John Kerry

Mr. KERRY

Mr. KERRY. Mr. President, today I am introducing legislation along with Senators Frist, Biden, Helms, Daschle and others that offers our Nation's most comprehensive response to date to the global HIV/AIDS crisis. It authorizes $4.7 billion over the next two years for U.S. contributions to the Global Fund to Fight AIDS, Tuberculosis and Malaria and for a dramatic expansion of bilateral U.S. programs administered by the US Agency for International Development, USAID. There can be no question that the AIDS pandemic has truly reached a crisis point, not only for the 40 million people infected worldwide, but also for the communities in which they live. The pandemic strikes at the foundations of societies, devastating families, undermining economies, and weakening a broad range of institutions by taking the lives of educators, health care providers, police, military personnel, and civil servants. These forces cripple the potential for long-term economic development and jeopardize political and social stability in Sub-Saharan Africa, the most-severely affected region, and increasingly in all corners of the world. Although 95 percent of people infected with HIV live in developing countries, this crisis ultimately affects us all. Here in the United States, we cannot afford to ignore the fact that instability anywhere threatens security everywhere. While this is certainly not a new reality, it became painfully evident on September 11 of last year that the fate of our people is inextricably bound to the lives of those living thousands of miles across the globe. We are called by moral duty and by our national interest to forcefully combat the further spread of HIV/AIDS. Only the United States has the capacity to lead and enhance the effectiveness of the international community's response. Clearly we have not done enough to address this crisis. The need for strong action has never been so urgent or so great. AIDS has become the fourth-highest cause of death globally, already claiming the lives of 22 million people. More than three-quarters of these deaths, more than 17 million, have been in Sub-Saharan Africa, where AIDS is now the leading cause of death. Last year alone, AIDS killed 2.3 million African people, and experts project that the disease will eventually take the lives of one in four adults throughout that region. Because of AIDS, Botswana, Zimbabwe, and South Africa are already experiencing negative population growth, and life expectancy for children born in some parts of the continent has dropped as low as 35 years. Of the estimated 40 million people now living with HIV globally, 28.1 million are in Sub-Saharan Africa. This number includes 3.4 million people who were infected last year alone. Other parts of the world are going down the same path as Africa. The Caribbean is now the second most affected region, with 2.3 percent of adults infected with HIV. Eastern Europe, especially the Russian Federation, is experiencing the world's fastest-growing epidemic, mainly from injection drug use. In Asia and the Pacific region, 7.1 million people are infected with HIV or living with AIDS. Although national prevalence rates in most countries throughout that region are relatively low, localized epidemics have broken out in many areas, and there is a serious threat of major outbreaks of the virus in China, India, and a number of other countries. More than 20 years after the first cases were reported, basic knowledge about HIV/AIDS remains disturbingly low. Half of all teenage girls in Sub-Saharan Africa still do not know that healthy-looking people can have HIV. In Mozambique, 74 percent of young women and 62 percent of young men aged 15 to 19 cannot name a single method of protecting themselves against HIV/AIDS. Worldwide, nine out of ten HIV infected individuals are unaware they are infected. The AIDS crisis is affecting females at an increasing rate. In 1997, 41 percent of adults living with HIV/AIDS were women. By 2000, that proportion had increased to 47 percent. Biologically, the risk of becoming infected with HIV during unprotected intercourse is greater for women than for men, and gender inequalities in social and economic status and access to medical care increase women's vulnerability. This gender imbalance is even stronger for younger females, in some countries, the rate of new infections among girls is as much as 5 to 6 times higher than among boys. Although girls are hardest-hit, the HIV/AIDS crisis takes a disproportionate toll on young people in general. Nearly one-third of the 40 million people currently living with HIV are between the ages of 15 and 24, and half of all new infections occur in this age group. Mother-to-child transmission is responsible for the vast majority of infections among children under the age of 15. Without preventive measures, 35 percent of infants born to HIV-positive mothers contract the virus. Even those who are not infected in this manner can confront tremendous difficulties, more than 13 million children under age 15 have already lost their mothers or both parents to AIDS, and this number is expected to more than double by the end of the decade. Children orphaned by AIDS are susceptible to extreme poverty, malnutrition, psychological distress, and a long list of other hardships. Many of these orphans turn to crime in order to survive. HIV/AIDS can undermine the economic security of individual families, communities, and even entire nations. The disease weakens the productivity and longevity of the labor force across a broad array of economic sectors, reducing the potential for immediate and long-term economic growth. In some countries, AIDS is reversing progress brought by decades of economic development efforts. But the ripple effects of this pandemic go far beyond the economic realm, touching virtually all aspects of life in the countries that are hardest-hit. HIV/AIDS strikes at the most mobile and educated members of society, many of whom are responsible for governance, health care, education, and security. Earlier this month, the World Bank reported that AIDS is spreading so rapidly in parts of Africa that it is killing teachers faster than countries can train them. At the same time, HIV-infected children and those orphaned by AIDS must often leave school. These trends have combined to create an education crisis. Africa is also confronting a mounting security crisis with ramifications for the broader international community. According to UNAIDS, many military forces in Sub-Saharan Africa face infection rates as high as five times that of the civilian population. These military forces are losing their capacity to preserve stability within their own borders and to engage in regional peacekeeping and conflict prevention efforts. This pattern is likely to compound the problem of failing states throughout Africa. My words have barely begun to chronicle the extent to which this pandemic has spread, the devastation it has wrought, and the myriad threats it poses to distant countries and to our own. We are facing the world's worst health crisis since the bubonic plague and it is not ``someone else's problem.'' It is humanity's problem. It is up to us to respond. American leadership is needed as never before. The United States can not afford to sit on the sidelines or tinker at the edges of a global pandemic. Only the United States is in a position to lead the effort with other governments and private sector partners to beat this pandemic and only the United States has the resources to make a difference. History is going to judge how we react to this crisis and we want history to judge us well. There is so much we can do--if we commit ourselves to the effort. We have learned that we can change behavior through prevention and education programs, especially if those programs make treatment available for those already sick. We can stop the transmission of the HIV virus from mother-to-child through the use of the drug nevirapine. And we can reduce the growing number of ``AIDS orphans'' if we start adding voluntary counseling, testing and treatment of parents and care- givers to children--in other words adding a Plus to the MTCT, mother- to-child transmission, programs. That is the goal of this legislation. It will provide clear American leadership, helping to harness resources here at home and around the globe for research and development to eradicate these deadly diseases. It will inject unprecedented amounts of capital in effective prevention and treatment programs and direct resources to the people on the ground fighting these diseases. The legislation that we are introducing today represents the first effort ever to create a comprehensive long term strategy for American leadership in responding to this global pandemic. If passed into law, this bill would represent the largest single monetary commitment ever made by the United States to deal with AIDS pandemic. It would double U.S. spending on global AIDS from roughly $1 billion this year to more than $2 billion per year over the next two years. But equally important, it would require the U.S. government to develop a comprehensive, detailed five-year plan to significantly reduce the spread of HIV/AIDS around the world and meet the targets set by the international community at the June 2001 United Nations Special Session on HIV/AIDS. This legislation authorizes $1 billion in this fiscal year and $1.2 billion in the next for US contributions to the Global Fund to Fight AIDS, Tuberculosis and Malaria--the international community's new combined effort to increase resources against this pandemic. It authorizes more than $800 million this year and $900 million next year for an expansion of existing USAID programs and creation of new programs to increase our efforts not only in the areas of prevention and education but also in the equally important areas of care and prevention. It provides significant new funding levels for programs to combat tuberculosis and malaria--serious infectious diseases which, together with HIV/AIDS, killed 5.7 million people last year. The fight against HIV/AIDS has started to produce results in some countries. Cambodia and Thailand, driven by strong political leadership and public commitment, have developed successful prevention programs. HIV prevalence among pregnant women in Cambodia dropped by almost a third between 1997 and 2000. In Uganda, rates of HIV infection among adults continue to fall, largely because President Yoweri Museveni has pursued an aggressive education campaign to make people in his country aware of ways they can protect themselves from this disease. President Museveni has displayed courage in his willingness to break through cultural boundaries to discuss the AIDS crisis openly and realistically. Leadership within the countries that are most severely-affected by HIV/AIDS is absolutely indispensable. Our legislation seeks to encourage that leadership by offering the possibility of obtaining greater resources to be used for health programs through a new round of international negotiations to further reduce the debt of many of these countries. Ultimately the fight against AIDS requires a broad partnership between the governments of those countries severely affected, governments like ours in a position to provide assistance, and the private sector which can bring not only resources but scientific and medical knowledge and expertise to bear. Various organizations in the private sector have already contributed a great deal to the struggle against HIV/AIDS. Philanthropies like the Bill & Melinda Gates Foundation have donated hundreds of millions of dollars to purchase drugs, improve health delivery systems, and bolster prevention campaigns, among other means of support. Pharmaceutical companies such as Merck and Pfizer have also offered a number of life- extending therapies to the developing world at no cost or at a very discounted rate. These contributions and these public/private sector partnerships are critical to the success or our effort. The bill that we are introducing makes it clear that these kinds of partnerships should be strengthened and expanded. And for the first time, it also sets out a voluntary code of conduct for American businesses who have operations in countries affected by the AIDS pandemic to follow, not unlike the Sullivan Code of Conduct that many American firms followed during the days of apartheid in South Africa. The global HIV/AIDS crisis is a matter of money, for words alone will not beat back the greatest challenge the world has ever witnessed to the very survival a continent, Africa, and an ever growing number of other areas. But it is more than that, this is a question of leadership, not fate; of willpower, not capacity. The question before us is not whether we can win this fight, but whether we will choose to, whether `here on earth,' as President Kennedy said, we are going to make ``God's work truly our own.'' I believe we will. That is why there is such a broad coalition supporting this effort. That is why my friend and colleague Senator Kennedy, chairman of the HELP Committee, is working in concert with us to produce a bill that will authorize another $500 million for the CDC and other HHS agencies to help fight this epidemic. And that is why Democrats and Republicans together are going to demonstrate the full measure of America's ability to respond to enormous tragedy with enormous strength.

Mr. KERRY

Mr. KERRY. Mr. President, as Chairman of the Oceans, Atmosphere and Fisheries Subcommittee, I rise today to submit a resolution regarding the policy of the United States at the upcoming 54th Annual Meeting of the International Whaling Commission, IWC. I wish to thank the Ranking Member of the Subcommittee, Ms. Snowe, for co-sponsoring this resolution. I wish to also thank my colleagues Mr. Hollings, Mr. McCain, Mr. Wyden, Mr. Fitzgerald, Mr. Lieberman, Mr. Akaka, Mr. Reed, Mr. Torricelli, Ms. Collins, Mr. Lugar, Mrs. Boxer and Mr. Kennedy for co-sponsoring as well. The IWC will meet in Japan from May 20 to 24, 2002. Despite an IWC moratorium on commercial whaling since 1985, Japan and Norway have harvested over 1000 minke whales since the moratorium was put in place. Whales are already under enormous pressure world-wide from collisions with ships, entanglement in fishing gear, coastal pollution, noise emanating from surface vessels and other sources. The need to conserve and protect these magnificent mammals is clear. The IWC was formed in 1946 under the International Convention for the Regulation of Whaling, Convention, in recognition of the fact that whales are highly migratory and that they do not belong to any one Nation. In 1982, the IWC agreed on an indefinite moratorium on all commercial whaling beginning in 1985. Unfortunately, Japan has been using a loophole that allows countries to issue themselves special permits for whaling under scientific purposes. The IWC Scientific Committee has not requested any of the information obtained by killing these whales and has stated that Japan's scientific whaling data is not required for management. At this meeting, Japan intends to propose to add an additional 100 whales to the whales it kills for scientific purposes. Japan's claim that it needs these whales for scientific purposes is ever more tenuous: last year, Japan unsuccessfully sought to obtain an exemption allowing 50 whales to be commercially hunted to provide economic assistance to specific vessels. This year, Japan is seeking to use these same vessels to kill the same number of whales, in the name of ``science.'' The additional 50 whales include new species, sei whales. Norway, on the other hand, objects to the moratorium on whaling and openly pursues a commercial fishery for whales. Iceland, currently a nonparty, is proposing to join the Convention, but only if it is granted a reservation that exempts it from the ban on commercial whaling. This resolution calls for the U.S. delegation to the IWC to remain firmly opposed to commercial whaling. In addition, this resolution calls for the U.S. to oppose the lethal taking of whales for scientific purposes unless such lethal taking is specifically authorized by the Scientific Committee of the Commission. The resolution calls for the U.S. to oppose the proposal to allow a non-member country to join the Convention with a reservation that would allow it to commercially whale. The resolution calls for the U.S. delegation to support an end to the illegal trade of whale meat and to support the permanent protection of whale populations through the establishment of whale sanctuaries in which commercial whaling is prohibited.

Mr. KERRY

Mr. KERRY. Madam President, I appreciate enormously the efforts of the chairman and ranking member to move what is always a very difficult issue through the Senate. They have done a good job of trying to resolve a great many issues. I don't oppose this amendment of theirs, but, in fact, I urge my colleagues to vote for the amendment. I emphasize to my colleagues that this amendment does not fix the chapter 11 problem that still exists with respect to the sovereignty of American businesses and the rights of Americans and of our communities to be able to be protected. I am very grateful for the chairman's willingness to try to respond, but substantial disagreements still exist with respect to how we best protect American businesses and our communities, according to our rights. As our colleagues know, it is clear that the NAFTA investor-State dispute resolution process, which is known as chapter 11, is going to be the model on which future agreements are predicated. And chapter 11, in its current form, is a flawed model. It is not a failed model; it is simply flawed. We have the ability to be able to fix it. Last night, Senator Baucus referenced letters written by several organizations that urged correction of the no-lesser-rights language, which is precisely what will happen in this particular amendment. I appreciate his response, but let me point out that in those letters he referenced, there are a whole set of other issues that are unaddressed in this amendment. Specifically, from the National League of Cities, they say: We are concerned that future trade negotiations, particularly for a hemispheric free trade area of the Americas, could include provisions that expand the definition of a regulatory taking. As evidenced by disputes under chapter 11 of NAFTA, vague expropriation language has allowed new avenues of recourse for foreign investors to challenge current State and local ordinances. So we are allowing a foreign investor to come in and actually undo the intent of our local and State communities to enforce certain kinds of health or other kinds of restraints. From the National Association of Towns and Townships: In particular, we are troubled that a claim by a foreign company that a local government's regulation or zoning laws constitutes a taking against the company will make it impossible for the locality to enforce that law or regulation. From the National Conference of State Legislators: The bill does not adequately and explicitly guarantee that trade agreements negotiated under this authority will respect State sovereignty, nor incorporate well defined and constitutional Fifth Amendment takings principles. Regrettably, the Baucus-Grassley amendment does not, despite what they claim in the no-greater-rights-than language, address the shortcomings of the chapter 11 model. Adopting their language without other needed changes is still going to allow future chapter 11-like tribunals to rule against legitimate U.S. public health and safety laws using a standard of expropriation that goes well beyond the clear standard that the Supreme Court has established in all of its expropriation cases. The amendment before us does not give assurances that the due process claims of the Constitution will be respected, nor does it provide safe harbor for legitimate U.S. public health and safety laws. I will propose an amendment, and we will debate this amendment over the course of the next couple of days. I urge my colleagues to adopt a policy that will fully protect the constitutional rights of American businesses and the constitutional right of our States, the expropriation laws and standards of the Supreme Court. I urge them to vote for this amendment recognizing this does not complete the task.

Mr. KERRY

Mr. KERRY. Mr. President, I want to speak just briefly about the chairman's amendment. I understand what the Senator is trying to do with this amendment, and I appreciate his efforts to seek common ground. He has not had an easy job trying to steer this omnibus trade package through very stormy seas. I am grateful for the chairman's willingness to be responsive to some of the concerns that I--and others--have raised. However, on the issue of investor-State dispute settlement, I am afraid that substantial disagreement remains. The Baucus-Grassley amendment makes a minor change to the bill. It is certainly better than the current language, but it just does not do a good enough job of protecting the ability of Federal, State and local governments to enact legitimate public health and safety legislation. As my colleagues know by now, it is clear that NAFTA's investor-State dispute resolution process popularly known as ``Chapter 11''--will be the model upon which future such agreements are predicated. Chapter 11 is a flawed model, not a failed model. I believe that having an investor-State dispute settlement process in a trade agreement is vital to ensuring that U.S. investors are able to invest abroad with confidence--but it needs to be improved. Regrettably, the Baucus-Grassley amendment does not despite what its proponents claim--effectively address the shortcomings in the chapter 11 model. Adopting the Baucus-Grassley language without other needed changes will still allow future chapter 11-like tribunals to rule against legitimate U.S. public health and safety laws using a standard of expropriation that goes well beyond the clear standard that the Supreme Court has established in all its expropriation cases. The amendment before us does not give any assurances that the due process clause of the Constitution will be respected, nor does it provide safe harbor for legitimate U.S. public health and safety laws. Without all of these safeguards, future investor-State dispute settlement bodies can run roughshod over the ability of State and local governments--or even the Federal Government--to make laws to protect the public. I have an amendment that I believe will make those improvements to the underlying bill, and I intend to offer that amendment soon. I will not oppose the pending amendment because it does not make the underlying bill any worse. But let us be clear: the chapter 11 model is flawed. Any suggestions that the Baucus-Grassley amendment takes care of these problems are simply incorrect. So I think we should adopt this amendment by unanimous consent, but I do believe that the Senate should have a thorough debate on this issue.

Mr. KERRY

Mr. KERRY. Mr. President, I rise today to join the people of Massachusetts and Navy veterans across the country in celebrating the 60th anniversary of the Battleship Massachusetts' commission. This historic ship, the heaviest craft ever launched from Quincy's Fore River Shipyard, served with distinction in theaters ranging from North Africa to the Marshall Islands, and I join its crew in celebrating the anniversary of this storied vessel. The Battleship Massachusetts entered combat on November 8, 1942 in Operation Torch on the shores of North Africa and saw its first action on the shores off Casablanca, Morocco. In that first engagement, the 16'' shells from the Massachusetts helped sink two destroyers, two merchant ships, visit heavy damage to buildings along the coast, and render a dry dock inoperable. One year later the ship came back to Boston for refitting before heading off to a new assignment in the Pacific, where she would remain for the duration of the war. During its Pacific service, the Massachusetts engaged the enemy in the New Guinea- Solomons in the southwest, raided Japanese bases in the west, and helped invade the Marshall Islands. As the war built to a bloody crescendo the Massachusetts proved itself repeatedly. Carrying its nickname of ``Big Mamie,'' the Massachusetts took center stage in the preliminary actions against Okinawa and Iwo Jima, shelling each island in preparation for the decisive land combat that began the final chapters of the long struggle. Together with the Third Fleet, the Massachusetts approached Japan in the summer of 1945. Its engagements at Kamaishi and Hamamatsu helped cripple the country's infrastructure and expedite the war's conclusion. After de-activation in 1946, the battleship remained in the Reserve Fleet until being struck from the Navy record in 1962. Despite being ordered to be sold for scrap, her wartime crew lobbied to save the ship as a memorial. Schoolchildren around Massachusetts rallied for the ship named for their state, and ``Big Mamie,'' was brought to Fall River in 1965 as a result of these tireless civic efforts. It now serves as the central attraction in Fall River's thriving waterfront; standing as a reminder of its service and inspiring young people to find their own ways to serve. Through it all, the ship beared the name of our Commonwealth with a pride that we match today, and I am honored to join the Navy, the citizens of Fall River, and people across our State in celebrating the 60th anniversary of the Massachusetts' receiving its commission.

Mr. KERRY

Mr. KERRY. Mr. President, I am pleased to join with my distinguished colleague, Senator Max Cleland, and the cosponsors of our legislation in introducing the National Small Business Regulatory Assistance Act. The bill we are introducing today is the Senate version of H.R. 203, which bears the same name as our legislation. H.R. 203 passed the House by voice vote in October of last year with the strong support of the House Committee on Small Business. However, our version deals with several issues that have been raised since House passage and will help ensure that small businesses receive the regulatory compliance assistance the legislation envisions. I am pleased to say that we have the full support of the Association of Small Business Development Centers, which has been working closely with us since January of this year to draft the Senate version of this legislation, correcting several issues with the House passed bill. I am also pleased to say that we have kept Congressman Sweeney, the House sponsor, and Congressman Manzullo, chairman of the House Committee on Small Business, informed of our actions throughout the process to ensure our changes would have the support of the House committee, as should be the case. Small businesses, especially small businesses with few employees, often face a daunting task when seeking advice on how to comply with Federal regulations, particularly when implementation varies for different regions of the country, or from State to State. Many small businesses fail to comply with important and needed labor and environmental regulations not because they want to break the law, but because they are unaware of the actions they need to take to comply. Often, small businesses are afraid to seek guidance from Federal agencies for fear of exposing problems at their business. One important way to help small business comply with Federal regulations is to provide them with free, confidential advice outside of the normal relationship between a small business and a regulatory agency. The Small Business Administration's, SBA, Small Business Development Centers, SBDC, are in a unique position to provide this type of assistance. Our bill establishes a pilot program to award competitive grants to 20 selected SBDCs, two from each SBA region, which would allow these SBDCs to provide regulatory compliance assistance to small businesses. The SBA would be authorized to award grants between $150,000 and $300,000, depending on the population of the SBDC's State. Under our legislation, the SBDCs would need to form partnerships with Federal compliance programs, conduct educational and training activities and offer free-of-charge compliance counseling to small business owners. Further, the measure would guarantee privacy to those who receive compliance assistance. This privacy provision has also been extended to all small businesses that seek any assistance from their local SBDC. The legislation we are introducing today uses only SBA funds and will serve to complement current small business development assistance as well as existing compliance assistance programs. Versions of this legislation introduced in previous Congresses used Environmental Protection Agency, EPA, enforcement funds to pay for these grants. Small businesses can succeed when it comes to complying with Federal regulations, if provided with the necessary tools and information. The National Small Business Regulatory Assistance Act will go a long way toward assisting our Nation's small businesses who want to comply with Federal Regulations. I urge all of my colleagues to support this legislation.

Mr. KERRY

Mr. KERRY. Mr. President, I am very proud to introduce legislation today with Senator Hatch that would amend the Low-Income Housing Tax Credit to make access to Internet and broadband technology one of the criteria that State housing agencies must consider when awarding the credits. This bill will help more low-income families gain access to the new technologies and services that are driving today's modern economy, and it will do so at very minimal cost to developers. The bill will take effect for all new housing built with the credit beginning on January 1 of next year. My colleagues should understand that the Kerry-Hatch bill would not require that new housing units have Internet or broadband capability; it is not an unfunded mandate. Rather, our bill simply adds broadband access to the list of things that State agencies would have to consider when they award the credits each year. Our bill also does not specify any particular technology, meaning that developers and providers can decide for themselves which technology will work best for a given community. This bill has the support of many well-known companies and associations from the technology and telecommunications industries, including Corning, Nortel Networks, BellSouth, SmartForce, the Telecommunications Industry Association, Siemens, and Cisco Systems. This is just a partial list. A number of well-known national nonprofit organizations and representatives of the housing industry, such as Habitat for Humanity, the National Leased Housing Association, and the National Housing Conference also support the bill. Senator Hatch and I hope that the Finance Committee, of which we are both members, will consider adding this provision when it marks up charity-related legislation later this month. There is no revenue cost associated with the bill, making it more likely that the committee will be able to include it. Several States are running ahead of the Federal Government and are enacting their own local policies to do what the Kerry-Hatch legislation will do nationally. To date, the States of Oregon and Nebraska have re-written their policies with technical assistance from One Economy Corporation, a national nonprofit organization that works to bring technology to low- income populations and make that technology a tool to help them build assets and raise their standards of living. Oregon and Nebraska now have an incentive for broadband in awarding the low-income credits. Dialogues are currently underway with housing finance agencies from the States of North Carolina, Michigan, Kentucky, and Minnesota, several of which may change their policies very soon. Understandably, there may be some Senators that believe that building access to broadband technology into these new low-income housing units will be prohibitively expensive. Well, I am happy to report that this is not so. Engineers from Cisco Systems have evaluated the costs of wiring buildings at the time of construction. When wiring a new building, the baseline cost to run telecommunications infrastructure into a unit, a fixed cost in new construction, is approximately $150. When adding conduit for high-speed connectivity, the cost increases anywhere between $1 and $25. So for a 50-unit building, that's an added cost of about $1,250 if you assume the highest cost. This is likely to be less than one-quarter of 1 percent of total construction costs, a small increase that is more than offset by the increased value of the property. The added cost is insignificant, and the added value is great. This legislation is critical because having access to and understanding of technology is increasingly a prerequisite for succeeding in today's knowledge-based economy. Technology can be a significant tool to help low-income families move up and out of poverty. I believe that this small change to section 42 of the tax code will help to close the digital divide in the United States by getting modern technology into the homes of more low-income Americans. Recently, some influential opinion leaders in Washington and the press have begun to ``debunk'' the digital divide. They claim that since so many more people have access to technology in the workplace, the percentage of families with incomes between $15,000 and $25,000 that now use computers at home or in the workplace is now close to 50 percent, concerns about the digital divide are overstated. These statistics only tell part of the story, because there are key Internet services that people will only feel comfortable using at home due to privacy concerns, such as those related to one's health or personal finance. Access to computers in the workplace is not sufficient. Sure some people might check out Yahoo when they have a free moment at work. They might perform an Internet search, check driving directions on MapQuest, or bid on something on eBay. But they are not going to seek financial advice, research their kids' health, or do anything of a truly personal nature from the workplace. And in terms of computer use in the home, there is still a huge digital divide: Even with all of the technological advances and price reductions of the past few years, less than 30 percent of households earning under $35,000 are online at home. In fact, more than one-quarter of zip codes with median incomes under $35,000 do not have a single high-speed Internet subscriber, despite the fact that the services are available. In my opinion, this is a real problem if we want these millions of Americans to participate in the Information Economy and access the online services that the rest of us take for granted. Here are some real stories from the Columbia Heights neighborhood here in Washington, brought to my attention by One Economy Corporation, that speak to the power of access to technology in the home: A mother of three young children uses her computer to take an online course to get A+ Certification from the Department of Employment Services. Having a computer at home means that she can take the classes online at night when her kids are asleep. Once she has the certification she will qualify for a better, higher-paying job; a young woman in her mid-20s uses her home computer to look for jobs and pursue educational opportunities. After September 11, she went online to find people to talk to for support; and a 50-something grandmother has a three-year old grandson who suffers from recurring ear infections. The doctor said that the little boy needed to get an operation to put tubes in his ears. His grandmother used the computer to research this treatment on the Internet and ultimately decide that it was the best thing for her grandson. When asked what she would have done without the Internet, she said that she would have ``left it up to God.'' These are just a few examples. The central point is that access to computers and Internet technology in the workplace is no substitute for having similar access in the home. Another important issue to consider is the amount of time that many families of modest means spend interacting with public agencies. I've been told that can often be as high as 10 hours a month, sometimes more. Many of these services could undoubtedly be provided online, which would allow parents to spend more time at work and less waiting on line. Parents would also be able to spend more time with their children. In other words, Internet access at home could alleviate some of the stresses in these families' daily lives. I guess the best way to put it is: Being online is far better than waiting on a line. I look forward to promoting this important bill in the Finance Committee. I would like to take a moment to speak about the housing crisis in the country more generally. My colleagues know that I have spoken frequently on the Senate floor about the lack of affordable housing throughout the country. Recent changes in the housing market have further limited the availability of housing, while the growth in our economy over the last decade has dramatically increased the cost of the housing that remains. Many working families have been unable to keep up with these increased costs. While the bill I am introducing today does not specifically address the supply of housing, I want to reiterate my concern about and dedication to this issue. The low-income housing tax credit is only one tool, but is an effective one, generating about 85,000 new housing units per year. It is an important program, but it only helps a small fraction of the more than 5 million American households that the Department of Housing and Urban Development estimates to have ``worst case'' housing needs, an increase of 12 percent since 1990. Many of these families are spending more than half their income on housing, or are living in severely substandard housing. On average, a person needs to earn more than $11 per hour just to afford the median rent on a two- bedroom apartment in the United States. This hourly figure is dramatically higher in many metropolitan areas, an hourly wage of $22 is needed in San Francisco; $21 on Long Island; $17 in Boston; $16 in the D.C. area; $14 in Seattle and Chicago; and, $13 in Atlanta. I have mentioned these statistics before. In fact, there is not one metropolitan area in the country where a minimum wage earner can afford to pay the rent for a two-bedroom apartment. A person trying to live in Boston would have to make more than $35,000 annually just to afford such a home. This means teachers, janitors, social workers, police officers, and other full-time workers may have trouble affording even a modest place to live, segregating our communities by class and occupation. We can no longer ignore the lack of affordable housing, and the impact it is having on families and children around the country. It is not clear to me why this crisis has not caused more concern here in Congress. How many families need to be pushed out of their homes and into the streets before action is taken? Do we not act because these people vote less often, or because they don't give to political campaigns? Do we not believe that most of these Americans would prefer more affordable housing to the measly tax cut they received in last year's tax bill? I believe it is time for our Nation to take a new path, one that ensures that every American has the opportunity to live in decent and safe housing. Everyone knows that decent housing plays an enormous role in shaping young lives, and we need to do more to address this quiet, but simmering, crisis. While the bill I am introducing today with Senator Hatch will certainly help bring more Americans of modest means into the Information Age, it won't help those Americans with substandard housing, or no homes at all. Addressing that problem requires a greater commitment from all of us, and our mayors and Governors back home will all thank us.

Mr. KERRY

Mr. KERRY. Mr. President, I am very proud to introduce legislation today with Senator Hatch that would amend the Low-Income Housing Tax Credit to make access to Internet and broadband technology one of the criteria that State housing agencies must consider when awarding the credits. This bill will help more low-income families gain access to the new technologies and services that are driving today's modern economy, and it will do so at very minimal cost to developers. The bill will take effect for all new housing built with the credit beginning on January 1 of next year. My colleagues should understand that the Kerry-Hatch bill would not require that new housing units have Internet or broadband capability; it is not an unfunded mandate. Rather, our bill simply adds broadband access to the list of things that State agencies would have to consider when they award the credits each year. Our bill also does not specify any particular technology, meaning that developers and providers can decide for themselves which technology will work best for a given community. This bill has the support of many well-known companies and associations from the technology and telecommunications industries, including Corning, Nortel Networks, BellSouth, SmartForce, the Telecommunications Industry Association, Siemens, and Cisco Systems. This is just a partial list. A number of well-known national nonprofit organizations and representatives of the housing industry, such as Habitat for Humanity, the National Leased Housing Association, and the National Housing Conference also support the bill. Senator Hatch and I hope that the Finance Committee, of which we are both members, will consider adding this provision when it marks up charity-related legislation later this month. There is no revenue cost associated with the bill, making it more likely that the committee will be able to include it. Several States are running ahead of the Federal Government and are enacting their own local policies to do what the Kerry-Hatch legislation will do nationally. To date, the States of Oregon and Nebraska have re-written their policies with technical assistance from One Economy Corporation, a national nonprofit organization that works to bring technology to low- income populations and make that technology a tool to help them build assets and raise their standards of living. Oregon and Nebraska now have an incentive for broadband in awarding the low-income credits. Dialogues are currently underway with housing finance agencies from the States of North Carolina, Michigan, Kentucky, and Minnesota, several of which may change their policies very soon. Understandably, there may be some Senators that believe that building access to broadband technology into these new low-income housing units will be prohibitively expensive. Well, I am happy to report that this is not so. Engineers from Cisco Systems have evaluated the costs of wiring buildings at the time of construction. When wiring a new building, the baseline cost to run telecommunications infrastructure into a unit, a fixed cost in new construction, is approximately $150. When adding conduit for high-speed connectivity, the cost increases anywhere between $1 and $25. So for a 50-unit building, that's an added cost of about $1,250 if you assume the highest cost. This is likely to be less than one-quarter of 1 percent of total construction costs, a small increase that is more than offset by the increased value of the property. The added cost is insignificant, and the added value is great. This legislation is critical because having access to and understanding of technology is increasingly a prerequisite for succeeding in today's knowledge-based economy. Technology can be a significant tool to help low-income families move up and out of poverty. I believe that this small change to section 42 of the tax code will help to close the digital divide in the United States by getting modern technology into the homes of more low-income Americans. Recently, some influential opinion leaders in Washington and the press have begun to ``debunk'' the digital divide. They claim that since so many more people have access to technology in the workplace, the percentage of families with incomes between $15,000 and $25,000 that now use computers at home or in the workplace is now close to 50 percent, concerns about the digital divide are overstated. These statistics only tell part of the story, because there are key Internet services that people will only feel comfortable using at home due to privacy concerns, such as those related to one's health or personal finance. Access to computers in the workplace is not sufficient. Sure some people might check out Yahoo when they have a free moment at work. They might perform an Internet search, check driving directions on MapQuest, or bid on something on eBay. But they are not going to seek financial advice, research their kids' health, or do anything of a truly personal nature from the workplace. And in terms of computer use in the home, there is still a huge digital divide: Even with all of the technological advances and price reductions of the past few years, less than 30 percent of households earning under $35,000 are online at home. In fact, more than one-quarter of zip codes with median incomes under $35,000 do not have a single high-speed Internet subscriber, despite the fact that the services are available. In my opinion, this is a real problem if we want these millions of Americans to participate in the Information Economy and access the online services that the rest of us take for granted. Here are some real stories from the Columbia Heights neighborhood here in Washington, brought to my attention by One Economy Corporation, that speak to the power of access to technology in the home: A mother of three young children uses her computer to take an online course to get A+ Certification from the Department of Employment Services. Having a computer at home means that she can take the classes online at night when her kids are asleep. Once she has the certification she will qualify for a better, higher-paying job; a young woman in her mid-20s uses her home computer to look for jobs and pursue educational opportunities. After September 11, she went online to find people to talk to for support; and a 50-something grandmother has a three-year old grandson who suffers from recurring ear infections. The doctor said that the little boy needed to get an operation to put tubes in his ears. His grandmother used the computer to research this treatment on the Internet and ultimately decide that it was the best thing for her grandson. When asked what she would have done without the Internet, she said that she would have ``left it up to God.'' These are just a few examples. The central point is that access to computers and Internet technology in the workplace is no substitute for having similar access in the home. Another important issue to consider is the amount of time that many families of modest means spend interacting with public agencies. I've been told that can often be as high as 10 hours a month, sometimes more. Many of these services could undoubtedly be provided online, which would allow parents to spend more time at work and less waiting on line. Parents would also be able to spend more time with their children. In other words, Internet access at home could alleviate some of the stresses in these families' daily lives. I guess the best way to put it is: Being online is far better than waiting on a line. I look forward to promoting this important bill in the Finance Committee. I would like to take a moment to speak about the housing crisis in the country more generally. My colleagues know that I have spoken frequently on the Senate floor about the lack of affordable housing throughout the country. Recent changes in the housing market have further limited the availability of housing, while the growth in our economy over the last decade has dramatically increased the cost of the housing that remains. Many working families have been unable to keep up with these increased costs. While the bill I am introducing today does not specifically address the supply of housing, I want to reiterate my concern about and dedication to this issue. The low-income housing tax credit is only one tool, but is an effective one, generating about 85,000 new housing units per year. It is an important program, but it only helps a small fraction of the more than 5 million American households that the Department of Housing and Urban Development estimates to have ``worst case'' housing needs, an increase of 12 percent since 1990. Many of these families are spending more than half their income on housing, or are living in severely substandard housing. On average, a person needs to earn more than $11 per hour just to afford the median rent on a two- bedroom apartment in the United States. This hourly figure is dramatically higher in many metropolitan areas, an hourly wage of $22 is needed in San Francisco; $21 on Long Island; $17 in Boston; $16 in the D.C. area; $14 in Seattle and Chicago; and, $13 in Atlanta. I have mentioned these statistics before. In fact, there is not one metropolitan area in the country where a minimum wage earner can afford to pay the rent for a two-bedroom apartment. A person trying to live in Boston would have to make more than $35,000 annually just to afford such a home. This means teachers, janitors, social workers, police officers, and other full-time workers may have trouble affording even a modest place to live, segregating our communities by class and occupation. We can no longer ignore the lack of affordable housing, and the impact it is having on families and children around the country. It is not clear to me why this crisis has not caused more concern here in Congress. How many families need to be pushed out of their homes and into the streets before action is taken? Do we not act because these people vote less often, or because they don't give to political campaigns? Do we not believe that most of these Americans would prefer more affordable housing to the measly tax cut they received in last year's tax bill? I believe it is time for our Nation to take a new path, one that ensures that every American has the opportunity to live in decent and safe housing. Everyone knows that decent housing plays an enormous role in shaping young lives, and we need to do more to address this quiet, but simmering, crisis. While the bill I am introducing today with Senator Hatch will certainly help bring more Americans of modest means into the Information Age, it won't help those Americans with substandard housing, or no homes at all. Addressing that problem requires a greater commitment from all of us, and our mayors and Governors back home will all thank us.

Mr. KERRY. Mr. President, I am pleased to join with my distinguished colleague, Senator Max Cleland, and the cosponsors of our legislation in introducing the National Small Business Regulatory Assistance Act. The bill we are introducing today is the Senate version of H.R. 203, which bears the same name as our legislation. H.R. 203 passed the House by voice vote in October of last year with the strong support of the House Committee on Small Business. However, our version deals with several issues that have been raised since House passage and will help ensure that small businesses receive the regulatory compliance assistance the legislation envisions. I am pleased to say that we have the full support of the Association of Small Business Development Centers, which has been working closely with us since January of this year to draft the Senate version of this legislation, correcting several issues with the House passed bill. I am also pleased to say that we have kept Congressman Sweeney, the House sponsor, and Congressman Manzullo, chairman of the House Committee on Small Business, informed of our actions throughout the process to ensure our changes would have the support of the House committee, as should be the case. Small businesses, especially small businesses with few employees, often face a daunting task when seeking advice on how to comply with Federal regulations, particularly when implementation varies for different regions of the country, or from State to State. Many small businesses fail to comply with important and needed labor and environmental regulations not because they want to break the law, but because they are unaware of the actions they need to take to comply. Often, small businesses are afraid to seek guidance from Federal agencies for fear of exposing problems at their business. One important way to help small business comply with Federal regulations is to provide them with free, confidential advice outside of the normal relationship between a small business and a regulatory agency. The Small Business Administration's, SBA, Small Business Development Centers, SBDC, are in a unique position to provide this type of assistance. Our bill establishes a pilot program to award competitive grants to 20 selected SBDCs, two from each SBA region, which would allow these SBDCs to provide regulatory compliance assistance to small businesses. The SBA would be authorized to award grants between $150,000 and $300,000, depending on the population of the SBDC's State. Under our legislation, the SBDCs would need to form partnerships with Federal compliance programs, conduct educational and training activities and offer free-of-charge compliance counseling to small business owners. Further, the measure would guarantee privacy to those who receive compliance assistance. This privacy provision has also been extended to all small businesses that seek any assistance from their local SBDC. The legislation we are introducing today uses only SBA funds and will serve to complement current small business development assistance as well as existing compliance assistance programs. Versions of this legislation introduced in previous Congresses used Environmental Protection Agency, EPA, enforcement funds to pay for these grants. Small businesses can succeed when it comes to complying with Federal regulations, if provided with the necessary tools and information. The National Small Business Regulatory Assistance Act will go a long way toward assisting our Nation's small businesses who want to comply with Federal Regulations. I urge all of my colleagues to support this legislation.

Mr. KERRY

Mr. KERRY. Mr. President, I would like to congratulate Senator Harkin for his hard work in bringing this farm bill together. As Chairman Harkin said yesterday, this conference report is not anyone's idea of perfection. It's not the bill Senator Harkin passed in the Senate, nor is it, I think it's fair to say, the bill that Senator Harkin or any of us might have written were legislation written to match an ideal standard. But the legislation before us today is a product of hard work and tough negotiating, and U.S. Senators are only afforded the opportunity to vote on what's before us, to make a judgment about whether we're going to provide relief and support to farmers in Massachusetts and nationwide in need of relief today, or whether we're going to vote it down and hope for an ideal farm bill the legislative process itself has proven will not be forthcoming. Given that choice, I will support this farm bill--I will support it because it will meet needs in Massachusetts and all around the country that are absolutely critical and which we cannot afford to leave unmet. This legislation includes record amounts of funding for land and water conservation programs, nutrition spending and reestablishing a dairy program that keeps small dairy farmers in business. This bill increases spending for land and water conservation programs by $17 billion an 80 percent increase. This funding allows producers to qualify for assistance if they voluntarily incorporate conservation practices on their lands. In addition the bill provides $1 billion for the Farmland Protection Program, which provides for protection around urban areas and prevents sprawl. Massachusetts has a model program for protecting farmland and this funding will only allow us to preserve and protect more farmland in the Commonwealth. Nutrition and food programs under this bill total $6.4 billion. Like most of us I would have preferred the Senate number, however as we all know compromises have to be made in large bills such as this. We all should be proud of the fact that this bill restores benefits to legal immigrant adults who have lived in the United States for at least 5 years. This bill also restores benefits to children and the disabled without a 5-year waiting period. The bill will also provide benefits for working families moving from welfare to work. The dairy provision in the bill is very important to Massachusetts as well. I wish to thank Senator Leahy for all of his work in this area. He has crafted a compromise that allows small dairy farmers in the Northeast to compete with larger producers in the Midwest. I am especially grateful that the dairy provisions are retroactive to December 1, 2001 so that these small diary farmers who have been severely impacted by the expiration of the old Northeast Dairy Compact, in October of last year, can now look forward to much needed help as they struggle to survive. This is yet another way that we can protect open space and prevent urban sprawl by giving these small dairy farmers a helping hand. This bill contains an authorization for a $10 million buyback of groundfish permits in New England. I strongly believe that we need to help family fishermen just like we lend a hand to farmers. The fishermen in New England are reeling from a recent court decision that has reduced their ability to fish by a minimum of 20 percent and in some cases by 75 percent. These fishermen are going to need some help and I intend to work with my colleagues to get these fishermen some assistance so that they can retire with dignity and seek opportunities elsewhere. As I stated earlier, this is not a perfect piece of legislation. I am disappointed that the bill does not contain the strong payment limitations that were contained in the Senate bill nor does this conference report prohibit meat packers from owning livestock. I supported both of these amendments when we debated this bill in the Senate and I believe that both of these provisions would go along way to protecting rural America and small family owned farms. I wish to go on record as saying that I will work with my colleagues Senators Johnson and Wellstone to have these measures enacted in the future. I remain very concerned about a flaw of this legislation, one which I know many Democrats worked very hard to avoid but which remains a serious problem in this bill. Without meaningful payment limitations we run the risk that large, powerful, corporate farms will continue to gobble up America's small, family-owned, environmentally responsible farmers. We cannot allow this to happen. This bill should protect rural America rather than subsidize another round of corporate giveaways that put at risk our environment, endanger the livelihood of family farmers, and lavish hard earned taxpayer money on corporations that need it the least. By that measure, this farm bill is a far cry from what our family farms need the most, and I would respectfully suggest that in the future we consider a whole host of efforts that do better than this bill does today. We all should remain concerned about the cost of this legislation as well. The bill will increase the cost of Federal agricultural programs by $45 billion over the next 6 years and $73.5 billion over the next 10 years. With our country at war against terrorism and our economy still not recovered we should all be concerned about the deficits that this country could potentially face. Lastly, the conference report contains a number of animal protection provisions that I do not support. Particularly troubling were the provisions on animal fighting and downed animal protection that were nearly identical in both bills and yet the conference report contains a weakened provision. I strongly believe we should revisit these issues at the earliest possible time. In summary, this bill is not perfect, but it is the choice before us, and in the Senate this year I see no better choices being offered. And while I think it's critical that we do better in the future, that we strike a better balance, I do not believe it would be in the best interests of our nation to deny family farmers and America's small farms the lifeline they so desperately need today.

Mr. KERRY

Mr. KERRY. Mr. President, I am pleased today to submit a Resolution expressing the sense of the Senate that small business participation is vital to the defense of our Nation, and that Federal, State, and local governments should aggressively seek out and purchase innovative technologies and services from American small businesses to help in homeland defense and the fight against terrorism. Since the events of September 11, the people of our Nation have come together in many ways to help protect our land and its citizens. Whether it is the high number of individuals signing up to become Sky Marshals, fighter pilots pulling letters of resignation and staying in the military, expressions of pride through the display of the American flag or other patriot memorabilia, or the desire of innovative small businesses to sell products to the Federal Government for the fight against terrorism or for homeland defense, the ground swell of patriotism has been truly uplifting. But today, I want to focus the attention of my colleagues on the contributions being made specifically by our small businesses. Throughout the years, small businesses have also heard the call to arms and to defend the nation, and have responded through the development of innovative products to protect our Nation. Whether it's a need for a new type of night vision scope for a lonely sniper in the field, lighter materials for a Marine's backpack, more reliable field communications gear, or nonlethal weaponry, America's small businesses have heard the call and met the challenge. Fortunately, our government has recognized the need to promote a diverse defense industrial base, and since World War II, the Federal Government has actively sought to grow and maintain a thriving small business sector. And like many policies designed to promote defense, government policy to foster small business creation and growth has turned out to be a great boon for the U.S. economy. Today, small businesses represent more than 99 percent of all employers, employ 51 percent of private sector workers, account for 96 percent of all exporters of goods, and provide 75 percent of net new jobs. Additionally, small businesses are more adaptable, more innovative and more likely to retain and hire employees during an economic downturn than their larger brethren. Our government's commitment to purchasing goods and services from small businesses is a key element in creating a positive environment for small business creation and growth. It results in more competition and increased productivity, which leads to lower prices and new innovations. Yet with all of these positive elements, today, we are faced with a unique challenge. Budgetary pressures in the Federal Government have resulted in demands for faster and cheaper purchases of goods and services. Federal procurement personnel have retired and not been replaced, government streamlining has hurt competition by eliminating or severely reducing the array of small business suppliers in the Federal procurement arena, and contract bundling has made it increasingly more difficult for small businesses to compete for government contracts. That is why, as our Nation looks for new technologies to promote homeland defense and fight terrorism, small businesses should play an active role. I would like to commend the Pentagon's Technical Support Working Group, which is responsible for seeking new technologies to assist the military, for sending an urgent plea seeking ideas on how to fight terrorism. America's small businesses responded, and in just two months, over 12,500 ideas were submitted to the Technical Support Working Group, most of them from small businesses. This not only demonstrates the commitment of America's small businesses and demonstrates their ability to be innovative, it clearly shows that when the Federal Government calls for action, small businesses respond. The Resolution I am introducing today, along with the support of Senator Bond, the ranking member of the Committee on Small Business and Entrepreneurship, which I chair, seeks to encourage Federal procurement officials to seek out and purchase innovative technologies and services from, and promote research opportunities for, American small businesses to help in homeland defense and the fight against terrorism. This Resolution is a precursor to the Small Business Homeland Defense Exposition that Senator Bond and I are jointly sponsoring, which will take place this July here on Capitol Hill. At the Expo, a selection of small businesses will help send the message to Federal officials that they should look to small businesses for true innovations that will help us win the war against terrorism. The Expo will showcase high- tech, innovative products that have been developed by our nation's small businesses. For the last month, Senator Bond and I have been soliciting small business homeland defense nominees from our colleagues, so that we can select truly unique products for the Expo. As expected, the response has been enthusiastic and I would encourage all of my colleagues to attend this event so that they may see and try these products. My only regret is that we do not have the space available to allow every small business to participate. However, every nominee will be included in our event book highlighting these innovative small businesses. I would like to conclude by once again stressing the importance of our Nation's small businesses, both to our economic security and our national security. Supporting small businesses is supporting America. I urge all of my colleagues to cosponsor this Resolution.

Mr. KERRY

Mr. KERRY. Madam President, I am pleased today to be introducing legislation, the Small Business Federal Contractor Safeguard Act, designed to protect the interests of small businesses in the Federal marketplace. As the Chairman of the Senate Committee on Small Business and Entrepreneurship, I have focused a considerable amount of energy promoting the interests of small businesses in the Federal marketplace. The legislation being introducing today marks a critical step forward in this process. It is no secret that the Committee on Small Business and Entrepreneurship places a great deal of importance on moving legislation forward in a bipartisan manner, the members of my Committee understand we represent the interests of all of our Nation's small businesses, the most important and dynamic segment of our economy. And nowhere is the bipartisan consensus stronger than in the area of Federal procurement and ensuring that our Nation's small businesses receive their fair share of procurement opportunities. I am pleased to once again be introducing bipartisan legislation with the Committee's ranking member, Senator Kit Bond. Regardless of who has chaired the Committee during our tenure together, we have both worked hard to improve small business Federal procurement opportunities. I am also pleased to be joined by Senator Jean Carnahan, a member of the Committee on Small Business and Entrepreneurship and the Senate Armed Services Committee and Senator Susan Collins, also a member of the Senate Armed Services Committee. While small business participation in procurement activities is important throughout the Federal Government, nowhere is it more important than at the Department of Defense, which is responsible for over 63 percent of the goods and services purchased by the Federal government. The support of Senator Carnahan and Senator Collins will help ensure the success of this legislation. The legislation we are introducing today has one ultimate purpose, to prevent Federal agencies from circumventing small business protections with regard to the practice known as contract bundling. Few issues have so strongly galvanized the small businesses contracting community as the practice of contract bundling, which occurs when procurement contracts are combined to form large contracts, often spread over large geographic areas, resulting in minimal or no small business participation. Many supporters of the practice of contract bundling point to its cost savings. They claim it saves the taxpayer money to lump contracts together. Unfortunately, there is little evidence supporting this claim, and too many contracts are bundled without the required economic research designed to determine if a bundled contract will actually result in a cost savings. The Small Business Administration's, SBA, Office of Advocacy, an independent body within the SBA, estimated that for every increase of 100 bundled contracts, there was a decrease of over 106 individual contracts issued to small firms. Additionally, for every $100 awarded on a bundled contract, there was a decrease of $33 to small business. The Office of Advocacy arrived at these conclusions using a conservative definition of what constitutes a bundled contract. Therefore, the negative impact on small businesses from contract bundling is likely more severe. While seemingly an efficient and cost effective means for Federal agencies to conduct business, bundled contracts, are anti-competitive. When a Federal agency bundles contracts, it limits small businesses' ability to bid for the new bundled contract, thus limiting competition. Small businesses are consistently touted as more innovative, providing better and cheaper services then their larger counterparts. But when forced to bid for mega-contracts, at times across large geographic areas, few, if any, small businesses can be expected to compete. By driving small business from the Federal marketplace, contract bundling will actually drive up the costs of goods and services purchased by the Federal Government because competition will be limited and our economy will be deprived of possible innovations brought about by small businesses. Although there is current law in place intended to require Federal agencies to conduct market research before bundling a contract, loopholes in the current definition of a bundled contract allow them to often skirt these safeguards. Our legislation changes the name ``bundled contract'' to consolidated contract, strengthens the definition of a consolidated contract, and closes the loopholes in the existing definition to prevent Federal agencies from circumventing statutory safeguards intended to ensure that separate contracts are consolidated for economic reasons, not administrative expediency. The new definition relies on a simple premise: if you combine contracts, be it new contracts, existing contracts or a combination thereof, you are consolidating them and would need to take the necessary steps to ensure it is justified economically before proceeding. Our legislation also alters the current Small Business Act requirements regarding procurement strategies when a contract is consolidated to include a threshold level for triggering the economic research requirements. Previously, any consolidated contract would trigger the economic research requirements, something considered onerous by many Federal agencies and often cited as the reason for circumventing the law. The new procurement strategies section of the Small Business Act would require a statement of benefits and a justification for any consolidated contract over $2 million and a more extensive analysis, corresponding to current requirements for any consolidated contract, for consolidations over $5 million. In order to move forward with a consolidated contract over $2 million, the agency must put forth the benefits anticipated from the contract, identify alternatives that would involve a lesser degree of consolidation and include a specific determination that the consolidation is necessary and justified. The determination that a consolidation is necessary and justified may be determined simply through administrative and personnel savings, but their must be actual savings. In order to move forward with a consolidated contract over $5 million, an agency must, in addition to the above: conduct current market research to demonstrate that the consolidation will result in costs savings, quality improvements, reduction in acquisition times, or better terms and conditions; include an assessment as to the specific impediments to small business participation resulting from the consolidation; and specify actions designed to maximize small business participation as subcontractors and suppliers for the consolidated contract. The determination that a consolidation is necessary and justified may not be determined through administrative and personnel savings alone unless those savings will be substantial for these larger contracts. By establishing this dual threshold system, we have placed the emphasis for the economic research on contracts more likely to preclude small business participation, while not ceding smaller contracts to the whims of a Federal agency. This change, coupled with a clear definition of a consolidated contract should be enough to garner compliance. However, if Federal agencies continue to consolidate contracts when there is no justification, fail to conduct the required economic research, or fail to provide procurement opportunities to small businesses, I would see little choice but to support legislative changes requiring punitive measures for these Federal agencies. This is a step I have been reluctant to take in the past. However, I am optimistic that such a step will not be necessary and that the fair and reasonable system established under this legislation will be effective. I would once again like to thank my fellow sponsors, Senators Bond, Carnahan, and Collins for their support on this issue. I hope all of my colleagues will join us in supporting this bill. I ask unanimous consent that the text of the legislation be printed in the Record.

Mr. KERRY

Mr. KERRY. Madam President, I am pleased today to be introducing legislation, the Small Business Federal Contractor Safeguard Act, designed to protect the interests of small businesses in the Federal marketplace. As the Chairman of the Senate Committee on Small Business and Entrepreneurship, I have focused a considerable amount of energy promoting the interests of small businesses in the Federal marketplace. The legislation being introducing today marks a critical step forward in this process. It is no secret that the Committee on Small Business and Entrepreneurship places a great deal of importance on moving legislation forward in a bipartisan manner, the members of my Committee understand we represent the interests of all of our Nation's small businesses, the most important and dynamic segment of our economy. And nowhere is the bipartisan consensus stronger than in the area of Federal procurement and ensuring that our Nation's small businesses receive their fair share of procurement opportunities. I am pleased to once again be introducing bipartisan legislation with the Committee's ranking member, Senator Kit Bond. Regardless of who has chaired the Committee during our tenure together, we have both worked hard to improve small business Federal procurement opportunities. I am also pleased to be joined by Senator Jean Carnahan, a member of the Committee on Small Business and Entrepreneurship and the Senate Armed Services Committee and Senator Susan Collins, also a member of the Senate Armed Services Committee. While small business participation in procurement activities is important throughout the Federal Government, nowhere is it more important than at the Department of Defense, which is responsible for over 63 percent of the goods and services purchased by the Federal government. The support of Senator Carnahan and Senator Collins will help ensure the success of this legislation. The legislation we are introducing today has one ultimate purpose, to prevent Federal agencies from circumventing small business protections with regard to the practice known as contract bundling. Few issues have so strongly galvanized the small businesses contracting community as the practice of contract bundling, which occurs when procurement contracts are combined to form large contracts, often spread over large geographic areas, resulting in minimal or no small business participation. Many supporters of the practice of contract bundling point to its cost savings. They claim it saves the taxpayer money to lump contracts together. Unfortunately, there is little evidence supporting this claim, and too many contracts are bundled without the required economic research designed to determine if a bundled contract will actually result in a cost savings. The Small Business Administration's, SBA, Office of Advocacy, an independent body within the SBA, estimated that for every increase of 100 bundled contracts, there was a decrease of over 106 individual contracts issued to small firms. Additionally, for every $100 awarded on a bundled contract, there was a decrease of $33 to small business. The Office of Advocacy arrived at these conclusions using a conservative definition of what constitutes a bundled contract. Therefore, the negative impact on small businesses from contract bundling is likely more severe. While seemingly an efficient and cost effective means for Federal agencies to conduct business, bundled contracts, are anti-competitive. When a Federal agency bundles contracts, it limits small businesses' ability to bid for the new bundled contract, thus limiting competition. Small businesses are consistently touted as more innovative, providing better and cheaper services then their larger counterparts. But when forced to bid for mega-contracts, at times across large geographic areas, few, if any, small businesses can be expected to compete. By driving small business from the Federal marketplace, contract bundling will actually drive up the costs of goods and services purchased by the Federal Government because competition will be limited and our economy will be deprived of possible innovations brought about by small businesses. Although there is current law in place intended to require Federal agencies to conduct market research before bundling a contract, loopholes in the current definition of a bundled contract allow them to often skirt these safeguards. Our legislation changes the name ``bundled contract'' to consolidated contract, strengthens the definition of a consolidated contract, and closes the loopholes in the existing definition to prevent Federal agencies from circumventing statutory safeguards intended to ensure that separate contracts are consolidated for economic reasons, not administrative expediency. The new definition relies on a simple premise: if you combine contracts, be it new contracts, existing contracts or a combination thereof, you are consolidating them and would need to take the necessary steps to ensure it is justified economically before proceeding. Our legislation also alters the current Small Business Act requirements regarding procurement strategies when a contract is consolidated to include a threshold level for triggering the economic research requirements. Previously, any consolidated contract would trigger the economic research requirements, something considered onerous by many Federal agencies and often cited as the reason for circumventing the law. The new procurement strategies section of the Small Business Act would require a statement of benefits and a justification for any consolidated contract over $2 million and a more extensive analysis, corresponding to current requirements for any consolidated contract, for consolidations over $5 million. In order to move forward with a consolidated contract over $2 million, the agency must put forth the benefits anticipated from the contract, identify alternatives that would involve a lesser degree of consolidation and include a specific determination that the consolidation is necessary and justified. The determination that a consolidation is necessary and justified may be determined simply through administrative and personnel savings, but their must be actual savings. In order to move forward with a consolidated contract over $5 million, an agency must, in addition to the above: conduct current market research to demonstrate that the consolidation will result in costs savings, quality improvements, reduction in acquisition times, or better terms and conditions; include an assessment as to the specific impediments to small business participation resulting from the consolidation; and specify actions designed to maximize small business participation as subcontractors and suppliers for the consolidated contract. The determination that a consolidation is necessary and justified may not be determined through administrative and personnel savings alone unless those savings will be substantial for these larger contracts. By establishing this dual threshold system, we have placed the emphasis for the economic research on contracts more likely to preclude small business participation, while not ceding smaller contracts to the whims of a Federal agency. This change, coupled with a clear definition of a consolidated contract should be enough to garner compliance. However, if Federal agencies continue to consolidate contracts when there is no justification, fail to conduct the required economic research, or fail to provide procurement opportunities to small businesses, I would see little choice but to support legislative changes requiring punitive measures for these Federal agencies. This is a step I have been reluctant to take in the past. However, I am optimistic that such a step will not be necessary and that the fair and reasonable system established under this legislation will be effective. I would once again like to thank my fellow sponsors, Senators Bond, Carnahan, and Collins for their support on this issue. I hope all of my colleagues will join us in supporting this bill. I ask unanimous consent that the text of the legislation be printed in the Record.

Mr. KERRY

Mr. KERRY. Madam President, I am proud to join in celebrating an extraordinary milestone for my friend, Mayor Tom Menino, an honor shared by all the people of Boston who have benefitted from Tom's remarkable leadership in our city. A reflection of all that he has accomplished and continues to achieve, Mayor Tom Menino ascends to the position of President of the U.S. Conference of Mayors. I am proud to join his family, staff and colleagues across the country in congratulating him as he embarks on this new challenge. Since his election as Mayor in 1993, Tom Menino has been tireless in his efforts to make the nation's greatest city even stronger. As he begins his term as President of the Conference, mayors from across the country will find in Tom a friend and a national trail blazer as the chief spokesperson and leader of their efforts. Tom Menino's record of achievement already serves as a blueprint for our nation's cities; in 2001 he was recognized by Governing Magazine as ``Public Official of the Year,'' dubbing him the ``Main Streets Maestro.'' Mayors from cities from Houston, Detroit to Philadelphia have come to Boston to study Tom's approach to governing, and each has returned to their own city and implemented a piece of Boston's success story. After a recent Boston visit, Mayor O'Malley returned to Baltimore to open an Office of Neighborhoods, borrowing a page from the Menino play book. But it is in the neighborhoods of Boston where the results of his hands-on management style are most visible. In places like Grove Hall and Jackson Square, new businesses are starting up, community development corporations are working hand-in-hand with the Mayor to jump start new developments and rehabilitate old buildings, and small, locally-owned businesses are flourishing in all corners of the city. But do not take my word for it, just look at the statistics: Crime rates are dramatically lower than 10 years ago; the public school drop- out rate has been cut in half during Tom's time in office; and almost 70 percent of Boston's high school graduates continue on to college. Mayor Menino's work on behalf of the children of Boston reflects a long term commitment that reaches far into the future: He has almost doubled the number of immunized children; launched a youth literacy campaign that has been replicated in over 100 other U.S. cities; and Tom Menino is the first mayor of a major city to completely wire the school system to the Internet. Mayor Menino has partnered with the Ten Point Coalition and other violence prevention groups to create successful programs like Operation Ceasefire and ``2 to 6'', that target the city's at risk youth with activities and structure during those crucial after school hours. I am proud to stand shoulder-to-shoulder with Tom Menino as we move ahead and continue our work together on improving public schools, increasing the availability of affordable housing and making our streets as safe as they can be. He is a dedicated and talented public servant, one whom I am fortunate to call a colleague and friend, and I join the whole Massachusetts delegation and mayors across the State in congratulating him on his Presidency of the U.S. Conference of Mayors.

Mr. KERRY

Mr. KERRY. Mr. President, I am proud to be a cosponsor of the amendment submitted by Senators Lieberman and Smith demonstrating our continued solidarity with our ally, Israel, in its efforts to defend itself against terrorism. Suicide bombings and the taking of lives of innocent civilians are terrorist acts by anyone's definition. No moral or political justification exists for the bombing of civilians on buses or in restaurants or at religious celebrations. This resolution makes it clear that we oppose these acts of terrorism and that we recognize and support Israel's right to defend itself against them. Now that Yasser Arafat is no longer confined to his headquarters in Ramallah, it is imperative that he make every effort possible to stem the tide of Palestinian terrorism and to break up whatever elements remain of the terrorist networks. And it is equally important that those Arab states who say they want to work with us in the war on terrorism do all that they can to help bring about an end to all forms of terrorism. They must make it clear that like us, they too oppose suicide bombings and that they expect the leadership of the Palestinian authority to live up to its responsibility to bring them to a halt. Israel exercised its legitimate right to self-defense when it used force to root out and break up the terrorist networks threatening its own civilians. But force alone cannot ensure the security of the Israel and its people over the long term. I am convinced that the only way to truly enhance Israel's security is to replace the dynamic of violence with hope and political settlement. This amendment acknowledges that reality. It calls upon all parties in the region to pursue vigorously efforts to establish a just and lasting comprehensive peace. When I was in the region in January, I met with all the key players. At that time I came away convinced that we must find a way to get back to a peace process. That need is even more urgent now. Ultimately the Israelis and Palestinians are going to have to live with each other as neighbors, not enemies. Passions are so high at this point that it is difficult if not impossible for either side to imagine that future. It is our responsibility, as the one country with the greatest influence over both sides, to help them see beyond the current impasse and to move them toward the prospect of reopening political discussions particularly now that some semblance of calm has been established. Now that the Administration has finally gotten engaged it must stay engaged. Our role as broker is vital and we must be willing to undertake it if we are serious about Israel's long-term security, peace in the Middle East and combating terrorism.

Mr. KERRY

Mr. KERRY. Mr. President, I simply ask my colleague from Massachusetts--and I thank him for bringing this issue before us-- whether or not he believes, in a moment when people are being thrown out of work, in a moment when the economy is down, and at the same time we are talking about making education the most important issue for Americans, as Americans believe it is--if at that moment it makes any sense at all, when more people are trying to apply to schools, when more people realize the importance of education to get a high-value- added job to move the economy of this country--how can one justify, I ask my colleague, asking students in this country to pay the price of a large number of corporations getting a tax break, of a large number of wealthy people getting a tax break, and making it more difficult for people to secure the very education the President says and others agree is the most important ingredient in not only moving our economy but of good citizenship? I ask my colleague, is there any possible way to justify that as a commonsense policy?

Mr. KERRY. I thank my colleague.

Mr. KERRY. Mr. President, I ask unanimous consent that the Senator from Massachusetts be permitted to control his time.

Mr. KERRY

Mr. KERRY. Mr. President, I rise today to introduce with my colleagues, Ms. Snowe, Mr. Hollings, Mr. Stevens, Mr. Breaux, Mr. Sarbanes, Mr. Reed and Mr. Feingold the National Sea Grant College Program Act Amendments of 2002, legislation to reauthorize the National Sea Grant College Program Act. Congress established the Sea Grant program back in 1966. Since that time Sea Grant has provided the Administration and Congress a comprehensive vehicle that engages our best universities to respond to complex and changing ocean, coastal, and Great Lakes issues. The 31 Sea Grant programs, located in coastal and Great Lakes States and Puerto Rico, serve as the core of this dynamic national network of over 300 participating institutions involving more than 3,000 scientists, engineers, educators, students, and outreach experts. Sea Grant's legislative charge is to ``increase the understanding, assessment, development, utilization, and conservation of the nation's ocean and coastal resources by providing assistance to promote a strong education base, responsive research and training activities, and broad and prompt dissemination of knowledge and techniques''. Sea Grant has consistently proven its value to taxpayers as a program that supports rigorous, high quality research that is directly responsive to the concerns of coastal constituents. The Sea Grant Program brings academic creativity and expertise to bear on a host of issues affecting the oceans, coasts and Great Lakes. Most decisions that affect the coastal environment are made locally, and, through the Sea Grant Colleges, the federal government has the ability to partner with state and local constituencies to address national problems at state and local levels. Moreover, many coastal issues cross State jurisdictions and need to be addressed regionally. In addition to its state-based infrastructure, Sea Grant has developed a system of regional networks for organizing multi-state responses to regional/ecosystem-level problems. The current administration proposed moving the Sea Grant program from the National Oceanic and Atmospheric Administration, NOAA, to the National Science Foundation, NSF. I do not support such a move. The Sea Grant program has been a success in NOAA and one has to wonder if something is not broke why should we fix it. This is obviously the case with Sea Grant and I see no reason why we should move the program from NOAA to NSF. Allow me for a moment to point out one area where the Sea Grant/NOAA partnership is working. As Chairman of the Oceans, Fisheries and Atmosphere Subcommittee I know first-hand the struggles that commercial fishermen face as we try and rebuild our stocks. Sea Grant is currently working in coastal communities to better document the social and economic impacts of fishery regulations on communities, so that we can develop regulations that not only preserve and protect are valuable marine resources but also protect the fabric of our coastal communities. As you may know, the National Marine Fisheries Service is one of five line offices within NOAA, that is charged with regulating all of our domestic commercial fisheries. One thing that all of us from coastal states will agree on is the need to improve our knowledge of fishing communities and how regulations affect the lives of the people who live there. A unique feature of the existing National Sea Grant College Program Act, which is maintained through this reauthorization bill, is that the majority of grants awarded require that every $2 of federal funds be matched by $1 of non-federal funds that are usually provided by host universities, as well as state or local governments, thus providing outstanding leverage as well as strong regional support for the federal funds awarded. Because Sea Grant is non-regulatory and science-based, it serves as an ``honest broker'' among a wide range of constituents. In an age that emphasizes multi-disciplinary, goal-oriented, performance-measured partnerships, Sea Grant has demonstrated its capability to effectively deliver relevant science and services. In short, Sea Grant offers numerous economic opportunities, problem- solving processes and programmatic efficiencies for the federal government to achieve its marine and coastal science agenda. Based on the Sea Grant College Program's remarkable capabilities, excellent track record, and cost effective use of federal funds, I ask for your support in quick passage of this reauthorization bill. I ask unanimous consent the text of the bill be printed in the Record.

Mr. KERRY

Mr. KERRY. Mr. President, I rise today to introduce with my colleagues, Ms. Snowe, Mr. Hollings, Mr. Stevens, Mr. Breaux, Mr. Sarbanes, Mr. Reed and Mr. Feingold the National Sea Grant College Program Act Amendments of 2002, legislation to reauthorize the National Sea Grant College Program Act. Congress established the Sea Grant program back in 1966. Since that time Sea Grant has provided the Administration and Congress a comprehensive vehicle that engages our best universities to respond to complex and changing ocean, coastal, and Great Lakes issues. The 31 Sea Grant programs, located in coastal and Great Lakes States and Puerto Rico, serve as the core of this dynamic national network of over 300 participating institutions involving more than 3,000 scientists, engineers, educators, students, and outreach experts. Sea Grant's legislative charge is to ``increase the understanding, assessment, development, utilization, and conservation of the nation's ocean and coastal resources by providing assistance to promote a strong education base, responsive research and training activities, and broad and prompt dissemination of knowledge and techniques''. Sea Grant has consistently proven its value to taxpayers as a program that supports rigorous, high quality research that is directly responsive to the concerns of coastal constituents. The Sea Grant Program brings academic creativity and expertise to bear on a host of issues affecting the oceans, coasts and Great Lakes. Most decisions that affect the coastal environment are made locally, and, through the Sea Grant Colleges, the federal government has the ability to partner with state and local constituencies to address national problems at state and local levels. Moreover, many coastal issues cross State jurisdictions and need to be addressed regionally. In addition to its state-based infrastructure, Sea Grant has developed a system of regional networks for organizing multi-state responses to regional/ecosystem-level problems. The current administration proposed moving the Sea Grant program from the National Oceanic and Atmospheric Administration, NOAA, to the National Science Foundation, NSF. I do not support such a move. The Sea Grant program has been a success in NOAA and one has to wonder if something is not broke why should we fix it. This is obviously the case with Sea Grant and I see no reason why we should move the program from NOAA to NSF. Allow me for a moment to point out one area where the Sea Grant/NOAA partnership is working. As Chairman of the Oceans, Fisheries and Atmosphere Subcommittee I know first-hand the struggles that commercial fishermen face as we try and rebuild our stocks. Sea Grant is currently working in coastal communities to better document the social and economic impacts of fishery regulations on communities, so that we can develop regulations that not only preserve and protect are valuable marine resources but also protect the fabric of our coastal communities. As you may know, the National Marine Fisheries Service is one of five line offices within NOAA, that is charged with regulating all of our domestic commercial fisheries. One thing that all of us from coastal states will agree on is the need to improve our knowledge of fishing communities and how regulations affect the lives of the people who live there. A unique feature of the existing National Sea Grant College Program Act, which is maintained through this reauthorization bill, is that the majority of grants awarded require that every $2 of federal funds be matched by $1 of non-federal funds that are usually provided by host universities, as well as state or local governments, thus providing outstanding leverage as well as strong regional support for the federal funds awarded. Because Sea Grant is non-regulatory and science-based, it serves as an ``honest broker'' among a wide range of constituents. In an age that emphasizes multi-disciplinary, goal-oriented, performance-measured partnerships, Sea Grant has demonstrated its capability to effectively deliver relevant science and services. In short, Sea Grant offers numerous economic opportunities, problem- solving processes and programmatic efficiencies for the federal government to achieve its marine and coastal science agenda. Based on the Sea Grant College Program's remarkable capabilities, excellent track record, and cost effective use of federal funds, I ask for your support in quick passage of this reauthorization bill. I ask unanimous consent the text of the bill be printed in the Record.

Mr. KERRY

Mr. KERRY. Mr. President, the recent demise of Enron Corporation has generated national attention and shed light on an alarming trend. A growing number of corporations and individuals are exploiting tax havens in the Caribbean and elsewhere to evade and avoid paying taxes. Often cloaked in a web of bank secrecy and taxpayer privacy, businesses and individuals operating in offshore financial centers create sham corporations and partnerships. By sheltering tax-dodgers and tax cheats, these overseas tax havens undermine confidence and trust in our Federal Government. The spread of illegal tax haven activity punishes those who play by the rules. The end result is higher taxes on the little guy--those who comply with the law. They are stuck paying the tab, forced to make up for the lost revenue through unnecessarily high taxes. The vast majority of American businesses and individuals do not engage in abusive tax schemes. These taxpayers' activities will be unaffected by the Tax Haven and Abusive Tax Shelter Reform Act of 2002. The legislation will not stand in the way of legitimate tax planning and business activity. However, the bill will create real consequences for those individuals who flout the law, and those businesses who engage in transactions with no real business purpose other than generating artificial losses and deductions. The exact details of Enron's tax avoidance practices are still under investigation by the Senate Finance Committee. What we do know is the energy conglomerate held over 800 subsidiaries in tax haven jurisdictions. Enron created 692 subsidiaries in the Cayman Islands alone. Through the use of sophisticated financial instruments, at least one analyst estimates Enron was able to avoid income taxes in four of the last five years. Enron is not alone. The use of offshore tax havens by corporations and wealthy individuals is widespread. Through accounting tricks and tax loopholes, large companies not only avoid corporate income taxes, they claim sizable tax refunds. In a typical example, a corporation establishes a foreign subsidiary not subject to American taxes, shifts profits to the subsidiary which then sends them back to the parent corporation in a form that is considered not taxable under U.S. law. While some corporations use loopholes to skirt the edges of the law, other individuals use tax havens outright illegally. The Internet has simplified the process of launching a corporation or opening an account offshore. While Americans are taxed on their worldwide earnings, individuals operating in offshore financial centers gamble that the IRS will never uncover their overseas income. Taxpayers select tax havens because they offer little or no taxation on income in their jurisdiction and have privacy rules that help taxpayers hide what they are doing. Once the transfers are established, income is often repatriated back to the U.S. owners through loans, credit cards, or debit cards. By using complex transactions and multiple entities, the individuals using these schemes hide their income and avoid potential tax liabilities. The scope of the problem is daunting. Assets in offshore entities have climbed from an estimated $200 billion in 1983, to an estimated $5 trillion today. One private sector estimate suggests the use of tax havens to illegally shelter income results in the loss of $70 billion annually. The IRS estimates that in tax year 2000, about 740,000 taxpayers used abusive schemes, both domestic and offshore. Clearly, Congress must act to restore public confidence in our federal tax system. We can start by ensuring that honest, middle-class Americans are not the only ones left holding the bill. Unfortunately, the Bush administration has shied away from aggressively attacking tax evasion. Last May, Treasury Secretary Paul O'Neill voiced support for abolishing the corporate income tax. The Treasury Department recently fought to water down an international campaign to reform tax haven practices led by the Organization for Economic Cooperation and Development, OECD. Last fall, the Administration sought to repeal the corporate alternative minimum tax, a tax designed to ensure that large corporations do not entirely escape taxation. Exempting our Nation's largest firms from taxation altogether is not the answer. On the contrary, Congress should take steps to ensure that criminal tax evasion is detected and addressed accordingly. The Tax Haven and Abusive Tax Shelter Reform Act of 2002 would impose strict measures against nations identified as uncooperative tax havens those which use confidentiality rules and practices to undermine tax enforcement and administration or refuse to participate in effective information exchange agreements. The legislation would limit foreign tax credits claimed by taxpayers operating in uncooperative tax havens. It would require a strict reporting of outbound transfers by U.S. taxpayers. The bill imposes a new civil penalty on U.S. taxpayers who fail to report an interest in an offshore account. Finally, it mandates a comprehensive review of the offshore tax evasion problem, including specific mechanisms used by taxpayers to shelter income and assets. By imposing real consequences for jurisdictions which are identified as uncooperative tax havens, the bill pierces the veil of secrecy which shields tax cheats from scrutiny and provides a strong incentive for otherwise uncooperative tax havens to enter into commitments with the United States to reform their practices. The peddling of abusive corporate tax shelters also demands attention. Pre-packaged, tax-motivated transactions with no real economic risk or business purpose--but which capitalize on technical ambiguities in the tax code--are sold to corporations by creative practitioners to generate artificial losses and deductions. Provisions in the Tax Haven and Abusive Tax Shelter Reform Act of 2002, identical to those introduced in the House by Rep. Lloyd Doggett, D-TX, would disallow tax benefits from transactions that have no real business purpose other than tax savings. In addition, they expand disclosure requirements so that the IRS is fully aware of dubious tax schemes and tighten penalties against gross underpayments resulting from illegal tax shelters. A tax system which asks working families to pay their fair share, but gives large corporations such as Enron a free ride, is a national disgrace. And as tax havens and shelters proliferate, confidence in the integrity and fairness of our tax system and government declines. Middle-class families rightly conclude that our own government cannot effectively enforce its laws. The administration, while proposing new disclosure requirements, has offered little in the way of substantive changes to alter the tax treatment of transactions which clearly serve no real business purpose other than tax avoidance. Furthermore, the administration has undermined international efforts to aggressively address sheltering activity in tax havens. The Tax Haven and Abusive Tax Shelter Reform Act of 2002 is the first step in what will surely be a long road to restoring the confidence and faith of the vast majority of hard-working, law-abiding Americans who pay taxes on every dollar they earn. I urge my colleagues to join me in this effort, and I ask that a summary of the legislation as well as the full text of the bill be printed in the Record. The material follows:

Mr. KERRY

Mr. KERRY. Mr. President, the recent demise of Enron Corporation has generated national attention and shed light on an alarming trend. A growing number of corporations and individuals are exploiting tax havens in the Caribbean and elsewhere to evade and avoid paying taxes. Often cloaked in a web of bank secrecy and taxpayer privacy, businesses and individuals operating in offshore financial centers create sham corporations and partnerships. By sheltering tax-dodgers and tax cheats, these overseas tax havens undermine confidence and trust in our Federal Government. The spread of illegal tax haven activity punishes those who play by the rules. The end result is higher taxes on the little guy--those who comply with the law. They are stuck paying the tab, forced to make up for the lost revenue through unnecessarily high taxes. The vast majority of American businesses and individuals do not engage in abusive tax schemes. These taxpayers' activities will be unaffected by the Tax Haven and Abusive Tax Shelter Reform Act of 2002. The legislation will not stand in the way of legitimate tax planning and business activity. However, the bill will create real consequences for those individuals who flout the law, and those businesses who engage in transactions with no real business purpose other than generating artificial losses and deductions. The exact details of Enron's tax avoidance practices are still under investigation by the Senate Finance Committee. What we do know is the energy conglomerate held over 800 subsidiaries in tax haven jurisdictions. Enron created 692 subsidiaries in the Cayman Islands alone. Through the use of sophisticated financial instruments, at least one analyst estimates Enron was able to avoid income taxes in four of the last five years. Enron is not alone. The use of offshore tax havens by corporations and wealthy individuals is widespread. Through accounting tricks and tax loopholes, large companies not only avoid corporate income taxes, they claim sizable tax refunds. In a typical example, a corporation establishes a foreign subsidiary not subject to American taxes, shifts profits to the subsidiary which then sends them back to the parent corporation in a form that is considered not taxable under U.S. law. While some corporations use loopholes to skirt the edges of the law, other individuals use tax havens outright illegally. The Internet has simplified the process of launching a corporation or opening an account offshore. While Americans are taxed on their worldwide earnings, individuals operating in offshore financial centers gamble that the IRS will never uncover their overseas income. Taxpayers select tax havens because they offer little or no taxation on income in their jurisdiction and have privacy rules that help taxpayers hide what they are doing. Once the transfers are established, income is often repatriated back to the U.S. owners through loans, credit cards, or debit cards. By using complex transactions and multiple entities, the individuals using these schemes hide their income and avoid potential tax liabilities. The scope of the problem is daunting. Assets in offshore entities have climbed from an estimated $200 billion in 1983, to an estimated $5 trillion today. One private sector estimate suggests the use of tax havens to illegally shelter income results in the loss of $70 billion annually. The IRS estimates that in tax year 2000, about 740,000 taxpayers used abusive schemes, both domestic and offshore. Clearly, Congress must act to restore public confidence in our federal tax system. We can start by ensuring that honest, middle-class Americans are not the only ones left holding the bill. Unfortunately, the Bush administration has shied away from aggressively attacking tax evasion. Last May, Treasury Secretary Paul O'Neill voiced support for abolishing the corporate income tax. The Treasury Department recently fought to water down an international campaign to reform tax haven practices led by the Organization for Economic Cooperation and Development, OECD. Last fall, the Administration sought to repeal the corporate alternative minimum tax, a tax designed to ensure that large corporations do not entirely escape taxation. Exempting our Nation's largest firms from taxation altogether is not the answer. On the contrary, Congress should take steps to ensure that criminal tax evasion is detected and addressed accordingly. The Tax Haven and Abusive Tax Shelter Reform Act of 2002 would impose strict measures against nations identified as uncooperative tax havens those which use confidentiality rules and practices to undermine tax enforcement and administration or refuse to participate in effective information exchange agreements. The legislation would limit foreign tax credits claimed by taxpayers operating in uncooperative tax havens. It would require a strict reporting of outbound transfers by U.S. taxpayers. The bill imposes a new civil penalty on U.S. taxpayers who fail to report an interest in an offshore account. Finally, it mandates a comprehensive review of the offshore tax evasion problem, including specific mechanisms used by taxpayers to shelter income and assets. By imposing real consequences for jurisdictions which are identified as uncooperative tax havens, the bill pierces the veil of secrecy which shields tax cheats from scrutiny and provides a strong incentive for otherwise uncooperative tax havens to enter into commitments with the United States to reform their practices. The peddling of abusive corporate tax shelters also demands attention. Pre-packaged, tax-motivated transactions with no real economic risk or business purpose--but which capitalize on technical ambiguities in the tax code--are sold to corporations by creative practitioners to generate artificial losses and deductions. Provisions in the Tax Haven and Abusive Tax Shelter Reform Act of 2002, identical to those introduced in the House by Rep. Lloyd Doggett, D-TX, would disallow tax benefits from transactions that have no real business purpose other than tax savings. In addition, they expand disclosure requirements so that the IRS is fully aware of dubious tax schemes and tighten penalties against gross underpayments resulting from illegal tax shelters. A tax system which asks working families to pay their fair share, but gives large corporations such as Enron a free ride, is a national disgrace. And as tax havens and shelters proliferate, confidence in the integrity and fairness of our tax system and government declines. Middle-class families rightly conclude that our own government cannot effectively enforce its laws. The administration, while proposing new disclosure requirements, has offered little in the way of substantive changes to alter the tax treatment of transactions which clearly serve no real business purpose other than tax avoidance. Furthermore, the administration has undermined international efforts to aggressively address sheltering activity in tax havens. The Tax Haven and Abusive Tax Shelter Reform Act of 2002 is the first step in what will surely be a long road to restoring the confidence and faith of the vast majority of hard-working, law-abiding Americans who pay taxes on every dollar they earn. I urge my colleagues to join me in this effort, and I ask that a summary of the legislation as well as the full text of the bill be printed in the Record. The material follows:

Mr. KERRY

Mr. KERRY. Mr. President, I am pleased today to join with my colleague, Senator Johnson, as well as the cosponsors of our legislation, Senators, Cantwell, Wellstone, Daschle, Baucus, Inouye, Bingaman, Stabenow, and Clinton in introducing the Native American Small Business Development Act. This legislation bears the same name as legislation that passed the House last year, H.R. 2538, which was introduced by Congressman Tom Udall, a recognized leader in promoting the interests of American Indians. I would like to thank Congressman Udall for his work in stewarding H.R. 2538 through the House and for his assistance in working with Senator Johnson and me in drafting the Senate version of our legislation. I would also like to thank the National Indian Business Association, the National Center for American Indian Enterprise Development, the Association of Small Business Development Centers, ONABEN, Native American Management Services, Inc., and all of the tribes that met with us or provided information to help in the crafting of this legislation. The Senate version of the Native American Small Business Development Act, while incorporating the heart of the Udall legislation, is more comprehensive and provides greater assistance to Native American communities. Senator Johnson, who serves on the Indian Affairs Committee, and I, as Chairman of the Senate Committee on Small Business and Entrepreneurship, were able to combine our resources in crafting this legislation. Our desire to fashion a comprehensive assistance package for Native American small businesses stems in no small part from an apparent lack of commitment the Small Business Administration (SBA) has shown to our Native American communities under the Bush Administration. While I applaud the Bush Administration for responding to congressional requests and including $1 million in the Administration's fiscal year 2003 budget request for Native American outreach, I was disappointed that it did not seek the full level of $2.5 million requested in a letter I sent with my colleagues Senators Daschle, Wellstone, Johnson, Bingaman and Baucus. Our request specifically sought funding for the SBA's Tribal Business Information Center (TBIC) program, started under the Clinton Administration and designed to address the unique conditions faced by American Indians when they seek to start or expand small businesses. I do not believe that anyone in this Congress would dispute that economic development in Indian Country has often been difficult to achieve and that one important way to help American Indians who live on reservations is to provide them with assistance to open and run their own small businesses. Helping Native Americans open and run small businesses not only instills a sense of pride in the owner and his or her community, it also provides much-needed job opportunities, as well as other economic benefits. Although underfunded, the TBIC program has provided assistance to a number of small businesses on Indian reservations. TBICs have the support of the American Indian communities they serve because they provide desperately needed, culturally tailored business development assistance in those communities. The administration should be seeking to strengthen its commitment to programs that assist Native American communities. Unfortunately, the SBA cut off TBIC funding on March 31, 2002, and has not met a request by a bipartisan group of Senators to begin the reprogramming process in order to keep the TBICs open for the remainder of the fiscal year. The Native American Small Business Development Act will ensure that the SBA's programs to assist Native American Affairs (ONAA) a permanent office, create a statutory grant program, known as the Native American Development grant program, to assist Native Americans, establish two pilot programs to try new means of assisting Native American communities and require Native American communities to be consulted regarding the future of SBA programs designed to assist them. In short, our legislation will ensure that our Native American communities will receive the assistance they need to help start and grow small businesses. The ONAA, to be headed by an Assistant Administrator, will be responsible for assisting Native Americans and Native American communities to start, operate, and grow small business concerns; develop management and technical skills; seek Federal procurement opportunities; increase employment opportunities through the start and expansion of small business concerns; and increase their access to capital markets. To be selected to serve as the Assistant Administrator for ONAA, a candidate must have knowledge of Native American cultures and experience providing culturally tailored small business development assistance to Native Americans. Under our legislation, the Assistant Administrator would be statutorily required to consult with Tribal Colleges and Tribal Governments, Alaska Native Corporations (ANC) and Native Hawaiian Organizations (NHO) when carrying out responsibilities under this legislation. The Assistant Administrator for ONAA would be responsible for administering the Native American Development program and the pilot programs created by the Native American Small Business Development Act. The Native American Development program is designed to be the SBA's primary program for providing business development assistance to Native American communities. To offer this support, the SBA will provide financial and resource assistance to establish and keep Native American Business Centers (NABC) in operation. Financial assistance under the Native American Development program would be available to Tribal Governments and Tribal Colleges. Unlike the SBA's TBIC program, however, ANCs and NHOs would also be eligible for the grants. NABCs would address the unique conditions faced by reservation-based American Indians, as well as Native Hawaiians and Native Alaskans, in their efforts to create, develop and expand small business concerns. Grant funding would be used by the NABCs to provide culturally tailored financial education assistance, management education assistance, and marketing education assistance. The first pilot program under the legislation establishes a Native American development grant. This grant is modeled after the Udall legislation and designed to bring the expertise of SBA's Small Business Development Centers (SBDC) to Native American communities. Additionally, any private nonprofit organization, whose board of directors consists of a majority of Tribal Government members or their designees, is an NHO or an ANC, may also apply for the grant. Nonprofits were included in the Senate version thanks to the thoughtful input of Senator Cantwell. Many American Indian communities in Washington State are served by an organization called ONABEN, which provides SBDC-like services to Native American communities in Washington, Oregon, Idaho, and California. Organizations like ONABEN should be encouraged to provide resources to Native American communities, and including them in the grant program available to SBDCs was an important addition to the legislation. Finally, our legislation establishes a second pilot program to try a unique experiment in Indian County. Grant funding would be made available to establish American Indian Tribal Assistance Centers. These centers will consist of joint entities, such as a partnership between an NABC, a Native American development center (which receive grants from the Department of Commerce) and possibly an SBDC. The purpose of this grant is to bring together experts from various entities to provide culturally tailored business development assistance to prospective and current owners of small business concerns on or near Tribal Lands. I would again like to thank Senator Johnson and all of the cosponsors of this important legislation to assist our Native American communities. I would also, again, like to thank Congressman Udall for taking the lead in the House on providing critical assistance for small businesses in Native American communities. I would urge all of my colleagues to cosponsor this legislation to help us fulfill our commitment to Native American communities.

Mr. KERRY

Mr. KERRY. Mr. President, today the Senate completed consideration of the energy reform bill after 6 weeks of debate. I voted yea on final passage. Before we began debate on this legislation, I gave a talk here in Washington at the Center for National Policy outlining a sound energy policy for this Nation. Despite my vote for the energy bill, I believe that the Senate has fallen far short of crafting a sound energy policy for this nation. The Senate did not enact a national energy policy today. I should add that the House and President has failed at that task, as well. Why then am I voting for the Senate bill? Because the Senate bill is far better than the President's plan or the House bill. It is critically important that the Senate have a voice in this discussion and put forward its work. After 17 years in the Senate, I can see from this debate, that while the bill we passed today falls far short of what the Nation needs, it is simply the most the political system can bear right now. The fundamental changes we need were resisted and ultimately defeated by the special interests that benefit from the status quo. And while it may be too much to ask, I hold out hope that the bill can be improved in the conference process. If it is not improved, I do not believe I will be able to support the conference report. I want to quickly outline some of the strengths in this bill and some of the weaknesses. The tax package is reasonable and balanced. It totals about $15 billion, with that cost nearly equally divided between coal, oil, gas, and nuclear and energy efficiency and renewable energy. In the context of this measure, I support the assistance to clean coal, marginal well production, and other areas. I strongly support the tax credit for hybrid, fuel cell, and alternative fuel vehicles. I strongly support tax credits for efficient air conditioners, water heaters and other appliances. I strongly support the tax credits for wind, solar, biomass, geothermal, and other renewable electricity and energy production. The bill contains significant provisions to increase oil and gas production. As I have said, it includes new tax credits for marginal well and other production. It also includes loan guarantees and prices supports for the construction of a natural gas pipeline from the North Slope of Alaska to the Lower 48 States. This will move more than 35 trillion cubic feet of natural gas to market, be the largest private works project ever undertaken in North America, and create hundreds of thousands of jobs. The bill also contains a very modest renewable portfolio standard that would require 10 percent of the Nation's electricity be produced from renewable energy sources by 2020. This standard is weaker than what I believe is possible. I have advocated that the Nation set a goal of producing 20 percent of its electricity from renewable sources by 2020. Unfortunately, the Senate not only accepted a lower target, but it adopted an amendment that undermines the integrity of the RPS system allowing for the purchase of inexpensive credits, credits potentially below the market price of renewable electricity. Nevertheless, it is important to enshrine this important concept of a renewable portfolio standard into law. I supported the renewable fuel standard in the law. This provision was supported by the State of Massachusetts as a way to end more costly mandates under the Clean Air Act, ensure clean air, end the use of polluting MTBE, and create a national market for corn ethanol, biomass ethanol, and other renewable fuels. The bill's most significant failure is that it does nothing to meaningfully reduce oil consumption or enhance efficiency in the transportation sector. The Senate rejected a proposal I crafted with Senator McCain that would have raised fuel economy standards for America's passenger vehicles and save 1 million barrels of oil per day by 2015. The result is that the Senate has foregone action on the single greatest step we can take as a nation to reduce our dependence on oil, protect the economy from oil price shocks, and reduce harmful pollution. For the past year I have urged my colleagues to oppose drilling in the Arctic National Wildlife Refuge. I am grateful that a majority of the Senate voted to protect the refuge. I am grateful that, while this bill is inadequate, it does not open the refuge to oil drilling. I will oppose any attempt to add drilling in this bill in conference with the House. As I have said, this energy bill is not an energy policy for the Nation. It is a collection of policies, many good and many bad, that will, in total, move the Nation only incrementally forward. It is not by any means a solution to the challenges that we face. While I voted for this bill today, I pledge myself to continuing the fight for clean, reliable, and domestic energy and for a real energy policy for this Nation.

Mr. KERRY

Mr. KERRY. Mr. President, I am pleased today to join with my colleague, Senator Johnson, as well as the cosponsors of our legislation, Senators, Cantwell, Wellstone, Daschle, Baucus, Inouye, Bingaman, Stabenow, and Clinton in introducing the Native American Small Business Development Act. This legislation bears the same name as legislation that passed the House last year, H.R. 2538, which was introduced by Congressman Tom Udall, a recognized leader in promoting the interests of American Indians. I would like to thank Congressman Udall for his work in stewarding H.R. 2538 through the House and for his assistance in working with Senator Johnson and me in drafting the Senate version of our legislation. I would also like to thank the National Indian Business Association, the National Center for American Indian Enterprise Development, the Association of Small Business Development Centers, ONABEN, Native American Management Services, Inc., and all of the tribes that met with us or provided information to help in the crafting of this legislation. The Senate version of the Native American Small Business Development Act, while incorporating the heart of the Udall legislation, is more comprehensive and provides greater assistance to Native American communities. Senator Johnson, who serves on the Indian Affairs Committee, and I, as Chairman of the Senate Committee on Small Business and Entrepreneurship, were able to combine our resources in crafting this legislation. Our desire to fashion a comprehensive assistance package for Native American small businesses stems in no small part from an apparent lack of commitment the Small Business Administration (SBA) has shown to our Native American communities under the Bush Administration. While I applaud the Bush Administration for responding to congressional requests and including $1 million in the Administration's fiscal year 2003 budget request for Native American outreach, I was disappointed that it did not seek the full level of $2.5 million requested in a letter I sent with my colleagues Senators Daschle, Wellstone, Johnson, Bingaman and Baucus. Our request specifically sought funding for the SBA's Tribal Business Information Center (TBIC) program, started under the Clinton Administration and designed to address the unique conditions faced by American Indians when they seek to start or expand small businesses. I do not believe that anyone in this Congress would dispute that economic development in Indian Country has often been difficult to achieve and that one important way to help American Indians who live on reservations is to provide them with assistance to open and run their own small businesses. Helping Native Americans open and run small businesses not only instills a sense of pride in the owner and his or her community, it also provides much-needed job opportunities, as well as other economic benefits. Although underfunded, the TBIC program has provided assistance to a number of small businesses on Indian reservations. TBICs have the support of the American Indian communities they serve because they provide desperately needed, culturally tailored business development assistance in those communities. The administration should be seeking to strengthen its commitment to programs that assist Native American communities. Unfortunately, the SBA cut off TBIC funding on March 31, 2002, and has not met a request by a bipartisan group of Senators to begin the reprogramming process in order to keep the TBICs open for the remainder of the fiscal year. The Native American Small Business Development Act will ensure that the SBA's programs to assist Native American Affairs (ONAA) a permanent office, create a statutory grant program, known as the Native American Development grant program, to assist Native Americans, establish two pilot programs to try new means of assisting Native American communities and require Native American communities to be consulted regarding the future of SBA programs designed to assist them. In short, our legislation will ensure that our Native American communities will receive the assistance they need to help start and grow small businesses. The ONAA, to be headed by an Assistant Administrator, will be responsible for assisting Native Americans and Native American communities to start, operate, and grow small business concerns; develop management and technical skills; seek Federal procurement opportunities; increase employment opportunities through the start and expansion of small business concerns; and increase their access to capital markets. To be selected to serve as the Assistant Administrator for ONAA, a candidate must have knowledge of Native American cultures and experience providing culturally tailored small business development assistance to Native Americans. Under our legislation, the Assistant Administrator would be statutorily required to consult with Tribal Colleges and Tribal Governments, Alaska Native Corporations (ANC) and Native Hawaiian Organizations (NHO) when carrying out responsibilities under this legislation. The Assistant Administrator for ONAA would be responsible for administering the Native American Development program and the pilot programs created by the Native American Small Business Development Act. The Native American Development program is designed to be the SBA's primary program for providing business development assistance to Native American communities. To offer this support, the SBA will provide financial and resource assistance to establish and keep Native American Business Centers (NABC) in operation. Financial assistance under the Native American Development program would be available to Tribal Governments and Tribal Colleges. Unlike the SBA's TBIC program, however, ANCs and NHOs would also be eligible for the grants. NABCs would address the unique conditions faced by reservation-based American Indians, as well as Native Hawaiians and Native Alaskans, in their efforts to create, develop and expand small business concerns. Grant funding would be used by the NABCs to provide culturally tailored financial education assistance, management education assistance, and marketing education assistance. The first pilot program under the legislation establishes a Native American development grant. This grant is modeled after the Udall legislation and designed to bring the expertise of SBA's Small Business Development Centers (SBDC) to Native American communities. Additionally, any private nonprofit organization, whose board of directors consists of a majority of Tribal Government members or their designees, is an NHO or an ANC, may also apply for the grant. Nonprofits were included in the Senate version thanks to the thoughtful input of Senator Cantwell. Many American Indian communities in Washington State are served by an organization called ONABEN, which provides SBDC-like services to Native American communities in Washington, Oregon, Idaho, and California. Organizations like ONABEN should be encouraged to provide resources to Native American communities, and including them in the grant program available to SBDCs was an important addition to the legislation. Finally, our legislation establishes a second pilot program to try a unique experiment in Indian County. Grant funding would be made available to establish American Indian Tribal Assistance Centers. These centers will consist of joint entities, such as a partnership between an NABC, a Native American development center (which receive grants from the Department of Commerce) and possibly an SBDC. The purpose of this grant is to bring together experts from various entities to provide culturally tailored business development assistance to prospective and current owners of small business concerns on or near Tribal Lands. I would again like to thank Senator Johnson and all of the cosponsors of this important legislation to assist our Native American communities. I would also, again, like to thank Congressman Udall for taking the lead in the House on providing critical assistance for small businesses in Native American communities. I would urge all of my colleagues to cosponsor this legislation to help us fulfill our commitment to Native American communities.