John Kerry

Mr. KERRY

Mr. KERRY. Mr. President, I call up amendment No. 721 and ask for the yeas and nays.

Mr. KERRY

Mr. KERRY. Mr. President, the Senate today passed H.R. 1696, legislation authorizing expeditious construction of the World War II Memorial at the Rainbow Pool site on the National Mall in a manner consistent with previously approved plans, but ``subject to design modifications'' that may subsequently be approved by the National Capital Planning Commission and the Commission of Fine Arts under the Commemorative Works Act. In rejecting the original House bill in favor of this legislation, the Senate today recognizes that appropriate modifications to the design may be warranted. The bill permits the National Capital Planning Commission to proceed with its plans to view an on-site mock-up of the memorial and to consider modifications to the design that will ensure that the memorial respects the open, historic character of the Mall, that significant vistas are not obstructed, and that the height and mass of this memorial are appropriate for the site. Consistent with this legislation, such modifications ought to be expeditiously considered and approved by the National Capital Planning Commission and the Commission of Fine Arts so that construction of the memorial may proceed without undue delay.

Mr. KERRY

Mr. KERRY. This is an amendment which seeks to address the problem of the alternative minimum tax in this bill. My amendment would exempt all taxpayers with incomes of $100,000 or less from the alternative minimum tax, as it is known. For millions of Americans, the tax cut under consideration today is a phantom tax cut. It is a phantom tax cut because some don't get it at the outset, and it is a phantom tax cut that, because of the alternative minimum tax, millions will be pushed into a tax bracket that they were never in previously, and that will take away from them the very tax cut they are being promised. The alternative minimum tax was created, as we know, in 1969, to curtail the ability of high-income individuals to escape payment of income tax through various deductions, exclusions, and exemptions. It is effectively a separate tax system that rides parallel to the normal tax system. It was originally intended to prevent wealthier people from being able to make use of credits and deductions and thereby escape any tax liability whatsoever. In 1998, we began to notice that something was happening that was unintended. There was an encroachment of the AMT on middle-class taxpayers. That year, our omnibus appropriations bill included a provision allowing taxpayers to claim personal tax credits--such as the HOPE and lifetime learning credits, as well as the adoption credit-- without being pushed into the AMT liability. In 1999, we extended this provision through this year. Last year, about $1.3 million taxpayers confronted AMT liability. Under the current law, that number would climb to over 17 million taxpayers in 2010. But under the bill before us, the number of taxpayers subject to the AMT will climb to nearly 40 million by 2011. As a result, overall alternative minimum tax liability will rise from about $6 billion in the year 2000 to nearly $40 billion in 2010. The increase in AMT liability, for the most part, is attributable to inflation, but unlike the AMT, the regular tax system is indexed for inflation. The AMT is not. The personal exemptions, standard deduction, and tax brackets increase annually. Under the AMT, the exemption amounts and the tax brackets remain constant. Thus, every year taxpayers whose incomes rise with inflation are taxed at the same rate under the regular income tax but they are increasingly penalized by the AMT. It is simply fraudulent to say in this tax bill that we are offering a great number of Americans tax relief when we know we are pushing millions of Americans into the alternative minimum tax. That is No. 1. Secondly, everybody knows this is coming down the road, and yet we are under the limits of the total tax cut of $1.35 trillion. We know there is going to be a cost of several hundred billion over a number of years in order to pay for the tax cut we are giving because the consequence of this tax cut is to create a liability on the AMT. But lo and behold, we do not pay for it. That means, once again, the Congress is prepared to defer the tough decisions from today into the future. And everybody knows what will happen in the future. That will, indeed, be dealt with, and it will mean it is a much larger tax cut than is even being promised to the American people today. For taxpayers, navigating the maze of AMT rules is a significant administrative burden. The National Taxpayer Advocate at the IRS ranks the AMT as one of the most burdensome areas of tax law. To comply with the AMT, taxpayers must compute their regular tax liability and then recalculate their AMT liability using a different base of income, different exemptions, and different tax rates. The AMT also applies different treatments to certain income deductions, exclusions, and credits that may be used by taxpayers under the regular income tax. In essence, taxpayers are required to apply two methods of accounting--one for the regular tax and one for the AMT. If Congress fails to adequately address the AMT problem, the coverage will gradually shift from higher income taxpayers to more and more middle-class American taxpayers in States with high income and property taxes, such as States like Massachusetts that are particularly hard hit, because under the AMT, taxpayers are prohibited from deducting State and local taxes. In addition, as the grasp of the AMT spreads, incentives in the regular tax systems, such as the HOPE and the lifetime learning credits, and the adoption credit, completely lose their effectiveness. Not only do we create a liability, but we undo a benefit that we have put into effect previously. Madam President, the amendment I am proposing today would ensure that the AMT never touches the vast majority of middle-class Americans. It is simple and straightforward. It exempts all taxpayers with incomes of $100,000 or less from the AMT. As many employees in high-tech firms have already learned, stock options are another item treated differently under the AMT. The Joint Committee on Taxation, in its recent tax simplification report, recommended complete repeal of the alternative minimum tax. The committee stated in its report, ``the alternative minimum tax can be a trap for the unwary, especially for large families, and creates disparate treatment of taxpayers depending on where they live.'' Despite the overwhelming sentiment against the AMT, the legislation before us moves in the opposite direction. While the bill would provide some limited AMT relief through 2006, all such relief would be repealed in 2007. Even with the purported AMT fix in the bill before us, during the next five years, the number of taxpayers subject to the AMT will continue to rise steadily--nearly doubling next year alone. In 2002, as a result of the bill before us--with its combination of significant rate reductions and limited AMT relief--thousands of taxpayers will find themselves confronted for the first time by the AMT. And during the second five years, the number of taxpayers subject to the AMT will explode, reaching nearly 40 million in 2011. In short, the tax bill's proponents want to give Americans a tax cut with the right hand and take it away with the left hand. It is misleading--it is deceptive--and for millions of Americans, it is a phantom tax cut. And finally, it is fiscally irresponsible. Nobody truly believes Congress will allow the AMT to hit 40 million taxpayers. But the solution has been put off for another day. When we finally deal with the problem, it will be expensive--perhaps costing as much as $300 billion. The amendment I am proposing today would ensure that the AMT never touches the vast majority of middle-class Americans. It is simple and straightforward. My amendment would exempt all taxpayers with incomes of $100,000 or less from the AMT. By exempting taxpayers with incomes below $100,000 from the AMT, the amendment protects the original goal--to ensure that wealthy individuals do not entirely escape taxation--while also ensuring that the AMT will never touch the vast majority of maiddle-class taxpayers. The Joint Committee on Taxation estimates that exempting taxpayers with incomes below $100,000 from the alternative minimum tax will cost $110 billion over the next ten years. That is a small price to pay to ensure that middle-class Americans are able to benefit from the proposed tax reduction. The Joint Committee on Taxation further estimates that the amendment would eliminate AMT liability for 18 million taxpayers. If the amendment passes, 18 million middle-class taxpayers will be freed from the unintended burden of the alternative minimum tax. We should not miss our opportunity to address the growing AMT problem. We should not wait. AMT reform deserves more than the token measures included in the bill before us. Anything less is misleading and fiscally irresponsible. I urge my colleagues to support my amendment.

Mr. KERRY. Madam President, I call up amendment No. 721.

Mr. KERRY

Mr. KERRY. Reserving the right to object, before colleagues get a second bite of the apple, some Members would like a first. I ask unanimous consent to be added to the order. I think it would be fair for colleagues who have not had a first bite, before others get second bites of the apple.

Mr. KERRY. The question has been answered.

Mr. KERRY. Reserving the right to object, may I ask: Is the Carnahan amendment under any kind of time agreement at this point? I ask the Senator from Iowa.

Mr. KERRY

Mr. KERRY. Mr. President, I am pleased to introduce legislation today with my good friend and colleague from Iowa, Senator Harkin, to deal with the issue of overcrowded and dilapidated schools. In March I offered an amendment in the Senate Finance Committee that was very similar to the legislation that we are introducing today. I am sorry that the amendment failed on a 10-10 vote in the Committee, but I am hopeful that we can come together to find a way to pass school construction legislation during this Congress. The need for school construction assistance is great. Three-quarters of the public schools are in need of repairs, renovation, or modernization. More than one-third of schools rely on portable classrooms, such as trailers, many of which lack heat or air conditioning. Twenty percent of public schools report unsafe conditions, such as failing fire alarms or electric problems. At the same time the schools are getting older, the number of students is growing, up nine percent since 1990. The Department of Education estimates that 2,400 new schools will be needed by 2003 and public elementary and secondary enrollment is expected to increase another million between 1999 and 2006, reaching an all-time high of 44.4 million and increasing demand on schools. It's increasingly difficult to have meaningful reform in schools that are falling apart at the seams. Research does show that student and teacher achievement lags in shabby school buildings, those with no science labs, inadequate ventilation, and faulty heating systems. Older schools are also less likely to be connected to the Internet than recently built or renovated schools. Facilities are vital to implementation of research-based school reform efforts. We know, for example, that students learn more effectively in small classes, but school districts cannot create smaller classes or hire more teachers unless there is a place to put them. Many schools are trying to offer more robust curricula, including music, physical education and classes in the arts, but their ability to provide these programs is hampered if there is no space to house them. Almost every State in the Nation has implemented curriculum standards, calling for advanced work in science and technologies, but some schools are so old that their electrical wiring cannot support enough computers for the students and their science facilities are so antiquated that students cannot perform the experiments required to learn the state's curriculum. Some school districts are looking to implement universal preschool, a service that we know enhances children's school preparedness and which a study published in last week's Journal of the American Medical Association confirmed makes children more likely to complete high school, less likely to need special education or grade retention services while in school, and more likely to avoid arrest as young adults, but the lack of available facilities is often prohibitive. If we are serious about encouraging research-based, meaningful, effective education reforms, and if we are serious about doing our part to help local districts run safe schools, a commensurate investment in school facilities is imperative. The America's Better Classroom Act, is similar to legislation introduced in the House by Congressman Rangel and Congresswoman Johnson that has 158 cosponsors. Our legislation allows the Federal government to issue $24.8 billion in school modernization bonds through a formula- based allocation to states and through expansion of the Qualified Zone Academy Bond, QZAB, program. The bill also includes a $200 million set- aside for Bureau of Indian Affairs schools for two years to help school replacement projects at schools funded or run by the Bureau of Indian Affairs. Our bill would allocate 60 percent of $22 billion in bonds to states based on school-aged population. The remaining 40 percent of the bond revenue would be directly allocated to the 125 school districts with the largest number of low-income students based on ESEA Title I funding. States and local school districts are investing in school construction, but it is clear that they still need our help. Annual construction expenditures for elementary and secondary schools have been growing. But local and state budgets have not been able to keep up with demand for new schools and the repair of aging ones. Unless school leaders can persuade their wary voters to pass such bond referendums or raise local taxes, though, there's often little hope of change. Until the last few years, the plight of state and local leaders had not received much attention from Washington. Last year we came together to respond to their call by funding a $1.2 billion grant program and this year we should come together again and pass legislation that continues our commitment to help local districts with their repair and renovation needs. It is a tragedy that so many of our Nation's students attend schools in crumbling and unsafe facilities. According to the American Institute of Architects, one in every three public schools in America needs major repair. The American Society of Civil Engineers found school facilities to be in worse condition than any other part of our nation's infrastructure. The problem is particularly acute in some high-poverty schools, where inadequate roofs, electrical systems, and plumbing place students and school employees at risk. Last month I visited the Westford Public School District in Massachusetts. School facilities were a big concern for this semi-rural town which has seen its student population sky rocket in recent years, but has not experienced comparable property tax revenues. In order to meet the fiscal demands of new school construction, the town is foregoing replacement of large, drafty windows from the early 1950s and is relying on pre-fab trailers to serve as an elementary school. The Wilson Middle School in Natick, MA was built for approximately 500 students and currently houses 625. The school has no technical infrastructure, it has no electrical wiring to allow the integration of computers in the classroom. The classrooms are 75 percent of the size of contemporary classrooms and were built with chairs and desks fixed to floor. Classrooms like these make it near-impossible for teachers to use modern-day teaching methods which rely heavily on student collaboration and interaction. The school also lacks science laboratories, making it impossible for students to do hands-on work and experiments. Natick High School, like many aging school buildings around the Commonwealth, needs to have its basic infrastructure updated: electrical wiring, heating, plumbing and intercom systems are among the many components of the school in need of modernization. Also, the science labs are presently unable to meet the demands of updated state curricula. Natick put in place a prototype lab, and saw remarkable changes in students' interest and ability to experiment in science. I am very pleased to be introducing this legislation today with Senator Harkin, and it is my sincere hope that we can come together again on the issue of school construction and pass legislation that addresses this Nation's critical need for school repairs and renovation, and that we can do it as a part of a broader package of honest and tough reforms which focus, above all else, on the goal of empowering our schools to raise student achievement.

Mr. KERRY

Mr. KERRY. Mr. President, I am pleased to introduce legislation today with my good friend and colleague from Iowa, Senator Harkin, to deal with the issue of overcrowded and dilapidated schools. In March I offered an amendment in the Senate Finance Committee that was very similar to the legislation that we are introducing today. I am sorry that the amendment failed on a 10-10 vote in the Committee, but I am hopeful that we can come together to find a way to pass school construction legislation during this Congress. The need for school construction assistance is great. Three-quarters of the public schools are in need of repairs, renovation, or modernization. More than one-third of schools rely on portable classrooms, such as trailers, many of which lack heat or air conditioning. Twenty percent of public schools report unsafe conditions, such as failing fire alarms or electric problems. At the same time the schools are getting older, the number of students is growing, up nine percent since 1990. The Department of Education estimates that 2,400 new schools will be needed by 2003 and public elementary and secondary enrollment is expected to increase another million between 1999 and 2006, reaching an all-time high of 44.4 million and increasing demand on schools. It's increasingly difficult to have meaningful reform in schools that are falling apart at the seams. Research does show that student and teacher achievement lags in shabby school buildings, those with no science labs, inadequate ventilation, and faulty heating systems. Older schools are also less likely to be connected to the Internet than recently built or renovated schools. Facilities are vital to implementation of research-based school reform efforts. We know, for example, that students learn more effectively in small classes, but school districts cannot create smaller classes or hire more teachers unless there is a place to put them. Many schools are trying to offer more robust curricula, including music, physical education and classes in the arts, but their ability to provide these programs is hampered if there is no space to house them. Almost every State in the Nation has implemented curriculum standards, calling for advanced work in science and technologies, but some schools are so old that their electrical wiring cannot support enough computers for the students and their science facilities are so antiquated that students cannot perform the experiments required to learn the state's curriculum. Some school districts are looking to implement universal preschool, a service that we know enhances children's school preparedness and which a study published in last week's Journal of the American Medical Association confirmed makes children more likely to complete high school, less likely to need special education or grade retention services while in school, and more likely to avoid arrest as young adults, but the lack of available facilities is often prohibitive. If we are serious about encouraging research-based, meaningful, effective education reforms, and if we are serious about doing our part to help local districts run safe schools, a commensurate investment in school facilities is imperative. The America's Better Classroom Act, is similar to legislation introduced in the House by Congressman Rangel and Congresswoman Johnson that has 158 cosponsors. Our legislation allows the Federal government to issue $24.8 billion in school modernization bonds through a formula- based allocation to states and through expansion of the Qualified Zone Academy Bond, QZAB, program. The bill also includes a $200 million set- aside for Bureau of Indian Affairs schools for two years to help school replacement projects at schools funded or run by the Bureau of Indian Affairs. Our bill would allocate 60 percent of $22 billion in bonds to states based on school-aged population. The remaining 40 percent of the bond revenue would be directly allocated to the 125 school districts with the largest number of low-income students based on ESEA Title I funding. States and local school districts are investing in school construction, but it is clear that they still need our help. Annual construction expenditures for elementary and secondary schools have been growing. But local and state budgets have not been able to keep up with demand for new schools and the repair of aging ones. Unless school leaders can persuade their wary voters to pass such bond referendums or raise local taxes, though, there's often little hope of change. Until the last few years, the plight of state and local leaders had not received much attention from Washington. Last year we came together to respond to their call by funding a $1.2 billion grant program and this year we should come together again and pass legislation that continues our commitment to help local districts with their repair and renovation needs. It is a tragedy that so many of our Nation's students attend schools in crumbling and unsafe facilities. According to the American Institute of Architects, one in every three public schools in America needs major repair. The American Society of Civil Engineers found school facilities to be in worse condition than any other part of our nation's infrastructure. The problem is particularly acute in some high-poverty schools, where inadequate roofs, electrical systems, and plumbing place students and school employees at risk. Last month I visited the Westford Public School District in Massachusetts. School facilities were a big concern for this semi-rural town which has seen its student population sky rocket in recent years, but has not experienced comparable property tax revenues. In order to meet the fiscal demands of new school construction, the town is foregoing replacement of large, drafty windows from the early 1950s and is relying on pre-fab trailers to serve as an elementary school. The Wilson Middle School in Natick, MA was built for approximately 500 students and currently houses 625. The school has no technical infrastructure, it has no electrical wiring to allow the integration of computers in the classroom. The classrooms are 75 percent of the size of contemporary classrooms and were built with chairs and desks fixed to floor. Classrooms like these make it near-impossible for teachers to use modern-day teaching methods which rely heavily on student collaboration and interaction. The school also lacks science laboratories, making it impossible for students to do hands-on work and experiments. Natick High School, like many aging school buildings around the Commonwealth, needs to have its basic infrastructure updated: electrical wiring, heating, plumbing and intercom systems are among the many components of the school in need of modernization. Also, the science labs are presently unable to meet the demands of updated state curricula. Natick put in place a prototype lab, and saw remarkable changes in students' interest and ability to experiment in science. I am very pleased to be introducing this legislation today with Senator Harkin, and it is my sincere hope that we can come together again on the issue of school construction and pass legislation that addresses this Nation's critical need for school repairs and renovation, and that we can do it as a part of a broader package of honest and tough reforms which focus, above all else, on the goal of empowering our schools to raise student achievement.

Mr. KERRY. Mr. President, last month at the African Summit on AIDS in Nigeria, the Secretary General of the U.N., Kofi Annan, called upon the international community to establish a new multibillion-dollar global fund to combat AIDS and other infectious diseases, such as tuberculosis and malaria. He estimates that $7 billion to $10 billion annually will be needed to fight the global pandemic of HIV/AIDS on all fronts-- prevention, care, and treatment. This call reflects the magnitude of the challenge before all of us. The AIDS crisis has never been so devastating or so urgent as it is today. In less than two decades, AIDS has become a global epidemic, endangering the lives of millions of people, the majority of them in developing countries. It has proved more devastating than wars. In 1998, in Africa, 200,000 people died in armed conflict, but in the same time, 2.2 million people died from AIDS. It is destroying the economies of many developing countries at a critical juncture, unacceptable as that level of death would be at any time, and it is reversing half a century of developmental gains. Even more importantly, AIDS has emerged as an international security threat with the ability to destroy communities, whole generations, and even nations. Just recently, the Bush administration continued what the Clinton administration had done, which is recognizing it as a security threat to the United States of America. The statistics are chilling. Over 36.1 million people are living with HIV/AIDS around the world. According to the United Nations, every 60 seconds, 11 people contract HIV due mostly to unprotected sex, but also to intravenous drugs. At the end of the day today, 14,500 more men, women, and children will be infected with HIV. Over 13 million children have been orphaned by AIDS. Africa is hardest hit by this epidemic today. Eight African countries are struggling under the weight of a disease that has infected 15 percent of their adult populations. Three African countries--South Africa, Botswana, and Zimbabwe--are threatened with negative population growth in the next few years, and if a cure is not found, that will happen. I know it is difficult for any of us to imagine the enormity of the human suffering that goes along with these statistics, but it is important that we as policymakers do not shy away from understanding the terrible impact AIDS is having on a global basis. In South Africa, which is at the epicenter of this global epidemic, 25 percent of adults, one in every nine South Africans, are now living with HIV. U.N. officials estimate that if the epidemic continues to spread at its current pace, close to one-half of the country's 15-year- olds will die of AIDS-related illnesses in the coming years--one-half of all the 15-year-olds. This represents an entire generation of South Africans. While Africa is bearing the brunt of the epidemic today, there are strong signs that Asia will soon fall under the same inconceivable burden. Infection rates are climbing in Asia with countries such as India on the brink of a large-scale expansion of the epidemic. Currently, almost 4 million people in India are infected--second only to South Africa in total number of infections. In a country with one-sixth the world's population, the AIDS pandemic in India is of particular concern to us. According to the International AIDS Vaccine Initiative, it is making clear inroads into the general population. As with many countries affected by HIV/AIDS, many of the high-risk groups, such as commercial sex workers, intravenous drug users, truckers, and migrant workers, all of whom have high infection rates, end up spreading HIV at alarming rates as globalization and the market economies continue to put pressure on the movement of migrant populations of workers. Prevention efforts in India face many of the same obstacles as in many developing countries. These include high illiteracy rates, widespread poverty, very poor infrastructure, the low status of women, and taboos on talking about issues of sexuality. In East Asia, more than 2.4 million people are already infected with the HIV virus, and an estimated 150,000 children have been orphaned. While China does not yet have the same infections as India, Chinese researchers estimate that the number of HIV-infected people could jump to 10 million in a few years. Countries of the former Soviet Union and Eastern Europe are also vulnerable, with Russia experiencing the highest increase in infection rates in the world last year. The Russian Federation had more new HIV infections in 2000 than in all the previous years of the epidemic combined, totaling 700,000 infections in the year 2000, up from 170,000 in 1997. Latin America and the Caribbean are also heading down the same path. In fact, some of the Caribbean island states have worse epidemics than any country outside of sub-Saharan Africa. Five percent of the adults in Haiti are living with AIDS. Even these alarming statistics do not give a full picture of the scope of the HIV/AIDS threat. In fact, for many people in the developing world, AIDS is simply another burden on top of many others, such as poverty, armed conflict, and incomplete infrastructure. By eating away at the social capital of many of these countries, AIDS is decimating the most productive members of society who are needed to solve many of the other problems in their nations. In addition to the challenges posed by AIDS, malaria and tuberculosis are also exacting a tremendous toll on the developing world. In 1999, there were an estimated 8.4 million new tuberculosis cases, and 10.2 million new cases are expected in 2005 if present trends continue. Malaria also poses an increasing threat as well, killing at least 1 million people each year, about 3,000 people a day. The spread of each of these infectious diseases is made worse by health systems' failure, population movement, deteriorating sanitation, and insufficient prevention and treatment efforts. A human crisis of this proportion demands that we respond with urgency and thoughtfulness. We must continue to support robust prevention, treatment and care programs. But we must also recognize that vaccines are the most effective weapons in the arsenal of modern medicine to stop the threat of AIDS and other infectious diseases. Pharmaceutical companies, however, are reluctant to invest in research for vaccines to prevent HIV/AIDS and other infectious diseases because they fear they will not recover the expense of their research. The bill that I am introducing today, along with my colleague Senator Frist, is designed to address this problem by providing incentives for pharmaceutical and biotech research companies to accelerate their efforts to develop vaccines and microbicides to prevent AIDS, TB, malaria, and other deadly infectious diseases. It does this in three ways. First, it provides a 30 percent tax credit each year on qualified research expenses to develop microbicides for HIV and vaccines for HIV, TB, malaria, and other infectious diseases that kill more than 1 million people annually. This is an expansion of the existing R&D tax and can be applied to clinical trials outside of the United States, since the majority of those infected with these diseases are beyond our borders. Second, it provides a refundable tax credit to small biotechnology companies based on the amount of qualified research that they do in a given year. Biotech firms are among the most innovative when it comes to research. Increased research efforts by these firms could be instrumental to the effort to develop effective vaccines, particularly for HIV/AIDS. Third, the bill provides a 100 percent tax credit on contracts and other arrangements for research and development of these vaccines and microbicides. This credit, which is an increase over the 65 percent credit now in the tax code, is designed to serve as an incentive to larger pharmaceutical companies to work hand in hand with the smaller biotech companies to pick up the pace of vaccine development. Over the last year a number of pharmaceutical companies have taken steps to help in the treatment of those infected with AIDS by providing life-extending therapies to the developing world at reduced costs. These drugs are critically important but the war against AIDS cannot be won unless we develop vaccines against the HIV virus and related infectious diseases. The pharmaceutical and biotech companies hold the key. Once vaccines are developed, it is imperative that they be widely distributed. The bill that I am introducing today with Senator Frist also addresses the distribution side of the equation. It provides a 100 percent tax credit to companies on the sales of new vaccines and microbicides as long as those sales are made to a qualified international health organization or foreign government for distribution in developing countries. It also directs the Secretary of the Treasury to establish a fund in the Treasury for the purchase and distribution of eligible vaccines to developing countries. Finally, it urges continued U.S. government support for the Global Alliance for Vaccines and Immunizations, GAVI, and the Global Fund for Children's Vaccines. Mr. President, many steps need to be taken in the war against AIDS and other infectious diseases. This bill focuses on only one area but a critically important one: vaccine development and distribution. If the public and private sectors work together with energy and commitment, I believe we can develop the vaccines and once developed, we will win the war. It is easy for people in a country as rich as we are, as safe as we are, as blessed as we are to lose sight of what is happening on the rest of the planet. There are even some in this country who are quick to simply say: Well, it's their fault; it's the result of their sexual practices; it's the result of their values; it's the result of their culture. It may well be that it is possible for people to cast a finger and to point blame, but this is a crisis of human proportions that affects all of us. It affects all of us because of the potential destabilization of whole nations with which we do business and on whom we must rely in a whole series of relationships. It is also critical for us to understand the implications of this because in the world today there are no boundaries. This is a disease, and a disease has all the capacity to be carried across boundaries and become as important to us in this nation as it should have been already simply by virtue of the number of people in our country who are infected and who may potentially carry the disease elsewhere. Yes, we must continue to support prevention; yes, we must continue to support treatment; and, yes, we must continue to support care programs. But I do not believe any of us can feel secure in the notion that there will be enough money, enough delivery systems, or that we will ever have the capacity to provide the kind of care, treatment, and prevention that will deal with the numbers about which we are talking in a global pandemic of this nature. The most important tool, the most important weapon in the arsenal against this we have not even begun to use because we have not discovered it yet, and that is a vaccine. A vaccine can replace all of the need for infrastructure, except for the delivery of the vaccine, the need for care, the extraordinary burden on health care systems, and the incapacity of systems to deal with the sheer numbers we are facing. There is a reason we do not have a vaccine. It is because there is no marketplace. All of these countries are poor, and the drug companies, by and large, have an incentive to provide the drugs that most rapidly remunerates them. We have Prozac, Viagra, and a host of other drugs that are quickly and easily put in the marketplace. We need to create an incentive in the Tax Code to encourage research and development for the creation of an AIDS vaccine. Many of us are confident that if the United States were to create the kind of energy in our research and development technology, in our education sector, we have the ability to provide the ultimate vaccine against this. Senator Frist, a colleague of enormous respect in this institution, as a physician is unparalleled in his understanding of the difficulties of this issue. I am proud that he is a cosponsor with me of this legislation. We are hoping our colleagues will join us next week when the tax bill comes to the floor in reconciliation. We have an opportunity to provide the small amount of money necessary through this tax structure to be able to create the vaccine that can help deal with this crisis. Many steps are needed in the war against AIDS and other infectious diseases. This bill focuses on only one area, but it is a critically important one, vaccine development and distribution. If the public and private sectors work together with the energy and commitment that we produced for so many other things in this country, we can make a global contribution of historic proportions. I think we should strive to do nothing less than that. I yield the floor.

Mr. KERRY

Mr. KERRY. Mr. President, last month at the African Summit on AIDS in Nigeria, the Secretary General of the U.N., Kofi Annan, called upon the international community to establish a new multibillion-dollar global fund to combat AIDS and other infectious diseases, such as tuberculosis and malaria. He estimates that $7 billion to $10 billion annually will be needed to fight the global pandemic of HIV/AIDS on all fronts-- prevention, care, and treatment. This call reflects the magnitude of the challenge before all of us. The AIDS crisis has never been so devastating or so urgent as it is today. In less than two decades, AIDS has become a global epidemic, endangering the lives of millions of people, the majority of them in developing countries. It has proved more devastating than wars. In 1998, in Africa, 200,000 people died in armed conflict, but in the same time, 2.2 million people died from AIDS. It is destroying the economies of many developing countries at a critical juncture, unacceptable as that level of death would be at any time, and it is reversing half a century of developmental gains. Even more importantly, AIDS has emerged as an international security threat with the ability to destroy communities, whole generations, and even nations. Just recently, the Bush administration continued what the Clinton administration had done, which is recognizing it as a security threat to the United States of America. The statistics are chilling. Over 36.1 million people are living with HIV/AIDS around the world. According to the United Nations, every 60 seconds, 11 people contract HIV due mostly to unprotected sex, but also to intravenous drugs. At the end of the day today, 14,500 more men, women, and children will be infected with HIV. Over 13 million children have been orphaned by AIDS. Africa is hardest hit by this epidemic today. Eight African countries are struggling under the weight of a disease that has infected 15 percent of their adult populations. Three African countries--South Africa, Botswana, and Zimbabwe--are threatened with negative population growth in the next few years, and if a cure is not found, that will happen. I know it is difficult for any of us to imagine the enormity of the human suffering that goes along with these statistics, but it is important that we as policymakers do not shy away from understanding the terrible impact AIDS is having on a global basis. In South Africa, which is at the epicenter of this global epidemic, 25 percent of adults, one in every nine South Africans, are now living with HIV. U.N. officials estimate that if the epidemic continues to spread at its current pace, close to one-half of the country's 15-year- olds will die of AIDS-related illnesses in the coming years--one-half of all the 15-year-olds. This represents an entire generation of South Africans. While Africa is bearing the brunt of the epidemic today, there are strong signs that Asia will soon fall under the same inconceivable burden. Infection rates are climbing in Asia with countries such as India on the brink of a large-scale expansion of the epidemic. Currently, almost 4 million people in India are infected--second only to South Africa in total number of infections. In a country with one-sixth the world's population, the AIDS pandemic in India is of particular concern to us. According to the International AIDS Vaccine Initiative, it is making clear inroads into the general population. As with many countries affected by HIV/AIDS, many of the high-risk groups, such as commercial sex workers, intravenous drug users, truckers, and migrant workers, all of whom have high infection rates, end up spreading HIV at alarming rates as globalization and the market economies continue to put pressure on the movement of migrant populations of workers. Prevention efforts in India face many of the same obstacles as in many developing countries. These include high illiteracy rates, widespread poverty, very poor infrastructure, the low status of women, and taboos on talking about issues of sexuality. In East Asia, more than 2.4 million people are already infected with the HIV virus, and an estimated 150,000 children have been orphaned. While China does not yet have the same infections as India, Chinese researchers estimate that the number of HIV-infected people could jump to 10 million in a few years. Countries of the former Soviet Union and Eastern Europe are also vulnerable, with Russia experiencing the highest increase in infection rates in the world last year. The Russian Federation had more new HIV infections in 2000 than in all the previous years of the epidemic combined, totaling 700,000 infections in the year 2000, up from 170,000 in 1997. Latin America and the Caribbean are also heading down the same path. In fact, some of the Caribbean island states have worse epidemics than any country outside of sub-Saharan Africa. Five percent of the adults in Haiti are living with AIDS. Even these alarming statistics do not give a full picture of the scope of the HIV/AIDS threat. In fact, for many people in the developing world, AIDS is simply another burden on top of many others, such as poverty, armed conflict, and incomplete infrastructure. By eating away at the social capital of many of these countries, AIDS is decimating the most productive members of society who are needed to solve many of the other problems in their nations. In addition to the challenges posed by AIDS, malaria and tuberculosis are also exacting a tremendous toll on the developing world. In 1999, there were an estimated 8.4 million new tuberculosis cases, and 10.2 million new cases are expected in 2005 if present trends continue. Malaria also poses an increasing threat as well, killing at least 1 million people each year, about 3,000 people a day. The spread of each of these infectious diseases is made worse by health systems' failure, population movement, deteriorating sanitation, and insufficient prevention and treatment efforts. A human crisis of this proportion demands that we respond with urgency and thoughtfulness. We must continue to support robust prevention, treatment and care programs. But we must also recognize that vaccines are the most effective weapons in the arsenal of modern medicine to stop the threat of AIDS and other infectious diseases. Pharmaceutical companies, however, are reluctant to invest in research for vaccines to prevent HIV/AIDS and other infectious diseases because they fear they will not recover the expense of their research. The bill that I am introducing today, along with my colleague Senator Frist, is designed to address this problem by providing incentives for pharmaceutical and biotech research companies to accelerate their efforts to develop vaccines and microbicides to prevent AIDS, TB, malaria, and other deadly infectious diseases. It does this in three ways. First, it provides a 30 percent tax credit each year on qualified research expenses to develop microbicides for HIV and vaccines for HIV, TB, malaria, and other infectious diseases that kill more than 1 million people annually. This is an expansion of the existing R&D tax and can be applied to clinical trials outside of the United States, since the majority of those infected with these diseases are beyond our borders. Second, it provides a refundable tax credit to small biotechnology companies based on the amount of qualified research that they do in a given year. Biotech firms are among the most innovative when it comes to research. Increased research efforts by these firms could be instrumental to the effort to develop effective vaccines, particularly for HIV/AIDS. Third, the bill provides a 100 percent tax credit on contracts and other arrangements for research and development of these vaccines and microbicides. This credit, which is an increase over the 65 percent credit now in the tax code, is designed to serve as an incentive to larger pharmaceutical companies to work hand in hand with the smaller biotech companies to pick up the pace of vaccine development. Over the last year a number of pharmaceutical companies have taken steps to help in the treatment of those infected with AIDS by providing life-extending therapies to the developing world at reduced costs. These drugs are critically important but the war against AIDS cannot be won unless we develop vaccines against the HIV virus and related infectious diseases. The pharmaceutical and biotech companies hold the key. Once vaccines are developed, it is imperative that they be widely distributed. The bill that I am introducing today with Senator Frist also addresses the distribution side of the equation. It provides a 100 percent tax credit to companies on the sales of new vaccines and microbicides as long as those sales are made to a qualified international health organization or foreign government for distribution in developing countries. It also directs the Secretary of the Treasury to establish a fund in the Treasury for the purchase and distribution of eligible vaccines to developing countries. Finally, it urges continued U.S. government support for the Global Alliance for Vaccines and Immunizations, GAVI, and the Global Fund for Children's Vaccines. Mr. President, many steps need to be taken in the war against AIDS and other infectious diseases. This bill focuses on only one area but a critically important one: vaccine development and distribution. If the public and private sectors work together with energy and commitment, I believe we can develop the vaccines and once developed, we will win the war. It is easy for people in a country as rich as we are, as safe as we are, as blessed as we are to lose sight of what is happening on the rest of the planet. There are even some in this country who are quick to simply say: Well, it's their fault; it's the result of their sexual practices; it's the result of their values; it's the result of their culture. It may well be that it is possible for people to cast a finger and to point blame, but this is a crisis of human proportions that affects all of us. It affects all of us because of the potential destabilization of whole nations with which we do business and on whom we must rely in a whole series of relationships. It is also critical for us to understand the implications of this because in the world today there are no boundaries. This is a disease, and a disease has all the capacity to be carried across boundaries and become as important to us in this nation as it should have been already simply by virtue of the number of people in our country who are infected and who may potentially carry the disease elsewhere. Yes, we must continue to support prevention; yes, we must continue to support treatment; and, yes, we must continue to support care programs. But I do not believe any of us can feel secure in the notion that there will be enough money, enough delivery systems, or that we will ever have the capacity to provide the kind of care, treatment, and prevention that will deal with the numbers about which we are talking in a global pandemic of this nature. The most important tool, the most important weapon in the arsenal against this we have not even begun to use because we have not discovered it yet, and that is a vaccine. A vaccine can replace all of the need for infrastructure, except for the delivery of the vaccine, the need for care, the extraordinary burden on health care systems, and the incapacity of systems to deal with the sheer numbers we are facing. There is a reason we do not have a vaccine. It is because there is no marketplace. All of these countries are poor, and the drug companies, by and large, have an incentive to provide the drugs that most rapidly remunerates them. We have Prozac, Viagra, and a host of other drugs that are quickly and easily put in the marketplace. We need to create an incentive in the Tax Code to encourage research and development for the creation of an AIDS vaccine. Many of us are confident that if the United States were to create the kind of energy in our research and development technology, in our education sector, we have the ability to provide the ultimate vaccine against this. Senator Frist, a colleague of enormous respect in this institution, as a physician is unparalleled in his understanding of the difficulties of this issue. I am proud that he is a cosponsor with me of this legislation. We are hoping our colleagues will join us next week when the tax bill comes to the floor in reconciliation. We have an opportunity to provide the small amount of money necessary through this tax structure to be able to create the vaccine that can help deal with this crisis. Many steps are needed in the war against AIDS and other infectious diseases. This bill focuses on only one area, but it is a critically important one, vaccine development and distribution. If the public and private sectors work together with the energy and commitment that we produced for so many other things in this country, we can make a global contribution of historic proportions. I think we should strive to do nothing less than that. I yield the floor.

Mr. KERRY

Mr. KERRY. I thank the Chair. (The remarks of Mr. Kerry and Mr. Frist pertaining to the introduction of S. 895 are located in today's Record under ``Statements on Introduced Bills and Joint Resolutions.'') Amendment No. 425, As Modified

Mr. KERRY. Mr. President, I don't intend to debate it, but Senator Kennedy indicated he would be right back. I don't know if he intends to speak. I wanted to protect his right to do that.

Mr. KERRY

Mr. KERRY. Mr. President, I speak today in strong support of the sense-of-the Senate resolution introduced by Chairman Bond and myself, recognizing the important role played by the Small Business Administration on behalf of the United States small business community. I am pleased to say that nearly every Senator on the Small Business Committee has cosponsored this important Resolution. I would like to thank Senators Burns, Levin, Bennett, Harkin, Snowe, Lieberman, Enzi, Wellstone, Crapo, Cleland, Ensign, Landrieu, Edwards, and Cantwell for showing their support for America's small businesses by cosponsoring this Resolution. Mr. President, small businesses keep the U.S. economy moving. They are responsible for employing more than 52 percent of the private workforce; for generating more than 51 percent of the nation's gross domestic product; and are the principal source of new jobs. They were also responsible for helping to end the recession of the early 1990's, and with the right programs and assistance, will be a major factor in sustaining our current economy. To help them achieve success, small businesses rely on a range of programs administered and monitored by the Small Business Administration (SBA), such as the Small Business Innovation Research Program (SBIR), the 7(a) Guaranteed Loan Program, the 8(a) Business Development Program, the Small Business Development Center and Women's Business Center Programs, and the New Markets Venture Capital Program. And these are just a few of the many initiatives that continue to receive widespread support from the Senate and House Committees on Small Business, as well as the Congress as a whole. Our resolution commends the SBA for their activities, and calls on the President to make every effort to strengthen and expand assistance to small business concerns through Federal programs. SBA programs are relied upon to help restore economically depressed communities, spur technological innovation, provide access to capital, train entrepreneurs, monitor the procurement practices of Federal agencies, and ensure small businesses are heard when new regulations are being developed. Unfortunately, the SBA has received increasing responsibilities without the necessary increase in resources to do the job as effectively as possible. To make the situation worse, the Bush administration's budget request for fiscal year 2002 is woefully inadequate and goes in the wrong direction. President Bush has consistently stated that the economy is in a period of economic decline, yet he has proposed limiting the resources available to our small businesses by cutting funding and charging additional fees for programs that create businesses and jobs, and help generate revenue for the American people. Mr. President, I would like to commend Chairman Bond for working with me to pass an amendment to the budget resolution restoring many of the cuts initiated by the Bush administration. I am hopeful that our joint effort will be retained in the final budget. I also hope that by continuing to work in a bipartisan fashion on this critical issue, we can further increase SBA resources for the next fiscal year. The SBA deserves our continued support for its important work, and I urge my colleagues to support this resolution as well as sufficient resources for the SBA and America's small businesses.

Mr. KERRY

Mr. KERRY. Mr. President, I would like to discuss the amendment that the Senator from Iowa and I, and others, have offered to deal with the oft-discussed issue of overcrowded and dilapidated schools. As many of my colleagues know, for this is an issue that we have talked about before and even addressed in a bipartisan fashion last year, the need for school construction assistance is great. Three- quarters of the public schools are in need of repairs, renovation, or modernization. More than one-third of schools rely on portable classrooms, such as trailers, many of which lack heat or air conditioning. Twenty percent of public schools report unsafe conditions, such as failing fire alarms or electric problems. At the same time the schools are getting older, the number of students is growing, up 9 percent since 1990. The Department of Education estimates that 2,400 new schools will be needed by 2003 and public elementary and secondary enrollment is expected to increase another million between 1999 and 2006, reaching an all-time high of 44.4 million and increasing demand on schools. I have come to the floor on more than a few occasions and made clear my feeling that Democrats need to acknowledge that bricks and mortar alone are not the answer for our public schools; I think the reforms on accountability, local control, and tough standards that our party has embraced make clear that we have heard that message, but it does not for a minute dilute the fact that it's increasingly difficult to have meaningful reform in schools that are falling apart at the seams. Research does show that student and teacher achievement lags in shabby school buildings, those with no science labs, inadequate ventilation, and faulty heating systems. Older schools are also less likely to be connected to the Internet than recently built or renovated schools. Facilities are vital to implementation of research-based school reform efforts. We know, for example, that students learn more effectively in small classes, but school districts cannot create smaller classes or hire more teachers unless there is a place to put them. Many schools are trying to offer more robust curricula, including music, physical education and classes in the arts, but their ability to provide these programs is hampered if there is no space to house them. Almost every State in the Nation has implemented curriculum standards, calling for advanced work in science and technologies, but some schools are so old that their electrical wiring cannot support enough computers for the students and their science facilities are so antiquated that students cannot perform the experiments required to learn the State's curriculum. Some school districts are looking to implement universal preschool--a service that we know enhances children's school preparedness and which a study published in last week's Journal of the American Medical Association confirmed makes children more likely to complete high school, less likely to need special education or grade retention services while in school, and more likely to avoid arrest as young adults--but the lack of available facilities is often prohibitive. If we are serious about encouraging research-based, meaningful, effective education reforms--and if we are serious about doing our part to help local districts run safe schools--a commensurate investment in school facilities is imperative. I have listened to the debate today and have heard some of my colleagues on the other side of the aisle talk about the Federal Government overstepping its bounds into what is a State and local issue. I agree with their sentiment that the Federal Government should not go into local communities and decide what to build or decide what to repair. I also agree, to a certain extent, that the burden of building and renovating schools should be borne by localities. But what we have seen very clearly over the past several years is that States and local school districts are investing in school construction, but they still need our help. Annual construction expenditures for elementary and secondary schools have been growing. But local and State budgets have not been able to keep up with demand for new schools and the repair of aging ones. Unless school leaders can persuade their wary voters to pass such bond referendums or raise local taxes, though, there's often little hope of change. Until the last few years, the plight of State and local leaders had not received much attention from Washington. Last year we came together to respond to their call by funding a $1.2 billion grant program and this year we should come together again and pass legislation that continues our commitment to help local districts with their repair and renovation needs. The amendment that we are offering will provide $1.6 billion in grants to local education agencies to help them make urgently needed repairs and to pay for special education and construction expenses related to upgrading technology. And this amendment builds upon the bipartisan emergency school modernization initiative that passed into law as part of the fiscal year 2001 Labor-HHS-Education bill. Under this amendment, States will distribute 75 percent of the funds on a competitive basis to local school districts to make emergency repairs such as fixing fire code violation, repairing the roof or installing new plumbing. The remaining 25 percent will be distributed by State competitively to local school districts to use for technology activities related to school renovation or for activities authorized under the Individuals with Disabilities Education Act. I know that my friend from Iowa has seen this school modernization program work. Earlier he talked about the demonstration program in his State, which leveraged $10.33 for each federal dollar invested in the demonstration program. This amendment is a partnership between the Federal Government and districts and it does constitute a legitimate role of the Federal Government. It is a tragedy that so many of our Nation's students attend schools in crumbling and unsafe facilities. According to the American Institute of Architects, one in every three public schools in America needs major repair. The American Society of Civil Engineers found school facilities to be in worse condition than any other part of our Nation's infrastructure. The problem is particularly acute in some high-poverty schools, where inadequate roofs, electrical systems, and plumbing place students and school employees at risk. Last month I visited the Westford Public School District in Massachusetts. School facilities were a big concern for this semi-rural town which has seen its student population sky rocket in recent years, but has not experienced comparable property tax revenues. In order to meet the fiscal demands of new school construction, the town is foregoing replacement of large, drafty windows from the early 1950s and is relying on pre-fab trailers to serve as an elementary school. The Wilson Middle School in Natick, MA, was built for approximately 500 students and currently houses 625. The school has no technical infrastructure, it has no electrical wiring to allow the integration of computers in the classroom. The classrooms are 75 percent of the size of contemporary classrooms and were built with chairs and desks fixed to floor. Classrooms like these make it near-impossible for teachers to use modern-day teaching methods which rely heavily on student collaboration and interaction. The school also lacks science laboratories, making it impossible for students to do hands-on work and experiments. Natick High School, like many aging school buildings around the Commonwealth, needs to have its basic infrastructure updated: electrical wiring, heating, plumbing and intercom systems are among the many components of the school in need of modernization. Also, the science labs are presently unable to meet the demands of updated State curricula. Natick put in place a prototype lab, and saw remarkable changes in students' interest and ability to experiment in science. The urgent repair funding that passed the Congress last year provided $1.2 billion for repairs in high-need schools. In fiscal year 2001, this important program will help repair some 3,500 schools across the country and Massachusetts is slated to receive $19.5 million. But that will be the only money that my State receives unless we pass this important amendment and ensure that every student has a safe learning environment. The ESEA bill that we have been debating for the past several weeks represents a true coming together of the parties. This body worked tirelessly to hammer out an agreement on the outstanding issues that have separated us in the past and which prevented us from completing work on this reauthorization during the last Congress. It is my sincere hope that we can come together again on the issue of school construction and pass legislation that addresses this nation's critical need for school repairs and renovation, and that we can do it as a part of a broader package of honest and tough reforms which focus, above all else, on the goal of empowering our schools to raise student achievement.

Mr. KERRY

Mr. KERRY. Mr. President, today I rise to introduce legislation to reauthorize the Small Business Administration's Small Business Technology Transfer, STTR, Program. The STTR program funds cooperative R&D projects between small companies and research institutions as an incentive to advance the nation's technological progress. For those of us who were here when Congress created this program in 1992, we will remember that we were looking for ways to move research from the laboratories to market. What could we do to keep promising research from stagnating in Federal labs and research universities? Our research in this country is world renowned, so it wasn't a question of good science and engineering. We, without a doubt, have one of the finest university systems in the world, and we have outstanding research institutions. What we needed was more development, development of innovative technology. We needed a system that would take this research and find ways it could be applied to everyday life and national priorities. One such company is Sterling Semiconductor. Sterling, in conjunction with the University of Colorado, has developed silicon carbide wafers for use in semiconductors that can withstand extreme temperatures and conditions. In addition to defense applications, these wafers can be used for everything from traffic lights to automobile dashboards and communications equipment. With technology transfer, it was not just the issue of the tenured professor who risked security if he or she left to try and commercialize their research; it was also an issue of creating businesses and jobs that maximized the contributions of our scientists and engineers once they graduated. There simply weren't enough opportunities at universities and labs for these bright individuals to do research and development. The answer was to encourage the creation of small businesses dedicated to research, its development, and ultimately moving that research out of the lab and finding a commercial application. We knew that the SBA's existing Small Business Innovation Research, SBIR, program had proven to be extremely successful over the previous ten years, so we established what is now known as the Small Business Technology Transfer program. The STTR program complements the SBIR program. Whereas the SBIR program funds R&D projects at small companies, STTR funds cooperative R&D projects between a small company and a research institution, such as a university or Federally funded R&D lab. The STTR program fosters development and commercialization of ideas that either originate at a research institution or require significant research institution involvement, such as expertise or facilities, for their successful development. This has been a very successful program. One company, Cambridge Research Instruments of Woburn, Massachusetts, has been working on an STTR project with the Marine Biological Lab in Woods Hole. They have developed a liquid crystal-based polarized light microscope for structural imaging. While that is a mouthful, I'm told that it helps in manufacturing flat screen computer monitors, and even helps improve the in vitro fertilization procedure. Together this company and the lab expect to have sales in excess of $1 million dollars next year from this STTR project. As this example illustrates, the STTR program serves an important purpose for this country's research and development, our small businesses, our economy, and our nation. The program is set to expire at midnight on Sunday, September 30th. By the way, we absolutely have no intention of letting reauthorization get down to the wire, which was the unfortunate fate of the reauthorization of the SBIR program last year. I have worked in partnership with Senator Bond to develop this legislation, and as part of the process we have consulted with and listened to our friends in the House, both on the Small Business Committee and the Science Committee. We do not see this legislation as contentious, and we have every intention of seeing this bill signed into law well before September. Shaping this legislation has gone beyond policy makers; we have reached out to small companies that conduct the STTR projects and research universities and Federal labs. On my part, I sponsored two meetings in Massachusetts on March 16th to discuss the STTR program. At my office in Boston, there was a very helpful discussion with six of Massachusetts' research universities expressing what they like and dislike about the program, and why they use it, or don't use it more. The meeting included the licensing managers from Boston University, Harvard, MIT, Northeastern University, and the University of Massachusetts. They said they need to hear more about the STTR program and have more outreach to their scientists and engineers so that they understand when and how to apply for the program. Based on their suggestions, we've included an outreach mandate in our bill. In addition, we're trying to provide SBA with more resources in its Office of Technology to be responsive to the concerns of STTR institutions and small businesses. Later that day, my office was part of a meeting in Newton at Innovative Training Systems in which about 20 leaders and representatives of small high-tech companies talked about the SBIR and STTR programs. They make a tremendous contribution to the economy and state of Massachusetts. They said that the Phase II award for STTR should be raised form $500,000 to $750,000 to be consistent with the SBIR program. Otherwise, since a minimum of 30 percent of the award goes to the university partner, it was too little money to really develop the research. As I said, we listened to them. And we also listened to what the program managers of the participating agencies had to say. Agencies participate in this program if their extramural R&D budget is greater than $1 billion. Consequently, there are five eligible agencies: the Department of Defense, the Department of Energy, the National Aeronautics and Space Administration, the Department of Health and Human Services, and the National Science Foundation. For the STTR projects, they set aside .15 percent of their extramural R&D budget. The comes to about $65 million per year invested in these collaborations between small business and research institutions. Combining all the suggestions for improvement, the STTR Program Reauthorization Act of 2001 does the following: 1. It reauthorizes the program for nine years, setting the expiration date for September 30th, 2010. 2. Starting in two years, FY2003, it raises in small increments the percentage that Departments and Agencies set aside for STTR R&D. In FY2004, the percentage increases from .15 percent to .3 percent. After three years, in FY2007, the bill raises the percentage from .3 percent to .5 percent; 3. Starting in two years, FY2003, the legislation raises the Phase II grant award amount from $500,000 to $750,000; 4. It requires the participating agencies to implement an outreach program to research institutions in conjunction with any such outreach done with the SBIR program; 5. As last year's legislation did for the SBIR program, this bill strengthens the data collection requirements regarding awards and the data rights for companies and research institutions that conduct STTR projects. The goal is to collect better information about the companies doing the projects, as well as the research and development, so that we can measure success and track technologies. While I believe that these changes reflect common sense and are reasonable, I would like to discuss two of the proposed changes. First, I would like to talk about reauthorizing the program for nine years. The STTR program was a pilot program when it was first enacted in 1992. Upon review in 1997, the results of the program were generally good and the program was reauthorized that year. A more recent review and study of the program shows that the program has become more successful as it has had more time to develop. Specifically, the commercialization rate of the research is higher than for most research and development expenditures. Further, universities and research is higher than for most research and development expenditures. Further, universities and research institutions have developed excellent working relationships with small businesses, and the program has also had good geographic diversity, involving small companies and research institutions throughout the country. The nine-year reauthorization will allow the agencies, small businesses and universities to gradually ramp up to the higher percentage in a predictable and orderly manner. Second, I would like to talk about the gradual, incremental increases in the percentages reserved for STTR contracts and the increase in the Phase II awards. When we reached out to the small businesses and the research institutions that conduct STTR projects, and the program managers of the five agencies that participate in the STTR program, we heard two recurring themes: one, raise the amount of the Phase II awards; and two, increase the amount of the percentage reserved for STTR projects. Speaking to the first issue, we heard that the Phase II awards of $500,000 generally are not sufficient for the research and development projects and should be increased to $750,000, the same as the SBIR Phase II awards, to make the awards worth applying for the small businesses and research institutions. As for the second issue, we were told that the percentage of .15 reserved for STTR awards needed to be increased in order to better meet the needs of the agencies. Last year, that .15 percent of the five agencies' extramural research and development budgets amounted to a total $65 million dollars available for small businesses and research institutions to further develop research and transfer technology from the lab to market through the STTR program. Less than a quarter of one percent to help strengthen this country's technological progress is not extravagant; in fact, it is not adequate support for this important segment of the economy. Nevertheless, we are very conscientious about the needs of the departments and agencies to meet their missions for the nation and have proposed gradual increases that take into full consideration the realities of implementing the changes for the agencies and departments that participate in the program. Consequently, the legislation does not increase the percentage for STTR awards until two full years after the program has been reauthorized. We are also conscientious about the fact that we want more research, not less, so we have timed the increase of the Phase II awards to coincide with the initial percentage increase reserved for STTR projects. Overall, we believe this gradual increase will help encourage more innovation and greater cooperation between research institutions and small businesses. As the program requires, at least 30 percent of these additional funds will go to university and research institutions. Not only do the universities and research institutions that collaborate with small businesses get 30 percent of the STTR award money for each contract, they also benefit in that they often receive license fees and royalties. We are also conscientious about being fiscally responsible, the percentage increases will have no budget implication since it does not increase the amount of the money spent. Rather, it ultimately, after six years, redirects one half of one percent to this very successful program which benefits the economy overall. This bill will ensure that this successful program is continued and increased. It will also provide Congress with important information and data on the program and encourage more outreach to small businesses and research institutions. I want to encourage my colleagues to learn about this program, to find out the benefits to their state's hi-tech small businesses and research universities and labs, and to join me in passing this legislation in the Senate as soon as possible. To my friend from Missouri, Senator Bond, I want to thank you and your staff for working with me and my staff to build this country's technological progress. I also want to thank all of the cosponsors: Senators Cleland, Landrieu, Bennett, Levin, Lieberman, Harkin, bingaman, Enzi, and Cantwell. I ask unanimous consent that the text of the bill be printed in the Record.

Mr. KERRY

Mr. KERRY. Mr. President, today I rise to introduce legislation to reauthorize the Small Business Administration's Small Business Technology Transfer, STTR, Program. The STTR program funds cooperative R&D projects between small companies and research institutions as an incentive to advance the nation's technological progress. For those of us who were here when Congress created this program in 1992, we will remember that we were looking for ways to move research from the laboratories to market. What could we do to keep promising research from stagnating in Federal labs and research universities? Our research in this country is world renowned, so it wasn't a question of good science and engineering. We, without a doubt, have one of the finest university systems in the world, and we have outstanding research institutions. What we needed was more development, development of innovative technology. We needed a system that would take this research and find ways it could be applied to everyday life and national priorities. One such company is Sterling Semiconductor. Sterling, in conjunction with the University of Colorado, has developed silicon carbide wafers for use in semiconductors that can withstand extreme temperatures and conditions. In addition to defense applications, these wafers can be used for everything from traffic lights to automobile dashboards and communications equipment. With technology transfer, it was not just the issue of the tenured professor who risked security if he or she left to try and commercialize their research; it was also an issue of creating businesses and jobs that maximized the contributions of our scientists and engineers once they graduated. There simply weren't enough opportunities at universities and labs for these bright individuals to do research and development. The answer was to encourage the creation of small businesses dedicated to research, its development, and ultimately moving that research out of the lab and finding a commercial application. We knew that the SBA's existing Small Business Innovation Research, SBIR, program had proven to be extremely successful over the previous ten years, so we established what is now known as the Small Business Technology Transfer program. The STTR program complements the SBIR program. Whereas the SBIR program funds R&D projects at small companies, STTR funds cooperative R&D projects between a small company and a research institution, such as a university or Federally funded R&D lab. The STTR program fosters development and commercialization of ideas that either originate at a research institution or require significant research institution involvement, such as expertise or facilities, for their successful development. This has been a very successful program. One company, Cambridge Research Instruments of Woburn, Massachusetts, has been working on an STTR project with the Marine Biological Lab in Woods Hole. They have developed a liquid crystal-based polarized light microscope for structural imaging. While that is a mouthful, I'm told that it helps in manufacturing flat screen computer monitors, and even helps improve the in vitro fertilization procedure. Together this company and the lab expect to have sales in excess of $1 million dollars next year from this STTR project. As this example illustrates, the STTR program serves an important purpose for this country's research and development, our small businesses, our economy, and our nation. The program is set to expire at midnight on Sunday, September 30th. By the way, we absolutely have no intention of letting reauthorization get down to the wire, which was the unfortunate fate of the reauthorization of the SBIR program last year. I have worked in partnership with Senator Bond to develop this legislation, and as part of the process we have consulted with and listened to our friends in the House, both on the Small Business Committee and the Science Committee. We do not see this legislation as contentious, and we have every intention of seeing this bill signed into law well before September. Shaping this legislation has gone beyond policy makers; we have reached out to small companies that conduct the STTR projects and research universities and Federal labs. On my part, I sponsored two meetings in Massachusetts on March 16th to discuss the STTR program. At my office in Boston, there was a very helpful discussion with six of Massachusetts' research universities expressing what they like and dislike about the program, and why they use it, or don't use it more. The meeting included the licensing managers from Boston University, Harvard, MIT, Northeastern University, and the University of Massachusetts. They said they need to hear more about the STTR program and have more outreach to their scientists and engineers so that they understand when and how to apply for the program. Based on their suggestions, we've included an outreach mandate in our bill. In addition, we're trying to provide SBA with more resources in its Office of Technology to be responsive to the concerns of STTR institutions and small businesses. Later that day, my office was part of a meeting in Newton at Innovative Training Systems in which about 20 leaders and representatives of small high-tech companies talked about the SBIR and STTR programs. They make a tremendous contribution to the economy and state of Massachusetts. They said that the Phase II award for STTR should be raised form $500,000 to $750,000 to be consistent with the SBIR program. Otherwise, since a minimum of 30 percent of the award goes to the university partner, it was too little money to really develop the research. As I said, we listened to them. And we also listened to what the program managers of the participating agencies had to say. Agencies participate in this program if their extramural R&D budget is greater than $1 billion. Consequently, there are five eligible agencies: the Department of Defense, the Department of Energy, the National Aeronautics and Space Administration, the Department of Health and Human Services, and the National Science Foundation. For the STTR projects, they set aside .15 percent of their extramural R&D budget. The comes to about $65 million per year invested in these collaborations between small business and research institutions. Combining all the suggestions for improvement, the STTR Program Reauthorization Act of 2001 does the following: 1. It reauthorizes the program for nine years, setting the expiration date for September 30th, 2010. 2. Starting in two years, FY2003, it raises in small increments the percentage that Departments and Agencies set aside for STTR R&D. In FY2004, the percentage increases from .15 percent to .3 percent. After three years, in FY2007, the bill raises the percentage from .3 percent to .5 percent; 3. Starting in two years, FY2003, the legislation raises the Phase II grant award amount from $500,000 to $750,000; 4. It requires the participating agencies to implement an outreach program to research institutions in conjunction with any such outreach done with the SBIR program; 5. As last year's legislation did for the SBIR program, this bill strengthens the data collection requirements regarding awards and the data rights for companies and research institutions that conduct STTR projects. The goal is to collect better information about the companies doing the projects, as well as the research and development, so that we can measure success and track technologies. While I believe that these changes reflect common sense and are reasonable, I would like to discuss two of the proposed changes. First, I would like to talk about reauthorizing the program for nine years. The STTR program was a pilot program when it was first enacted in 1992. Upon review in 1997, the results of the program were generally good and the program was reauthorized that year. A more recent review and study of the program shows that the program has become more successful as it has had more time to develop. Specifically, the commercialization rate of the research is higher than for most research and development expenditures. Further, universities and research is higher than for most research and development expenditures. Further, universities and research institutions have developed excellent working relationships with small businesses, and the program has also had good geographic diversity, involving small companies and research institutions throughout the country. The nine-year reauthorization will allow the agencies, small businesses and universities to gradually ramp up to the higher percentage in a predictable and orderly manner. Second, I would like to talk about the gradual, incremental increases in the percentages reserved for STTR contracts and the increase in the Phase II awards. When we reached out to the small businesses and the research institutions that conduct STTR projects, and the program managers of the five agencies that participate in the STTR program, we heard two recurring themes: one, raise the amount of the Phase II awards; and two, increase the amount of the percentage reserved for STTR projects. Speaking to the first issue, we heard that the Phase II awards of $500,000 generally are not sufficient for the research and development projects and should be increased to $750,000, the same as the SBIR Phase II awards, to make the awards worth applying for the small businesses and research institutions. As for the second issue, we were told that the percentage of .15 reserved for STTR awards needed to be increased in order to better meet the needs of the agencies. Last year, that .15 percent of the five agencies' extramural research and development budgets amounted to a total $65 million dollars available for small businesses and research institutions to further develop research and transfer technology from the lab to market through the STTR program. Less than a quarter of one percent to help strengthen this country's technological progress is not extravagant; in fact, it is not adequate support for this important segment of the economy. Nevertheless, we are very conscientious about the needs of the departments and agencies to meet their missions for the nation and have proposed gradual increases that take into full consideration the realities of implementing the changes for the agencies and departments that participate in the program. Consequently, the legislation does not increase the percentage for STTR awards until two full years after the program has been reauthorized. We are also conscientious about the fact that we want more research, not less, so we have timed the increase of the Phase II awards to coincide with the initial percentage increase reserved for STTR projects. Overall, we believe this gradual increase will help encourage more innovation and greater cooperation between research institutions and small businesses. As the program requires, at least 30 percent of these additional funds will go to university and research institutions. Not only do the universities and research institutions that collaborate with small businesses get 30 percent of the STTR award money for each contract, they also benefit in that they often receive license fees and royalties. We are also conscientious about being fiscally responsible, the percentage increases will have no budget implication since it does not increase the amount of the money spent. Rather, it ultimately, after six years, redirects one half of one percent to this very successful program which benefits the economy overall. This bill will ensure that this successful program is continued and increased. It will also provide Congress with important information and data on the program and encourage more outreach to small businesses and research institutions. I want to encourage my colleagues to learn about this program, to find out the benefits to their state's hi-tech small businesses and research universities and labs, and to join me in passing this legislation in the Senate as soon as possible. To my friend from Missouri, Senator Bond, I want to thank you and your staff for working with me and my staff to build this country's technological progress. I also want to thank all of the cosponsors: Senators Cleland, Landrieu, Bennett, Levin, Lieberman, Harkin, bingaman, Enzi, and Cantwell. I ask unanimous consent that the text of the bill be printed in the Record.

Mr. KERRY

Mr. KERRY. Mr. President, it is a special honor for me today to ask all of my colleagues in the United States Senate to join me in commemorating the 60th Wedding Anniversary on April 3, 2001 and the Bat- and Bar-Mitzvah on May 18, 2001 of Gladys and Abraham Barron of Centerville, Massachusetts. Gladys, born in Roxbury, Massachusetts, of immigrant parents on May 19, 1921, spent her youth in Revere, MA, and graduated from Revere High School. When she was 20, she married Abraham Barron on April 3, 1941. Abraham had emigrated from Kiev, Russia when he was two-years old and settled in Chelsea with his mother. He graduated from Chelsea High School and began to learn the welder's trade. Following his marriage to Gladys in 1941, his father-in law introduced him to the hat-maker's trade. Abe became so proficient and so gifted in the art of fashioning caps and hats that his colleagues bestowed on him the soubriquet ``Golden Hands.'' Eventually, Abe began his own business while Gladys raised their two children, Melanie and Jeffrey. Gladys' love for painting inspired her to enroll in art courses and indeed both she and Abe could be called life-long students not only of the arts but also of their Jewish heritage. Gladys was a tireless worker for Hadassah while Abe was a dedicated member of the synagogue. Their respect for others led them to become dedicated to the civil rights movement and to the cause of Israel. On May 18, 2001 they will at long last celebrate their Bat and Bar Mitzvah, Gladys for the first time and Abe to renew his commitment to his religion. The Bar Mitzvah ceremony; such an essential part of Jewish life is a distinct honor and Abe and Gladys are to be commended for their continued dedication to the Jewish faith throughout their lives. Ordinarily, a rite of passage for young Jewish children about to enter their teens, the ceremony has been adapted so that Gladys and Abe can celebrate that which was denied them so long ago. It is a true honor to see Abe and Gladys reach this momentous day. Congratulations to you Abe, Gladys and your family as you share in this meaningful and important milestone in your lives.

Mr. KERRY

Mr. KERRY. Mr. President, this legislation reauthorizes the Small Business Administration's Small Business Technology Transfer Program. The STTR program funds cooperative R&D projects between small companies and research institutions as an incentive to advance the nation's technological progress. For those of us who were here when Congress created this program in 1992, we will remember that we were looking for ways to move research from the laboratories to market. What could we do to keep promising research from stagnating in Federal labs and research universities? Our research in this country is world renowned, so it wasn't a question of good science and engineering. We, without a doubt, have one of the finest university systems in the world, and we have outstanding research institutions. What we needed was more development, development of innovative technology. We needed a system that would take this research and find ways it could be applied to everyday life and national priorities. One such company is Sterling Semiconductor. Sterling, in conjunction with the University of Colorado, has developed silicon carbide wafers for use in semiconductors that can withstand extreme temperatures and conditions. In addition to defense applications, these wafers can be used for everything from traffic lights to automobile dashboards and communications equipment. With technology transfer, it was not just the issue of the tenured professor who risked security if he or she left to try and commercialize their research; it was also an issue of creating businesses and jobs that maximized the contributions of our scientists and engineers once they graduated. There simply weren't enough opportunities at universities and labs for these bright individuals to do research and development. The answer was to encourage the creation of small businesses dedicated to research, its development, and ultimately moving that research out of the lab and finding a commercial application. We knew that the SBA's existing Small Business Innovation Research (SBIR) program had proven to be extremely successful over the previous ten years, so we established what is now known as the Small Business Technology Transfer program. The STTR program complements the SBIR program. Whereas the SBIR program funds R&D projects at small companies, STTR funds cooperative R&D projects between a small company and a research institution, such as a university or Federally funded R&D lab. The STTR program fosters development and commercialization of ideas that either originate at a research institution or require significant research institution involvement, such as expertise or facilities, for their successful development. This has been a very successful program. One company, Cambridge Research Instruments of Woburn, Massachusetts, has been working on an STTR project with the Marine Biological Lab in Woods Hole. They have developed a liquid crystal-based polarized light microscope for structural imaging. While that is a mouthful, I'm told that it helps in manufacturing flat screen computer monitors, and even helps improve the in vitro fertilization procedure. Together this company and the lab expect to have sales in excess of $1 million dollars next year from this STTR project. As this example illustrates, the STTR program serves an important purpose for this country's research and development, our small businesses, our economy, and our nation. The program is set to expire at midnight on Sunday, September 30th. By the way, we absolutely have no intention of letting reauthorization get down to the wire, which was the unfortunate fate of the reauthorization of the SBIR program last year. I have worked in partnership with Senator Bond to develop this legislation, and as part of the process we have consulted with and listened to our friends in the House, both on the Small Business Committee and the Science Committee. We do not see this legislation as contentious, and we have every intention of seeing this bill signed into law well before September. Shaping this legislation has gone beyond policy makers; we have reached out to small companies that conduct the STTR projects and research universities and Federal labs. On my part, I sponsored two meetings in Massachusetts on March 16th to discuss the STTR program. At my office in Boston, there was a very helpful discussion with six of Massachusetts' research universities expressing what they like and dislike about the program, and why they use it, or don't use it more. The meeting included the licensing managers from Boston University, Harvard, MIT, Northeastern University, and the University of Massachusetts. They said they need to hear more about the STTR program and have more outreach to their scientists and engineers so that they understand when and how to apply for the program. Based on their suggestions, we've included an outreach mandate in our bill. In addition, we're trying to provide SBA with more resources in its Office of Technology to be responsive to the concerns of STTR institutions and small businesses. Later that day, my office was part of a meeting in Newton at Innovative Training Systems in which about 20 leaders and representatives of small high-tech companies talked about the SBIR and STTR programs. They make a tremendous contribution to the economy and state of Massachusetts. They said that the Phase II award for STTR should be raised from $500,000 to $750,000 to be consistent with the SBIR program. Otherwise, since a minimum of 30 percent of the award goes to the university partner, it was too little money to really develop the research. As I said, we listened to them. And we also listened to what the program managers of the participating agencies had to say. Agencies participate in this program if their extramural R&D budget is greater than $1 billion. Consequently, there are five eligible agencies: the Department of Defense, the Department of Energy, the National Aeronautics and Space Administration, the Department of Health and Human Services, and the National Science Foundation. For the STTR projects, they set aside .15 percent of their extramural R&D budget. That comes to about $65 million per year invested in these collaborations between small business and research institutions. Combining all the suggestions for improvement, the STTR Program Reauthorization Act of 2001 does the following: 1. It reauthorizes the program for nine years, setting the expiration date for September 30th, 2010. 2. Starting in two years, FY2003, it raises in small increments the percentage that Departments and Agencies set aside for STTR R&D. In FY2004, the percentage increases from .15 percent to .3 percent. After three years, in FY2007, the bill raises the percentage from .3 percent to .5 percent. 3. Starting in two years, FY2003, the legislation raises the Phase II grant award amount from $500,000 to $750,000. 4. It requires the participating agencies to implement an outreach program to research institutions in conjunction with any such outreach done with the SBIR program. 5. As last year's legislation did for the SBIR program, this bill strengthens the data collection requirements regarding awards and the data rights for companies and research institutions that conduct STTR projects. The goal is to collect better information about the companies doing the projects, as well as the research and development, so that we can measure success and track technologies. While I believe that these changes reflect common sense and are reasonable, I would like to discuss two of the proposed changes. First, I would like to talk about reauthorizing the program for nine years. The STTR program was a pilot program when it was first enacted in 1992. Upon review in 1997, the results of the program were generally good and the program was reauthorized that year. A more recent review and study of the program shows that the program has become more successful as it has had more time to develop. Specifically, the commercialization rate of the research is higher than for most research and development expenditures. Further, universities and research institutions have developed excellent working relationships with small businesses, and the program has also had good geographic diversity, involving small companies and research institutions throughout the country. The nine-year reauthorization will allow the agencies, small businesses and universities to gradually ramp up to the higher percentage in a predictable and orderly manner. Second, I would like to talk about the gradual, incremental increases in the percentages reserved for STTR contracts and the increase in the Phase II awards. When we reached out to the small businesses and the research institutions that conduct STTR projects, and the program managers of the five agencies that participate in the STTR program, we heard two recurring themes: one, raise the amount of the Phase II awards; and two, increase the amount of the percentage reserved for STTR projects. Speaking to the first issue, we heard that the Phase II awards of $500,000 generally are not sufficient for the research and development projects and should be increased to $750,000, the same as the SBIR Phase II awards, to make the awards worth applying for the small businesses and research institutions. As for the second issue, we were told that the percentage of .15 reserved for STTR awards needed to be increased in order to better meet the needs of the agencies. Last year, that .15 percent of the five agencies' extramural research and development budgets amounted to a total $65 million dollars available for small businesses and research institutions to further develop research and transfer technology from the lab to market through the STTR program. Less than a quarter of one percent to help strengthen this country's technological progress is not extravagant; in fact, it is not adequate support for this important segment of the economy. Nevertheless, we are very conscientious about the needs of the departments and agencies to meet their missions for the nation and have proposed gradual increases that take into full consideration the realities of implementing the changes for the agencies and departments that participate in the program. Consequently, the legislation does not increase the percentage for STTR awards until two full years after the program has been reauthorized. We are also conscientious about the fact that we want more research, not less, so we have timed the increase of the Phase II awards to coincide with the initial percentage increase reserved for STTR projects. Overall, we believe this gradual increase will help encourage more innovation and greater cooperation between research institutions and small businesses. As the program requires, at least 30 percent of these additional funds will go to university and research institutions. Not only do the universities and research institutions that collaborate with small businesses get 30 percent of the STTR award money for each contract, they also benefit in that they often receive license fees and royalties. We are also conscientious about being fiscally responsible, the percentage increases will have no budget implication since it does not increase the amount of the money spent. Rather, it ultimately, after six years, redirects one half of one percent to this very successful program which benefits the economy overall. This bill will ensure that this successful program is continued and increased. It will also provide Congress with important information and data on the program and encourage more outreach to small businesses and research institutions. Mr. President, I want to encourage my colleagues to learn about this program, to find out the benefits to their state's hi-tech small businesses and research universities and labs, and to join me in passing this legislation in the Senate as soon as possible. To my friend from Missouri, Senator Bond, I want to thank you and your staff for working with me and my staff to build this country's technological progress. I also want to thank all of the cosponsors: Senators Cleland, Landrieu, Bennett, Levin, Lieberman, Harkin, Bingaman, Enzi and Cantwell. Mr. President, I ask that my statement and a copy of the bill be included in the Record.

Mr. KERRY

Mr. KERRY. Mr. President, I am pleased to join my colleague Senator Snowe in introducing the Medicare Mental Illness Non-Discrimination Act. This legislation will establish mental health care parity in the Medicare program. Medicare currently requires patients to pay a 20 percent co-payment for all Part B services except mental health care services, for which patients are assessed a 50 percent co-payment. Thus, under the current system, if a Medicare patient sees an endocrinologist for diabetes treatment, an oncologist for cancer treatment, a cardiologist for heart disease treatment or an internist for treatment of the flu, the co- payment is 20 percent of the cost of the visit. If, however, a Medicare patient visits a psychiatrist for treatment of mental illness, the co- payment is 50 percent of the cost of the visit. This disparity in outpatient co-payment represents blatant discrimination against Medicare beneficiaries with mental illness. The prevalence of mental illness in older adults is considerable. According to the U.S. Surgeon General, 20 percent of older adults in the community and 40 percent of older adults in primary care settings experience symptoms of depression, while as many as one out of every two residents in nursing homes are at risk of depression. The elderly have the highest rate of suicide in the United States, and there is a clear correlation between major depression and suicide: 60 to 70 percent of suicides among patients 75 and older have diagnosable depression. In addition to our seniors, 400,000 non-elderly disabled Medicare beneficiaries become Medicare-eligible by virtue of severe and persistent mental disorders. To subject the mentally disabled to discriminatory costs in coverage for the very conditions for which they became Medicare eligible is illogical and unfair. There is ample evidence that mental illness can be treated. Unfortunately, among the general population, those in need for treatment often do not seek it because they are ashamed of their condition. Among our Medicare population, the mentally ill face a double burden: not only must they overcome the stigma about their illness, but once they seek treatment they must pay one-half of the cost of care out of their own pocket. The Medicare Mental Illness Non- Discrimination Act will eliminate the 50 percent co-payment for mental health care services. By applying the same 20 percent co-payment rate to mental health services to which all other outpatient services are subjected, the Medicare Mental Illness Non-Discrimination Act will bring parity to the Medicare program and improve access to care for our senior and disabled beneficiaries who are living with mental illness.

Mr. KERRY

Mr. KERRY. Mr. President, I am pleased to join my colleague Senator Snowe in introducing the Medicare Mental Illness Non-Discrimination Act. This legislation will establish mental health care parity in the Medicare program. Medicare currently requires patients to pay a 20 percent co-payment for all Part B services except mental health care services, for which patients are assessed a 50 percent co-payment. Thus, under the current system, if a Medicare patient sees an endocrinologist for diabetes treatment, an oncologist for cancer treatment, a cardiologist for heart disease treatment or an internist for treatment of the flu, the co- payment is 20 percent of the cost of the visit. If, however, a Medicare patient visits a psychiatrist for treatment of mental illness, the co- payment is 50 percent of the cost of the visit. This disparity in outpatient co-payment represents blatant discrimination against Medicare beneficiaries with mental illness. The prevalence of mental illness in older adults is considerable. According to the U.S. Surgeon General, 20 percent of older adults in the community and 40 percent of older adults in primary care settings experience symptoms of depression, while as many as one out of every two residents in nursing homes are at risk of depression. The elderly have the highest rate of suicide in the United States, and there is a clear correlation between major depression and suicide: 60 to 70 percent of suicides among patients 75 and older have diagnosable depression. In addition to our seniors, 400,000 non-elderly disabled Medicare beneficiaries become Medicare-eligible by virtue of severe and persistent mental disorders. To subject the mentally disabled to discriminatory costs in coverage for the very conditions for which they became Medicare eligible is illogical and unfair. There is ample evidence that mental illness can be treated. Unfortunately, among the general population, those in need for treatment often do not seek it because they are ashamed of their condition. Among our Medicare population, the mentally ill face a double burden: not only must they overcome the stigma about their illness, but once they seek treatment they must pay one-half of the cost of care out of their own pocket. The Medicare Mental Illness Non- Discrimination Act will eliminate the 50 percent co-payment for mental health care services. By applying the same 20 percent co-payment rate to mental health services to which all other outpatient services are subjected, the Medicare Mental Illness Non-Discrimination Act will bring parity to the Medicare program and improve access to care for our senior and disabled beneficiaries who are living with mental illness.

Mr. KERRY

Mr. KERRY. Mr. President, in a few moments, the Senate will vote on the President's nomination of John Bolton for Undersecretary of State for Arms Control and International Security. I am under no illusions about the fact that Mr. Bolton will be confirmed for this position. But I will vote against him, because I believe his views on the issues for which he will have responsibility are inconsistent with the best interests of the United States. President Bush has promised to work with our friends and allies to build a new framework for U.S. policies on arms control and international security. But his nomination of John Bolton to be the principal advisor to the Secretary of State on these issues is just one of many steps that have sent a decidedly mixed message about his commitment to pursuing a thoughtful, cooperative approach. In the last several weeks, President Bush has withdrawn the United States from the Kyoto Protocol, sent the South Korean President home with no commitment that we will continue to work on reducing the dangers from North Korea's ballistic missile program, reversed a more than 20-year-old United States policy that has kept the peace in the Taiwan Strait, and announced that the United States will no longer concern itself with negotiations to control and reduce the strategic nuclear arsenal of the former Soviet Union. Last week, in what will assuredly not be the last evidence of growing concern and impatience with U.S. unilateralism, we were voted off the U.N. Human Rights Commission, to the delight of human rights abusers everywhere. This growing unilateralism is very troubling to those of us who understand that the interests of the American people are best protected when we work in concert with others on common interests and problems. Senate confirmation of John Bolton to be Undersecretary of State for Arms Control and International Security will be another serious blow to U.S. leadership on these important issues. Over the last 8 years, John Bolton has expressed extreme views on a wide range of U.S. foreign policy issues. He has belittled the United Nations, referred to supporters of the Comprehensive Test Ban Treaty as neo-pacifists, labeled our closest allies ``appeasers'' for opposing sanctions policy also opposed by Vice President Cheney, and questioned whether the United States is ever legally bound by its treaty obligations. I find John Bolton's views most troubling on the arms control issues over which he will exercise a great deal of influence in this position. He is a staunch opponent of important treaties--including the Comprehensive Test Ban Treaty, the ABM Treaty, and the Ottawa Convention banning antipersonnel land mines which he has criticized as unenforceable, while at the same time opposing the development of international enforcement mechanisms. His antagonism to arms control threatens the Nuclear Non-proliferation Treaty (NPT), a cooperative, verifiable agreement that has effectively kept the nuclear weapons club to very low numbers for more than three decades span. But future international participation in the NPT is inextricably tied to the stability of treaties that Mr. Bolton has condemned. So too is the success of our cooperative nuclear threat-reduction measures with Russia. Mr. Bolton has also consistently advocated that the United States give diplomatic recognition to Taiwan, a position at odds with decades of U.S. policy and with President Bush's declared One China stance. From 1994-1996, the Taiwanese government paid $30,000 to Mr. Bolton for several papers on Taiwan and the U.N. It is troubling that during this time Mr. Bolton testified about this same issue before two House subcommittees. Should he be confirmed, Mr. Bolton will play a major role in overseeing United States arms sales to Taiwan, one of the most important--and most potentially volatile--issues in United States policy toward Asia. While the State Department has signed off on ethical questions surrounding this possible conflict of interest, I believe United States arms sales policy toward Taiwan can not help but be affected--least in perception, if not in fact--by Mr. Bolton's past relationship with the Government of Taiwan. On another issue of great importance to stability in Asia, Mr. Bolton has criticized the Clinton administration's efforts to freeze North Korea's nuclear and ballistic missile programs as ``egregiously wrong.'' This despite the undisputed facts that the 1994 Agreed Framework has successfully stopped Pyongyang's nuclear program and more recent talks have convined North Korea to unilaterally suspend its missile tests until 2003. President Bush is now reviewing United States policy toward North Korea, which I hope will conclude with a decision to continue talks with Pyongyang about the future of its missile program. While I am sympathetic to the President's desire to review past policy, I believe it would be mistake to walk away from a dialogue that holds out the possibility of a verifiable agreement to freeze North Korea's missile program and halt their missile sales. John Bolton has taken a dismissive view of the value of dialogue with Pyongyang, and I am deeply concerned that adding his voice to the administration's debate on this issue will further undermine the United States interest in advancing peace and stability on the Korean Peninsula. Finally, while Mr. Bolton's testimony before the Foreign Relations Committee seemed to suggest that his current views are more moderate than his writings indicate, I remain perplexed by the question of what views he will take with him into this administration. This is not an academic or inappropriate issue to raise. While, ultimately, Mr. Bolton's personal opinions will be subsumed by the decisions of the Secretary of State and the President, he will have an enormous amount of influence in the policy debates that shape those decisions. I find it difficult to imagine that a man who has dedicated his life to public service on behalf of a set of values that he has taken the time to articulate in public writings will suddenly cease to advocate on behalf of those values at exactly the moment when his ability to influence public debate is at its zenith. Mr. President, the United States has a strong interest in maintaining and advancing transparent, verifiable arms control regimes and stopping the proliferation of weapons of mass destruction. These issues are far too important to be left in the hands of a man who has denied their very legitimacy. I urge my colleagues to vote against this nominee.

Mr. KERRY

Mr. KERRY. I thank the Chair and my colleagues. I will be brief. I see the Senator from Maryland is here, as well as others. Mr. President, I do not think there is a person in the Senate who does not view education as the single most important domestic priority this year. A number of us have been working for a long period of time to advance the dialog with respect to education. Indeed, a couple of years ago, we Democrats were prepared to move forward on the Elementary and Secondary Education Act. We were prevented from doing so because, frankly, our colleagues on the other side, for political reasons, were unwilling to allow President Clinton to be the person who signed a bill that passed education reform in the country. Politics trumped real reform. Politics trumped, once again, the interests of young people in our country. I remember Joe Lieberman, others, and myself talking for hours with Paul Coverdell, our late colleague, with Slade Gorton, and others trying to find the common ground so we could move forward on this critical issue. Here we are this year with Democrats having moved in ways that many people would have argued they never would have moved previously. There has been a challenging of the orthodoxy that has governed the debate on education for a long period of time. So we have a consolidation of programs. We have an effort to deal in a realistic way with the problem of accountability. It used to be there were some pretty one-sided discussions. Some people on the other side of the aisle thought it was just good money chasing after bad, and so they did not even want to talk about resources. All the discussion was about an alternative to the public education system--fundamentally, vouchers. On this side there was fundamentally only a discussion about school construction or class size. Nothing happened. Most important, nothing happened for our kids. The schools did not get much better, except in isolated instances where extraordinary leadership managed to break through. The fact is that 90 percent of America's children go to school in public schools. There are not enough vouchers and there are not enough private and parochial schools to offer enough choice to all of the students of this generation to get the education they need by alternatives. The bottom line is if 90 percent of America's children go to school today in public schools, if we are going to have the workforce we need for the future, but equally important, if we are going to have the skilled labor force we need, and much more important, if we are going to have young people who grow up to understand the obligations of citizenship, who have the capacity in an age of managing more information to be able to process the information and translate it into good civic activities, the acceptance of values, the acceptance of family responsibilities, the acceptance of community responsibilities, then every student, indeed, better have the best of opportunities. I have joined with Joe Lieberman, Evan Bayh, Mary Landrieu, Blanche Lincoln, John Breaux, Tom Carper, and a host of Democrats in agreeing we have to change the dynamics of this debate; that we need strict accountability; that we cannot put money into a school and allow it year after year as a consequence of some kind of reform to fail. But everybody in this institution knows there are countless communities in the United States of America that just cannot afford to do the basics. Property tax is what funds education. Come to Lawrence, New Bedford, or Holyoke, MA, or countless other communities in America where they don't have the tax base, particularly through the property tax, where people are on fixed incomes trying to hang on to a home and cannot afford higher property rates. In many States, there are limits on what can be raised on the property tax--mine among them. The question is, how do we provide adequate numbers of teachers to have a class size where a teacher can actually cope with children? How do we keep school doors open into the evening if the community can't pay the custodians or the additional teachers or have remedial classes? How do we put in the technology if they can't afford to buy it? The bottom line is, we have put in place in this bill an enormous change, a sea change, in how we are prepared to try to encourage accountability, to encourage reform and encourage change. But we cannot do it if there isn't an adequate commitment of resources for IDEA, the greatest burden we hear principals talk about in schools, to the capacity to be able to have a teacher for certain classes. We have some schools where 80 percent of the children in the school do not have an algebra teacher. Teachers are teaching out of field. Test students all you want, but if they do not get the fundamentals, they will be in deficit from the beginning. This is a choice for the Senate. Either we fund education reform to the degree that will empower it to actually take place or we will invite an incredible new round of cynicism. We will pass something and call it reform, and teachers and parents across the country will say: Thank God, reform at last. It is coming. But if you don't empower them to be able to do it, you can see the next wave of discussion. It will be: The public schools have failed; they did not live up to the expectations. We gave them the opportunity, and they didn't make it. Now it is alternatives. I am not going to buy into, as I think many of my colleagues will not buy into, a false equation of reform. We insist there be adequate funding of those communities that simply do not have the ability to be able to make the difference. That is the best of what the Federal Government exists for in the sense we assert a national priority, something in the interest of everybody in this country--educating our kids, making sure they have values, making sure they are in safe communities, where they can grow up to full citizenship. We share the capacity of our country to be able to guarantee that no child is left behind. In the budget that President Bush has presented, with only a 5 percent increase in disadvantaged children's funding, how can one possibly live up to that promise? This is not a political fight. This is not a political food fight. This is not just Washington somehow being the same. I respect President Bush's effort to change the tone and be bipartisan. Right now, the only bipartisanship has been movement on our side of the aisle to consolidate the programs, to move toward a more sensible regime for accountability. The question we are asking is, where is the bipartisanship on the other side of the aisle that moves toward us with respect to this critical element of funding? You can have accountability, but if you don't have adequate funding to make it happen, it is a complete sham and waste of time. Likewise, we believe you can have a lot of money but if you don't have the accountability, it is equally a sham and waste of time. If we are prepared to change the dynamic and provide this country with education reform it deserves, we must be prepared to adequately fund the reform effort. I reserve the balance of my hour, and I ask unanimous consent I be permitted to speak again within the hour, if necessary.

Mr. KERRY. Mr. President, I ask unanimous consent to proceed for a few minutes within my hour on the motion to proceed.

Mr. KERRY

Mr. KERRY. Mr. President, yesterday the President of the United States gave a very broad outline of a new national security strategy that moves away from the reliance on deterrence and arms control towards missile defenses and unilateral arms reductions. Frankly, the President's brief remarks raise more questions than they answer. I wanted to take a few minutes to address in this Chamber some of the key issues he touched on yesterday. First, the President stressed that we must move away from our reliance on deterrence to keep our citizens and our allies safe from aggression or from nuclear blackmail. While I agree that in principle we want to find alternative methods of being able to protect ourselves from the potential of nuclear blackmail or terrorism, the hard reality is that there will always be a measure of deterrence in any approach we find with respect to the prevention of attack or maintaining the security of the United States of America. If there is a real potential of a rogue nation--and I underscore ``if'' there is a real potential of a rogue nation--firing a few missiles at any city in the United States, responsible leadership requires the most thoughtful steps possible to prevent losses as a consequence thereof. The same is true of accidental launch. If at some point in time, God forbid, there were to be an accidental launch of a nuclear missile, the notion that any country in the world, if technology were available, should be subject to that possibility would be unacceptable. All of us in the civilized world need to take steps to try to protect ourselves against the potential of that ever happening. Let me make it clear. The rogue missile rationale that has been offered on many occasions really merits much greater analysis than many people have given it. For a state to develop a missile capacity, it would require some measure of testing, some measure of actual deployment, such as we have seen in North Korea with its Taepo Dong 2. It would also require a launch site and capacity, all of which are detectable by the United States, all of which are traceable over a period of time. If, indeed, a state is to such a degree a rogue state that we think its leadership might be in a position of firing one or two rogue missiles at the United States, we ought to also think beyond that as to what they would be inviting as a response. Clearly, one or two missiles clearly traceable, obviously coming from a particular rogue state, would invite their annihilation. So when we measure threats, we don't just measure capacity to be able to do something. We measure the intent to do something. We measure the consequences of somebody doing something. Indeed, Saddam Hussein, who possessed weapons of mass destruction, saw fit not to use those weapons of mass destruction when we went to war against him, even when he was losing the war. The reason that he didn't was because, Secretary Baker made it patently clear what would happen to them if they did. Even the most unreasonable, most demonized of leaders still calculates risk and still calculates the repercussions of his actions. Indeed, our military, in making a judgment about the different tiers of threat we face, places the threat of a rogue missile attack at the very bottom of threats the United States might face. Here we are in a debate about education and we are being told we are not sure we have enough money for education; we are not sure we have enough money for alternative and renewable fuels; we are not sure we have enough money for a prescription drug program for seniors; we are not sure we have enough money to fix our schools and provide the next generation with the kinds of education we want--we need to balance what we get for our expenditures in terms of national security against other initiatives that also have an impact on the national security of our country. I say, with respect, that the President's efforts with respect to the rogue missile threat seem to be willing to do things to the ABM treaty, to our relationships with Russia and China that go well beyond what we could possibly gain in terms of our security. Let me come back to missile defense, which is really only a response of last resort when diplomacy and deterrence have failed. I support research and development of a limited missile defense system that, indeed, might have the ability to knock down one or two incoming missiles. I think it would be, in fact, a step forward for the United States to be able to at least know that we have that capacity. I suggest, very respectfully, that most scientists and most strategists who are well respected in this country recognize the extraordinary difficulties developing a system that might do much more than take out a selected number of missiles, and that if this were something more than a limited system, if it were a system designed to provide some kind of shield or some kind of larger protection against the potential of a larger attack, and was in fact deployed in that way, we would simply be inviting the kind of counterresponse we saw throughout the cold war, when we unilaterally initiated some advance in technology which the Soviet Union interpreted in a way that invited them to respond. Most people who make judgments about the potential of knocking down missiles, given the difficulties of decoys, of the extraordinary technological difficulty of discerning the difference between artificial and real targets, the capacity of 1 warhead to potentially carry 100 different bomblets, which you have to discern the difference between in a matter of seconds--to suggest you can somehow have a system that is going to be 100- percent effective would be to stretch the imagination to where I think no strategist would want to go. I don't think anybody worth their salt in making judgments about potential conflict would come to a conclusion that one is 100-percent failsafe protected. So if you are not 100-percent failsafe protected, you are still dependent, ultimately, on deterrence. We can't get rid of that equation. If you know you are going to suffer some damage, the judgment then becomes, well, how much damage? If we suffer that amount of damage, what is it going to take in return to be able to guarantee that they will, too? So, in effect, you are pushed back into a corner where you are still dependent on the mutual assured destruction equation--the very equation we have lived with since the beginning of the Cold War in 1945. If you have a system that is 100-percent effective, you have also dramatically changed the equation of the balance of power because if you are sitting there and your adversary says, well, they have a system that is 100-percent effective against an intercontinental ballistic missile, so we had better deliver systems that completely avoid the intercontinental ballistic missile--if, indeed, they are an adversary-- if China is sitting there and their strategists are saying the United States now has the ability to shoot down all of our missiles--they have a 100-percent effective defense--that means they have the first strike capacity because the minute you have developed a 100-percent defense, you have translated defense into offense because if you are 100-percent protected, you can fire with impunity first, knowing nothing hits you in return. So what you have done is really turned on its ear the very concept of fear by both sides that the consequences of a conflict are so great that you avoid the conflict. In point of fact, one of the reasons the United States restrained itself from considering even greater escalation in Vietnam, and in other parts of the world in conflicts, was knowing that the Soviet Union and China have this extraordinary capacity to escalate to the ultimate confrontation. It was always the fear of the ultimate confrontation that drove us to restrain ourselves and ultimately to put in place the ABM Treaty. The ABM Treaty represents the conclusion of Republican and Democrat administrations alike that we need to find a way out of the continuing escalation of the arms race. That is why we put it in place. It gave us a guarantee that we knew we could begin to reduce weapons because neither side was going to upset this equilibrium. That is why China and Russia are so deeply upset at what we are now considering doing--if we do it unilaterally. I am not against doing it if it is arrived at mutually. I want to research the capacity. I think there is a value to being able to say to New York City or Los Angeles, you are never going to be hit by a rogue missile or an accidental launch. But what good is it if you deploy it in such a way that you abrogate the treaty that has held the balance and invite your adversaries to interpret it as the efforts of the United States to gain this superior edge, which then leads them into the same response--the tit-for-tat syndrome that led us through the entire arms race in the first place? That arms race is completely traceable. We were the first people to actually use an atom bomb. People forget that. We used it for a noble purpose--to end the war and hopefully save lives. But we used it. After that, quickly Russia did an atom bomb. Then we did the hydrogen bomb. Russia did the hydrogen bomb. Then we did long-range bombers. They did long-range bombers. We put them on submarines, and they put them on submarines. In one--maybe two--instances, they beat us. With Sputnik, they beat us. In every other instance, the United States led. We were the first to put out the more sophisticated weaponry capacity. But what happened? Inevitably immediately it may have taken we found ourselves in this race. The whole purpose of the SALT talks and the START talks--now START I and START II--where we have the capacity to lower from 7,200 weapons down to the 3,500, is the notion that we have arrived at an equilibrium and we are prepared to ratchet down together to make the world safer. I say to my colleagues, very simply, if we can get China and Russia and our allies to understand that a mutual deployment of a clearly verifiable, highly transparent system, mutually arrived at in protocol--if we can deploy that, all of us together, with a clear understanding of the reductions we are seeking, that could be salutary in its extraordinarily limited way. But if the United States insists on moving unilaterally, abrogating a treaty, we will send a message to already paranoid hardliners in other countries that the United States once again wishes to have technological superiority. That will drive them to respond as a matter of their security perception and as a matter of their politics, the same politics we have, where a bunch of people sit around and say: How can you allow them to do that? You are a weak leader. You had better respond. If you don't respond, you are going to be thrown out of office. And they respond. What happens? We wind up spending trillions of dollars on something that takes us to a place that we will ultimately decide is more dangerous than the place we are in today and from which we need to back off. Sam Nunn and Dick Lugar, two of the most respected Senators--one former Member and one current Member of this institution--have led this body in a well known effort to reduce the nuclear threat from the former Soviet Union. We had distinguished bipartisan testimony in the Foreign Relations Committee a few weeks ago that we need some $30 billion more than we are allocating now just to reduce the threat of the nuclear missiles we are trying to dismantle in the former Soviet Union. Yet we are talking about spending more than that to create a whole new round of mistrust and misunderstanding. The President, yesterday, also stressed the fact that national missile defense is only one part of a comprehensive national security strategy. I could not agree more; it is. But let me underscore that missile defense will do nothing to address what the Pentagon itself considers a much more likely and immediate threat to the American homeland from terrorists and from nonstate actors, who can quietly slip explosives into a building, unleash chemical weapons into a crowded subway, or send a crude nuclear weapon into a busy harbor. I ask my colleagues: What do you think is the more likely scenario? Do you really believe that North Korea will leave the trail of a missile, a targetable trail and send a missile to the United States, and like the sleeping giant that was awakened in Pearl Harbor, have us return the compliment, or do you believe if they were intent on doing injury to the United States, they would take a little bottle of anthrax and drop it in the water system in Washington, DC? What do you think is more likely? Do you think it is more likely perhaps that some rogue nation might say: Wait a minute, they have the ability to knock down our missile, so let's put one of these illegally purchased weapons in the marketplace--because we are not doing enough to stop proliferation internationally so they can go out and purchase a small nuclear weapon--and they bring it in on a rusty freighter under the Verrazano Bridge, and detonate a nuclear weapon just outside New York City. I would like to see us focus on those things that most threaten us, not create these notions of false threat that require us to debate for hours to stop something that does not necessarily promise a very positive impact for the long-term interests of our Nation. Obviously, the President gave very few details yesterday because he cannot. We do not have an architecture yet. We do not even have a budget yet. We do not even have enough successful tests yet to suggest we should be rapidly deploying and abrogating the ABM Treaty. What are we talking about? The President said he wants to pursue technology that would allow us to intercept a ballistic missile at the boost phase when they are moving the slowest. I agree with that. In June of 2000, I called on the previous administration to explore the technology for a boost phase intercept system which would build on the current technology of the Army's land-based THAAD and the Navy's sea-based theater-wide defense system to provide forward-deployed defenses against both theater missile ballistic threats and long-range ballistic missile threats. I welcome President Bush's commitment to investing considerable resources needed to make those systems capable of reaching the speeds necessary to intercept an ICBM. A forward-deployed boost phase intercept system would allow us to target relatively small ballistic missile arsenals and shoot down a very few accidental or unauthorized launches. Deploying such a system, even though it might require amendments to the 1997 ABM Treaty Demarcation Agreement, would establish the line between theater missile defense systems that are not limited by the treaty and the strategic defenses that the treaty prescribes. In a nutshell, these agreements allow the United States to deploy and test the PAC-3, the THAAD, and the Navy theater-wide TMD systems, but they prohibit us from developing or testing capabilities that would enable these systems to shoot down ICBMs. Russia might not be happy about that, but I believe they would prefer that to a system that would really scrap the entire treaty and all the limitations on strategic defenses that would come with it. I agree that the strategic situation we confront today is worlds apart from the one we faced in 1972, but nothing in this changed environment suggests that we will be better off by walking away from the ABM Treaty. If somehow Russia and China are not persuaded by President Bush's assurances that our missile defense system is not aimed at undermining their nuclear deterrent capabilities, and instead they perceive a growing threat to their interests, they will act to counter that threat. We will not be safer if our NMD system focuses their energies on developing--and eventually selling--new ways to overwhelm our defenses. The ABM Treaty can be amended to reflect our changed security environment. But to abandon it all-together is to welcome an arms race that will make us more vulnerable, not less. The President made a point of announcing that he will begin high- level consultations with our allies about his plans for NMD and he stressed that he would seek real input from them as he moves forward. This is critical. Even if, as can be expected, our allies in Europe and Asia accept a U.S. NMD system, they have a lot at stake in how we develop and deploy that system. The President must take their views into account as he determines what architecture he will pursue and the timing of deploying. Clearly, these are important discussions that will require more than one or two cursory consultations. The administration must also pay close attention to our allies concerns about Russia. Because they are keenly aware that a fearful, insecure Russia is a dangerous Russia, they have consistently stressed the importance of including Moscow in our discussions on NMD. Let me be clear: the importance of working with Russia as we move forward is not to suggest that Moscow has a veto over our missile defense plans. But we have an obligation to avoid unilateral steps that will throw our already tenuous relations with Russia into further turmoil. Serious discussions with Moscow on amending the ABM Treaty--even if they are not ultimately successful--will allow us to move toward NMD deployment transparently and with minimal provocation. As with Russia, if an NMD decision is made absent serious discussions with China, the leadership in Beijing will perceive the deployment as at least partially directed at them. The Administration must try hard to reach a common understanding with China that there is a real threat from isolated regimes bent on terrorism and accidental or unauthorized launches. The Clinton administration invested a great deal of time and diplomatic effort convincing Russia that the threat is real and it affects us both. We must make the same effort with China. If we fail to take this task seriously, we will jeopardize stability in the Pacific. The President's proposal on NMD lacks specifics and his intentions on the ABM Treaty are vague. He and his advisors know that the American people will not support an expensive, ineffective NMD system, or one that comes at the expense of a Treaty that has made them safer over the last 20 years. So to sweeten the President's bad news on these two issues, he promised--again without any detail--to unilaterally reduce the U.S. arsenal of strategic nuclear weapons. The proposal to unilaterally reduce U.S. nuclear stockpiles is an important and overdue first step toward reducing the nuclear danger. Unfortunately, before the President can make good on this promise, he will have to convince his Republican colleagues in the Congress to repeal a provision in the FY 98 Defense Department Authorization bill that prohibits the reduction of strategic nuclear delivery systems to levels below those established by the START I treaty. Senate Democrats have tried for the last three years to repeal this provision, which prevents exactly the kind of nuclear reduction President Bush has spoken about. But they have been stymied by a Republican leadership that believes the U.S. should not move to START II arms levels even though the Senate ratified that treaty in 1996-- before Russia has done so. I hope we can move immediately to repeal this prohibition and begin the process of cutting our strategic arsenal in half--from more than 7,000 warheads today to the 3,500 allowed under START II. While those reductions are underway, the President should immediately proceed to talks with Russia on a START III agreement, which could bring our arsenal to below 2,000 warheads and codify similar, transparent, verifiable and irreversible reductions by Russia. Mr. President, for 40 years, the United States has led international efforts to reduce and contain the danger from nuclear weapons. We can continue that leadership by exploiting our technological strengths to find a defense against ballistic missiles, and by extending that defense to our friends and allies. But we must not jeopardize stability in Europe and Asia by putting political ideology ahead of commitments that have kept us safe for decades.