John Kerry

Mr. KERRY

Mr. KERRY. I thank the Chair. I thank my colleague, the chairman of the committee. I thank him for his work on this act and for his leadership within the committee so that we can proceed as he has described. Most of the media attention with respect to the Y2K problem has been on big businesses, the challenges they face and the costs they are going to bear in order to fix the problem. But as my colleague has mentioned, small businesses face the same effects of Y2K as big businesses. However, they often have little or no resources available to devote to detecting the extent of the problem or to developing a workable and cost-effective solution. That is why we on the Small Business Committee are proceeding with this particular response which I think is most important. It is in our economic best interest to make sure that all of our small businesses, some 20 million if we include the self-employed--are up and running soundly and effectively, creating jobs and providing services, on and after January 1 of the year 2000. There are a lot of questions about what the full impact of the Y2K problem is going to be. Is it going to bring a whole series of nationwide glitches? Could it, in fact, induce a worldwide recession? One hears differing opinions on the extent of that. I was recently at the World Economic Forum in Davos, Switzerland, and there was a considerable amount of focus there from sizable numbers of companies on this issue. I think it is fair to say that here in the United States we have had a greater response than has taken place in Europe or in many other countries. But it is interesting to note that the Social Security Administration, I understand, spent about 6 years and some 600 people, and spent upwards of $1 billion, in order to be ready and capable of dealing with the Y2K problem. Other Departments have spent significant amounts of money as well and have had very large teams of people working in order to guarantee that they are going to be safe. Compared to that, you have very large entities in Europe and elsewhere that are only just beginning. So, if you look at the numbers of people and the amount of money and the amount of years people have been spending in order to try to put together solutions--obviously those experiences can be helpful to many other entities around the world as we cope with this problem. But the bottom line is, we know our economy is interdependent. We know that most of our technology, interdependent as it is, is date-dependent, and much of it is incapable of distinguishing between the years 2000 and 1900. We have 10 short months now to become completely Y2K compliant, and national studies have found that the majority of small businesses in the United States are not ready and they are not even preparing. Specifically, the 1998 ``Survey of Small and Mid-Sized Business'' by Arthur Andersen Enterprise Group and National Small Business United found that only 62 percent of all small- and mid-sized businesses have even begun addressing Y2K issues. The good news is that a greater percentage of small- and mid-sized businesses are preparing for Y2K than last summer. The bad news is that they have only just begun that process and a significant group is taking a ``wait and see'' approach. On a local level, Y2K consultants and commercial lenders in Massachusetts, from Bank Boston to the Bay State Savings Bank, tell us of reactions to the Y2K dilemma that vary from complete and total ignorance, or complete and total denial, to paralysis or simply to apathy. I will give you an example. Bob Miller, the president of Cambridge Resource Group in Braintree, MA, shared with us what he has observed. Though his company specializes in the Y2K compliance of systems with embedded processors for Fortune 1000 companies and large State projects, he knows how real the technology problem is and how expensive a consultant can be. He has tried to help small companies through free seminars, but literally no one shows up. One time, in Maine, only 2 out of 400 companies responded. ``Small businesses just don't get it. Many think it is a big company problem, but it is not. It will bite them,'' says Mr. Miller. He advises companies to start now, and to build a contingency plan first, because it is so late in the game. The owner of Coventry Spares, Ltd., a vintage motorcycle parts company, would not disagree with that. John Healy was one of those small business owners who thought it was somebody else's problem. It couldn't happen to him. Luckily for John Healy and his business, he got a scare and so he decided to test his computer system by creating a purchase order for motorcycle pistons with a receivable date of early January 2000. So what happened when he put the order into his system? He punched a key and he waited for his software to calculate how many days it would take to receive the order. He got back a series of question marks. Then he turned to the company's software that publishes its ``Vintage Bikes'' magazine and he tested it with a 2000 date. His indispensable machine told him the date was not valid. Mr. Healy's computer problems are, ironically, compounded by his own Yankee ingenuity. As his business evolved, he combined and customized a mishmash of computer systems. It saved money, it worked well, handling everything from the payroll to inventory management, but making these software programs of the various computers Y2K-compliant is all but impossible. As Mr. Healy said: ``[These programs] handle 85 percent of the business that makes me money. If I didn't fix this by the year 2000, I couldn't do anything. I'd be a dead duck in the water.'' When all is said and done, Mr. Healy estimates he is going to pay more than $20,000 to become Y2K-compliant, and that includes the cost of new hardware, operating system and database software and conversion. So, how do we reach those small business owners who have been slow to act, or who, to date, have no plans at all to act? How do we help them facilitate assessment and remediation of their businesses? We believe the way we do that is by making the solution affordable. According to the same Andersen and NSBU study that I quoted a moment ago, 54 percent of all respondents said ``affording the cost [was the] most difficult challenge in dealing with information technology.'' That sentiment was echoed by David Eddy, who is a Y2K consultant who owns Software Sales Group in Boston, and who testified before the Small Business Committee when we were putting this legislation together last June. Mr. Eddy recently wrote: ``Basically, all of our customers are having trouble paying for Y2K. . ..The cost varies from client to client, but no business has ``extra'' money around, so they are struggling.'' So, Mr. President, cost is a very legitimate, albeit risky, reason to delay addressing the Y2K problem--saving until you are a little ahead or waiting until the last possible moment to take on new debt to finance changes. Those are strategies that many companies are forced to adopt, but those are strategies that can still leave you behind the eight ball as of January 1, year 2000. If you own your own facility, you have to ask yourself, Is the security system going to need an upgrade? What will the replacement cost be? Will simple things work? Will the sprinklers in your plant work? What happens if there is a fire? If you own a dry cleaning store and you hire a consultant to assess the equipment in your franchise, will remediation eat up all of your profit and set you back? These are the basic questions of any small business person in this country. Some business owners literally cannot afford to hear the answers to those questions. It may come down to a choice between debt or dissolution, or rolling the dice, which is what a lot of small companies are deciding to do. They say to themselves: I can't really afford to do it, I am not sure what the implications are, I am small enough that I assume I can put the pieces together at the last moment-- so they are going to roll the dice and see what happens. There is another problem with waiting. Just as regulators have forced lenders to bring their systems into compliance, the lenders themselves are now requesting the same compliance of existing borrowers and loan applicants. In Massachusetts, for instance, the Danvers Savings Bank, one of the State's top SBA lenders, has stated publicly that it will not make loans to businesses unless they are in control of their Y2K problems. The bank fears that if a small company isn't prepared for Y2K problems, it could adversely affect its business, which could then, obviously, adversely affect the loan that the bank has made and the small business ability to repay the loan, which adversely affects the bottom line for the bank. The Year 2000 Readiness Act gives eligible business owners a viable option. And that is why we ask our colleagues to join in supporting this legislation today. This legislation will make it easy for lenders, and timely for borrowers, and it is similar to the small business loan bill that I introduced last year in Congress. It expands the 7(a) loan program, one of the most popular and successful guaranteed lending programs of the Small Business Administration. Currently, this program gives small businesses credit, including working capital, to grow their companies. If the Year 2000 Readiness Act is enacted, those loans can be used until the end of the year 2000 to address Y2K problems ranging from the upgrade or replacement of date-dependent equipment and software to relief from economic injury caused by Y2K disruptions, such as power outages or temporary gaps in deliveries of supplies and inventory. The terms of 7(a) loans are very familiar to those, obviously, within the small business community, and they have taken advantage of them. The fact is, these loans are very easy to apply for and to process. They are structured to be approved or denied, in most cases, in less than 48 hours. So for those who fear paperwork or fear the old reputation of some Government agencies, we believe this is a place where they can find a quick answer and quick help to their problems. We expect the average Y2K loan to be less than $100,000. In addition, Mr. President, to give lenders an incentive to make 7(a) loans to small businesses for Y2K problems, the act raises the Government guaranties of the existing program by 10 percent, from 80 percent to 90 percent for loans of $100,000 or less, and from 75 to 85 percent for loans of more than $100,000. Under special circumstances, the act also raises the dollar cap of loan guarantees from $750,000 to $1 million for Y2K loans. Eligible lenders can use the SBA Express Pilot Program to process Y2K loans. Under this pilot, lenders can use their own paperwork and make same-day approval, so there can be a streamlined process without a whole lot of duplication for small businesses, which we know is one of the things that most drives small business people crazy. The tradeoff for the ease and loan approval autonomy is a greater share of the loan risk. Unlike the general 7(a) loans, SBA Express Pilot loans are guaranteed at 50 percent. We know that many small-business owners also have shoestring budgets, and that they are going to be hard-pressed to pay for another monthly expense. With this in mind, we have designed the Small Business Year 2000 Readiness Act to encourage lenders to work with small businesses addressing Y2K-related problems by arranging for affordable financing terms. For example, when quality of credit comes into question, lenders are directed to resolve reasonable doubts about the applicant's ability to repay the debt in favor of the borrower. And, when warranted, borrowers can get a moratorium for up to 1 year on principal payments on Y2K 7(a) loans, beginning when the loans are originated. Mr. President, one final comment. As important as this Y2K loan program is, in my judgment, it has to be available in addition to, not in lieu of, the existing 7(a) program. It is a vital capital source for small businesses. We provided 42,000 loans in 1998, and they totaled $9 billion. That is not an insignificant sum. What we do not want to have happen is to diminish the economic up side of that kind of lending. With defaults down--and they are--and recoveries up and the Government's true cost under the subsidy rate at 1.39 percent, we should not create burdens that would slow or reverse the positive trend that we have been able to create. To protect the existing 7(a) program, we have to make certain that it is adequately funded for fiscal years 1999 and 2000. And because the Y2K loan program is going to be part of the 7(a) business lending program, funds that have already been appropriated for the 7(a) program can be used for the Y2K loan program. Already this year, demand for that lending is running very high. Typically, the demand for 7(a) loans increases by as much as 10 percent in the spring and in the summer. So we are entering the high season of cyclical lending within the SBA itself. If that holds true for the current fiscal year, the program may use nearly all of its funds to meet the regular loan demand. There may be even greater demand for Y2K lending as people become more aware of the problem with increased publicity and discussion of it in a national dialogue. Under these circumstances, we need to be diligent about monitoring the 7(a) loan program to make certain there is adequate funding. I appreciate that Chairman Bond, who also serves on the Appropriations Committee, shares this concern and has agreed to work with me to secure the necessary funds targeted specifically for the Y2K loan program, and I thank Chairman Bond for his commitment. I also thank Senators Bennett and Dodd and the Small Business Administration for working with our committee on this important initiative. We have tackled some tough policy issues, and the give-and- take, I believe, has made this legislation more helpful for businesses that face the Y2K problems. I am very hopeful that all of our colleagues will join with us in voting yes today and that our friends on the House side will act as quickly as possible to pass S. 314. It is, obviously, a good program that will have a profound impact on the year 2000 and on the long-term economic prospects of our Nation. Mr. President, I reserve the remainder of our time. Mr. BOND addressed the Chair.

Mr. KERRY

Mr. KERRY. Mr. President. February 23rd is an important day not just in Black History Month, but in the history of Massachusetts. Today is the birthday of one of the most significant leaders ever to call Massachusetts home, one of the brave leaders of the early civil rights movement whose words still stir us today. 131 years ago, W.E.B. DuBois was born in Great Barrington, Massachusetts. He studied at Harvard University in Cambridge, where he earned his doctorate and published his landmark book ``Souls of Black Folk,'' through the Harvard University press. On college campuses around the country, in our high schools, in our cities, and on our village greens, we are still reading that pioneering text--and we remember the way it touched off a movement and challenged a nation to consider the issue of race in a more honest and personal light. DuBois's prophetic words about the age in which he was living still ring true. ``The problem of the twentieth century,'' he wrote, ``is the problem of the color line.'' DuBois was right. We look back this month and honor the struggles and the perseverance of so many courageous trailblazers in the civil rights movement, so many leaders whose sacrifices paved the way for a society more attune to the guarantees of equal opportunity under God and under the law--ideas as fundamental to the promise of America as the Declaration of Independence itself. This month we remember Dr. King, Medgar Evers, James Meredith, Julian Bond, the late Rep. Barbara Jordan, and my distinguished colleague from Georgia, Rep. John Lewis. We honor their efforts to remove the barriers of race that kept America from knowing the full measure of its own greatness--and we look towards their legacy as a polestar to guide us towards the future. There could be no more appropriate time to reflect on the future of the Civil Rights Movement and the future of our nation itself than today--in this historic month, in this, the last year of the twentieth century. No one can deny that ``the problem of the color line'' was indeed the great problem of the twentieth century. But no one can deny that America made strides in putting that problem to rest, in healing our wounds--and in moving forward towards a brighter day in American history. African American family income, college admissions, and home ownership have hit an all-time high. African American poverty is down to near-record levels. African Americans have written some of the pivotal decisions of our Supreme Court, written the laws of our land in the Congress, and written their own inspiring stories into the fabric of our history. But still more must be done before we can say the problem of the color line has been eradicated. The question before us today is simple--to paraphrase the words of the late Rev. Dr. Martin Luther King, Jr. in his last book, ``where do we go from here?'' The violence in Jasper, Texas; the conditions of too many of our nation's inner city schools; the subtler forms of discrimination still prevalent in so many of our top corporations; all these problems require our attention if we are to make good on the promise that never--never again--will an American century be defined by our struggles over race and our encounters with an intransigent crisis. With open hearts and open minds--and with the commitment and determination of W.E.B. DuBois or Rosa Parks, who forty years ago sat down on a bus and said she `would not be moved'--we too can tell those who stand against equality that America will not be moved from an unshakable belief in the fundamental rights of every American--no matter their race, creed, or color--to life, liberty, and the pursuit of happiness. The challenge before us today is to summon the leadership in the twenty-first century--at the highest levels of government, and in our daily lives--to wipe away hatred, bigotry, and intolerance--and to make America in the image of the African Americans we honor this month: the land of the free, the proud, and the brave. I urge the United States Senate to contemplate that challenge on this special day, in this important month for the United States of America.

Mr. KERRY

Mr. KERRY. Mr. President, the overall goal of this bill is to address the critical recruitment and retention problems facing our military today. I strongly support that objective. We have heard that recruitment numbers are down; that the Navy is 20,000 sailors short of what it needs to meet our national interests at sea; that within the last three months the Army was 2,300 soldiers short of its recruitment goal; and that increasingly pilots are leaving the service to take more lucrative jobs with private airlines. These are serious problems requiring serious attention. At a time when we are asking our Armed Forces to undertake more different kinds of missions, we need to provide incentives to men and women to serve and to be able to keep those who are currently serving. A 1998 Youth Attitude Tracking Study of 10,000 young men and women found that the desire to serve in our military remains strong. In fact, more than 25% of the men surveyed said they wanted to join one of the active duty services. The percentage of women who expressed interest actually increased by a percentage point from last year, reaching 13% for 1998. Therefore, if the initial desire is there, we should not allow it to be clouded by fears of low pay, frequent deployments and insufficient retirement benefits once they sign up. We must do everything we can to ensure that high quality men and women will continue to join the United States Armed Services maintaining a force that is second to none in the world. The U.S. military maintains its stature because of the people who serve in it. We cannot afford to lose them or lower the standards of recruitment just to fill in the holes. Unfortunately, the reality is that we are losing them and we are being forced to look at ways of lowering the bar so that each service can meet its recruitment goal for the coming years. A strong economy able to boast of high paying jobs in the private sector is causing extreme recruitment and retention problems for the Department of Defense. S. 4 attempts to reverse these problems by offering high pay raises, reforming the pay table, establishing a retirement savings plan and expanding Montgomery GI bill benefits for those who serve and will serve in the military. Specifically, it provides for a 4.8% pay raise for every member of the Armed Services. It changes the pay scale to recognize and reward meritorious service rather than the number of years served. It establishes a thrift savings plan similar to the one available to Federal civil employees and available to many in the private sector by way of 401-K plans. It also provides a monthly subsistence allowance for those service personnel eligible to receive food stamps and expands current Montgomery GI Bill benefits both in the amount of money provided and in the number of people who can use it, among many other things. When I read through this bill, I find many things that I believe can improve the current system and I support the general thrust of this legislation. I believe that significant pay increases are necessary both to help those currently serving in the military and those who might serve in the future. The Administration did not ignore the call for pay increases coming from many personnel, as well as the Joint Chiefs. They are in the President's budget request. It is clear that military pay must be competitive with wages paid in the private sector. It truly saddens me that about 12,000 of the brave men and women who have chosen to serve their country by defending the flag, to which we all pledge allegiance, are on food stamps. These people should not be forced to make a decision between serving their country and bringing home enough money to make ends meet. At a time when our economy is growing and higher paying jobs require the kind of skills that are taught in the military, it must be very difficult not to look at the greener pastures. There is another part of this bill that I want to address because it is one of the reasons why I am going to vote in favor of it. I sincerely believe that the Montgomery GI Bill should be revamped and am pleased that this legislation takes a step in that direction. When this body passed the GI Bill in 1984, the average annual cost of tuition at a four-year university was about $5,200. That number has since doubled with costs reaching above $11,000 for the school year 1996 to 1997. However, we are still offering basically the same amount of financial assistance per month and requiring that those eligible to use it first pay $1200 before they can receive anything back. I wholeheartedly agree that we should do away with that requirement and increase the amount of monthly assistance provided. It is the right thing to do. I also support the provision in this bill that allows immediate family members also to benefit from the education allowances. I am pleased that my friend--and fellow veteran--Max Cleland introduced this portion of the bill and that it was incorporated into the final version we are debating today. I don't believe there is a single one of us who would argue that we shouldn't do more for our Armed Services personnel. That is clear. There is no question that they need increases in their basic pay and an expansion of their education and retirement benefits. But it seems to me that we ought to be careful and at least examine--if not critically analyze--how best to go about addressing our recruitment and retention problems without trying to fast-tract a bill which has significant increases in funding, above and beyond what the Administration has requested, without adequately explaining how to pay for it. I believe that we owe it to our military men and women to determine how we are going to pay for this bill and how funds used for this purpose will affect overall spending and military readiness. What are the sources for funding this bill? Is this coming out of other accounts within the Pentagon's budget? Is it coming out of domestic spending? Is it going to be off-budget? Can we really afford to pay for this across all the pay scales? Are we going to tap into our large budget surplus? It is not clear to me that these critical questions have been answered. This bill requires funding for 10 years, not just this fiscal year. We don't have any ironclad promises that our economy will prove as strong tomorrow as it is today. I think we ought to be sure that the commitments we make now can be met in the future. I remain concerned that we are moving this bill in the absence of hearings by the Armed Services Committee and an overall discussion about how our defense dollars should be spent. However, I will support this bill because as a veteran, I understand how important it is to know that your country is behind you and to know that your country recognizes and rewards the service you have given it. amendment no. 9

Mr. KERRY

Mr. KERRY. Mr. Chief Justice, my colleagues, I want to thank the Chief Justice for his important stewardship of these proceedings. And I thank Senator Lott and Senator Daschle for their patient leadership in helping to bridge the divide of partisan votes so that these are not partisan deliberations. There is a special spirit in this Chamber. No matter all the easy criticisms directed our way, this is a great institution and in our own way we are witnessing--living out--the remarkable judgment of the Founding Fathers. Let me turn to the question of removing President William Jefferson Clinton. Many times the House managers have argued to us that if you find the facts as you argue them, you must vote to convict and thereby remove. But of course, that, like a number of things that they said, is really not true. You can, of course, find the facts and still acquit, because you don't want to remove on a constitutional basis or, frankly, on any other balance that a Senator decides to make in the interest of the Nation. Now, I agree that perjury and obstruction of justice can be grounds for removal or grounds for impeachment. The question is, Are they in this case? I will not dissect the facts any further because I don't have the time but also because I believe there are issues of greater significance than the facts of this case. Let's assume you take the facts as the House managers want you to. I would like to talk about some of the things in the arena outside of the mere recitation of facts--critical considerations in this matter. I have listened to all of the arguments for removal, and I must say that even as I understand what many have said, there seems to be a gap between the words and the reality of what is happening in this country. Some have said it sets a double standard for judges, despite the fact that the vast majority of scholars say there is a difference between impeachment of judges and the President, despite a difference clearly spelled out in the Constitution, and despite all of the distinguishing facts of each one of those cases involving judges. Some have said we will have a negative impact on kids, on the military, and on the fabric of our country. And while I agree that this is absolutely not about polls and popularity, some are making a judgment that clearly the country itself does not agree with. The country does not believe the fiber of our Nation is unraveling over the President's egregious behavior, because most people have a sense of proportion about this case that seems totally lacking in the House managers' presentation. No parent or school in America is teaching kids that lying or abusing the justice system is now OK. In fact, the President's predicament, I argue, does not make it harder to do so. If anything, there may now be a greater appreciation for the trouble you can get into for certain behavior. More parents are teaching their children about lying, about humiliation, about family hurt, about public responsibility, than before we ever heard the name of Monica Lewinsky. The clear answer to children who write letters about the President is that since being discovered he has been in a lot of trouble, may even be criminally liable, has suffered public humiliation, and all of history will not erase the fact of this impeachment, this trial, or the lessons of this case. But the bottom line for us is our constitutional duty, our responsibility to balance based on common sense and sense of honor. There is a simple question but a question of enormous consequence: Do we really want to remove a President of the United States because he tried to avoid discovery in a civil case of a private, consensual affair with a woman who was subsequently determined to be irrelevant to the case, which case itself was thrown out as wholly without merit under the law? That is the question. Let me be clear about the President's behavior so no one misinterprets. I am as deeply disturbed by it as all of us are here in the Senate. But I am not sure we need additional moralizing about something that the whole Nation has already condemned and digested. The President lied to his countrymen, to family, friends, to all of us. And if one is not enormously concerned by gifts not surrendered, conversations which can't refresh recollection, jobs produced with uncommon referral and speed, certainly one must be unsettled by the mere lack of easy compliance with judicial inquiry by a President. That is of grave concern to all. It deserves our censure. But let me say as directly as I can that no amount of inflated rhetoric, or ideological or moral hyperextension can lift the personal, venial aspects of the President's actions to the kind of threat to the fabric of the country contemplated by the Founding Fathers. I must say that I am truly somewhat surprised to see so many strict constructionists of the Constitution giving such new and free interpretation to the clear intent of the framers. And I have, frankly, been stunned by the overreach, the moral righteousness, even the zealotry of arguments presented by the House managers. No matter the words about not hating Bill Clinton, no matter the disclaimers about partisanship, I truly sensed at times not just a scorn but a snarling, trembling venom that told us the President is a criminal and that ``we need to know who our President is.'' Well, the President is certainly a sinner. We all are. And he may even have committed a crime. But just plain and simply measured against the test of history so eloquently articulated by the Senator from New York this morning and by the Senator from Delaware yesterday, just plain and simply, this is not in any measure on the order of high a crime and misdemeanor so clearly contemplated by the Founding Fathers. Unlike President Nixon's impeachment case, no government power or agency was unleashed or abused for a goal directly affecting public policy. No election was interfered with. No FBI or IRS power was wrongfully employed. At worst, this President lied about his private, consensual affair and tried wrongfully, but on a human level-- understandable to most Americans, at least as to the Paula Jones case-- to cover it up. I think, in fact, that most Americans in this country understood there was in that inquiry a violation of a zone of privacy that is as precious to Americans as the Constitution itself. The fact that the House dropped the Paula Jones deposition count underscores the underlying weakness on which all of this is based. So I ask my colleagues, are we really incapable of at least measuring the real human dimensions of what took place here and contrasting it properly with the constitutional standards we are presented by precedent and history? We have heard some discussion of proportionality. It is an important principle within our justice system and in life itself. The consequences of a crime should not be out of proportion to the crime itself. As the dictionary tells us, it should correspond in size, degree or intensity. I must say that no one yet who will vote to remove has fully addressed that proportionality issue. If you want to find perjury because you believe Monica about where the President touched her, and you believe that adopting the definition given to him by a judge and by Paula Jones' own lawyers, and you can reach into the President's mind to determine his intent, then that is your right. But having done that, if you think a President of the United States should be removed, an election reversed, because of such a thin evidentiary thread, I think you give new meaning to the concept of proportionality. If you do that, you turn away from the central fact that the President opened his grand jury testimony by acknowledging ``inappropriate, intimate contact'' with Monica Lewinsky. Enough said, you would think. But no, not enough for this independent prosecutor. While not one more question really needed to be asked, a torrent of questions followed. Every question thereafter calculated to either elicit an admission of a lie in a case found to be without merit, or to create a new lie which could bring us here. With the President's acknowledgment of intimate contact, everyone in this Chamber understood what had happened. Everyone in America understood what had happened. For what reason did we need eighty percent of the questions asked about sexual relations? For the simple reason that the Presidential jugular instinct of the so-called independent counsel was primed by what all of us have come to know--he had colluded with Paula Jones' attorneys and Linda Tripp to set the Monica trap in the January deposition, and now he was going to set the perjury trap in the grand jury. Mr. Bennett's own comments in the deposition underscore this: ``I mean, this is not what a deposition is for, Your Honor. He can ask the President, What did he do? He can ask him specifically in certain instances what he did, and isn't that what this deposition is for? It is not to sort of lay a trap for him.'' I wonder if there is no former district attorney, now Senator; no former attorney general, now Senator; no former U.S. attorney, now Senator; former officer of the court, now Senator, who is not deeply disturbed by a so-called independent counsel grilling a sitting President of the United States of America about his personal sex life, based on information from illegal phone recordings? Is there no one finding a countervailing proportionality in this case when confronted by our own congressionally created Javert who is not just pursuing a crime but who is at the center of creating the crime which we are deliberating on now? Think about it. When Mr. Starr was appointed, when we authorized an independent counsel, when the grand jury was convened, the crime on trial before us now had not even been committed, let alone contemplated. I wonder also if there is no one even concerned about Linda Tripp-- who new gives definition to the meaning of friendship--working with Paula Jones' attorneys even as she was in the guidance and control of Mr. Starr as a Federal witness. Some of you may want to turn away from these facts. Secondly, the House managers never even acknowledged them in their presentations. I raise them, my colleagues, not for ideological or political purposes, but fundamental fairness demands that we balance all of the forces at play in this case. Now, much has also been made in this trial of the rights of Paul@ Jones and her civil rights case--that we must protect Paul@ Jones' rights against the President of the United States. My fellow colleagues--please let us have the decency to call this case what it was. This was no ordinary civil rights case. It was an assault on the Presidency and on the President personally, and the average American's understanding of that is one of the principal reasons our fellow citizens figured this case out long ago. But there is more to it than that: Mr. Starr became involved in the Paula Jones suit before he became independent counsel. He had contacts with Paula Jones' attorneys before his jurisidction was expanded. He wired Linda Tripp before his jurisdiction was expanded. Many sources documented that without any expansion of jurisdiction, in 1997, he had FBI agents interrogating Arkansas State troopers, asking about Governor Clinton's private life--especially inquiring into Paula Jones. After Paul@ Jones filed her suit in 1994, announcing it at a conservative political convention, and with new counsel affiliated with the Rutherford Institute, her spokesperson said, ``I will never deny that when I first heard about this case, I said, ``OK, good. We're gonna get that little slime ball.'' She later said: ``Unless Clinton wants to be terribly embarrassed, he'd better cough up what Paula needs. Anybody that comes out and testifies against Paula better have the past of a Mother Teresa, because our investigators will investigate their morality.'' Even Steve Jones, Paula Jones' husband, was part of an operation to poison the President's public reputation by divulging the secrets of his personal life--threatening even to employ subpoena power to depose, under oath, every State trooper in Arkansas who may have worked for the Governor. Steve Jones pledged that: ``We're going to get names; we're going to get dates; we're going to do the job that the press wouldn't do. We're going to go after Clinton's medical records, the raw documents, not just opinions from doctors. . .we're going to find out everything.'' Into all of this came Ken Starr, and the police power of our Nation. This was not a civil rights suit in the context most of us would recognize. Indeed, there existed an extended and secret Jones legal team of outside lawyers--including George Conway and Jerome Marcus, experts on sexual harassment and Presidential immunity, who ghostwrote almost every substantive argument leveled by Paula Jones' lawyers; Ken Starr's friend Theodore Olson, and Robert Bork, the former Supreme Court nominee, who together advised the Jones team; Richard Porter, a law partner of Ken Starr and former Bush-Quayle opposition research guru, who also wrote briefs for the Jones team; and the conservative pundit and longtime Clinton opponent Ann Coulter, who worked on Paula Jones' response to President Clinton's motion for a dismissal. The connections between this crack--and covert--legal team, and Ken Starr's staff and his witnesses--including Paul Rosenzweig, Jackie Bennett, and Linda Tripp--as well as familiar figures including Lucianne Goldberg, add up to something far more than a twisted and disturbing game of six degrees of separation. I do not suggest that this was the right wing conspiracy bandied about on the talk shows. But I ask you--are we not able to acknowledge that this was a legal and political war of personal destruction--not just a civil rights case? And we cannot simply dismiss the fact that all of this turmoil--these entire proceedings--arise out of this deeply conflicted, highly partisan, ideologically driven, political civil rights case with incredible tentacles into and out of the office of the independent counsel. Moreover, I remind my colleagues, Mr. Starr is supposed to be independent counsel--not independent prosecutor. He was and is supposed to represent all of the Congress and nowhere do I remember voting for him to make a referral of impeachment--a report of facts, yes--a referral of impeachment, no. Now there is a rejoinder to all of this. Nothing wipes away what the President did or failed to do. So, some of you may say, So what? The President lied. The President obstructed justice. No one made him behave as he did. And yes, you're right. The President behaved without common sense, without courage, and without honor, but we are required to measure the totality of this case. We must measure how political this may have been; whether process was absurd; whether the totality of what the President did meets the constitutional threshold set by the Founding Fathers. We must decide whether the removal of the President is proportional to the offense and we must remember that proportionality, fairness, rule of law--they must be applied not just to convict, but also to defend--to balance the equities. I was here during Iran-contra and I remember the extraordinary care Senator Rudman, Senator Inouye, and Senator Sarbanes exerted to avoid partisanship and maintain proportionality. I wish I did not conclude that their example frankly is in stark contrast to the experience we are now living. The House managers often spoke to us of principle and duty. And equally frequently we were challenged to stand up for the rule of law. Well, we all believe in rule of law. But we also believe in the law being applied fairly, evenly--that the rule of law is not something to cite when it serves your purposes, only to be shunted aside when it encumbers. But where was the managers' duty to their colleagues in the House--in the committee--on the floor; where was the same self-conscious sense of pain for what they were going through, when they denied a bipartisan process for impeachment; where was their commitment to rule of law in denying the President's attorneys access to the exculpatory evidence which due process affords any citizen? Rule of law is a process in a democratic institution, and there is a duty to honor process. I believe the Senate has distinguished itself in that effort and I want to express my deep respect for the strongly held views of all my colleagues. Reasonable people can differ and we do, but we can still come together in an affirmation of the strength of our Constitution. Chairman Hyde says ``let it be done''--I hope it will be. Right requires we be proportional as to all aspects of this case. I hope that what we do here will apply the law in a way that gives confidence to all our citizens, that everyone can look at the final result of our deliberations and say justice was done. And we have called an end to the process by which we savage each other, and are beginning to heal our country.

Mr. KERRY

Mr. KERRY. Mr. President, I rise today to pay tribute to Rear Admiral Bill Stubblefield on the occasion of his retirement as the Director of the Office of NOAA Corps Operations and the Director of the NOAA Corps, in the Department of Commerce's National Oceanic and Atmospheric Administration. Rear Admiral Stubblefield has given 33 years of dedicated service to the nation. Bill Stubblefield served as a commissioned officer in the U.S. Navy from 1962 to 1968 aboard a minesweeper and an icebreaker, and then with the U.S. Navy's SOSUS network. In 1968, he resigned his commission from the Navy to further his education and received his Master's degree in Geology from the University of Iowa in 1971. In July 1971 Admiral Stubblefield joined the NOAA Commissioned Corps as a Lieutenant in his home town of Medina, Tennessee, and attended the 38th NOAA Corps Basic Officer Training Class which was held at the United States Merchant Marine Academy in Kings Point, New York. After his commissioning, he was assigned to serve as a Junior Officer aboard the NOAA Ships Pathfinder and Rainier, conducting hydrographic surveys in California, Washington, and Alaska. His next assignment was ashore with the Environmental Research Laboratory, Office of Oceanic and Atmospheric Research, in Miami, Florida, as Deputy Director of the Marine Geology and Geophysics Division. For this work, he received a NOAA Corps Special Achievement Award. Admiral Stubblefield returned to sea duty in December of 1975 as Operations Officer aboard the NOAA Ship Researcher, which conducted oceanographic and atmospheric research in the waters of the Atlantic Ocean. From January 1978 to May 1979, Admiral Stubblefield attended full- time university training at Texas A&M University receiving his Ph.D. in geological oceanography. He returned to the Environmental Research Laboratory as a research oceanographer until 1981, when he was summoned back to sea as the Executive Officer of the NOAA Ship Researcher. Following his sea assignment Admiral Stubblefield had tours of duty as the Scientific Support Coordinator of the southeastern Atlantic and Gulf coastal areas for the NOAA Office of Marine Pollution Assessment Hazardous Material Program and Technical Specialist for the NOAA Office of Sea Grant in Washington, D.C. Admiral Stubblefield was then assigned to the position of Chief Scientist for the NOAA Undersea Research Program. He returned to sea in 1988 as Commanding Officer of the NOAA Ship Surveyor which conducted oceanic research from the Arctic to the Antarctic, including the north and south Pacific Ocean, Gulf of Alaska, and the Bering Sea. At the time, the Surveyor had attained the award of traveling the farthest north and south of any NOAA vessel at its time. In 1990 he was assigned the position of Coordinator for the Fleet Modernization Study to assess the life expectancy of NOAA's ships and determine how to modernize NOAA's fleet to operate into the 21st century. For this work, he received the Department of Commerce Silver Medal, DOC's second highest award. In late 1990, Admiral Stubblefield became the Executive Director for the Office of Oceanic and Atmospheric Research, where he was responsible for the management and budget functions, international affairs, and administrative duties of this NOAA program office. In August 1992, he was promoted to the rank of Rear Admiral, Lower Half and assigned as Deputy Director, Office of NOAA Corps Operations where he was responsible for the day-to-day operations of this staff office. In 1995, Admiral Stubblefield was selected for the position of Director, Office of NOAA Corps Operations and Director of the NOAA Commissioned Corps, and promoted to Rear Admiral, Upper Half, the highest position in the NOAA Corps. Since Admiral Stubblefield became Director, the Office of NOAA Corps Operations has undergone many changes. He re-engineered the office to become more cost-efficient and customer oriented. He decommissioned five older ships, downsized the headquarters office by over 40 percent, both civilian and commissioned personnel, and reduced ship operating costs, while increasing the level of ship support. Under his command, a new oceanographic ship, the Ronald H. Brown, was built and commissioned, and two former Navy ships were converted to conduct fisheries, oceanic, and atmospheric research. He also saw the new Gulfstream IV jet built and brought into operation to study the effects of El Nino last winter off the California coast and conduct hurricane reconnaissance this past hurricane season. Also under his command, Admiral Stubblefield faced the most challenging task of his career, one that no head of a uniformed service would ever want to face--the decision to disestablish the NOAA Commissioned Corps. The Corps was under a hiring freeze that lasted for 4 years. Yet, Admiral Stubblefield still was able to maintain morale and fill the assignments required to operate the ships and aircraft. This past October, when it became apparent the NOAA Corps plays a vital role for the country, the decision was made to retain the NOAA Corps. In January 1999, 17 new officers began their basic training at the Merchant Marine Academy in Kings Point, New York. Admiral Stubblefield is an officer, a scientist, and a gentleman. I commend Bill for his tremendous accomplishments during his career and service to the Nation, especially those over the past three years. Thanks to his efforts, NOAA is stronger, more efficient and will carry out its invaluable mission into the next century.

Mr. KERRY

Mr. KERRY. I ask the majority leader this: He mentioned that he hoped during the deliberations that there would be more than just speeches, that there would be a process of colloquy. I was wondering if he was contemplating how that would work because I think under the rules we are limited to one intervention of a specific time period. Does the majority leader contemplate approaching that difficulty?

Mr. KERRY. Mr. Chief Justice, I ask consent that I be permitted to ask a point of clarification.

Mr. KERRY

Mr. KERRY. Mr. President, today I join my colleague, Senator Max Cleland, in introducing the Disaster Mitigation Coordination Act of 1999, a bill that helps our nation's small businesses save money and prepare for natural disasters. We can't prevent disasters, but we can take measures to lessen and prevent the destruction that often hurts, and sometimes destroys, small businesses. Aside from avoiding inconveniences and disruptions, we know that there are cost-benefits to making meaningful improvements and changes to facilities before a disaster. According to the Federal Emergency Management Agency, which has a disaster mitigation program for communities, rather than businesses, we know that we save two dollars of disaster relief money for each dollar spent on disaster mitigation. I see a great need for this type of assistance in the small business community. This bill establishes a five-year pilot program that would make low-interest, long-term loans available to small business owners financing preventive measures to protect their businesses against, and lessen the extent of, future disaster damage. This pilot program is designed to help those small businesses that can't get credit elsewhere and that are located in disaster-prone areas. The small business pre-disaster mitigation loan pilot program would be run as part of the Small Business Administration's regular disaster loan program, testing the pros and cons of preparedness versus reaction. Up to $15 million will be set aside for this pilot if enacted. Only a portion of SBA's regular disaster loans, up to 20 percent, are available for mitigation after a recent natural disaster. In contrast, this legislation would allow 100 percent of an SBA disaster loan to be used for mitigation purposes within any area that the Federal Emergency Management Agency has designated as disaster-prone. In Massachusetts, that includes Marshfield and Quincy, two coastal communities that are prone to flooding, rainstorms and Nor'easters. Nationwide, whether you're a business in Missouri or Massachusetts, this pilot would allow you to take out a loan to make the improvements to your building or office to protect against disasters. For floods it can mean elevating the foundation or relocating. For tornados it can mean installing storm windows and building a stronger roof. For hurricanes it can mean reinforcing walls. And for fires it can mean adding sprinklers and flame-retardant building materials. The Administration supports this pilot program and included it in Clinton's budget request this fiscal year, and again for fiscal year 2000. The President requests that up to $15 million of the total $358 million proposed for disaster loans be used for disaster mitigation loans. Senator Cleland and I introduced this same legislation in the last Congress. And although it passed committee and the full Senate without opposition, the House did not have time to vote on its merits before the 105th Congress ended. I thank my colleagues, Senators Hollings, Conrad, Boxer, Daschle and Harkin for sharing our concern to meet the needs of our small business owners while also working to find solutions that are smarter, more pro-active and more cost-effective. Mr. President, I am pleased to cosponsor this legislation and am hopeful it will again receive the full support it deserves when it comes before the Senate this Congress.

Mr. KERRY

Mr. KERRY. Mr. President, today I join my colleague, Senator Max Cleland, in introducing the Disaster Mitigation Coordination Act of 1999, a bill that helps our nation's small businesses save money and prepare for natural disasters. We can't prevent disasters, but we can take measures to lessen and prevent the destruction that often hurts, and sometimes destroys, small businesses. Aside from avoiding inconveniences and disruptions, we know that there are cost-benefits to making meaningful improvements and changes to facilities before a disaster. According to the Federal Emergency Management Agency, which has a disaster mitigation program for communities, rather than businesses, we know that we save two dollars of disaster relief money for each dollar spent on disaster mitigation. I see a great need for this type of assistance in the small business community. This bill establishes a five-year pilot program that would make low-interest, long-term loans available to small business owners financing preventive measures to protect their businesses against, and lessen the extent of, future disaster damage. This pilot program is designed to help those small businesses that can't get credit elsewhere and that are located in disaster-prone areas. The small business pre-disaster mitigation loan pilot program would be run as part of the Small Business Administration's regular disaster loan program, testing the pros and cons of preparedness versus reaction. Up to $15 million will be set aside for this pilot if enacted. Only a portion of SBA's regular disaster loans, up to 20 percent, are available for mitigation after a recent natural disaster. In contrast, this legislation would allow 100 percent of an SBA disaster loan to be used for mitigation purposes within any area that the Federal Emergency Management Agency has designated as disaster-prone. In Massachusetts, that includes Marshfield and Quincy, two coastal communities that are prone to flooding, rainstorms and Nor'easters. Nationwide, whether you're a business in Missouri or Massachusetts, this pilot would allow you to take out a loan to make the improvements to your building or office to protect against disasters. For floods it can mean elevating the foundation or relocating. For tornados it can mean installing storm windows and building a stronger roof. For hurricanes it can mean reinforcing walls. And for fires it can mean adding sprinklers and flame-retardant building materials. The Administration supports this pilot program and included it in Clinton's budget request this fiscal year, and again for fiscal year 2000. The President requests that up to $15 million of the total $358 million proposed for disaster loans be used for disaster mitigation loans. Senator Cleland and I introduced this same legislation in the last Congress. And although it passed committee and the full Senate without opposition, the House did not have time to vote on its merits before the 105th Congress ended. I thank my colleagues, Senators Hollings, Conrad, Boxer, Daschle and Harkin for sharing our concern to meet the needs of our small business owners while also working to find solutions that are smarter, more pro-active and more cost-effective. Mr. President, I am pleased to cosponsor this legislation and am hopeful it will again receive the full support it deserves when it comes before the Senate this Congress.

Mr. KERRY

Mr. KERRY. Mr. Chief Justice, I suggest the absence of a quorum.

Mr. KERRY. Clearly, the purpose of the trial and the purpose of this effort is to have a fair presentation of evidence. The Senate now having denied notice to White House counsel of what areas may be the subject of video, it might be that the voice of the witnesses themselves is the best response to whatever it is that the House were to present. If they were to decide----

Mr. KERRY. Mr. Chief Justice, reserving the right to object. I ask the majority leader, is there an assumption that if White House counsel were to want sufficient time on Saturday in order to be able to present video testimony countering whatever surprise video--and there may or may not be a surprise --would they have time to be able to provide that on Saturday--not to carry over, but merely if they choose to, to do that on Saturday?

Mr. KERRY

Mr. KERRY. Mr. President, today I join Chairman Bond in support of the Small Business Investment Company Technical Corrections Act. The Small Business Investment Company (SBIC) program is vital to our fastest growing small companies that have capital needs exceeding the caps on SBA's loan programs, but are not large enough to be attractive to traditional venture capital investors. The demand is clear: Last year, participating securities in the SBIC program invested $360 million in 495 financings. In Massachusetts, where there is an impressive community of fast-growing companies, particularly in the hi- tech industry, there were 140 SBIC financings, worth $145.4 million. This legislation sets out to make five technical changes. They range from improving the incentive for SBIC's to loan money to small companies to structuring a fairer formula for determining whether companies of the same revenue size can quality for SBIC financing. One of the most important changes will increase the authorized levels for participating securities. The Participating Securities component of the SBIC program invests principally in the equities of new or expanding businesses. To leverage the private capital of participating securities and better serve these fast-growing businesses, I supported Senator Lieberman's amendment to H.R. 3412 during the last Congress, which would have raised the authorization level for participating securities from $800 million to $1 billion in fiscal year 1999 and from $900 million to $1.2 billion in fiscal year 2000. This bill passed the Senate Small Business Committee and the full Senate by unanimous consent, but unfortunately, the House was unable to act on it before the 105th Congress ended. Since that amendment was introduced, we have seen that the need is even greater than those levels. The Administration anticipates faster growth in the SBIC program because of both its increasing popularity and the increase in additional personnel at the Small Business Administration to its SBIC licensing unit. In fiscal years 1997 and 1998, SBA licensed approximately 30 new SBIC's per year. With more staff devoted to the licensing unit, SBA projects that it will license more than double that amount in fiscal year 1999. Accordingly, Senator Bond's Act would increase the authorization level to $1.2 billion in FY99 and to $1.5 billion in FY2000. Mr. President, I am pleased to cosponsor this legislation and I applaud the work of my colleagues on the Senate Small Business Committee, Chairman Bond and Senator Lieberman.

Mr. KERRY

Mr. KERRY. Mr. President, today I join Chairman Bond in support of the Small Business Investment Company Technical Corrections Act. The Small Business Investment Company (SBIC) program is vital to our fastest growing small companies that have capital needs exceeding the caps on SBA's loan programs, but are not large enough to be attractive to traditional venture capital investors. The demand is clear: Last year, participating securities in the SBIC program invested $360 million in 495 financings. In Massachusetts, where there is an impressive community of fast-growing companies, particularly in the hi- tech industry, there were 140 SBIC financings, worth $145.4 million. This legislation sets out to make five technical changes. They range from improving the incentive for SBIC's to loan money to small companies to structuring a fairer formula for determining whether companies of the same revenue size can quality for SBIC financing. One of the most important changes will increase the authorized levels for participating securities. The Participating Securities component of the SBIC program invests principally in the equities of new or expanding businesses. To leverage the private capital of participating securities and better serve these fast-growing businesses, I supported Senator Lieberman's amendment to H.R. 3412 during the last Congress, which would have raised the authorization level for participating securities from $800 million to $1 billion in fiscal year 1999 and from $900 million to $1.2 billion in fiscal year 2000. This bill passed the Senate Small Business Committee and the full Senate by unanimous consent, but unfortunately, the House was unable to act on it before the 105th Congress ended. Since that amendment was introduced, we have seen that the need is even greater than those levels. The Administration anticipates faster growth in the SBIC program because of both its increasing popularity and the increase in additional personnel at the Small Business Administration to its SBIC licensing unit. In fiscal years 1997 and 1998, SBA licensed approximately 30 new SBIC's per year. With more staff devoted to the licensing unit, SBA projects that it will license more than double that amount in fiscal year 1999. Accordingly, Senator Bond's Act would increase the authorization level to $1.2 billion in FY99 and to $1.5 billion in FY2000. Mr. President, I am pleased to cosponsor this legislation and I applaud the work of my colleagues on the Senate Small Business Committee, Chairman Bond and Senator Lieberman.

Mr. KERRY

Mr. KERRY. Mr. President, today I join my colleagues--Chairman Bond of the Small Business Committee and Senators Bennett and Dodd of the Special Committee on the Year 2000 Technology Problem--to introduce a bill that provides affordable loans to small businesses preparing for or responding to the Year 2000 computer problem. As Ranking Member of the Committee on Small Business, I believe it is in our economic best interest to make sure that our small businesses, some 20 million if we include the self-employed, are still up and running, creating jobs and providing services, on and after January 1, 2000. Will the new year bring national ``hiccups'' or ``worldwide recession''? It depends on who you ask. Peter de Jager, considered one of the first Year-2000 crusaders, believes there will be problems, but not devastation. As published in the December 31, 1998 issue of ``ITAA's (Information Technology Association of America) Year 2000 Outlook'': De Jager says ``a blackout across North America is `inconceivable' and power brown-outs, should they occur, will be localized.'' However, if you ask a particular senior executive at Barclays about the millennium computer bug, his advice would be to sell your home, stockpile cash and buy gold in case of a global economic collapse. He and other international bank managers fear a run on deposits. Because our economy is inter-dependent and most of our technology is date-dependent, either scenario concerns me, particularly for small businesses. National surveys and conversations with Y2K consultants and commercial lenders in Massachusetts tell a story that varies from ignorance to denial to paralysis to apathy. That's serious when you consider a 1998 Arthur Andersen Enterprise Group and National Small Business United survey that found 94 percent of all small and mid-sized businesses have computers, and only 62 percent of all small and mid-sized businesses, regardless of whether they rely on computers or date-dependent equipment, have ``begun addressing'' Y2K issues. The good news is that a greater percentage of small and mid-sized businesses are preparing for Y2K than last summer; the bad news is that they've only ``begun'' and a significant group is taking a wait-and-see approach. And what about those who have been slow to act or have no plans to act? How do we reach them and facilitate assessment and remediation of their businesses? By making the solution affordable. The Andersen and NSBU study showed that 54 percent of all respondents said ``affording the cost [was the] most difficult challenge in dealing with information technology.'' Cost is a legitimate, albeit risky, reason to delay addressing the Y2K problem--saving till you're a little ahead or waiting until the last possible moment to take on new debt to finance changes are strategies many small businesses are forced to adopt. Most of the media attention has been on big business, the challenges they face and the costs they are bearing to fix the problem. Small businesses face the same effects of the Y2K problem as big businesses, but, as the study found, they often have little or no resources to devote to detecting the extent of the problem or developing a workable and cost-effective solution. If you own your facility, is the HVAC (Heating Ventilation and Air Conditioning) system in compliance and how much will it cost to fix a system that serves 5,000 square feet? Does the security system need an upgrade or to be replaced? If you own a dry cleaner and you hire a consultant to assess your equipment in your franchise, will remediation eat all your profits or set you back? These are questions to which some business owners can't afford to hear the answers. It may come down to a choice between debt or dissolution. The Year 2000 Readiness Act gives eligible business owners a viable option. To make it easy for lenders and timely for borrowers, this Act, like the Y2K small business loan bill I introduced last Congress, expands the 7(a) loan program, one of the U.S. Small Business Administration's most popular and successful guaranteed lending programs. Currently, the 7(a) program is intended to give small businesses credit and capital, including working capital to grow their companies. If the Year 2000 Readiness Act is enacted, that program could be used until the end of the year 2000 to address Y2K problems through assessment, planning, remediation and testing computers and equipment, or to provide relief for substantial economic injury a small business suffers as a direct result of Y2K problems, such as a brown-out or a temporarily incapacitated supplier. The terms of 7(a) loans are familiar to lenders and small-business owners alike and, therefore, the loans are easy to apply for and process. They are structured to be approved or denied, in most cases, in less than 48 hours. We expect the average Y2K 7(a) loan to be less than $100,000. To give lenders an incentive to make 7(a) loans to small businesses for Y2K problems and related economic injury, this Act raises the government guaranties of the existing 7(a) program by ten percent. Under special circumstances, it also raises the dollar cap of loan guaranties from $750,000 to $1 million for these Y2K small business loans. For Y2K 7(a) loans of more than $100,000, the government will guarantee 85 percent, and for such loans of $100,000 or less, the government will guarantee 90 percent. For those lenders with special authority to approve their loans, this Act allows them to use the SBA Express Pilot Program--a pilot that makes it easy for lenders to process loans worth up to $150,000 using their own paperwork and making same-day approval--for Y2K loans. SBA Express loans are guaranteed at 50 percent. This legislation encourages lenders to work with small businesses addressing Y2K-related problems by arranging for affordable financing. When quality of credit comes into question, lenders are directed to resolve reasonable doubts about the applicant's ability to repay the debt in favor of the borrower. And when appropriate, to establish a moratorium for up to one year on principal payments on Y2K 7(a) loans, beginning when the loans are originated. To protect against fraud, abuse or double compensation, this Act prohibits a business from qualifying for a Y2K 7(a) loan if it has already received insurance proceeds for Y2K problems or economic injury related to Y2K problems. As important as this Y2K loan program is, it must be available in addition to, and not in lieu of, the existing 7(a) program. The 7(a) program is a vital capital source for small businesses, providing more than 42,000 loans in 1998, totaling $9 billion. Nine hundred sixty-six of those loans went to small businesses in Massachusetts. With defaults down, recoveries up and the government's true cost, called the subsidy rate, at 1.39 percent, we should not create burdens that would slow or reverse this trend. To protect the existing 7(a) program, we need to make sure that it is adequately funded for fiscal years 1999 and 2000. Because the Y2K loan program would be part of the existing 7(a) business loan program, funds that have already been appropriated for the 7(a) program may be used for the Y2K loan program. As of two weeks past the end of the first quarter of fiscal year 1999, SBA's records show that the program has already used $2.5 billion (roughly 23 percent) of the total $10 billion appropriated. Typically the demand for these loans increases by as much as ten percent in the spring and summer. If this holds true for this fiscal year, it is an indication that the program will need nearly all of its funds to meet the regular loan demand. Under these circumstances, we must be diligent about monitoring the 7(a) loan program to make sure the Y2K loans don't drain the program and cause it to run out of money. If we do find that the appropriated amount is inadequate to support the general 7(a) loan program and the new Y2K loan program, we will need to get more funding. Though it's never easy to get more money, Chairman Bond, who also serves on the Committee on Appropriations and is chairman of one of the Appropriation subcommittees, has agreed to attempt to secure additional funds targeted specifically for the Y2K loan program. I thank Chairman Bond for his commitment, and offer my help if the need arises. I am hopeful that this legislation can be passed in the Small Business Committee and the full Senate as quickly as possible to begin assisting small businesses in need of this important initiative. This is a good program, which with adequate funding, will help many small businesses get a strong start in 2000 and the new millennium. Mr. DODD, Mr. President, I rise today to join my colleagues in supporting this very important legislation. Together with Senators Bond, Kerry, and Bennett, I recognize the necessity of strengthening the ability of America's small businesses to negotiate the complex challenges related to the Year 2000 computer problem. This legislation is designed to assist the 14.5 million small businesses that may have Y2K concerns. According to various studies, almost half of all of the small businesses in America are not ready to respond to the possible effects of the Y2K computer problem. I would like to take a moment and thank Chairman Bond and Ranking Member John Kerry of the Small Business Committee for their leadership and cooperation with the Special Committee on the Year 2000, on which I serve as Vice-Chair. The object of this cooperation between our two Committees is to strengthen the economic backbone of America, small businesses, as they face a potentially devastating threat to their very existence. This is not to alarm anyone, but merely to warn of a possible danger. As I have said on numerous occasions, I believe very strongly that we must prepare and plan for any Y2K contingency. We must be vigilant and provide assistance for small businesses. Unfortunately, many small businesses do not consider themselves in danger from the effects of the Y2K problem and so have taken little, if any, steps to address problems that may arise. This extends to reviewing whether all of their suppliers, customers and financial institutions are free from the Y2K glitch. Even if our small enterprises were aware of all problems that face them, not all of them have access to the necessary funds to take corrective measures. This legislation helps our nation's small enterprises in two ways. First, if a company wants to remediate or fix its own equipment that is not Y2K compliant, this bill provides easier access to loans. Hopefully, this will encourage the small business owners to learn of their companies deficiencies, and then correct them in a timely manner so that company does not stop working. Second, if a company faces economic disruption due to outside Y2K related problems, then that company may apply for funds to assist it. This is the area to which I am especially sensitive. We do not know exactly what will work and what will need immediate attention so that our lives, our jobs, our economic well being, can continue. To address that lack of knowledge, this bill will allow small business owners access to financial support guaranteed by the Small Business Administration until December 31, 2000. This is very important. Our concern is not just January 1, 2000, but the continual smooth operation of our nation and our nation's small businesses throughout this momentous year. Less than one-third of small businesses have checked the Y2K preparedness of the companies that they depend upon to continue to function everyday. Though only half of the small businesses in America classify themselves as dependent upon computers, many of the small businesses in America are dependent on other businesses, which are dependent upon computers. Like a cog in the wheel of our nation's economy, if one small business suddenly ceases to function, its effects may be felt across the country. That is why I am glad to support this legislation to assist the United States small business community. An ounce of prevention is worth a pound of cure. We must help our nation's small businesses regardless of when they become aware of the problems facing them. This legislation is designed to do exactly that.

Mr. KERRY

Mr. KERRY. Mr. President, today I join my colleagues--Chairman Bond of the Small Business Committee and Senators Bennett and Dodd of the Special Committee on the Year 2000 Technology Problem--to introduce a bill that provides affordable loans to small businesses preparing for or responding to the Year 2000 computer problem. As Ranking Member of the Committee on Small Business, I believe it is in our economic best interest to make sure that our small businesses, some 20 million if we include the self-employed, are still up and running, creating jobs and providing services, on and after January 1, 2000. Will the new year bring national ``hiccups'' or ``worldwide recession''? It depends on who you ask. Peter de Jager, considered one of the first Year-2000 crusaders, believes there will be problems, but not devastation. As published in the December 31, 1998 issue of ``ITAA's (Information Technology Association of America) Year 2000 Outlook'': De Jager says ``a blackout across North America is `inconceivable' and power brown-outs, should they occur, will be localized.'' However, if you ask a particular senior executive at Barclays about the millennium computer bug, his advice would be to sell your home, stockpile cash and buy gold in case of a global economic collapse. He and other international bank managers fear a run on deposits. Because our economy is inter-dependent and most of our technology is date-dependent, either scenario concerns me, particularly for small businesses. National surveys and conversations with Y2K consultants and commercial lenders in Massachusetts tell a story that varies from ignorance to denial to paralysis to apathy. That's serious when you consider a 1998 Arthur Andersen Enterprise Group and National Small Business United survey that found 94 percent of all small and mid-sized businesses have computers, and only 62 percent of all small and mid-sized businesses, regardless of whether they rely on computers or date-dependent equipment, have ``begun addressing'' Y2K issues. The good news is that a greater percentage of small and mid-sized businesses are preparing for Y2K than last summer; the bad news is that they've only ``begun'' and a significant group is taking a wait-and-see approach. And what about those who have been slow to act or have no plans to act? How do we reach them and facilitate assessment and remediation of their businesses? By making the solution affordable. The Andersen and NSBU study showed that 54 percent of all respondents said ``affording the cost [was the] most difficult challenge in dealing with information technology.'' Cost is a legitimate, albeit risky, reason to delay addressing the Y2K problem--saving till you're a little ahead or waiting until the last possible moment to take on new debt to finance changes are strategies many small businesses are forced to adopt. Most of the media attention has been on big business, the challenges they face and the costs they are bearing to fix the problem. Small businesses face the same effects of the Y2K problem as big businesses, but, as the study found, they often have little or no resources to devote to detecting the extent of the problem or developing a workable and cost-effective solution. If you own your facility, is the HVAC (Heating Ventilation and Air Conditioning) system in compliance and how much will it cost to fix a system that serves 5,000 square feet? Does the security system need an upgrade or to be replaced? If you own a dry cleaner and you hire a consultant to assess your equipment in your franchise, will remediation eat all your profits or set you back? These are questions to which some business owners can't afford to hear the answers. It may come down to a choice between debt or dissolution. The Year 2000 Readiness Act gives eligible business owners a viable option. To make it easy for lenders and timely for borrowers, this Act, like the Y2K small business loan bill I introduced last Congress, expands the 7(a) loan program, one of the U.S. Small Business Administration's most popular and successful guaranteed lending programs. Currently, the 7(a) program is intended to give small businesses credit and capital, including working capital to grow their companies. If the Year 2000 Readiness Act is enacted, that program could be used until the end of the year 2000 to address Y2K problems through assessment, planning, remediation and testing computers and equipment, or to provide relief for substantial economic injury a small business suffers as a direct result of Y2K problems, such as a brown-out or a temporarily incapacitated supplier. The terms of 7(a) loans are familiar to lenders and small-business owners alike and, therefore, the loans are easy to apply for and process. They are structured to be approved or denied, in most cases, in less than 48 hours. We expect the average Y2K 7(a) loan to be less than $100,000. To give lenders an incentive to make 7(a) loans to small businesses for Y2K problems and related economic injury, this Act raises the government guaranties of the existing 7(a) program by ten percent. Under special circumstances, it also raises the dollar cap of loan guaranties from $750,000 to $1 million for these Y2K small business loans. For Y2K 7(a) loans of more than $100,000, the government will guarantee 85 percent, and for such loans of $100,000 or less, the government will guarantee 90 percent. For those lenders with special authority to approve their loans, this Act allows them to use the SBA Express Pilot Program--a pilot that makes it easy for lenders to process loans worth up to $150,000 using their own paperwork and making same-day approval--for Y2K loans. SBA Express loans are guaranteed at 50 percent. This legislation encourages lenders to work with small businesses addressing Y2K-related problems by arranging for affordable financing. When quality of credit comes into question, lenders are directed to resolve reasonable doubts about the applicant's ability to repay the debt in favor of the borrower. And when appropriate, to establish a moratorium for up to one year on principal payments on Y2K 7(a) loans, beginning when the loans are originated. To protect against fraud, abuse or double compensation, this Act prohibits a business from qualifying for a Y2K 7(a) loan if it has already received insurance proceeds for Y2K problems or economic injury related to Y2K problems. As important as this Y2K loan program is, it must be available in addition to, and not in lieu of, the existing 7(a) program. The 7(a) program is a vital capital source for small businesses, providing more than 42,000 loans in 1998, totaling $9 billion. Nine hundred sixty-six of those loans went to small businesses in Massachusetts. With defaults down, recoveries up and the government's true cost, called the subsidy rate, at 1.39 percent, we should not create burdens that would slow or reverse this trend. To protect the existing 7(a) program, we need to make sure that it is adequately funded for fiscal years 1999 and 2000. Because the Y2K loan program would be part of the existing 7(a) business loan program, funds that have already been appropriated for the 7(a) program may be used for the Y2K loan program. As of two weeks past the end of the first quarter of fiscal year 1999, SBA's records show that the program has already used $2.5 billion (roughly 23 percent) of the total $10 billion appropriated. Typically the demand for these loans increases by as much as ten percent in the spring and summer. If this holds true for this fiscal year, it is an indication that the program will need nearly all of its funds to meet the regular loan demand. Under these circumstances, we must be diligent about monitoring the 7(a) loan program to make sure the Y2K loans don't drain the program and cause it to run out of money. If we do find that the appropriated amount is inadequate to support the general 7(a) loan program and the new Y2K loan program, we will need to get more funding. Though it's never easy to get more money, Chairman Bond, who also serves on the Committee on Appropriations and is chairman of one of the Appropriation subcommittees, has agreed to attempt to secure additional funds targeted specifically for the Y2K loan program. I thank Chairman Bond for his commitment, and offer my help if the need arises. I am hopeful that this legislation can be passed in the Small Business Committee and the full Senate as quickly as possible to begin assisting small businesses in need of this important initiative. This is a good program, which with adequate funding, will help many small businesses get a strong start in 2000 and the new millennium. Mr. DODD, Mr. President, I rise today to join my colleagues in supporting this very important legislation. Together with Senators Bond, Kerry, and Bennett, I recognize the necessity of strengthening the ability of America's small businesses to negotiate the complex challenges related to the Year 2000 computer problem. This legislation is designed to assist the 14.5 million small businesses that may have Y2K concerns. According to various studies, almost half of all of the small businesses in America are not ready to respond to the possible effects of the Y2K computer problem. I would like to take a moment and thank Chairman Bond and Ranking Member John Kerry of the Small Business Committee for their leadership and cooperation with the Special Committee on the Year 2000, on which I serve as Vice-Chair. The object of this cooperation between our two Committees is to strengthen the economic backbone of America, small businesses, as they face a potentially devastating threat to their very existence. This is not to alarm anyone, but merely to warn of a possible danger. As I have said on numerous occasions, I believe very strongly that we must prepare and plan for any Y2K contingency. We must be vigilant and provide assistance for small businesses. Unfortunately, many small businesses do not consider themselves in danger from the effects of the Y2K problem and so have taken little, if any, steps to address problems that may arise. This extends to reviewing whether all of their suppliers, customers and financial institutions are free from the Y2K glitch. Even if our small enterprises were aware of all problems that face them, not all of them have access to the necessary funds to take corrective measures. This legislation helps our nation's small enterprises in two ways. First, if a company wants to remediate or fix its own equipment that is not Y2K compliant, this bill provides easier access to loans. Hopefully, this will encourage the small business owners to learn of their companies deficiencies, and then correct them in a timely manner so that company does not stop working. Second, if a company faces economic disruption due to outside Y2K related problems, then that company may apply for funds to assist it. This is the area to which I am especially sensitive. We do not know exactly what will work and what will need immediate attention so that our lives, our jobs, our economic well being, can continue. To address that lack of knowledge, this bill will allow small business owners access to financial support guaranteed by the Small Business Administration until December 31, 2000. This is very important. Our concern is not just January 1, 2000, but the continual smooth operation of our nation and our nation's small businesses throughout this momentous year. Less than one-third of small businesses have checked the Y2K preparedness of the companies that they depend upon to continue to function everyday. Though only half of the small businesses in America classify themselves as dependent upon computers, many of the small businesses in America are dependent on other businesses, which are dependent upon computers. Like a cog in the wheel of our nation's economy, if one small business suddenly ceases to function, its effects may be felt across the country. That is why I am glad to support this legislation to assist the United States small business community. An ounce of prevention is worth a pound of cure. We must help our nation's small businesses regardless of when they become aware of the problems facing them. This legislation is designed to do exactly that.

Mr. KERRY

Mr. KERRY. I would simply ask whether or not that answer was in fact fully responsive to the question. I believe the question also asked whether or not there were any omissions.

Mr. KERRY

Mr. KERRY. There were legitimate reasons to vote against the omnibus appropriations bill. This process was an insult to the Congress. The Republic leadership has put the Congress in an untenable position by refusing to pass many appropriations bills in regular order. I chose to vote for this legislation because of the important things it does for Massachusetts and the nation, and because I do not believe it is useful to cast a protest vote. I am hopeful that in the 106th Congress we can engage in a true legislative process. Today, the Senate will give final approval to legislation to preserve a balanced budget for the first time in more than a generation. A balanced federal budget has been a key objective for me since I came to the Senate in 1985. The Federal government had run a deficit continuously for more than 30 years until last year. It soared to dangerous levels in the 1980s during the Reagan and Bush Administrations. As a result of these deficits, our national debt multiplied several times, exacting a heavy toll on our economy, increasing interest rates, squeezing federal spending and making debt service one of the largest expenditures in the Federal budget. In 1993, following President Clinton's election, we began the long journey back from crushing deficits and toward fiscal responsibility by passing an enormously successful economic plan. The full power of our economy was unleashed: unemployment is at record low; interest rats are subdued; and economic growth continues to be strong. This path culminated in last years; agreement to balance the budget and provide substantial broad-based tax relief for working American families and small businesses. This year's federal budget is a continuation along the path of fiscal responsibility. At the same time, it begins to address some of our most pressing problems in education. I am pleased that the omnibus appropriations bill rejects the House Republican approach and expands spending on education. The bill includes funding to begin hiring one hundred thousand new teachers which will assist local school communities to reduce class size in the early grades to 18 students. One hundred thousand new teachers will allow more individual attention for students which will lead to better reading and math scores in the future. The final bill also includes $75 million to recruit and prepare thousands of teachers to teach in high-poverty areas. It also includes $75 million to train new teachers in how to use technology so that they can better assist their students. This funding is focused on assisting the schools and teachers who need the most help. We must do everything possible to increase the reading skills of our children so that they can compete in the global economy in the 21st century. This budget includes 260 million for the Child Literacy Initiative which will improve teachers' ability to teach reading, family literacy, and conduct tutor training to help children learn to read by the end of the third grade. Five million children are locked into a school day that ends in the early afternoon and dumps them into empty apartments, homes or violent streets despite the fact that we know those post-school hours are when teen pregnancies occur, drug use begins, and juvenile crime flourishes. The budget agreement includes $200 million for after-school programs that will help keep 250,000 children of the streets and into learning. We also must develop an educational system which prepares our children and young people for adulthood. Today, we are failing too many of our children with crumbling schools, overcrowded classrooms, and inadequately prepared teachers. The federal government provides a small amount of the total funding for public elementary and secondary education--less than seven percent of total public spending on K-12 education comes from the federal government, down from just under 10 percent in 1980. Reading scores show that of 2.6 million graduating high school students, one-third are below basic reading level, one- third are at basic, only one-third are proficient, and only 100,000 are at a world class reading level. Mr. President, I am developing legislation for next year to help every school make a new start on their own. It will be built on challenge grants for schools to pursue comprehensive reform and adopt the proven best practices of any other school, funds to help every school become a charter school within the public school system, incentives to make choice and competition a hallmark of our school systems, and the resources to help schools fix their crumbling infrastructure, get serious about crime, restore a sense of community to our schools, and send children to school ready to learn. However, increased spending on education is meaningless if there are no adequate school facilities to teach our children. I am disappointed that the Democrats' proposed tax credit to build and renovate our nation's schools was not included in the final budget agreement. Too many schools now operate in substandard facilities which in some cases are dangerous to our children. Any initiatives to support education must also include an investment to modernize our school buildings. America's children especially need support during the formative, preschool years in order to thrive and grow to become contributing adults. Additionally, adequate child care is not affordable or even available for too many families. That is why I believe we must provide more help to working families to pay for critically needed, quality child care, an early learning fund to assist local communities in developing better child care programs, and sufficient funding to double the number of infants and toddlers in Early Head Start. President Clinton shares this view and included in his 1999 budget proposal my recommendations on this issue. I am pleased that the final budget will also include $182 million to increase the quality and affordability of child care to assist our working families. Transportation funding is also crucial to maintain our aging national highway infrastructure. I am very pleased that the Omnibus Appropriations bill contains an additional $100 million in highway funds for Massachusetts as well as approximately $80 million for important transportation projects around the state. The Commonwealth has reached a critical juncture in its efforts to both complete in Central Artery and Tunnel project and also to maintain and upgrade roads and bridges throughout the state. As many of my colleagues are aware, the ISTEA reauthorization bill contained an unacceptably low level of highway funding for Massachusetts. In order to secure commitment not to delay Senate consideration of the ISTEA bill, Majority Leader Lott, Democratic Leader Daschle, Senators Chafee, and Baucus committed to me, among other things, that Massachusetts would receive an additional $100 million in highway funds. The inclusion of this money in the omnibus bill represents the fulfillment of this promise. I wish to express my sincere appreciation to them for following through on their commitment. I also wish to thank Senators Byrd and Lautenberg for their help in securing this funding. As noted above, the omnibus bill also contains $80 million for critical transportation projects around the state. It will provide millions of dollars to assist in completing the revitalization of historic Union Station in Worcester and Union Station in Springfield. It will also provide millions to support the construction of intermodal centers in Pittsfield and Westfield. Finally, the bill contains funds to support work on the North-South Rail Link in downtown Boston. It is my hope that his project will continue to receive the funding that it is so sorely deserves. Since 1995, when the conservative Republicans took control of this body and forced upon the Congress the ``Contract-with-America,'' we continually have had to fight to retain existing environmental protections. This year, we were successful in deleting a number of provisions from the final budget that would have set back efforts to protect our Nation's natural resources--our forests, parklands, fisheries and wildlife. The final budget supports our environment and improves the lives of the families around America by increasing funding for the clean water state revolving fund, the safe drinking water state revolving fund, protection of endangered species, preservation of precious lands, and the development of cleaner energy technologies. I also am very pleased that the final budget includes an additional $50 million for the cleanup of Boston Harbor to assist the 2.5 million ratepayers in 61 Boston area communities who will pay for the bonds which have primarily financed this project--$3.8 billion for the Boston Harbor sewage treatment project, and $2.8 billion required for combined sewer overflows (CSOs) and other water and wastewater infrastructure upgrades for the next 30 years. I am pleased that Congress agreed to provide the full $17.9 billion the administration requested to replenish IMF capital funds. The IMF desperately needs this funding because financial crises in South Korea, Japan, and Indonesia greatly have depleted its resources. Without full funding, the IMF would be inhibited from continuing its support of economic recovery in these countries and others. As the strongest political and economic power, the U.S. has a responsibility to step up to the plate and exercise its leadership in dealing with this problem. I agree that the IMF needs to make some reforms to achieve greater accountability and management of its programs. I believe that implementing the IMF reforms, as required under this bill, will be a strong step in the effort to achieve greater accountability and management of IMF programs. We must be assured that IMF rescue packages effectively will harness economic stability while relieving social and political tensions. The IMF must be a viable and demonstrable institution that can bring about real change for nations suffering under the strains of economic instability. As ranking member of the Committee on Small Business, I must give the omnibus appropriations bill mixed marks with respect to showing Congress's support for SBA's small business assistance programs. I am pleased that the Omnibus Appropriations Act adequately funds SBA's disaster loan program and fully funds the agency's salaries and expenses. To do otherwise would have been irresponsible and detrimental to the nation's small businesses and victims of natural disasters. The bill takes positive steps with respect to women-owned and veteran-owned businesses. The funding for SBA's Women's Business Centers is doubled to $8 million, consistent with reauthorizing legislation enacted last year, and veteran outreach receives $750,000, the first funding for veteran-owned businesses since fiscal year 1995. The bill contains a modest increase for the Small Business Development Centers, which provide valuable business counseling and training to small businesses throughout the country. The SBA's venture capital program received significant increases in funding, and the cornerstone 7(a) loan guarantee program received substantial funding, although less than the administration requested for fiscal year 1999. Unfortunately, although the omnibus appropriations bill contains some increased funding for SBA's successful Microloan program, I am disappointed that it fails to adopt the significant increases to the Microloan program, which the authorizing committees envisioned last year when Congress passed SBA's three-year reauthorization bill. That bill, which was reported out of the Committee on Small Business unanimously, made the Microloan program a permanent part of SBA's financial assistance portfolio and substantially increased authorization levels for both loans and technical assistance. Based on those legislative changes, the Administration requested that direct microloan be funded at the fully authorized level. During the appropriations process, Senator Grassley and nine of our colleagues joined me in sending two letters to the Subcommittee leadership voicing our support for full funding of the Microloan program, including a specific request for increased and adequate technical assistance funding. In those letters we described the relationship between loans in the Microloan program and technical assistance. Simply put, adequate technical assistance funding is prerequisite to successful microlending. The microloan and technical assistance funding contained in this bill will allow only minimal, if any, growth in this program, which helps the nation's neediest borrowers. I am also disappointed that the Economic Research arm of SBA's Office of Advocacy did not receive the $1.4 million, requested by the administration and passed by the Senate. The research performed by that office is highly respected and very valuable to work of the Committees on Small Business in both bodies and to other small business policy makers. I support the omnibus appropriations bill because I believe it is an acceptable compromise which keeps the federal government on the path of fiscal responsibility while beginning to fund critically needed and long overdue initiatives to assist America's children. I look forward to building on this budget to address the unfinished business of the American people in the 106th Congress. Extension of the Generalized System of Preferences

Mr. KERRY. Mr. President, I would ask my distinguished colleague and Chairman of the Committee on Finance for his attention with regard to a matter of some concern to the Savings Bank Life Insurance (SBLI) organizations in Massachusetts, New York, and Connecticut, as well as their operations in New Hampshire and Rhode Island. As the Chairman knows, we had hoped this year, after a long consideration of the matter, to act on a proposal that would clarify the tax consequences of a state-mandated consolidation of an SBLI organization in which required payments to policyholders are made over a period of years. Under the current Internal Revenue Service (IRS) interpretation, such payments would be non-deductible redemptions of equity. After considerable effort, we believe we have succeeded in demonstrating that such an interpretation is incorrect. Of necessity, however, it appears that a statutory clarification will be required, and, unfortunately, it does not appear possible this year to consider this kind of matter in a tax measure. SBLI entities and policyholders retain unique, long-recognized characteristics regarding voting rights and rights to surplus which set them apart from other insurance companies and policyholders and which form the basis for the needed clarification. The provision we had hoped would be considered this year would clarify that the Internal Revenue Code should treat additional policyholder dividends as deductible when mandated by state law. While only the Massachusetts SBLI is immediately affected, the sister entities in New York and Connecticut could be adversely affected if the appropriate clarification is not made. Unfortunately, if we are unable to accomplish our objective soon, SBLI and its policyholders throughout New York and the New England region will be subjected to a tax inequity which will be unnecessarily passed on to the consumer. It is important to note that the Treasury Department again this year reiterated that it does not oppose this clarification. I would observe that several of my colleagues including Senators Kennedy, Moynihan, D'Amato, Dodd, Lieberman, Gregg, Smith, Chafee, and Reed have indicated their support in correspondence with our distinguished Finance Committee Chairman. I respectfully ask the Finance Committee to consider this important measure in the context of comprehensive tax legislation next year.

Mr. KERRY

Mr. KERRY. Mr. President, Americans from every region in the country, from all walks of life--Americans straight and gay --have spent the past week expressing our sense of shock and outrage for what happened on a dark road in Wyoming. We have also expressed our passionate conviction and knowledge that there is no room in our country for the kind of vicious, terrible, pathetic, ignorant hate that took the life of Matthew Shepard. We are a better country than that and, Mr. President, I know that Wyoming is filled with good people who share our shock tonight. But the question, here in this city of monuments, is what will we do about it as a country? Is there a lesson that can become a monument to Matthew Shepard and so many others who suffer because of other people's limitations? The reason we are here is to guarantee that lesson and to make certain that there will be no period of indifference, as there was initially when the country ignored the burning of black churches or overlooked the spray-painted swastikas in synagogues; or suggested that the undiluted hatred which killed this young man is someone else's problem, some other community's responsibility. We must all accept national responsibility for the killing in Wyoming, and commit--each of us in our words, in our hearts, and in our actions--to insure that the lesson of Matthew Shepard is not forgotten. To my friends in the Congress, I say let us pass the Hate Crimes Prevention Act. And, let the so-called leaders in this country stop their immature and nonsensical rhetoric which encourages, or justifies, these barbaric acts. Look to the 58 high schools in my own beautiful state of Massachusetts where 22 percent of gay students say they skip school because they feel unsafe there and fully 31 percent of gay students had been threatened or actually physically attacked for being gay. Matthew Shepard is not the exception to the rule, Mr. President; his tragic death rather is the extreme example of what happens on a daily basis in our schools, on our streets and in our communities. And that's why we have an obligation to pass laws that make clear our determination to root out this hatred. We hear a lot from Congress today how we are a country of laws, not men. Let them make good on those words and pass hate crime legislation. To all Americans, I encourage you tonight to stare down those who want you to live in fear and declare boldly that you will not live in a country where private prejudice undermines public law. Each of us has the power to make this happen, and in a small way change misperception and reverse prejudice. Our belief in the strength of human justice can overcome the hatred in our society--by confronting it. So we must confront it as Martin Luther King did when he preached in Birmingham and Memphis and all over this country, when he thundered his protest and assuaged those who feared his dreams. He taught us how to look hatred in the face and overcome it. We should face it as Nelson Mandela did the day he left prison in South Africa, knowing that if his heart was filled only with hatred, he could never be free. Nelson Mandela destroyed systemic hatred, faced the fear--and today sets an example to the world about moving away from ignorance. We need to challenge it as Harvey Milk did in San Francisco, when he brushed aside hatred, suspicion, fear and death threats to serve his city. Even as he foretold his own assassination, Harvey prayed that ``if a bullet should enter my brain, let that bullet destroy every closet door.'' He knew that true citizenship belongs only to an enlightened people, undeterred by passion or prejudice--and it exists in a country which recognizes no one particular aspect of humanity before another. Today, the challenge is to face our fears and root out hatred wherever we find it--whether on Laramie Road in Wyoming, or on the back roads of Jasper, Texas, or in the Shenandoah National Park. The Declaration of Independence framed it all for us and everything we try to be is based on the promise of certain inalienable rights; life, liberty and the pursuit of happiness. Mr. President, those two young high school dropouts threaten each and every one of us when they stole Matthew's rights and life itself. That kind of hate is the real enemy of our civilization--and we come here to call on all people of good conscience to pass the laws that help us protect every citizen and we ask all Americans to make the personal commitment to live their lives each day in a way that brings us together.

Mr. KERRY

Mr. KERRY. As many of my colleagues are aware, on October 7, a coalition of prominent consumer groups released a study entitled ``The Consumer Case Against Microsoft.'' The report reviews quantitative evidence, journalistic accounts of the software industry and evidence presented by the Department of Justice and the states Attorneys General in its discussion of four major areas of alleged attempts at monopolization--operating systems, desktop applications, web browsers and electronic commerce. The report concludes that Microsoft has a monopoly in several important segments of the consumer software market and is likely to continue to use its market power to gain monopoly market share in other existing and developing markets. In addition, the report argues that Microsoft's business practices and monopoly status combine to deprive consumers of cost savings, quality and choice. These are important issues, and I hope the next Congress will further explore this matter. Later this month, after we adjourn, the antitrust case against Microsoft will go to trial, and it may conclude before the next Congress convenes. During the course of this trial, the public will learn much about business practices in the software industry, and issues surrounding competition in the software industry will likely gain a higher degree of visibility. I commend all of my colleagues to monitor this trial and the questions that it may raise. I also ask my colleagues to review the consumers groups' report along with any rebuttal which Microsoft may put forth. The issues raised in the report and during the trial may force Congress to examine whether existing antitrust law sufficiently addresses market abuses in the new digital age. They may also force Congress to consider new and important consumer protection and market dominance issues absent traditional antitrust examination. In the final analysis, we must strive to ensure that all consumers, large and small, are able to benefit from a vibrant and competitive electronic marketplace marked by innovation, competitive pricing and consumer choice.

Mr. KERRY

Mr. KERRY. Mr. President, I am pleased to support the bill before us today which would authorize the programs and activities of the U.S. Coast Guard for fiscal years 1998, 1999 and 2000. Mr. President, Massachusetts with its hundreds of miles of coastline, unforgiving storms, active maritime and fishing industries, and thriving recreational boating population, needs the Coast Guard at full strength. So does the rest of the nation. That is why I am pleased to support the bill before us today. I would like to describe some of the ways in which this bill addresses the challenges facing the Coast Guard. Our nation's maritime navigational infrastructure is of critical importance to a healthy economy. Over 95 percent of our nation's imports and exports are transported through our coastal waters by commercial shipping. This bill authorizes funds for the acquisition, construction, rebuilding, and improvement of aids to navigation, shore and offshore facilities, vessels, and aircraft. In addition, I am extremely pleased that the bill authorizes necessary funding which will extend the useful life of the LORAN-C System. While the Differential Global Positioning System (DGPS) has revolutionized precise navigation by ships and aircraft, we must recognize that there are still millions who rely on LORAN-C. One of the most important functions of the Coast Guard is to promote marine safety and environmental protection. This bill calls on the Secretary to establish procedures to ensure that after a serious marine incident occurs, alcohol testing of crew members or other persons responsible for the operation or other safety-sensitive functions of the vessel or vessels involved in such an incident is conducted no later than 2 hours after the incident occurs. I am pleased to see included here a provision designed to protect right whales. I worked closely with the Coast Guard and others to ensure that this bill included language that calls on the Secretary to implement and enforce two mandatory ship reporting systems, consistent with international law. One of these areas is located offshore of the Cape Cod Bay and Great South Channel. Upon entry into one of these areas, ships will be made aware of right whale sightings in order to lower the possibility of collision with these marine mammals. I am very pleased that this bill includes three land conveyances which transfer properties from the Coast Guard to Massachusetts communities: conveyance of communication station Boston Marshfield receiver site; conveyance of Nahant Parcel, Essex County; and conveyance of the Coast Guard Loran Station Nantucket. Mr. President, I am especially supportive of this bill's inclusion of language which will relieve the hiring freeze on the Commissioned Corps of the National Oceanic and Atmospheric Administration (NOAA), first imposed following the 1995 National Performance Review. This provision, which I am pleased to have sponsored, will guarantee consistent stewardship of the NOAA Corps and the very important role the Corps plays in NOAA and to our Nation. This legislation will restore stability and renew the good faith contract made with the men and women of the NOAA Corps by establishing a minimum and maximum authorized strength for our nation's seventh uniformed service. The NOAA Corps is an indispensable part of NOAA: a pool of professionals trained in engineering, earth sciences, oceanography, meteorology, fisheries science, and other related disciplines. Corps officers serve in assignments within the five major line offices of NOAA. They operate ships, fly aircraft into hurricanes, lead mobile field parties, manage research projects, conduct diving operations, and serve in staff positions throughout NOAA. They operate the ships that set buoys used to gather oceanographic and meteorological data on unusual weather phenomena such as El Nino. They fly research aircraft into hurricanes that record valuable atmospheric observations. They conduct hydrographic surveys along our nation's coast in order to make our waters safe for maritime commerce. This legislation will establish staffing levels for the NOAA Corps that will provide some assurance of long term viability. It is time that we reaffirm our commitment to studying the earth's oceans and atmosphere by insuring that the NOAA Corps is staffed at the appropriate level. Finally, Mr. President, let me again turn to the Coast Guard provisions in this bill. The Coast Guard is essential to the safety and well-being of citizens in every coastal state and in every state with navigable waters. Today, over 50 percent of the U.S. population lives within coastal areas and directly benefits from the services the Coast Guard provides. But, indirectly, the Coast Guard, in the performance of its mission, is there to protect every American and every visitor to our coastal waters. In fact, more than two-thirds of the total budget for the Coast Guard goes to operating expenses to protect public safety and the marine environment; to enforce fishery and other laws and treaties; maintain aids to navigation; prevent illegal drug trafficking and illegal immigration; and preserve defense readiness. S. 1259 will make management improvements and enhance law enforcement authority for the Coast Guard, enhancing its ability to accomplish these missions. I urge my colleagues to support this bill.

Mr. KERRY

Mr. KERRY. Mr. President, I want to take this opportunity to extend my congratulations to President Lee Teng-hui., Vice President Lien Chan and the people of the Republic of China today, on their National Day. Taiwan has continued to prosper economically even in the face of the Asian financial crisis. As the world's fourteenth largest economic entity, Taiwan plays a significant role in global trade and Asian economies. With its per capita income of $13,000 US dollars, Taiwan provides an important market for American consumer goods. In addition to its economic successes, Taiwan has embarked upon a democratic course resulting in a pluralistic society which enjoys basic democratic rights and freedoms including freedom of the press and direct elections for the president and other officials. The people of Taiwan and its leadership should be very proud of the successes that they have achieved. I congratulate them on this special day.

Mr. KERRY

Mr. KERRY. Mr. President, I ask unanimous consent that I be permitted to proceed in morning business for such time as I may consume.

Mr. KERRY

Mr. KERRY. Mr. President, we appear to be, obviously, stuck on the issue of education in the Senate as in the country. We have been talking about the crisis for a long time now. The fact is that there isn't a community in the country that isn't struggling with its public school system. Vouchers gain in popularity notwithstanding the fact that they are only going to solve the problem for a few of our kids. And the truth is that too many of our schools have a diminished tax base and an inability through the property tax to be able to do what they need to do. We also know that too many of our students are graduating from high school and given a degree by a principal even though principals in this country know that too many of those kids can't even read or write properly. Of 2.6 million kids who graduated from high school a year and a half ago, fewer than a third graduated with a proficient reading level. One-third were below basic reading, one third were at basic reading level, and only 100,000 of them had a world-class reading level. Thirty percent of our kids need remedial reading, writing, and arithmetic in the first days when they go to college. The truth is, we also have a crisis of teachers and their availability in our school system. We need some 2 million new teachers in the course of the next 10 years. We will need to hire 60 percent of them in the course of the next 5 years. This year alone, 61,000 new teachers went into our school systems. But the fact is, we are not able to draw from the best universities, the best colleges, and the best students because we barely pay enough for subsistence as starting salary and because too many kids come out of college today with loan payments due and with other opportunities that draw them away from the prospect of teaching. We really do have a major set of choices in front of us about our education system. There is a great struggle here in Washington. A lot of people argue the Federal Government has no role whatsoever, there is nothing the Federal Government can do with respect to this. After all, only 7 percent of the budget comes from the Federal Government, and as we all know, it is a cherished notion in America that schools are run locally. And that is the way we want it. I agree with that. There is nothing in what I propose that would suggest the Federal Government ought to increase its relationship. In fact, it can decrease it. But we have to acknowledge the reality that there are too many communities that simply cannot do it on their own. There is a whole new set of relationships that need to be created in our education system between teachers and the principals, the school boards and the layers of bureaucracy that have been created for all of these years. So I suggest we ought to undo the bureaucracy, think differently, think out of the box and not be locked into a traditional debate between Democrats and Republicans, conservatives and liberals. We ought to look at a way that we can take the best practices, what works best in a parochial school, in a private school--or in a wonderful public school. The truth is, there are some incredible public schools in this country where teaching is going on and kids are going on to the best colleges in the country. When you go to those schools, you will invariably find a principal, above all, who is energized, respected, creative, visionary; who has the respect of the community, who is able to move the school into new curricula, into a new relationship with the school board, into a new relationship with the students and with the teachers and they have worked out their own hybrid relationships with the teachers' unions and with the layers of bureaucracy. They have liberated themselves in many ways from what stifles creativity in too many of our schools. In essence, they have become a charter school within the public school system. I believe what we ought to strive to do is to allow every school within the public school system to effectively become a charter school within the public school system, allow those schools to be able to have principals who run the school on a local basis, hiring teachers from any walk of life, being responsible for the quality of that teaching. It does not make sense in America that someone who can teach at a college might not be allowed to teach in a high school or in a secondary or elementary school simply because they have not gone through the structure of the education system that is now licensed to provide teachers in most of our communities. How is it that you can have a professor in a college who would not be able, on a long-term basis--yes, maybe on a provisional basis--but on a long-term basis to teach in the public school system? We need to provide choice and competition within the public school system. We need to have accountability in those systems in ways that parents and children and the community as a whole will be more involved in the life and breadth of that school. I am going to be introducing legislation together with some Republican colleagues later in the year. I will be putting it in now as an outline, for purposes of the Record. I look forward, I hope in the next Congress, to our opportunity to engage in a stronger and more lively debate about real solutions to the crisis of education in America. I yield the floor and ask unanimous consent the outline be printed in the Record.