security provides benefits for more than 6 million spouses and children of breadwinners who have died prematurely or have become disabled. For these families, their benefits should not be touched. I know something about this. When I was 16 years old, my father died. The Social Security benefits my mother received were critical in helping her raise four young boys in Nebraska. I well remember my mother's relief when that Social Security check arrived each month. We must remember that the first obligation of Social Security is to the most needy Americans. My bill does not raise taxes. I believe we can fix Social Security without raising taxes. We need to begin reforming Government programs so they do not become so large and so expensive that future taxpayers will be unable to pay for them. Young wage earners and small businesses are the most vulnerable to tax increases, and they would be the ones most adversely affected by higher taxes to save Social Security. Additionally, whenever we increase the cost of labor, we hurt our competitive position in the world and make job creation more difficult. This is not abstract economic theory; it is reality that has an impact on every future American. Those are the principles that form the foundation of the bill I will introduce today. Here is how it would work. Upon passage of the bill, Americans 44 and younger would be given two voluntary options. One, they can invest 4 percent of their payroll tax into a personal investment account modeled on the same accounts now offered to all Federal Government employees. I participate and my staff participates in this program. The remainder of their payroll tax contribution would continue to go into the traditional Social Security system. Option 2, individuals can continue to invest their entire payroll tax in the traditional Social Security system. If they choose the personal account option, then individuals will be able to invest in the same five funds that collectively make up the current Federal Thrift Savings Plan--again, the program that I am in, Members of Congress are in, and Federal Government employees are in. The first is the common stock index fund. Over the last 10 years, this fund has earned an average annual rate of return of 11.99 percent. The second fund is the fixed income index investment fund. Over the last 10 years, this fund has earned an average annual rate of return of 7.72 percent. The third is the Government securities investment fund, and over the last 10 years, it has earned an average annual rate of return of 5.75 percent. The fourth is the small capitalization index. Over the last 10 years, it has earned an average annual rate of return of 11.84 percent. Fifth is the international stock index fund. Over the last 10 years, it has earned an average annual rate of return of 5.45 percent. These five funds provide a range of excellent investment options. My bill would also provide a default account for those Americans who, for whatever reason, do not want to deal with choosing a fund or funds for their accounts. This fund would invest differently in an individual's early working years than in their later working years. The Thrift Savings Plan has been a success for Government employees. Last year, returns on the different accounts ranged from just over 4 percent to 20 percent, and in the last 10 years, the returns have been between 5.5 and 12 percent. Compare this with the 3-percent return provided by Treasury bonds that Social Security now invests in today. These private accounts are in addition to the guaranteed Social Security benefits and personal savings pensions and retirement account programs individuals build up during their working years. Under my bill, personal accounts would be administered by a board within the Social Security Administration called the Social Security investment board. The board would be composed of the Secretary of the Treasury, the Chairman of the Federal Reserve Board, the Chairman of the Securities and Exchange Commission, and two Senate-confirmed appointments nominated by the President. One of the President's appointments would serve as chairman of the board. Upon retirement, those who choose to enroll in a personal account will have two accounts: their personal account and their traditional Social Security benefits account. They will be required to convert a portion of their personal account to an annuity which, when added to their guaranteed Social Security, would be at least 135 percent of poverty. There is no such guarantee in our Social Security system today. The remainder of the personal account will be theirs to spend as they wish. It could be used to help with health care costs and retirement living costs, or it could even help an account holder's children or grandchildren put a downpayment on a home or pay college tuition. There are those who say that allowing individuals to invest through personal accounts is too risky. Their concerns are serious, and they deserve a serious response. Under my plan, no person is required to have a personal account. An individual who does not want to invest can keep all of their money in the traditional Social Security system. I believe the policies which enhance personal freedom and responsibility encourage the ethic of saving and limit the role of Government in their lives. These are the policies which will be more flexible and successful for America's future. It is true that there is no guarantee with market-based investments; however, the historic success of markets is not a theory, it is a fact. Columnist George Will pointed out in a recent Washington Post column that in no 15-year period over the past eight decades has the growth of stocks ever been negative. In no 20-year period has the average growth been less than 3 percent, which exceeds the rate of return on Social Security assets today. This includes down times, significant down periods in the stock market. We are blessed in America. We are blessed in America because the vast majority of Americans live healthier, longer lives than they did a few decades ago. Continued advances in medicine, education, and personal health will continue to increase not only the length of our lives, but also the quality of our lives, providing opportunities for older Americans to remain healthy, vital, and productive members of the workforce. When Social Security was created in 1935, there were too many workers and not enough jobs. According to the Social Security Administration, in 1950, there were 16.5 workers per retiree. Incentives were created to move people out of the workforce. This dynamic is changing. Today there are 3.3 workers for every retiree. In 25 years, there will be about 2 workers for each retiree. Why is this important? This is important because Social Security is a transfer program. The money comes in and the payroll taxes from the workers go out at the end of the month to the retirees. So when there are less workers, there is less money coming into the system. My bill makes three adjustments to Social Security that will make it solvent for future generations. First, my bill would raise the current full benefit retirement age by 1 year from 67 to 68. Second, my bill would maintain the current earlier retirement age at 62 but would adjust benefits for those who choose to retire early. Currently, workers who retire early today receive 70 percent of their full retirement benefits. My bill will provide these early retirees with 63 percent of the traditional benefits. Third, currently an individual's base Social Security benefit is determined by two factors: their average income over 35 years and the wage index. My bill adds a third component, life expectancy. We are living longer. That means as we live longer, we will draw more from the Social Security fund. Over the life of the program Social Security benefit calculations have never been adjusted to reflect increased life expectancy. By factoring increased life expectancy into the base benefit calculation, the rate of increase in benefit payments will be slow. No other changes will be made to the annual consumer price indexing of benefit increases. In addition to making Social Security solvent, these adjustments can help confront the challenges of increasing Medicare costs and shortages in the workforce. It is important to protect the option of early retirement, but our laws need to encourage individuals to stay in the workforce, not leave it. Medicare costs, Medicaid costs, and labor shortages can be significantly reduced by keeping people healthy, vital, happy, and productive in the workforce. My bill pays for these changes in Social Security by using the existing $3.7 trillion unfunded liability to ensure the long-term health of the Social Security system. Doing nothing will mean at the end of 75 years, Social Security will have chewed up $3.7 trillion in taxpayer money to help keep Social Security solvent, but it will not, and we will still have an insolvent program with trillions of dollars more of unfunded liabilities staring us in the face. In recent testimony before the Senate, Alan Greenspan said Social Security's total unfunded liability could be as high as $10 trillion over the life of the program. I have introduced this bill because I believe that leaders have a responsibility to deal with the great challenges of their time, not defer them, not make excuses for them, but to try to fix them and come up with solutions. I do not hold my bill up as the only way to address the solvency of Social Security. It is one way. There may be better ways. No comprehensive bill will be immune from critical evaluation, nor should it be. However, I think my bill is a commonsense, responsible, and fiscally accountable place to start. All Americans need to ask tough questions about the future of Social Security. We need to begin the process of refining ideas to forge the best, most responsible policy for the future of Social Security. President Bush deserves great credit for making the modernization of Social Security a central part of his second-term agenda. There is no possibility for success in modernizing Social Security without strong Presidential leadership. As I said at the beginning of my speech, Social Security is one of the most important and successful Government programs in American history. Since 1935, it has provided a safety net for our society's most vulnerable. We have a high moral obligation to ensure that future generations continue to benefit from this safety net and social contract we have with our citizens. But in order to do this, we must fix the system. This is a personal issue for me. Forty years from now a young mother in Columbus, NE, may be left to raise four children on her own. I want her family to have the same access to the same safety net that my family had, and the promise that no matter where one starts in life, with a little help they can finish where they want. I am 58 years old. I am at the front of the baby boom generation. My daughter is 14 years old. My son is 12 years old. I do not want to fail their generation. That means addressing these entitlement program issues now, while we have time to do it in a wise, careful, and responsible way. This is a defining debate for today's leaders. Doing nothing is irresponsible and cowardly. It is in America's interest to deal with our challenge today. We have it in us to do what needs to be done. We can preserve, protect, and improve Social Security for all future generations of Americans. I send my bill to the desk and ask that it be assigned to the appropriate committee. I yield the floor.