J. Kerrey

Mr. KERREY

Mr. KERREY. Mr. President, this amendment addresses a very important problem that we saw in the oversight hearings that the chairman conducted, and that is sometimes the payment made to induce an individual to provide evidence against a taxpayer who is violating the law becomes an incentive to provide evidence that is faulty and the taxpayers end up being abused as a consequence. Normally, a request for a study would not necessarily go very far. In this case, Commissioner Rossotti has already launched an investigation by the Criminal Investigation Division, using Mr. Webster, former FBI Director, as the lead who has indicated he wants to get to the bottom of this problem as well. So I believe this modification is a good modification. I am prepared to accept it on this side.

Mr. KERREY. I move to lay that motion on the table. The motion to lay on the table was agreed to. Mr. BYRD addressed the Chair.

Mr. KERREY. First of all, let me say to the Senator from Nevada, long before I got on this issue of taxpayer rights, the Senator was there, working on Taxpayer Bill of Rights 1 and Taxpayer Bill of Rights 2. This legislation in title III is a continuation of your work. And I appreciate very much your early support of this bill that enabled us to fashion this legislation in a bipartisan way, which I think allows us to make certain that we can extend the rights and power and authority to the taxpayer and stop abuses that we see within the IRS's capacity to collect money that this Congress authorizes is to be collected. I appreciate, specifically, the problem you are identifying with your amendment. It is a problem that, thanks to Chairman Roth, we heard before our committee. We saw the problems that can occur when you offer somebody, essentially, a reward to inform; you can get abuse from that. As the Senator knows, as I have heard him talk about this as well, the dilemma is, how far do you go? We have this mechanism being used throughout law enforcement and there are many times when it works and when it is not abuse. I am wondering if the Senator would allow to us modify his amendment so it can require the commissioner to do a thorough analysis of this problem. Commissioner Rossotti has had this brought to his attention. It would require him to do a thorough analysis of this problem and then come back to us and say, how can we change the law so as to make certain that you are able to use this system when appropriate, but we can get rid of some of the abuses that are quite obviously not the intent of this Congress.

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

Mr. KERREY. I move to lay that motion on the table. The motion to lay on the table was agreed to. Vote on Amendment No. 2340

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

Mr. KERREY. Mr. President, I send an amendment to the desk, an amendment offered by Senator Leahy and Senator Ashcroft. It has been cleared on both sides. I ask that this amendment be agreed to.

Mr. KERREY. The Senator from North Dakota is exactly right. I hope colleagues will look at this letter from the Joint Tax Committee. This is the tip of the iceberg. The tax only scores 10 years out. They are saying, yes, Americans with over $100,000 in retirement income converting to a Roth IRA pay $47,000 in taxes each, and that will add to $2.6 billion by year 1, 2, 3, but after that it starts to cost more and more money as the individuals convert and don't pay any tax on their income. That is basically what will happen--and it grows. I say to the Senator from North Dakota, not only are you exactly right, but in the fourth year it costs $900 million and in the 10th year it is $1.7 billion. It is going up. This is less taxes that upper- income Americans will pay on these retirement accounts. As I said, it is apt to be the heirs. Who will pick up the slack? We know who will pick up the slack. If this amendment is accepted, which I suspect it will, I hope colleagues will look at the details of it. If you want to spend another $9 million in the second 5 years to pay for all the things that we added in the Senate Finance Committee, most of which are good and reasonable, if you want to add those provisions, the question is how will you pay for it. My hope is that we will find an alternative to this.

Mr. KERREY. Yes, sir.

Mr. KERREY. Mr. President, I wonder if the Senator from Delaware would agree--Senator Reid has an amendment he wants to bring right after this--that we stack these votes, and have a UC to have both of these votes stacked.

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

Mr. KERREY. The Senator is right. Title 3 of the bill is called the taxpayer rights provision. I worked very hard on those provisions. We extended lots of new taxpayer rights. In the bill that Senator Grassley and I introduced in the Finance Committee--and I voted for it--we added some additional rights. The problem is we don't know who will benefit from those tax reductions. We know three principal provisions cost us money. One is the shifting of burden of proof in Tax Court. For citizens, they need to ask themselves, do they go to Tax Court? If they don't go to Tax Court and don't have the experience on a regular basis in Tax Court, they will not bill. The second provision is called innocent spouse relief. They have to ask, will that affect me? Seventy percent of Nebraskans do not itemize their deductions. They will not be impacted by the second one. The third one, the suspension of the accrual of interest and penalties if the IRS fails to contact the taxpayer within 12 months after a timely filed return. Again, ask yourself who will be affected by this? We were unable, I regret, to get from the Joint Tax Committee an answer to that. We don't know who will benefit from those three additional provisions, but that is what is costing us the money. That is why we have to find some kind of an offset. As I said, I understand the die is likely to be cast and we will probably have 55 votes for the Roth amendment and 45 votes against. I will not ask for a rollcall vote on our alternative, but I appeal both to Republicans and Democrats on the floor to examine what it is we are about to do and ask ourselves, do we want to open up a hole in revenue in the outyears as a consequence of these conversions that will benefit a relatively small number of Americans who have retirement income in excess of $100,000 a year. Mr. President, I yield the floor.

Mr. KERREY. Mr. President, as I said, the die is cast on this thing. This amendment is going to be accepted. The question is, Will we have any reexamination moment? We will reexamine what we are about to do? Again, this affects people with incomes over $100,000 in retirement income. To get $100,000 in retirement income, I am probably going to have to have a million or more dollars in liquid assets that are earning this income. I would probably have tax-exempt bonds that I own as well. This is a very select group of people. We are not penalizing them; we are treating them like everybody else. I am capable of feeling sympathy for low- and moderate-income seniors who are struggling to pay for health care bills, and about making certain that Americans have the opportunity to save. But we are not helping Americans who are struggling to save with this. These are Americans who have accumulated a substantial amount of wealth. If we want to help struggling Americans, we ought to cut the payroll tax, as Senator Moynihan is proposing, giving Americans an $800 billion cut in taxes; that would go immediately into savings. That is exciting to me. And 98.5 percent of Americans die with estates under $600,000. We are talking about 1.5 percent of the American people who have estates over $600,000. You have to have an estate over a million dollars in order to generate $100,000 worth of income. Please don't tell me that tax lawyers and tax advisers can't figure out a way to transfer this to your heirs. If that assertion is made by a colleague, let's bring a tax adviser in before one of our committees and ask them. It darn sure can, and they darn sure will. This provides a benefit for a very small amount of Americans, and, frankly, it is very difficult to make the case that they need a benefit. They are not treating them in a fashion that is equal; they are treating them unequally with other Americans who are in the workforce and might be looking to retirement accounts as well. Mr. President, this pay-for ought to be rejected by this body; it is going to be accepted nonetheless. I hope we have some ``morning after'' doubts about this, after examining whom it is going to benefit and the dilemma it will pose to us down the road. I don't know how many in this body expect to be here 6, 7, 8 years from now, but if you are here, one of the questions you are going to have to answer is: Why did you give away $2 billion a year back in 1998 to less than 1 percent of the American public, who are not struggling, who are not foraging in the alley for food, and they are not trying to figure out how to make ends meet? They will use this change in the law to transfer an asset to heirs, and their heirs won't pay any taxes as a consequence. Mr. President, as I say, I know when it is time, if not to accept defeat, to acknowledge it. I expect 55 Republican votes for this amendment. I do not intend to ask for a rollcall vote on the substitute, but I hope my colleagues, as they begin to examine what this amendment does, will ask that we come back and revisit the pay-for for the second 5 years. I yield back whatever time I have. Amendment No. 2340, As modified

Mr. KERREY. Mr. President, as I indicated earlier, I have to ask for one modification. It is a date on page 2, line 2. In the earlier unanimous consent request, I indicated that I might need to modify our amendment. I send the modified amendment to the desk, as described.

Mr. KERREY. Could we modify it so we go to Senator Reid's amendment next and have rollcall votes not before 1:15?

Mr. KERREY. Mr. President, I ask for the yeas and nays.

Mr. KERREY. Mr. President, let me first do as the Senator from Iowa did, Senator Grassley, and compliment the intent of the distinguished Senator from Missouri. I started out exactly where the Senator from Missouri is, considering that a full-time board would be best. What I have concluded is that over time, examining what this board is going to be doing--and let nobody doubt, by the way, this board has substantial powers. This is not an advisory board. There are a number of things that we specifically say they cannot do, in order to avoid conflict of interest with procurement and with personnel and with confidentiality, but this board oversees the IRS in its administration, its management, its conduct, its direction, and its supervision of the execution and application of the IRS law. It has substantial powers in making recommendations to the President as to who the Commissioner ought to be and has the power to recommend the Commissioner ought to be terminated. I urge colleagues to look at section 1102 of the proposed legislation. I share the conclusion Senator Grassley has just iterated in his opposition to this amendment; that is, that a full-time board would actually restrict our capacity to go out and get the people with the kind of talent that we need to be on this board in the first place. There are an awful lot of Americans who have expertise in management, have expertise in computers, have expertise in the operation of a large organization. They especially have expertise in restructuring, which is going to be a very, very important piece of work that Mr. Rossotti will have the authority to do, restructuring and changing the nature an organization. We need people with all those kinds of expertise. And if you require the individual to serve full time, my conclusion, strongly felt, is you will exclude large numbers of citizens who would say: If it is part time, I'm prepared to sit on this Board as a consequence of my desire to improve the way this IRS is operated. My desire to improve it is strong enough to serve part time, but I can't possibly do it full time. We are going to reduce the list if we make it full time, of citizens who could serve this in this way. In addition, I point out this board sunsets in 2002; thus, Congress would have the opportunity to revisit and make a determination as to whether or not, as a result of the experience that we have had, this board needs to be full time. So I urge those who were concerned about this board being part time, on the one hand to consider we are going to restrict our ability to get the kind of expertise that is needed on this board, and, second, we will have an opportunity, after 5 years, to revisit this issue. If the experience of this board is that they are recommending to us that full time would be better than part time, we will have ample opportunity to make that judgment. I urge my colleagues, with great respect to the Senator from Missouri and his intent, to vote against this amendment.

Mr. KERREY. We would have to get a time agreement.

Mr. KERREY

Mr. KERREY. Mr. President, I ask unanimous consent that the amendment be temporarily laid aside so we can deal with an amendment to be offered by the Senators from Wisconsin, Mr. Kohl and Mr. Feingold, who have an amendment that both sides have agreed to.

Mr. KERREY. Mr. President, I ask unanimous consent that the Senator from New York be able to speak as in morning business.

Mr. KERREY. Mr. President, I ask unanimous consent the pending amendment be laid aside.

Mr. KERREY

Mr. KERREY. I thank the Senator from Minnesota. Mr. President, I rise in support of S. 1186, the Workforce Investment Partnership Act. This is an initiative that I have been involved with since my days as Governor of Nebraska from 1983 to 1987, and it is something I am proud to see come to fruition in the Senate. All of us understand that in today's global economy, this kind of legislation represents an important step in helping individual Americans achieve their shot at the American dream. One of the most satisfying efforts for me is to help, as a public official, some individual acquire the skills they need to earn a good wage so that they can support themselves and their families. Investments such as vocational education, job training, and adult education play a major role in this effort. But in order to be more effective, these programs need to be streamlined and coordinated in such a way that they work together to provide individuals the information and resources they need to be successful in a job market that demands an increasingly higher skill level. In 1994, along with Senator Nancy Kassebaum of Kansas, I introduced legislation to consolidate 91 job training programs into a single authorization called the Workforce Development Act. The bill also sought to reconnect job training, training-related education, and actual jobs. It also provided States greater flexibility in designing job training systems. Mr. President, I take great pleasure and am pleased that these concepts represented in this legislation are also incorporated into S. 1186. S. 1186 also encourages statewide partnerships consisting of the business community, the education community, the Governor, and local and State elected officials. A key responsibility in this partnership is the development of a State plan. The legislation also encourages one-stop customer service centers which will provide a central point of entry to job training programs. In the last few years in my State of Nebraska, Congress has increased its commitment to preparing individuals for the workforce. We have seen in our State an increase in Federal funding for job training of approximately $1.5 million since 1996; for vocational education, we have seen an increase of about $700,000; and for adult education, about $460,000. Mr. President, I would like to call this to the attention of my colleagues. I suspect, if they are like me, sometimes these program names get confusing, and I wonder whether or not they have any impact. In Nebraska, the $6.276 million allocation of Federal job training funds in 1997 provided 4,000 of my citizens with the skills they need to become more productive and to earn a higher living and satisfy the market demand, as the Senator from Vermont identified. There are many jobs out there that are unfilled simply because we cannot find people with skills. Mr. President, 4,000 of those jobs were filled; 4,000 of those people are happier. In addition, vocational and applied technology education grants assisted 70,000 secondary students and 47,800 post-secondary students who now have higher skills, a technical education they otherwise would not have had. They are going to get a shot at the American dream. They are going to be happier. They are going to be healthier. As I said, there are very few things that are more gratifying than having an individual say to you, ``Thank you for helping me get a shot at the American dream,'' and 17,340 adults in a single year were assisted in my State as a consequence of the $1.7 million in addition education. This is an investment with an excellent return. The legislation will not only help more individuals achieve the American dream but will also help our Nation become the best educated, most productive country in the world as we enter the 21st century. The Workforce Investment Partnership Act represents a good bipartisan effort to increase opportunities for American citizens. I look forward to seeing it move through Congress, and I congratulate and thank sincerely the distinguished chairman of the committee, Senator Jeffords of Vermont, and the ranking Democrat on the subcommittee, Senator Wellstone, as well as the chairman of the subcommittee, Senator DeWine. On behalf of the tens of thousands of Nebraskans who will receive the benefits of this program, I thank you. Mr. WELLSTONE addressed the Chair.

Mr. KERREY

Mr. KERREY. Will the Democratic leader yield?

Mr. KERREY. Just to inform both the Democratic leader and the majority leader, it would be Senator Roth's intention and my intention at 9:30 to take up both of the funding amendments and to have two back- to-back rollcall votes at 10:30, or close to that, unless we yield time back, so you and other colleagues can plan.

Mr. KERREY

Mr. KERREY. Likewise, Mr. President. I suggest the absence of a quorum.