George Miller

Mr. GEORGE MILLER of California

Mr. GEORGE MILLER of California. Mr. Speaker, I had the honor of joining the family and friends of WWII Veteran Nick Cominos in a ceremony to present several medals on Saturday, December 1, 2001, just days before the 60th anniversary of Pearl Harbor. These medals are a long-overdue recognition of his heroic efforts in the Dalmation Islands and Greece as part of a covert reconnaissance operation that led to the retreat of the Nazis from the area in 1944. Federal military decorations are awarded to members of the armed forces exhibiting valor and self-sacrifice, the heroic acts of Mr. Nick Cominos are worthy of such an honor. Almost 58 years ago, on Christmas Eve Nick Cominos and his Company boarded the liberty ship, Pierre L'enfant, to join a large convoy to the Atlantic. Thirty-one days later Cominos' Company landed on the only one of the Dalmation Islands in Adriatic Sea not occupied by the Nazis, the Island of Vis. From their base on the Island of Vis, Company C raided the Nazi occupied Island of Solta. Within two days, Company C and their allies had captured the island. This was not without a cost. Company C lost one man and six others were wounded, including Nick Cominos. After recuperating and returning to Vis, in August of 1944, Mr. Cominos and his Company C were deployed to Greece where they parachuted behind enemy lines and conducted covert reconnaissance missions to disrupt the German occupation of Greece. The Nazis retreated from Greece in November of 1944, at which time the Greek/American Operational Group was disbanded. The type of covert ground operations first used by Mr. Cominos and the men of Company C, 2671st Reconnaissance Battalion of the Office of Strategic Services are now being used to help fight the war against terrorism in Afghanistan. Mr. Cominos and other World War II veterans have received numerous medals commemorating their service to this country during the war. However, because the records of the Office of Strategic Service were classified until 1988, the individual acts of bravery of Mr. Cominos and Company C have not been officially recognized. Friday, December 7, 2001 is the 60th anniversary of the bombing of Pearl Harbor. Many have drawn parallels between the terrorists attacks of September 11th and Pearl Harbor. We have a living parallel. A WWII veteran and his Company who pioneered the types of special covert operations which are helping to bring closure to the tragic events of September 11. In a time of national emergency, when we are once again engaged in military operations on foreign soil in an international effort to defend freedom, it is important to praise those who have served our country so courageously in the past and whose actions make them role models for our troops in Afghanistan and in future military efforts. It is my honor to publicly recognize Mr. Nick Cominos for his acts of courage, heroism, and sacrifice in WWII.

Mr. GEORGE MILLER of California

Mr. GEORGE MILLER of California. Mr. Speaker, I rise in opposition to this legislation. Ladies and Gentlemen, Trade Promotion Authority is being sold to Americans as a few different things. The Bush Administration has called today's vote an act of patriotism, now more necessary than ever. House Republican leaders, in a suspicious midnight conversion, are now feverishly promising gifts to its critics in return for their support. Well folks, you can wrap this vote up in red, white and blue. You can tie it with a bow and put it under the tree. But either way, this trade bill is neither patriotic nor a gift. It is a dagger into our basic rights and our standard of living. Americans are being asked to make three sacrifices in exchange for President Bush's trade policy. They are being asked to give up their middle-class lifestyle, their environmental concerns, and their public health. For all those Americans who think that sounds like a raw deal-- and they are right--I urge my colleagues to vote a resounding ``no'' on this very bad trade deal. When NAFTA was passed in 1993, its supporters promised nothing but blue skies for hard-working Americans. Using fast-track authority. President Clinton hurdled the bill through Congress without a truly meaningful debate in Congress on the effects of such a trade agreement. Millions of Americans have paid a high price for that lack of candor eight years ago. A recent report shows that 3 million actual and potential jobs disappeared from the American economy between 1994 and 2000 due to NAFTA and the accelerated trade deficits it caused. In my home State of California, over 300,000 manufacturing jobs--good jobs, well-paying jobs--crossed the border during the last 6 years. The economic surge and booming stock market of the 1990s masked a harsh reality for millions of American workers--for them, NAFTA has meant nothing more than a pink slip. Despite this, President Bush and others in Congress would expand NAFTA further. If this bill passes, it would allow the Administration to eventually spread NAFTA's misery to over 30 other nations in our hemisphere and further exacerbate job losses in our own country. America's workers had hoped for a different kind of generosity from the American government. After losing their jobs to NAFTA a few years ago, they waited for training programs. In the wake of September 11, they waited for help that instead went to corporations. And they are waiting still, listening to empty promises that TPA will help bring back their jobs. In the last day, realizing that they are perilously close to losing this vote on fast track, Republican leaders have suddenly become concerned about the needs of America's working men and women. They are now promising more trade adjustment assistance, for example. That would be nice. But their bill does not guarantee more trade adjustment assistance, it just authorizes it. We've been there before. Their bill continue to fail to address the deeper pitfalls that fast track poses for working families. Fast Track also poses a serious threat to the environment. Frankly, it is insulting to my colleagues and all Americans when fast track proponents claim that their bill includes strong language that adequately addresses environmental concerns. One look at NAFTA shows why we should be terrified at extending current trade rules to future agreements. Chapter 11, a provision intended to protect multinational corporations from their host states, has been abused by corporations that refuse to be bound by lawfully decided and publicly supported environmental regulations. California was one of the first states to run into the chapter 11 problem when it tried to protect its environment from the harmful effects of MTBE. When California halted the use of the gasoline additive, a Canadian corporation called Methanex sued the United States under NAFTA's chapter 11 for almost one billion dollars because of lost revenue it said it would incur from California's decision to protect its environment. Luckily, however, America remains a democracy where important environmental decisions are reached in a fair, open manner. Consider this frightening, fast track reality: If foreign companies operating in the U.S. don't want to play by our rules, they get their cases decided before a secret tribunal accountable to no one. This lack of democracy doesn't bother the administration. The environment has become a defendant without rights. Rights are reserved for multi- national corporations. Like pharmaceutical companies, for example. According to the Bush administration, demanding higher labor standards in our trade agreements is an imposition of values. On the other hand, when we force other countries to rigidly adhere to our own intellectual property laws, this is sound policy. A principal negotiating objective in this bill is to achieve the elimination of, ``price controls and reference pricing which deny full market access for United States products''. I don't think such a narrow-minded, market-driven approach is justifiable in the face of an HIV/AIDS pandemic that has decimated much of Africa. Since the horrible events of September 11, public health experts have warned that our country must reduce its vulnerability to potential biological and chemical terrorism. The American Public Health Association doesn't support this bill because it represents a risk to the safety of America's food supply. Let me quote Dr. Mohammad Akhter, Executive Director of the American Public Health Association: With our system of imported food safety so flimsy, the last thing we need is an executive mandate for more porous borders. Executive mandate is exactly what this bill is. It stomps on the constitutional authority granted to Congress over international commerce. On these grounds alone, this bill is unconstitutional. But add to that criticism the hostility that this bill shows toward labor rights, environmental protection and public health, and you have a bill that is indefensible and should be voted down here today. A vote against fast track is a vote to defend the rights and liberties that we hold so dear. It is a vote to support working men and women in America. It is a vote to protect our environment, our public health and our values.

Mr. GEORGE MILLER of California

Mr. GEORGE MILLER of California. Mr. Speaker, I thank the gentlewoman for yielding me this time. Mr. Speaker, I was hoping that we would have a bill today that we could support, because I think the committee, on the underlying bill on insurance protection for the real estate industry and for the insurance companies and others, is on the right track. Yet we find this bill is substantially now loaded down with a whole series of tort reforms, without hearings, as many of my colleagues have alluded to here, and now threatens to delay, if not make impossible, the passage of this legislation. I also, though, want to raise some questions with respect to the legislation as we continue the consideration. I would refer Members of the House to the Wall Street Journal of November 15, an article on the insurance companies that points out that the market has taken a somewhat different picture of the insurance industry than the insurance industry is presenting to the Congress of the United States. The title of the article is, ``Insurance Companies Benefit From September 11, Still Seek Federal Aid.'' The article talks about raising premiums 100 percent, or 400 percent in some instances. It also makes it very clear that the insurance companies see this as an opportunity. A number of memos sent back and forth in Marsh & McLennan and other large insurance companies have made it clear the time is now to fully exploit the opportunity that was presented by September 11 in terms of creating new companies, creating new entities, and going after new capital. In an effort to raise a billion dollars in new capital within a few days after September 11, in an insurance industry that is seriously in trouble supposedly, what they are telling us in Washington, they were so oversubscribed they had to turn people away. Other entities then came in, and they raised about $4 billion in new capital. Many of the companies have sold additional stock that have been subscribed to by very, very reputable investors that have decided that this is a good take. On the date of that article the insurance company stocks were up about 7 percent. What is going on here? They are running in and frightening the banks and frightening the real estate industry, everybody else, raising their premiums; and they know on the other end they are going to get Federal protection. As the article points out, they know they have an ability now to raise premiums up to 400 percent, to limit their liability; and the payouts will be taken on the other end. That is why I think this committee is on the right track with the suggestion that we are prepared to help them out, but we also think there ought to be some payback. Because, again, the article makes it very clear, and the financing of this industry makes it very clear that even with the huge payouts they will experience from September 11 their reserves are sufficient. Over time, and hope to God we do not have other terrorist activities, those reserves will be built up. The premiums will be raised. We may have a catastrophic event, we may have to step in, but the nature of the industry is they have the ability to pay the taxpayer back. There are others who want to suggest that $10 billion and the industry is off the hook, or that we pick up all of the cost. I think we have to be very careful about how we approach this and we recognize the real financial capacity of this industry. They are running around telling people they are not going to rewrite the insurance. That is not what they are telling other people where they know they can extract the dollars. There may be some people that cannot afford this coverage. That is a different issue. But, clearly, this industry is rapidly rebuilding its reserves, rapidly rebuilding its premium base, rapidly rebuilding its revenues and its capital. That is what is going on on Wall Street, that is what is going on in the American marketplace, and they are running around Washington with a tin cup suggesting, in many instances, that we should pick up all this liability as a result of a terrorist attack. I think the committee is on the right track. Unfortunately, this bill now has been saddled with a whole series of issues that threaten to bring down its consideration by both bodies. I would also raise the point raised by the minority leader that, once again, here we are bailing out an industry that obviously is exuding a great market force at this very time; and yet we have hundreds of thousands of families that have lost their livelihood, that have no market force, have no ability to make their mortgage payments; and this Congress is about to leave town, about to adjourn. In spite of the representations of the President of the United States that he was going to have money, that money was taken away last night for unemployment insurance. That money was taken away from the States that could help pay people's health insurance. That was a Presidential program that was destroyed last night. The Speaker said he was going to work with the minority leader to help people put out of work in the airline industry and elsewhere because of September 11. Nothing has happened on that front. So what we find here is that the majority party is keeping from us any consideration of help for those people who, as a result of September 11, lost their employment, or those people who lost their employment before September 11 but now see their opportunities greatly diminished. We are going to do nothing for those people. Yet we are here, after the airline industry, and now with the insurance industry. Clearly, this Congress can see its way to help the most unfortunate people in our society and not make them further victims of the attack on September 11. Mr. Speaker, I submit for the Record the full newspaper article I referred to earlier. [From the Wall Street Journal, Nov. 15, 2001] Insurance Companies Benefit From Sept. 11, Still Seek Federal Aid (By Christopher Oster) For Marsh & McLennan Cos., the Sept. 11 attacks have meant two very different things. One is personal loss. The world's largest insurance brokerage lost 295 employees who worked at the World Trade Center. ``It was very painful for us, agonizing for loved ones and close friends,'' Jeffrey W. Greenberg, Marsh's chairman and chief executive, told employees at a memorial service in St. Patrick's Cathedral in New York on Sept. 28. But in the days after the attacks, even as the company was sorting out who was safe and who had perished, it quickly became clear that Sept. 11 presented a tremendous business opportunity for Marsh and other strong players in the industry. Within days of the twin towers' destruction, Mr. Greenberg and top lieutenants began planning to form a new subsidiary to sell insurance to corporate customers at sharply higher rates than were common before Sept. 11. Marsh also accelerated plans to launch a new consulting unit to capitalize on heightened corporate fears of terrorism. Vice Chairman Charles A. Davis says the company is merely meeting new marketplace demands. ``There is a financial reward for doing that,'' he says. Unlike airlines, which are reeling as travelers hesitate to fly, insurers have seen improved financial prospects since Sept. 11. Insurers expect to have to pay out $40 billion to $70 billion in claims related to the attacks. That sounds daunting, but in fact, it is manageable for an industry that collectively has $300 billion in capital. Moreover, in response to Sept. 11, insurers are already raising prices by 100% or more on some lines of commercial and industrial insurance. Nearly all such lines are seeing rate increases of more than 20%. For much of the 1990s, carriers had engaged in a price war, keeping premiums relatively low. The prospect of large payouts related to the attacks gave the industry grounds for demanding substantial increases. Sept. 11 payouts will hurt insurers' balance sheets for a number of quarters. The higher rats they are introducing are expected to last for years. Insurance stocks have jumped 7% since the attacks, outpacing the broader market, and the atmosphere in the industry is one of eager anticipation. Marsh set out to raise about $1 billion in outside money to capitalize its new company. Investors volunteered six times that much, and dozens had to be turned away. Amid these signs of robust health, however, the industry is stressing potential disaster as it pressures Congress for emergency aid. By the end of December, lawmakers are expected to approve legislation under which the government could have to pick up billions of dollars in claims related to future terror assaults in the U.S. This federal backing would have tremendous financial value to insurers in the event of another disaster. And it would have an immediate impact, too, emboldening the industry to sell new terrorism coverage, for which it will charge higher premiums. Carriers collect their money now, while the government would help pay any claims later. Even consumer advocates say newly recognized dangers warrant some sort of broader government role in insurance. But these advocates say the changed terror calculus doesn't justify a wave of steep rate increases for policies unrelated to terrorism--especially since the government is taking on the additional risk. ``It's very opportunistic'' of the industry, says Robert Hunter, insurance director for Consumer Federation of America, a Washington, D.C., advocacy group. In the weeks after Sept. 11, newspapers carried numerous advertisements touting insurers' intent to pay disaster claims promptly. Less well known is how these companies plan to recoup much of the money they will be sending to policyholders. The decade-long premium price war had been ending before the attacks, as weaker insurers collapsed or retrenched and stronger ones began gradually to charge more. Now, faced with payouts related to Sept. 11, the healthier companies are demanding that their customers share the pain by paying bigger premiums. Some insurance companies are so confident in this strategy that they are expanding operations. Since Sept. 11, at least seven insurers have sold additional shares of stock. An additional six, including Marsh, have formed new companies. Among the new units is a Bermuda-based carrier put together by American International Group Inc. Chubb Corp, and investment bank Goldman Sachs Group Inc. State Farm Mutual Automoible Insurance Co. and RenaissanceRe Holdings Ltd. are creating another one. Since Sept. 11, insurers have raised a total of about $4 billion in new capital, to which they are adding a modest amount of their own money. Deals valued at another $14 billion are expected to be completed in coming months, according to industry analysis. Since the attacks, aviation underwriters have raised premiums for airlines by 200% to 400%, according to insurance brokers. At the same time, the underwriters are cancelling parts of airlines' coverage for liability to third parties other than passengers in future terrorist acts. U.S. airlines don't have to worry about these increases immediately. The airline-bailout bill Congress approved after Sept. 11 included provisions under which the federal government for six months will pay any increases in commercial insurance and cover airlines' potential third- party liability for terrorism. In the not-too-distant future, though, the airlines could collectively face billions of dollars in additional annual premiums. new surcharge Led by giant AIG, insurers have offered airlines a new, more-expensive package to replace the rescinded terrorism coverage. The new price includes a $3.10-per-passenger surcharge. Lacking the backing of the U.S. government, numerous foreign airlines are buying the new coverage, which is expected to boost insurers' revenue by a total of hundreds of millions of dollars a year. Owners of New York trophy properties are seeing giant rate increases. Douglas Durst, a developer with large holdings in midtown Manhattan, including the 50-story Conde Nast building, says his insurance broker has told him that he will be lucky if his premiums increase by only 20% at renewal time in April. ``There are [real estate] people who are seeing their rates double,'' Mr. Durst says. Brookfield Properties Inc., which owns most of the World Financial Center complex adjacent to the World Trade Center, has said that insurers are cutting back on its terrorism coverage. Brookfield said its insurers agreed to cover its liability risk associated with future terrorist attacks but are refusing to reimburse it for property damage or the costs of business interruption. (The Wall Street Journal has offices in Brookfield's World Financial Center property.) Medium-sized and small corporate policyholders are also seeing premiums jump. One week after the attacks, Industrial Risk Insurers, a unit of General Electric Co.'s Employers Reinsurance unit, told textile manufacturer Johnston Industries Inc. that it wouldn't renew Johnston's property- insurance policies, which expired Oct. 31, Bill Henry, a vice president at the Columbus, Ga., company, says it wound up paying $1 million more to a European carrier for a year's coverage, ending in October 2002--a 150% increase. The limit of the new policy is only $350 million, or half of what Johnston previously received from the GE insurance unit. For a company with annual revenue of about $240 million, ``it's a major blow,'' says Mr. Henry. Dean Davison, a spokesman for the GE unit, confirms that it has discontinued many of its policies. But he adds that Sept. 11 merely hastened actions that had already been planned for later this year. government aid While aggressively raising premiums, the insurance industry has been busy seeking relief in Washington. Ten days after the attacks, a delegation of chief executives, including AIG's Maurice R. Greenberg, the father of Marsh's Jeffrey Greenberg, descended on the capital to lobby President Bush and lawmakers. The industry leaders sounded an alarm that reinsurance companies--which spread corporate risk by selling insurance policies to the insurance industry--were moving to cancel terrorism-related reinsurance coverage. The big primary carriers told the politicians they would eliminate almost all terrorism coverage unless the government stepped into the role of the reinsurers. Without this coverage, many lenders would hesitate to finance everything from factories to new real estate development, the insurance executives warned their Washington hosts. Large areas of the economy could grind to a halt. The pitch worked. Congress is now expected to approve a mechanism that will guarantee that if there are huge future terrorism liabilities, taxpayers will help pay them. A plan under consideration in the Senate would require the industry to pay the first $10 billion in claims, with the government picking up 90% of any remaining amount. The House Financial Services Committee favors government loans to insurers to help pay future terrorism claims. ``This is not a bailout,'' says Democratic Sen. Christopher Dodd of Connecticut, home to several large carriers. Rather, the government is proposing to serve as a ``backstop'' to encourage underwriters to provide terrorism coverage, he says. The legislation also gives carriers the confidence to sell some terrorism policies, for which they are charging much higher premiums. ``In the absence of future terrorist attacks, such an approach could create `windfall' profits for insurers, to the detriment of policyholders,'' says Fitch Inc., which provides investors with financial analysis of the insurance industry. Marsh & McLennan sees vast opportunity in this fast- changing environment. The company is primarily an insurance broker, not an underwriter. As a result, it has limited exposure to Sept. 11 property and liability claims. It took a $173 million charge for the third quarter, which ended Sept. 30, to cover costs related to the attacks. A big piece of that was for payments to families of its own injured and dead employees. Marsh's Mr. Greenberg knows well the dangers of appearing opportunistic in the wake of catastrophe. He gained this experience after Hurricane Andrew hit Florida in 1992, which until Sept. 11 was the industry's costliest disaster. Then a vice president at his father's AIG, the younger Mr. Greenberg wrote an internal memo saying that Andrew was ``an opportunity to get price increases now.'' After the memo was leaked to the media, Florida regulators imposed a moratorium on premium-rate increases. This embarrassment didn't stop Jeffrey Greenberg, now 50 years old, and his subordinates at Marsh from swiftly scouring the post-Sept. 11 business landscape for new opportunities. The World Trade Center attacks were a devastating blow to the company, which has its headquarters in midtown Manhattan. About 1,900 Marsh employees worked in the twin towers. Within an hour of the attacks, the company had set up a phone bank to assemble information about the missing. Counseling sessions and memorial services were held daily for weeks. modest disruption From a business perspective, the disaster caused only modest disruption for Marsh, which has 57,000 employees world-wide. On the evening of Sept. 11, Mr. Davis, Marsh's vice chairman and chief of its MMC Capital arm, sent a fax to Mr. Greenberg's home that accounted for the unit's employees--they were all safe--and suggested the formation of a new subsidiary that would underwrite corporate policies. ``We were absolutely thinking about the impact [of the attacks] and what the opportunities were in front of us,'' says Mr. Davis, who came to Marsh from Goldman Sachs three years ago. At a Sept. 18 meeting, 20 executives from Marsh's operating companies discussed the new terrain in their industry. Participants noted the premium increases already being announced and cancellations of terrorism coverage. Policy- holder demands was as strong as ever, meaning prices could only rise. There was strong support for Mr. Davis's idea for a new company. It wouldn't be the first time Marsh gave birth to an underwriter. In the mid-1980s, it launched Ace Ltd. and Exel Capital, now known as XL. Those moves came in response to some established insurers ceasing to write liability coverage in the wake of huge jury awards for asbestos-related illnesses and big judgments against corporate directors and officers. Both Ace and XL went on to become publicly traded. Marsh retains small stakes in them. Marsh raised its initial fundraising plan for the new carrier by 50%, to $1.5 billion. But that still wasn't enough to accommodate all of the investors lining up for a piece of the action. GE's GE Asset Management unit and TIAA-CREF, the national teachers' pension-fund manager, were among those allowed to buy stakes. Many others were turned away. As the investor list was being winnowed, Mr. Greenberg was stirring another pot. He called L. Paul Bremer, a former U.S. ambassador at large for counterterrorism, who had joined Marsh a year earlier. ``Funny you should ask'' Mr. Bremer says he responded to Mr. Greenberg's query about new business opportunities. Mr. Bremer had been working on a plan for a crisis- consulting practice for several months. ``It was clear to both of us that he should accelerate the introduction of that practice,'' Mr. Greenberg says. On Oct. 11, Marsh announced the formation of a new consulting unit, with Mr. Bremer at its head. Two weeks later, Marsh unveiled a partnership between its new unit and Versar Inc., a counterterrorism-service provider. The partnership will assess chemical and bioterrorism risks for corporate clients.

Mr. GEORGE MILLER of California

Mr. GEORGE MILLER of California. I will go ahead and the gentleman from New York (Mr. Walsh) will close; is that correct?

Mr. GEORGE MILLER of California. Mr. Chairman, I yield 2 minutes to the gentleman from New Jersey (Mr. Andrews). (Mr. ANDREWS asked and was given permission to revise and extend his remarks.)

Mr. GEORGE MILLER of California. Mr. Chairman, I thank the gentleman for his agreement on the time, and I appreciate the additional time. Mr. Chairman, this is a very difficult amendment to offer, but it is a very essential amendment to offer for a number of reasons. First and foremost, those of us who represent States and localities that have suffered dramatic increases in unemployment, both before and since September 11, with people who are unemployed and were hoping to get a job, who had their chances of a job being secured greatly diminished because of the September 11 attacks, and those who were immediately unemployed after September 11, we have an obligation to those people to make sure that money will be available to help with extended unemployment benefits, unemployment benefits, COBRA benefits or health care supplements; and that is what this amendment does. What this amendment does is essentially try and reverse what the amendment of the gentleman from New York (Mr. Walsh) did that was made in order as part of the rule which gathered up unemployment funds from all across the country and then said we are going to give these to New York to use for whatever purposes they seek to do that through the Community Development Block Grant. This is also a very important amendment, because I think it helps to make a point, and that is that what happened in New York, what happened to the people of New York, to the State of New York, what happened in Virginia, what happened in Pennsylvania, was completely unanticipated, unknown by anybody and an emergency; and when the New York delegation from the Senate and the House asked for $20 billion, the President looked them in the eye and said, you have got it. Now we find out he said, you got it, sort of; and today we find out he said, you got it, but you got to go take it from all the unemployed people in the rest of the country. That is not what America expects us to do in response to the tragedy of New York. They expect us to deal with New York and to deal with the needs of this country. As they see more of their friends and neighbors becoming unemployed, they expect us to help those individuals, not steal their unemployment in the middle of the night and give it to New York. We want to help New York. We have all voted to help New York, and we are going to continue to vote to help New York. But what has happened with this amendment has put New York in a terrible position, because our friends and colleagues from New York who are desperately in need now finally have to look us in the face and say we have no alternative. We did not do this amendment. They took this money from you. They made this in order. This was not a matter of debate. They came around and picked it up. Now, let us understand what this amendment does. This amendment completely ignores what the Secretary of Labor told our committee when she came before our committee. Every issue that we asked her about, the unemployment crisis in this country, the decline in the economy, September 11, her answer was we have a block grant that we are going to give to the Governors, and the Governors can take care of health care, take care of unemployment. They can extend benefits. They can do everything. Now we find out that $1.8 billion has been taken out of that block grant. So if you are in California, where parts of our economy have been devastated because of the lack of travel, San Francisco, Los Angeles, Disneyland, Orange County, we lose $220 million. If you are from North Carolina, where people have been unemployed because of the problems with U.S. Air, the hospitality interests on the Outer Banks, they lose $54 million. The State of Washington, where the Boeing employees were hit immediately, were unemployed, what do we do in the State of Washington? They lose $53 million. Hawaii, where almost instantaneously people were laid off because people stopped flying to Hawaii, people looking for jobs, low-wage jobs, people without a cushion, what did we do to Hawaii? We take 20 million of their dollars. It is simply not fair, and it is not right. It is not fair to New York to put the citizens of New York, the Representatives of New York and the victims of New York in this position, where they have to suggest that the only way they can be taken care of is to harm somebody else. These are people who have lost their jobs and continue to lose their jobs. The number of people who are running out of unemployment grew more than 60 percent in the third quarter over third quarter from year 2000 to this year. In Michigan it is up 88 percent; Indiana, 91 percent; North Carolina, 94 percent; Tennessee, 68 percent; Colorado, 65 percent. So, as people who are going on unemployment at record rates, the demise in the economy, and people who are on unemployment but losing their benefits at record rates, the answer in this legislation is to take away the money that the Governors could use to try to help them pay for the health insurance, to extend their unemployment benefits, to provide them unemployment benefits if they do not qualify. That is the challenge of the Walsh amendment. That is the unfairness of the Walsh amendment. That is the unfairness of this bill, that we would take one group of Americans who may be in the process of losing their children's education, losing their car, losing their home, and we would say to them, rather than take care of you too, we are going to take what you desperately need, you desperately need for your family, and we are going to move that over to New York. Then to New York we say we are helping you, but we had to take it from millions of other Americans who are in desperate trouble; in many instances, Americans that are as in trouble, that lost their economic livelihood. Within days of this vicious attack on the World Trade Center, on the Pentagon, within days they became unemployed, because people realized that people were not going to get back on the airplanes. So what do we do with these people that were working at the airports, working at the hotels, working in the restaurant industry? We told them a couple of months ago, the Secretary of Labor said we are going to give the money necessary; the Governors are going to have it. But now what has happened in this bill with the acceptance of the Walsh amendment is we have gone out and gathered all of that money up. We cannot let that be the legacy of this Congress. We cannot help the victims of New York by creating victims in California, by creating victims in Hawaii, by creating victims in Wisconsin, by creating victims in Minnesota, where hundreds of thousands of people are now unemployed there because of the layoffs, with the layoffs of Northwest Airlines, the decline and cutbacks in the routes, with people in Minneapolis-St. Paul who do not have jobs. Do we really think that we can transfer their misery to New York and make New York whole? Of course we cannot. Of course we cannot. That is why the President, in the heat of the moment, in the emotion of the moment, when the New York Senators, Senator Schumer and Senator Clinton, asked him for the $20 billion in front of everybody in the Cabinet Room, said, you got it. Because he knew this was an extraordinary event in the history of this country; that there was the only way we could deal with it, and that was to take care of this problem. Did the President really mean you got it, but you got to get it from somebody who has been unemployed because of the same tragedy? You have got to get it from somebody who has lost their health care coverage because of the same tragedy? I do not think so. I do not think he meant to take $141 million from the State of Florida that would go to cover their health care, go to extend their unemployment benefits, a State that has been devastated, again, because of its reliance on tourism and hospitality. I do not think that is what the President meant. But that is the policy that is being carried out here. I would urge my colleagues to vote for this amendment. The money, the money for New York has been appropriated. It is available. It simply has been impounded. It has been impounded by this President and this administration until such time. And the answer to that impoundment is not to make the life of the unemployed more miserable to help New York; it is to take care of New York, and to take care of the unemployed and those without health insurance because they are unemployed in this country. Mr. Chairman, I reserve the balance of my time.

Mr. GEORGE MILLER of California. Mr. Chairman, I yield 3 minutes to the gentleman from Hawaii (Mr. Abercrombie). (Mr. ABERCROMBIE asked and was given permission to revise and extend his remarks.)

Mr. GEORGE MILLER of California. Mr. Chairman, I yield myself 30 seconds just to say when the gentleman says that we are taking the money back that he took to New York out of all of the other unemployment funds and he says we did not do it in a technical way with the waivers, it is a little bit like a person who robbed my wallet and then when I took it back, he says I put it in the wrong pocket. No, it is my wallet. And these benefits go to the unemployed. This is not about divide and conquer. This is about this country meeting its obligation to New York and to unemployed Americans, and we can do both. Mr. Chairman, I yield 4 minutes to the gentleman from Washington (Mr. McDermott).

Mr. GEORGE MILLER of California. Mr. Chairman, I yield 2 minutes to the gentleman from Wisconsin (Mr. Obey).

Mr. GEORGE MILLER of California. Mr. Chairman, I yield 2 minutes to the gentlewoman from California (Ms. Woolsey). (Ms. WOOLSEY asked and was given permission to revise and extend her remarks.)

Mr. GEORGE MILLER of California. Mr. Chairman, I yield 2 minutes to the gentleman from North Carolina (Mr. Watt).

Mr. GEORGE MILLER of California. Mr. Chairman, if I might inquire, I am the only speaker left.

Mr. GEORGE MILLER of California. Mr. Chairman, may I inquire how much time I have.

Mr. GEORGE MILLER of California. I understand that; 30 minutes a side, as I understand it. I would like to make my opening remarks, and then have the time limit take effect. If the gentleman wants to do the same on his side, we would have maybe 70 minutes. It may not be that long. I do not know if Members will come to the floor or not who said they want to speak.

Mr. GEORGE MILLER of California. I am asking if the gentleman would amend that to let the opening statements be made by myself and by the gentleman and then have the 60 minutes.

Mr. GEORGE MILLER of California. I think so.

Mr. GEORGE MILLER of California. Mr. Chairman, reserving the right to object, I have a lot of people who said they want to speak. Could I ask that we do that after we have our opening statements. I think I will only take 3 or 4 minutes.

Mr. GEORGE MILLER of California. Mr. Chairman, I offer an amendment.

Mr. GEORGE MILLER of California. Mr. Chairman, I withdraw my reservation of objection.

Mr. GEORGE MILLER of California. Mr. Chairman, I yield 3 minutes to the gentlewoman from Connecticut (Ms. DeLauro).

Mr. GEORGE MILLER of California. Mr. Chairman, I yield back the balance of my time.

Mr. GEORGE MILLER of California. Mr. Chairman, may I inquire how much time is remaining?

Mr. GEORGE MILLER of California. Mr. Chairman, I yield myself the remainder of my time. The events of September 11 were uniquely cruel, were uniquely cruel against the victims, people who chose to do nothing more than get up and go to work in the morning, and by the thousands they were slaughtered, unique in their cruelness, in the history of this country and the history of the world. From the moment after September 11 and even as it was unfolding, we saw something uniquely American, and to the wonder of the rest of the world, we erased all of the boundaries, all of the characteristics, all of the identities, and we pulled together. People drove across country so they could put in a 12-hour shift; children sent money; people were out on the streets asking for help for New York. People raised billions of dollars. Uniquely American. That is what Robert Frost wrote about, about our boldness, our greatness, our strengths, about our broad shoulders, about our integrity. That is what America saw. It saw strength and it saw compassion. It saw a sharing like we have never witnessed in this country, in this generation of those of us who are alive now. It saw people who said I will do anything to help those people in New York. People went to enlist to help the fight overseas. People gave blood. They stood in line here at the Cannon Building, stood in line to give blood, more blood than they needed. What a tribute to our country. Now we have got to finish the job, but we have got to finish it as the United States of America, as the American people. When we had hurricanes in Florida, we did not say to the earthquake victims in California that they must contribute, and only victims. We did not say to the victims of the floods in Texas that the people devastated by the ice storms in Maine could only contribute. We did not say to the people in the tornadoes in Kansas, in Tennessee and Arkansas that they would have to get their help from the victims of the hurricanes. No. We came and said this is an American problem, this is a natural disaster, it is an act of God and America will take care of this problem. We will all join together. We got emergency funding for the floods in Texas, if my colleagues will remember the gentleman from Texas (Mr. DeLay) holding up the bill until it happened. Californians put their shoulders to the wheel to help the victims of Florida after Andrew. That is America. It is not about making your neighbor poor. It is not about collecting only from the poorest people in the country, those who are already unemployed, who are every much a victim as the unemployed of New York due to that event. That cannot be the trust fund from which we are going to rebuild New York. No. That is why this Congress went to the President of the United States and asked for $20 billion. That is why this Committee on Appropriations has struggled with the issues of homeland defense. We are not going to get there by thinking we are going to move money between accounts, my colleagues. And Americans have overwhelmingly said that they are willing to pay to rebuild this country and restore this country and to erase this scar on our landscape. They did not assign that to the unemployed. They assigned that to every American in this country. Every American in this country. That is who America assigned it to. The gentleman from New York (Mr. Walsh) is in an untenable position. An untenable position. Why? We know the struggles that our colleagues on the Committee on Appropriations have gone through, our colleagues from New York, trying to meet these demands. We heard from the Coast Guard earlier. This is going to cost a lot of money, my colleagues, but it is about the integrity of this country. It is about the future of our families. It is about the security of our Nation. Can we not rise to that occasion without creating new victims? Can we not rise to that occasion and defend this country and defend its families and try to provide them some income security, a little bit of health care while they are being devastated? I think we can. I think we can do this as a Congress. I think it is important that our colleagues from New York join us in this and turn our back on this beggar-thy-neighbor policy; that somehow we can make New York whole by bringing down the unemployed in Florida or the unemployed in California. That is not the way a great Nation addresses its great problems. That is not the response we have to terrorism. This is about our Nation, united in one step together to rebuild this country and to secure this country. And we are not going to do it on the backs of the unemployed. We should repudiate this.

Mr. GEORGE MILLER of California. Mr. Chairman, I yield 2 minutes to the gentleman from Massachusetts (Mr. Frank).

Mr. GEORGE MILLER of California

Mr. GEORGE MILLER of California. Madam Speaker, due to the faltering economy, State education budgets are being squeezed all across the country. According to last week's report of the House and Senate committees which deal with education, this year States will cut $11 billion in real education reductions. More cuts are likely, since State budgets are now showing a deficit of some $25 billion, and this does not take into account the full impact of the September 11 attack. Elementary and secondary education is one-third of the States' budget, so obviously they are going to have to be cut. But we ought to do all we can in the stimulus package to make sure that we support education. Over the last couple of years, schools have started to make progress in closing the achievement gap between poor and minority children and majority children and suburban children. We have made efforts on education reform. Children are doing better on the State exams and on the national exams. We ought to make sure that we do not lose this progress that we have made. We must understand that we cannot allow our children's education and the educational resources of this Nation to be set back because of the short-term recession. The Federal Government ought to do all it can to help States out at this time so we do not lose the advancements that have been made. California faces a $4.5 billion budget shortfall this year. California's revenues are projected to fall by 12% this year, the largest decline since World War II. To balance the budget, Governor Gray Davis has been forced to propose $843 million in education cuts, including after-school programs and initiatives to help low-performing schools. The cuts are likely to be worse next year, when the state projects a $12.4 billion shortfall. According to Brett McFadden of the Association of California School Administrators, ``It took years to recover from the budget deficits in the early `90s. If we have to go through that again, that is going to create lasting damage to the entire system.'' (San Francisco Chronicle, Nov. 15, 2001). Yesterday's New York Times described the impact the cuts will have on Harvey Elementary School in Santa Ana. After-school literacy classes for native-Spanish speakers has helped increase the proportion of fourth-graders reading above grade level from 7% to 25% in two years. One teacher called the progress her students had made in just three months ``remarkable.'' But state and local budget cuts may force the program to replace certified teachers with college students, and cut the number of students served in half next year. According to the schools' principal, ``There was a window of opportunity here, and that is closing.'' Congress is planning to spend tens or even hundreds of billions of dollars to respond to the economic recession and the effects of September 11. Clearly, we must make sure that we provide adequate assistance to our public schools so that they may continue the advancements in quality that we expect them to make. [From the Washington Post, Nov. 20, 2001] Schools Lack Funds, Study Warns (By Michael A. Fletcher) The slowing economy is preventing states from spending the money needed on education to keep pace with inflation and surging enrollments, and the federal government should do more to fill the funding gap, according to a report by congressional Democrats. The report said that education spending in 47 states has fallen a combined $10.5 billion behind what would be needed to keep pace with rising costs. Also, 11 states have cut a combined $800 million from their budgets, in some cases eliminating remedial classes, after-school tutoring and summer school. The budget problems are likely to multiply as states confront the economic problems they have suffered in the wake of the Sept. 11 terrorist attacks, the report said. California alone is facing $843 million in proposed education spending cuts to help balance a $12 billion revenue shortfall over the next two years. ``The faltering economy is putting at risk the advancement that many states are making to improve the quality of their educational systems,'' said Rep. George Miller (D-Calif.), the ranking minority member of the House education committee. The report was released by Miller and Sen. Edward M. Kennedy (D-Mass.), the key Democrats involved in negotiating an education package that overwhelmingly passed both chambers of Congress but is now making slow progress in a conference committee. The bill, one of President Bush's top domestic priorities, would require annual testing of students in grades three through eight and hold both students and educators responsible for the results. The bill also would give states more flexibility in spending federal education aid and increase the amount of money the federal government spends on literacy programs and on programs for the disadvantaged. But while there is wide agreement on many tenets of the bill, congressional Republicans and Democrats have clashed over the amount of money needed to make the reforms effective. The conference committee is expected to meet again next week, and despite the disagreements on funding and other issues, members have expressed optimism they can produce a final bill by the end of the year. ``Education reform is a high priority in Congress and a high priority for the American people,'' said Kennedy, chairman of the Senate education committee. ``But we need to provide more than lip service in dealing with this challenge. This report will be a wake-up call that persuades both Congress and the administration that greater federal investment in the nation's schools is an indispensable part of education reform.'' Republicans countered, however, that money is only one element of what is needed to improve schools. Moreover, they said, the federal government provides just 7 percent of the nation's education funding and significant increases have already been approved. ``The education reform bill isn't just about money. It is about what happens with that money,'' said Dave Schnittger, a spokesman for Rep. John A. Boehner (R-Ohio), chairman of the House education committee. ``What's essential is not just that states have new resources, but that they have the flexibility of using those resources as efficiently as possible.'' Amy Wilkins, a lobbyist for the nonpartisan Education Trust, called the report an attempt by Democrats to bolster their case for increased education funding--a goal she supports. But, she added, ``money will not solve everything.'' [From the New York Times, Nov. 26, 2001] Economy Puts Schools in Tough Position (By Jacques Steinberg) Santa Ana, Calif., Nov. 19.--Nearly all 600 students at Carl Harvey Elementary School arrive for class for the first time speaking Spanish, not English, which is why the school's three-hour after-school literacy classes have been so critical. But with substantial budget cuts coming from the state and the local district, and the prospects of federal help uncertain, Harvey Elementary's principal has already projected that after-school enrollment will have to be cut in half, if not more, by next fall. ``There was a window of opportunity here,'' the principal, Christine J. Anderson, said of the classes, which the school has given for the last two years, ``and that is closing.'' Having capitalized on a swelling economy to initiate new programs aimed at improving student performance, schools across the country like Harvey Elementary are now being asked to curtail those very efforts because of the nation's shrinking economy. In response to budget cuts, schools from New York to California are undertaking such measures as increasing class sizes, trimming bonuses for good teachers, putting off purchases of faster computers, postponing monetary rewards for high test scores and, as is the case here, scaling back after-school classes. For the schools, the timing could not be worse: at the very moment that states and school districts are demanding greater academic performance, particularly by insisting that students make the grade on an array of new standardized tests, the states are asking students and teachers to make do with less. In New York City, where a substantial part of a $400 million school budget shortfall is a result of tax losses since Sept. 11, administrators have pared Saturday sessions for struggling students, extra training for thousands of new teachers and art classes. In Las Vegas, which has one of the nation's fastest-growing school systems, district officials have cut alternative education programs for elementary school students with disciplinary problems. School administrators in Fairfax County, Va., have delayed some textbook purchases and placed limits on teachers' salary increases, all to help the state absorb an estimated $80 million in education budget cuts. In Memphis, schools have been told to prepare to delay all but the most pressing classroom repairs, as the state government tries to wean itself from dependence on dwindling sales tax revenues. In California, which was already experiencing a costly electrical power shortage before the economy turned downward, Gov. Gray Davis on Nov. 14 announced plans to delay support for poorly performing schools, cut assistance for novice teachers and reduce after-school programs like those here in Santa Ana, which is among the poorest districts in the nation. Those cuts are expected to exceed $800 million. All told, the Education Commission of the States, a nonpartisan research organization, has identified education cuts of more than $3 billion in at least 15 states. Those are among the cuts detailed in another report, by the Council of Great City Schools, a coalition of the 60 biggest districts. ``It's the poor schools that are so badly hit,'' said Delaine Eastin, the superintendent of education in California. ``They were starved for a quarter-century. They were just starting to come back.'' If there is a silver lining for the schools, it is that Senate Democrats have taken note of the states' retrenchment on education spending, and are trying to use the schools plight to wring more money from the Bush administration and the Republicans who control the House of Representatives. Senate and House leaders have been deadlocked for months over how much to spend on elementary and secondary schools in the next year. House leaders have agreed to spend nearly $30 billion, an increase of about $5 billion over the current year. But Senator Edward M. Kennedy, the Massachusetts Democrat who is chairman of the Health, Education, Labor and Pensions Committee, has called that figure at least $10 billion too low. To buttress his argument, Mr. Kennedy's aides released their own study of state education budgets on Nov. 16, which predicted that states will spend $11 billion less on schools this academic year than is needed, when inflation and enrollment growth are taken into account. Representative George Miller, a California Democrat whose staff worked with Mr. Kennedy's said, ``The faltering economy is putting at risk the advancements that many states are making to improve the quality of their educational systems.'' Given the realities of the economy, few districts have sought to challenge the state and local governments that are often ordering the cuts. ``What are we going to say?'' said Anthony Shorris, the deputy chancellor of the New York City Board of Education. ``This is a terrible catastrophe that hit New York. Our goal is to live with what we've got, and still help our students meet these new demands.'' In California, the more than $800 million in school budget cuts identified by Governor Davis have jolted systems that had grown accustomed to receiving more money from Sacramento each of the last few years. Ms. Anderson, the principal of Harvey Elementary, a wood- beam-and-stucco building that is crammed to four times its intended capacity, said she was sometimes inclined to agree with those researchers who have found that more money does not necessarily lead to improved student achievement, But, she said, the $300,000 the school spent on its afternoon literacy program in each of the last two years--it now serves 150 students, most of them Mexican-American--was followed by a relatively steep rise in reading scores. Last year, the school's students, who are among the most disadvantaged in the state, exceeded the overall scoring target set for them by state officials by a factor of five. Driving that improvement were the school's fourth graders, 25 percent of whom were found to be reading above grade level last year, compared with 7 percent three years ago. Amy McDonald, a third-grade teacher who sends 16 of her 19 students to the intensive after-school program, said that the impact on their English in just three months this year had been remarkable. She said that her students arrive in class in the morning eager to discuss what they learned the previous afternoon. Lizbett Mejia, 9, whose mother was born in Mexico and can barely communicate in English, said she had become hooked by her after-school teachers on a popular collection of books known as the ``Little Sister'' series. ``I didn't know that much of reading,'' Lizbett said. ``Now I know how to read more.'' By replacing certified teachers with local college students, Ms. Anderson said, she believe she can keep this year's after-school program running at full capacity. But when the proposed state cuts, including those to badly needed subsidies for school electrical payments, are combined with anticipated reductions in public and privately financed grants, Ms. Anderson estimates that she will have no more than $90,000 to spend next year on the program, which would probably cut enrollment in half. ``These last few years have been heaven,'' she said. ``Hopefully we've learned enough to be able to sustain what we think works without having the money we thought we needed to pay for it.''