Daniel Moynihan

Mr. MOYNIHAN

Mr. MOYNIHAN. Fifty.

Mr. MOYNIHAN. I move to lay that motion on the table. The motion to lay on the table was agreed to. Amendment No. 2488

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, may I simply thank my distinguished friend and colleague for the forcefulness with which he has made an unmistakably accurate point. I thank him for his generous personal references.

Mr. MOYNIHAN. I note that the Senator from Texas has to be elsewhere in a moment, but if she could stay just for a moment I would like to suggest that something exceptional has happened tonight. It may be something that Benjamin Disraeli wrote turns out to be wrong, and this is a new thought to me. But I was going to read a passage from Coningsby published in 1870 when the young Coningsby is having breakfast with the old duke, and the old duke says: In a couple of years or so you will enter the world; it is a different thing to what you read about. It is a masquerade; a motley, sparkling multitude in which you may mark all forms and colours, and listen to all sentiments and opinions; but where all you see and hear has only one object, plunder. Now, I think that the Senator from Texas, having said it is clearly the case that she is going to oppose a proposal in which the chief beneficiary in the first instance and on a superficial level perhaps would be the State of Texas, leads me to raise the question: Did Disraeli get it right or was it invariably a rule, or is there a Hutchison exception? In any event, I thank her for her remarks and do observe if this measure would cost the State of California $5.4 billion and the State of New York $4.6 billion, it hardly would be a promising addition to the legislation, the underlying bill before us. I would like to talk just a little bit about this subject, Madam President. We are talking about Federalism here. We are talking about some of the complexities, some of which have grown too complex over time. But the first point I would like to make is this: The disparities in AFDC benefits and Federal contributions, sharing contributions, how do they arise? The Senator from Texas happens to be right about them. They arise primarily for one reason which is very little understood and possibly never will be understood, that AFDC is not an entitlement to individuals; it is an entitlement to State governments for a Federal matching share of what the State governments choose to spend on the program. This goes back to the 1935 Social Security Act. It has been varied somewhat from time to time. But the essential fact is that the States are left to design their own programs or have no program. It would surprise many today to know that you do not have to have an unemployment insurance program. You do not have to have aid to dependent children or, as it later was, Aid to Families with Dependent Children. If you do, you are guaranteed a Federal match. States may choose to set generous eligibility thresholds and benefit levels, or they may choose not to. If they opt for a larger social safety net, they pay for it. But they also qualify for more matching Federal funds. The incentive is optional but intentional. Now, that Federal match from the beginning--the beginnings are in the Great Depression--was heavily skewed toward States in the South and West. It is only beginning to be better understood that it was part of a policy of the New Deal, although it comes from New York: a President from New York State, a Secretary of Labor from New York State. The object of the New Deal was to move resources away from cities such as New York, Wall Street as it would be termed, to the South and West, the Tennessee Valley, for the great water projects to reclaim the arid West. In this particular program, the formula, the matching rate, is borrowed from the Hill-Burton formula which came into effect just after World War II--Lister Hill of Alabama. The formula was used to allocate funding for a great hospital construction program. Our esteemed former colleague, Senator Russell Long of Louisiana, informed me that the Hill-Burton formula is the South's revenge for losing the Civil War. What it does, Madam President, it writes algebra into our statutes. The States receive a Federal match that is determined by the square of their per capita incomes so that the relative difference in those incomes becomes exaggerated. And so it is such that until very recently some States in the South received an 83 percent match from the Federal Government, other States such as New York, California, and I do believe Maine--we will check that in a moment--get 50 percent; 50 percent is the minimum. Actually, Maine's current Federal match rate is about 63 percent. It now goes from 50 percent to 79 percent. One of the first proposals I made when I came to the Senate 19 years ago when this was just beginning to be so patently inequitable, simply because costs of living were so different, I said, if we were going to have algebra in our statutes, instead of the square of the difference, why not the square root? Well, I did not get much support for the idea. But one did begin to study the differences in tax capacity, the differences in costs of living. It makes astounding differences. If you just take that fixed poverty level, you will find you underestimate the true cost-of-living equivalent of the poverty level in a State such as mine by about 30 percent. A word, if I may about per capita income. In virtually every debate we have on this floor or in committee about the States' relative fiscal capacity, we use per capita income as the proxy. Per capita income is a proxy, but not the only one. States such as Texas, for instance, that are endowed with natural resources may impose a severance tax when those minerals and natural gas and crude oil are severed from the ground. A severance tax is a wonderful way to raise revenue because the end user, usually out of State, ultimately pays it. I would note that Texas does not have a personal income tax. Perhaps one is not needed. After all, the State can export much of its tax burden out of State. The Advisory Commission on Intergovernmental Relations [ACIR] has looked into this. This is the ACIR established under President Eisenhower in 1959, a nonpartisan, professional group. In 1982, the Advisory Council on Intergovernmental Relations with its long history of research, adopted the following resolution. It said: The Commission finds that the use of a single index, resident per capita income, to measure fiscal capacity seriously misrepresents the actual ability of many governments to raise revenue. Because states tax a wide range of economic activities other than the income of their residents, the per capita income measure fails to account for sources of revenue to which income is only related in part. This misrepresentation results in the systematic over and understatement of the ability of many states to raise revenue. In addition, the recent evidence suggests that per capita income has deteriorated as a measure of capacity. Therefore, the Commission recommends that the federal government utilize a fiscal capacity index, such as the Representative Tax System measure, which more fully reflects the wide diversity of revenue sources which states currently use. * * * Another problem with viewing income as a proxy for wealth is that it fails to consider differences in the cost of living which, as I said a moment ago, can be quite large. Residents of New York and Connecticut make more than do their neighbors in Mississippi and Alabama. But they need to spend more, too. The other side of the equation is poverty. We have a national poverty threshold adjusted only by family size and composition. I think we would all agree if you just looked at the simple numbers, the richest people on Earth live in Alaska. Well, no, they do not. They have to pay so much more for [[Page S 13359]] what they consume as against the persons in the lower 48, they are probably, relatively speaking, not as well off. The point about the problem we are dealing with right now is that, for example, a family of four just above the poverty threshold living in New York City is demonstrably worse off than a family of four just below the threshold in rural Mississippi. Each year for the last 19 years I put out a compilation of the flow of funds between the Federal Government and the 50 States entitled ``The Federal Budget and the States.'' Here, I will display the report for you for the purposes of the Senate. More recently, the Taubman Center for State and Local Government at the John F. Kennedy School at Harvard has begun computing the actual numbers. I write an introduction. They have come up with an index to subnational poverty statistics. That is, Professor Herman B. Leonard, who is academic dean of the teaching programs, and Baker Professor of Public Finance, and Monica Friar, who is his associate in this matter. And we just look at the ``Friar/Leonard State cost-of-living index,'' as it is known, we find that--again I use my own State because I have been working at it--New York's poverty rate jumps from the 18th highest in the Nation to the sixth highest. It is no longer the case of the Mississippi Delta. It is no longer the case that poverty is more prevalent in the high plains. It is no longer the case that it is Appalachia. The sixth highest poverty rate in the Nation is in New York State once you adjust for the cost of living, which is obviously what poverty is all about. What does it get you with what you have? Earlier this year, a National Academy of Sciences [NAS] panel of experts released a congressionally commissioned study on redefining poverty. The study, edited by Constance F. Citro and Robert T. Michael, is entitled ``Measuring Poverty: A New Approach.'' According to a Congressional Research Service review of the NAS report: The NAS panel (one member among the 12 member panel dissented with the majority recommendations) makes several recommendations which, if fully adopted, could dramatically alter the way poverty in the U.S. is measured, how Federal funds are allotted to States, and how eligibility for many Federal programs is determined. The recommended poverty measure would be based on more items in the family budget, would take major noncash benefits and taxes into account, and would be adjusted for regional differences in living costs. * * * Under the current measure the share of the poor population living in each region in 1992 was: Northeast: 16.9 percent, Midwest: 21.7 percent, South: 40.0 percent, and West: 21.4 percent. Under the proposed new measure, the estimated share in each region would be: Northeast: 18.9 percent, Midwest: 20.2 percent, South: 36.4 percent, and West: 24.5 percent. But getting back to Hill-Burton, the fact is that this benefit formula, called the Federal Medical Assistance Percentage, has always been designed to bring more Federal funds to Southern States than to Northern ones. And again, when we talk about these matters, we cannot seem to get past talk about per capita income as a measure of a State's relative capacity. It is not, Madam President, as I showed just a moment ago. Per capita income disguises the large effects of cost of living. Madam President, the point here is that we have a set of Federal outlays which have corresponded to two things. First, they have helped compensate States with low per capita income way in the back; 83 percent to Mississippi, but only 50 percent to California, the Federal match. But also, the outlays reflect State spending. And the States that would be injured in this matter are just those States who of their own choice have chosen to provide a higher level of provision for dependent mothers and children. Per capita disparities exist in the block grant allocations because States are different--vastly different--in their willingness to spend their own money on their own poor people. Now, if at the moment we end the Federal entitlement, turn this matter back to the States, where it had been indeed as a widow's pension in the early years, in the 1930's, going back to the Depression era, what we shall have done is penalize everything we would have thought to be admirable in American public life. And by admirable we would think of provision for children in a world in which they are so extraordinarily exposed to the dissolution of family and the onset of enormous levels of dependency such as were never seen in the 1930's and we now find ourselves baffled by and troubled by in the 1990's. Let us take the analysis a bit further. ACIR does marvelous work and issues clearly written reports that too few of us in this Chamber read. Over the years, ACIR has developed and refined a really important index. They now have a measure of State revenue capacity and tax effort, without wishing to make any complaints of one kind or another. Here we go back to 1975, and we bring ourselves back up to 1991. And we look at New York. New York is the black dots. Its tax capacity goes down. And it goes up a bit, then comes down a bit. Just about average for the Nation. It was below average and now at 103. The State of Florida has stayed about average all along, and right now, 1991, its tax capacity is 103 too. The two States--New York and Florida--they are identical. They have the same per capita tax capacity. But New York, with an older tradition, has a tax effort of 156 as against the national norm of 100. And Florida has a tax effort, rising a bit of late, nothing dramatic, just as we decline a bit, of 86. New York has twice the tax effort of Florida. It is a public choice. Some States will value public goods more than private goods and others private goods more than public goods. Some have higher capacity. Some have less. But the disparities are nothing such as they were thought to be in years past. But if the Senator from Florida wants to know why there are State-by-State funding disparities under the block grant, he need look no further than this chart. Now, under the logic of the amendment offered by the senior Senator from Florida, we will reward his State's behavior by giving it an additional $1.7 billion over the next three years while we punish New York by taking away $2.7 billion of its block grant; $4.6 billion over the life of the bill. The practical effect of the Graham amendment is to reallocate money from high tax effort States--States that are willing to spend their own resources on their own poor people--to low tax effort States--States that, for whatever reason, are not willing to make those investments. Even though most of the less generous States benefit from the Hill- Burton formula and States like New York do not. This certainly does not comport with my notion of Federalism. I suppose the response is that we are talking about Federal funds. Well, why limit ourselves to a discussion of Federal welfare funds? Why not consider all other Federal funds? Perhaps we should block grant NASA spending and allocate the dollars to each State on a per capita basis. Perhaps we should block grant farm price supports. Perhaps, even, defense spending. Why not? Given the prevailing opinion regarding the competence of Washington, maybe New York would be better off if it were to receive block-granted defense funds allocated on a per capita basis. After all, I am sure that New Yorkers are more aware than distant DoD bureaucrats which points along our boundary with Canada are most susceptible to invasion. Mr. President, I suggest that, in keeping with the spirit of the Graham amendment, we extend it to cover all Federal spending. Let us smooth out the disparities that exist in the per capita allocation of all Federal dollars. Now, if we consider all Federal spending, we discover that it amounts to $5,095 per person in Florida. In New York, the total is a less munificent $4,973. Perhaps the senior Senator from Florida would be amenable to an effort to reallocate some of the Federal funds that flow to his State so that the disadvantage New York suffers can be ameliorated. Let us extend the analysis and consider not just spending received, but taxes paid, as well. Between fiscal years 1981 and 1994, on a cumulative basis, if New York's percentage share of allocable Federal spending had been equal to its share of taxes paid, the State would have received an additional $142.3 billion. Florida, on the other hand, would have received $38.5 [[Page S 13360]] billion less. I think notions of fairness and equity have been turned on their head here. The same may be said for regions. In the Northeast you find a big imbalance, a shortfall in the balance of payments with the Federal Government. In the South you find a big surplus. In the Midwest, an even bigger shortfall than the Northeast. The greatest--Illinois now ranks 49th in its balance of payments with the Federal Government. The real concentration of balance of payments deficits is in that old Midwest industrial area. And the West is a benefactor, always has been, for a variety of reasons of which defense outlays are probably the most important. This is a zero-sum situation. Combining the regions, we find that the Northeast-Midwest balance of payments deficit totals $690 billion. And that is the exact windfall the South and West have enjoyed over the past 14 years. Mr. President, the senior Senator from Texas often refers to ``people who pull the wagon'' and ``people who ride in the wagon.'' Well, we have States that pull the wagon and States that go along for the ride. Make no mistake. I am no fan of the block grant. But I must strenuously resist any attempt to raid my State of $4.6 billion, to decrease an allocation derived in large measure from New York's willingness to ``put its money where its mouth is,'' particularly when the ``raiders'' represent States that are unwilling to spend their own resources on their own poor people. Mr. President, in June 1990, during consideration of the housing bill, the senior Senator from Texas--then the junior Senator--offered an amendment to reallocate community development block grants [CDBG's] on the basis of population. I said during the course of that debate, we put at risk the principle of federalism if we ever begin to insist on this floor that any activity which has a disproportionate impact on one State or region as against another cannot be accepted. This floor saw the terrible divisions on regionalism that led to the most awful trauma of our national existence, which we still have not overcome, still not put behind us--the Civil War. There is a desk on this floor where a man was clubbed insensible, beaten insensible, over regional issues. All our intelligence says: Respond to need and be thoughtful and be accommodating and try to see that there is some rough balance. I spoke earlier of our having documented the imbalance and that we live with it. So might my colleagues from Sunbelt States. Mr. President, I was not sure this bill could get any worse. But after the votes on the Feinstein and Breaux amendments earlier today, it has. The race is on. We have dismantled the entitlement status of the AFDC program. States no longer have an incentive to spend their own money on their own poor. Now, we have no real requirement that they spend their own money, either. The race to which I refer is the race to the bottom. An article in last Wednesday's Washington Post sums up nicely the brave new world we are about to enter. The article, by Barbara Vobejda, is entitled States Worry Generosity May Be Magnet for Welfare Migrants. Taxpayers and State legislators and Governors are determined to prevent their States from becoming welfare magnets. Set your benefits as low as possible to encourage current welfare recipients to move out and discourage welfare migrants from moving in. The article reports that many welfare recipients now receive one-way bus tickets from their caseworkers out of the States in which they reside. Perhaps, under the proposed block grant, that will become the biggest welfare expenditure: one-way bus tickets out. Mr. President, I find it interesting and revealing that those Members whose States spend the least on their own poor people clamor the loudest for a more ``equitable'' distribution of the Federal block grant and resist most vociferously any attempt to impose a serious State maintenance of effort. In 1981, George Will wrote a column about the anti-Washington sentiment pervasive in public-land States in the West. He pointed out that residents of these States were the beneficiaries of considerable Federal largesse, particularly in the form of water and power subsidies. But these beneficiaries were budget cutters--somebody else's budget, that is--through and through. Borrowing a line from that eminent American historian Bernard DeVoto, he entitled his column Get Out and Give Us More Money. Does that line not wonderfully capture the mentality that has crossed the hundredth meridian heading East and has percolated up from the South? Get out and give us more money. That is the wretched state of debate on this wretched bill. The Senator from Nevada is here, and the Senator from New York is on the other side. We have been alternating one side of the aisle to the other, although the different sides do not represent different views on this amendment. Mr. President, I yield to the Senator from Nevada. I wonder if my friend from New York--I believe the Senator from Nevada has been here for an hour and a half and has a rather brief statement and then the Senator from New York, my distinguished friend, will follow.

Mr. MOYNIHAN

Mr. MOYNIHAN. No. The Senator from New York is awaiting with great expectation the remarks of the Senator from Arkansas.

Mr. MOYNIHAN. Mr. President, it was our informal understanding--we have no time agreement--that we would alternate from one side of the aisle to the other.

Mr. MOYNIHAN. I move to lay that on the table. The motion to lay on the table was agreed to.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, the Dole substitute to H.R. 4 authorizes a supplemental appropriation of $878 million over fiscal years 1997 through 2000 to be allocated to certain States in addition to the funds they would receive under the temporary assistance for needy families block grant. States qualify for the supplemental funds if one, total population--not just poor population--growth in fiscal year 1996 is above the national average and State welfare expenditures per poor person are at or below 50 percent of the national average, or two, State welfare expenditures per poor person are at or below 35 percent of the national average, regardless of population growth. States have a one-time opportunity to qualify in fiscal year 1997. If they do, they will receive a 2.5-percent increase in their block grant funding each year, 1997-2000, regardless of whether they continue to meet the eligibility standards in subsequent years. Likewise, States that fail to qualify in fiscal year 1997 are excluded from receiving any of the supplemental funds even if they were to quality later. The practical effect of the provision would be to boost cumulative funding in 19 so-called growth States--but not California--by 10.4 percent. The remaining 31 States, including New York, would be held harmless; their allocations under the main block grant would remain frozen through fiscal year 2000, Not surprisingly, fully two-thirds of the Senators who represent the winner States are Republicans. Mr. President, there are major flaws with this provision that makes me wonder just how serious its proponents are. First, general population growth is not a reliable proxy for an increase in a State's share of the growth of poor people who qualify for welfare benefits. Many rapid-growth States attract new residents precisely because their economies are strong and work opportunities are good. It is entirely possible that a State experiencing rapid growth due to economic expansion could see its share of poor people decline. Conversely, a slow-growing Rustbelt State could see its share of total population decline but its share of poor people eligible for welfare increase. The second problem is that supplemental fund will be made available only to those growth States whose State expenditures per poor person are at or below 50 percent of the national average. And then there is the curious provision that rewards nongrowth States if their State expenditures per poor person are at or below 35 percent of the national average. A State could have a large share of childless working or elderly poor. These individuals would dilute per capita welfare expenditures even though they would not be welfare recipients. More importantly, are now about to enter the business of rewarding States who will not spend their own resources on their own poor people? Are we going to start punishing States that do commit their own resources by reallocating scarce Federal funds away from them? I will have much more to say on this subject when we take up the formula amendment the senior Senator from Florida has offered. Suffice it to say at this point that I will not stand by and allow our Federal system to be wrecked in one fell swoop. Senator Feinstein's amendment is identical to the provision in the bill the House passed pertaining to supplemental block grant funds. Each State's annual share of the supplemental block grant, if any, would be proportionate to its share of the increase in the number of poor people nationwide. New York, theoretically, could be eligible for supplemental block grant funds. The Feinstein amendment requires the Census Bureau to update and publish data relating to the incidence of poverty for each State, county, and local school district unit of government every 2 years, commencing in fiscal year 1996 and authorizes an annual appropriation of $1.5 million for this purpose. Mr. President, I support the Feinstein amendment, but it does have two flaws. First, an increase in the number of poor people--while better than the proxy used in the underlying substitute--still is not a precise proxy for an increase in the number of poor people who would be welfare beneficiaries. Once again, low-income men and women without dependent children and the elderly poor, for instance, would not be AFDC recipients but would count in the population tallies that determine whether a State qualifies for the supplemental block grant. More importantly, while updating poverty data more frequently is a desirable public policy goal, which I support, statisticians are not confident yet that accurate subcounty counts are possible in any context other than the decennial census. Collecting data more frequently typically will harm slow-growing States like New York when the data sets are plugged into allocation formulas. Exacerbating the problem is the fact that poverty data do not reflect regional or State-by-State differences in the cost of living. A family of our just above the poverty threshold living in New York City is demonstrably worse off than a family of four just below the threshold living in rural Mississippi. Research indicates that differences in the cost of living can be as great as 50 percent. Each year, in collaboration with the Taubman Center for State and Local Government at the John F. Kennedy School of Government, I publish a document entitled ``The Federal Budget and the States'' that details the flow of funds for the previous fiscal year. Aficionados of the report know that I refer to it as the ``Fisc.'' I send a copy to each Senator every summer and hope that my colleagues read it. At any rate, the most recent edition of the Fisc contains, for the second year, the ``Friar/Leonard state cost of living index,'' which is named for its cocreators, my coauthors, Monica E. Friar, an indefatigable research assistant, and Professor Herman B. Leonard, academic dean of the teaching programs and Baker Professor of Public Finance at the Kennedy School. If we were to apply the Friar/Leonard index to subnational poverty statistics, we would find that New York's 1992 poverty rate jumps from the 18th highest rate nationwide to the 6th highest. One of the amendments I offered last, Friday would require the Census Bureau to develop cost of living index values for each of the States-- at a minimum, and at the sub-State level, if practicable--and apply those values to the national poverty threshold in determining the number of poor people for each State. The index value for the United States would be 100. A State such as New York might have a hypothetical index value of 106 while Mississippi might have an index value of 94. Applying the index values for the two States to the national poverty threshold would increase the income limit and hence the number of poor people in New York and decrease the income limit and the number of poor people in Mississippi. Earlier this year, a National Academy of Sciences [NSA] panel of experts released a congresssionally commissioned study on redefining poverty. The report, edited by Constance F. Cirro and Robert T. Michael, is entitled ``Measuring Poverty: A New Approach.'' According to a Congressional Research Service reviews, The NAS panel (one member among the 12 member panel dissented with the majority recommendations) makes several recommendations which, if fully adopted, could dramatically alter the way poverty in the U.S. is measured, how Federal funds are allotted to States, and how eligibility for many Federal programs is determined. The recommended poverty measures would be based on more items in the family budget, would take major noncash benefits and taxes into account, and would be adjusted for regional differences in living costs. . . . Under current measures the share of the poor population living in each region in 1992 was: Northeast: 16.9%, Midwest: 21.7%, South: 40.0%, and West: 21.4%. Under the proposed new measure, the estimated share in each region would be: Northeast 18.9% Midwest: 20.2%, South: 36.4%, and West: 24.5%. [[Page S 13203]] The CRS report, ``Redefining Poverty in the United States: National Academy of Science Panel Recommendations,'' was written by Thomas P. Gabe. Mr. President, despite the flaws I have just mentioned, the Feinstein amendment is enormously superior to the underlying provision, and I encourage my colleagues to support it.

Mr. MOYNIHAN

Mr. MOYNIHAN. That is right.

Mr. MOYNIHAN. I withdraw my request.

Mr. MOYNIHAN. Mr. President, I suggest the absence of a quorum.

Mr. MOYNIHAN. If the Senator from Florida would be understanding, I do not know that we could get a time agreement at this point. But in the sequence, he would come after the Senator from Illinois.

Mr. MOYNIHAN. Why do we not ask for that now? Mr. GRAHAM addressed the Chair.

Mr. MOYNIHAN. Did you want 1 hour?

Mr. MOYNIHAN. I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. MOYNIHAN. I move to lay that motion on the table. The motion to lay on the table was agreed to. Amendment No. 2523

Mr. MOYNIHAN. Mr. President, may we have order.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, may I simply thank my distinguished friend and colleague for setting out the day's procedure, and call to the attention of those who might be listening that we have some 200 more amendments that were filed on Friday, and that if we are to dispose of them by Wednesday, as the majority leader has indicated would have to be done if we are going to get through with the year that ends in 3 weeks' time, we will have to hear from Senators about which amendments they wish to have called up and get time agreements for them as we have done today. I see the distinguished Senator from Kansas has risen, and I look forward to her remarks.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, I am taking a moment to expand on the remarks I made toward the end of our debate on Friday concerning the amendment I offered, the Family Support Act of 1995, a measure which simply brought up to a new set of standards the Family Support Act of 1988. We began in 1988 saying all States would have to have 20 percent of their eligible adult welfare recipients in work, job training, or job search by 1995. It was understood that as we got the hang of this, as States learned to handle what was a new idea, welfare should be an interim measure, as people moved to independence and became self-supporting. We agreed to change a program that began as a widows' pension and is no longer such. It was contemplated we would work our way up to higher levels of participation, and indeed in the Family Support Act of 1995 we move to 50 percent by the year 2001, add money to the JOBS program, make improvements to the child support system, and build on a program which we have begun to feel is working. Dramatic improvement does not happen instantly when one passes legislation, not in an area like this, not in a situation where we have so many communities that have been reduced to an extraordinary incidence of dependence. I mentioned on Friday that, in the city of Chicago, 46 percent of children were on welfare at some time in the course of the year 1993; in Detroit, 67 percent; in New York, 39; in Philadelphia, 57; San Diego, 30. These are massive problems. It is not surprising that the first real reactions to the Family Support Act, the ones that were most innovative and effective, came in areas not necessarily rural, but not with the masses of poor who inhabit the great cities. Iowa is one of these areas with great significance. On the floor a month ago, Monday, August 7, my good friend and comanager here, the Senator from Iowa, [Mr. Grassley], said something very important. He said, ``. . . my State of Iowa began the implementation of its program in October 1993. In the last 2 years, the number of AFDC employed recipients has increased from 18 percent of all welfare recipients to 34 percent--I believe now the highest of any of the States--as a percentage of welfare recipients who are working.'' If I may interpolate, I think that is correct. We had set 20 percent as the initial goal. Iowa went right by it to 38 percent, more than halfway to the goal of fifty percent we had contemplated in the Family Support Act of 1995 presented to the Finance Committee. That bill failed 12 to 8 in the Finance Committee and received 41 votes here on the Senate floor; 54 to 41, if I recall. But that bill of 1988, which I say, once again, went out the Senate door 96 to 1, began to take hold. The program in Iowa that Senator Grassley was talking about is the program created under the Family Support Act. Mr. President, the Federal government pays at more than 60 percent of the program costs in the JOBS program. The Family Support Act of 1995, which we voted on Friday, would take it from 60 percent to a minimum of 70 percent for all expenditures, including administrative costs. States have not in the past drawn down the full amount available to them to implement the JOBS program--by increasing the federal share, my bill would make possible the full implementation of the JOBS program. I might just add as a preface to some of the other things I am going to say, Iowa passed a reform bill 2 years ago. Indeed, on that occasion, Mr. President, I put into the Record the Iowa Family Investment Program, for which basic approval under the JOBS program was requested in April 1993 and approved in August 1993. They received a waiver to raise the asset limit for applicants to $5,000 for recipients, exempt equity value of an automobile up to $3,000, adjust annual CPI by income deposited in an IDA account not to be counted as income, and so forth. In Iowa, if you are out in the countryside and you do not have an automobile, you are not going to find a job. One of the debilitating things about welfare is that it has required its recipients not only to be paupers but to remain paupers. About 5 years ago a [[Page S 13159]] mother was discovered in a Middle Western State who had been saving, had saved some $12,000 to put her daughter through college, and was, in consequence, a criminal. It just emiserates the population involved, and not a small number of persons. To say again, in some cities it is the majority of all the children living in the city--67 percent of the children in Detroit, 57 percent of the children in Philadelphia. On Friday, Senator Harkin gave a very careful and thoughtful description of the program in Iowa, following on some of the remarks by his colleague. He said he wanted to bring to his colleagues' attention what has happened in Iowa ``since we changed our welfare system.'' He said: We enacted a welfare reform program in October 1993, and almost 2 years later you can see what happened. Our total spending on welfare has dropped, and dropped dramatically since we had our welfare reform program. Mr. President, what Iowa has been doing is exactly what the Family Support Act hoped States would do. And Senator Harkin very properly said the program was enacted in October--that was following the approval from the Department of Health and Human Services in August. In Iowa, sixty-three percent of the JOBS funds are federal moneys. Iowa has every reason to be proud of its program. But is Iowa certain that the program will continue when the funds are discontinued? The JOBS program is abolished by both the Democratic bill, that we voted on earlier last week, and the Republican bill. We are taking something that has worked and decided, no, it has not worked fast enough. Or has not worked far enough? The proposal to undo this is the nearest thing to vandalism I can recall in 19 years in the Senate. We will regret it and we may return to it. Or we may, as in the case of the deinstitutionalization, forget what we did and wonder what this new, ominous, inexplicable problem of child poverty is? I say again, a 5-year limit in a situation where 76 percent of the recipients are on AFDC for more than 5 years, will lead to a situation out of control, if it is not already. We will not begin to see the effects for about 5 years. Five years is a very long time in our memory. I have said over and over again, how quickly we forgot that we emptied out our mental institutions and did not build the community health centers that President Kennedy contemplated. We will forget, perhaps, what we have done, what we did on the Senate floor in this September. And we are doing it in the face of the first really good evidence that the JOBS program is working. The Manpower Demonstration Research Corporation, last July, put out a report on the programs it had been following around the country, because we built evaluation into our studies. And the overwhelming evidence was that the Family Support Act was working. The most promising results involved a strategy that was tested in Atlanta, Riverside, and Grand Rapids, that emphasized rapid job entry. We learned something here. Training? No, no. Get into a job situation, and you will learn the job. You will learn on the job if you can learn to get to the job. The number of AFDC recipients dropped by 11 percentage points in those three. Employment rose by 8.1 percentage points. Expenditures dropped 22 percentage points, which was exactly what Senator Harkin was describing. And the MDRC, which is a very careful organization, observed that the 22 percentage point drop in expenditures exceeds the savings achieved by experimentally evaluated programs in the last 15 years. We are finally beginning to understand this problem. What we are dealing with here is the aftermath of an enormous increase in out-of-wedlock births. President George Bush was the first President to speak of this, and did so in a commencement note of 1992. President Clinton raised the issue in his State of the Union Address in 1994. Never before had Presidents touched on this subject. Never before have we debated it. We are doing so now, and as we must. In the current issue of The Economist, Mr. President, a journal not necessarily read widely in the United States but certainly respected, this week's cover story, ``The Disappearing Family,'' talks about the American experience, the awful experience. It includes a chart of the experience of this country for which I find myself cited as the source. It is the first time The Economist looked to me for data. Indeed we find that in every country in northern Europe there has been extraordinary increase in the ratio of births to unmarried mothers in the last 30 years. A few Western industrialized countries have not seen an extraordinary increase. Italy's rise has not been as shocking as ours, and Switzerland has had a fairly modest increase. Japan's ratio was 1 percent in 1970, and is 1 percent today. This is going to be a major subject of cross-cultural studies in the next century as we find ourselves asking what are the forces that make for the dissolution of the marriage unit in Western society that do not similarly affect Eastern societies? Just last Friday, as I believe, the Christian Coalition had a large conference here in Washington, and a number of Senators spoke. Mr. Ralph Reed is their director. They heard a stirring comment from Mr. Alan Keyes who spoke to them. This was the Christian Coalition's annual conference here in Washington. He said: And we know the breakdown of the marriage-based, two-parent family is at the root of every problem, crime problem, poverty problem, deteriorating education, even the problem of entitlements, where we have backed away from the family system that ought to take care of the children and the elderly and try to turn that task over to a Government that cannot get it right. You know, Mr. Keyes I believe is a candidate for the Republican Presidential nomination. He said: We are doing it wrong when we back away from the family system, and we have allowed the destruction of the family system because we are defining our freedom in a corrupt and a centrist way that destroys the loyalty and law and sense of obligation that is needed for family life. Now we know it is true, and I have a question for you then. If you know it is true, and you think it is right, then why on Earth would you sit back this time, when it matters more than anything else in this Nation that we put our No. 1 priority and put your seal of approval behind people who put it on the back burner and give it the backseat and only talk about it when they force them to? What is the matter with you? He went on to say: The marriage-based family, the No. 1 priority of this Nation's life, nothing is more important, not the budget, not the deficit, not taxes, not the power of the Federal Government over the State government. We will rebuild our families or we will perish, and we know it. Well, that is language that is perhaps more in the mode of bearing witness than of giving testimony. But it is a purposely legitimate setting and a purposely legitimate speaker saying something which I happen to think is entirely the case, and I think it is so important that we are talking about it. We used not to talk about it. We could not do it. We did not do it 30 years ago, or 20 years ago. We started to talk about it 10 years ago, and now we have reached it. We do not know what to do with very little evidence, no data. Only in the last Congress did I get a welfare indicators report established by statute, and in 2 years' time we get our first study. The idea is to match the economic report that was created by the Employment Act of 1946. We are getting there. Long before you get good answers, you have to ask good questions. I think we have begun to do that. I take heart from it. I wish that my friend from Iowa would acknowledge that their success is success under a statute we passed in 1988, and it is well deserved. And we might do worse than to build on that success rather than dismantle the program. But there you are. That is a decision the Senate will make in good time. I see my friend from North Dakota is on the floor. I understand he wishes to speak. In any event, Mr. President, I yield the floor. Mr. GRASSLEY addressed the Chair.

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

Mr. MOYNIHAN

Mr. MOYNIHAN. I Would like to share his concern about the state of the White House operation in this matter--the matter of drug interdiction and drug abuse--which was established by legislation in 1988. The then majority leader, Robert C. Byrd, created a task force which consisted of the Senator from Georgia, Mr. Nunn, and myself, and I think we had more than a little influence in the legislation that finally passed. I will take a moment of the Senate's time to speak about that legislation. We saw the problem as being twofold. One was the reduction in the supply of drugs--most of which began as legal pharmaceutical products. They arrived from the onset of organic chemistry in German universities in the early 19th century. You take this gradual escalation from opium to morphine to heroin. Heroin, Mr. President, is a trade name. You can find advertisements in the Yale Alumni News, if you wish, for heroin in 1910 or thereabouts. It was developed by the Bayer Co., that produced Bayer aspirin. Aspirin is a trade name. Heroin was tried out and tested on its employees and it made them feel heroisch in German, heroic. Cocaine emerged from the same process, from the coca leaf to the synthesized product. Sigmund Freud's first publication ``Uber Coca'' described his use of cocaine as a means of treating morphine addiction, which did not succeed, and he became very much opposed to it. These drugs were outlawed in 1915, if memory serves, by the Federal Government, and remain so. It is the last of the prohibition decrees of that era. We thought in terms of supply and demand. If I can tell my friend a little story, I think it may be said that in the late 1960's we had a heroin epidemic in this country, very much so in this city. You could tell it by the incidence of robbery of small grocery stores and food outlets--small amounts of money needed by persons who are getting withdrawal symptoms from the lack of heroin. It was so serious that--at this point I was Assistant to President Nixon for Urban Affairs--I was called to a meeting across the street, cater-cornered from the White House, by some of the most respected and responsible citizens in the city of Washington, who asked me if I would ask the President to garrison the Capitol. Such was the problem. This particular flow of heroin originated in the opium fields in Turkey, made its way to Marseilles, where, in small simple laboratories, it was converted into heroin, thence smuggled into New York, more or less directly, and then around the country. It seemed to me a curious thing. In 1969, as Assistant to the President for Urban Affairs, I thought the most important thing we had to deal with was welfare, which we are doing today, and next the heroin epidemic. President Nixon, in August of that year, sent to the Congress a very wide-ranging proposal, the Family Assistance Plan, which would establish a guaranteed income and replace the welfare program altogether. It passed the House twice and never get out of the Finance Committee in the Senate. That done, I left immediately for Turkey by way of India, which is still the largest source of illicit opium. I would not want to live in a world without morphine, not with my teeth. But it is still widely used properly as a medicine for medicinal purposes. I went to Turkey, to Istanbul, and met with the Foreign Minister, representing the President of the United States. I said, we have an epidemic in our country and we have to stop it. That means we have to stop the production of opium in the province of Afyon. Opium is made from poppy seeds. Poppy seeds are part of the Turkish cuisine. They put poppy seeds on their bread. This was not an easy thing to do. It is like someone arriving in Washington and telling our Secretary of State they had to stop growing corn in Iowa--sorry about that, you just have to stop. The Secretary of State will say, I see, of course. Actually, they did not close them down; they just harvested them in a different way, called straw poppy. You could still extract the ingredients needed for pharmaceutical purposes, but without the paste which is derived by simply putting an incision on the stamen of the poppy plant, collecting the moisture which oozes out by fingers and wrapping it up in a leaf until it gradually became raw opium. I then went to Paris where I found the American Embassy was not aware that anything was going on in Marseilles, much less going on in Washington. But they took my word for it and I met with the director of the Surete, their internal police, which has been there since the Napoleonic age. These conversations went back and forth a number of times. Finally the French agreed, all right, they would close down the Marseilles operations, and the Turks agreed they would move to this new mode of harvest. I was in a helicopter--I wonder if my friend from Iowa might hear this because it would help him--I was in a helicopter on my way up to Camp David and just back from Paris. The only other person present was the then Director of the Office of Management and Budget, George P. Shultz. I said to him, ``George, I have good news, I think we are going to close down the French connection.'' This is what it became known as. He looked up from his papers and said, ``Good,'' and then I said, a little deflated, ``No, no, really. This is important. They are going to close it down. I have it from the head of the Surete in Paris.'' And he looked up and said ``Good.'' Then, quite crestfallen, I said ``I suppose''--he being an economist--``I suppose you think that so long as there is a demand there will be a supply?'' He looked up at me and said, ``You know, there is hope for you yet.'' Of course in 3 to 4 years' time the Mexicans were providing heroin. Now it comes in from anywhere in the world, and will continue to do so. That is why in our 1988 legislation, we said there will be two deputies in the newly created White House office--the Office of National Drug Control Policy. One would be the Deputy Director for Demand Reduction, who would seek a clinical device, a pharmaceutical block, an equivalent in one way or another in that general field of methadone treatment for heroin, who would learn the chemistry of this subject enough to have some treatment beyond the sort of psychiatric, psychological treatment available. The numbers would overwhelm us. We cannot cope. President Bush made extraordinary, fine appointments. He appointed Dr. William Bennett as the head of the office. As the Deputy Director for Demand Reduction he appointed Dr. Herbert Kleber, a physician at the Yale Medical School, a research scientist, and exactly the man you would want for this. Then after a while Bennett left, and Kleber also left. Kleber has gone to Columbia College of Physicians and Surgeons and is working at the New York Psychiatric Institute in this field. Nobody succeeded him in a scientific role. There have been a number of persons in the job. I am sure they are good persons, but they are nothing like what we had in mind in the legislation. Just 2 weeks ago, I tried to learn what had been the professional qualifications of the persons who had succeeded Dr. Kleber, and I found that in this office in the White House, they could not tell me. They did not know. This was not a long time back. It was 1988--well, 1990. They did not know their history 5 years back. They had no idea what the statute intended. They were not doing anything the statute contemplated. So I actually thought I would put in legislation abolishing the position, on the grounds that if it was not going to do what it was intended to do by statute, why not just eliminate it? [[Page S 13152]] I would like to think someone there is listening to what the Senator from Iowa said, and what I said. I doubt it very much. I will introduce that measure, or insist on it. But I may try to offer it as an amendment somewhere along the line. The main point is, we enacted a good statute which has been trivialized, a fact which I regret, but about which I can do very little. Mr. President, I see no other Senators seeking recognition. The chairman of the Committee on Foreign Relations is on the floor. He may be seeking the floor. Mr. President, I yield the floor. Mr. HELMS addressed the Chair.

Mr. MOYNIHAN. Mr. President, I ask unanimous consent that I might proceed as in morning business to comment on the very able remarks of my friend and collaborator at this point from Iowa.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, I ask unanimous consent that reading of the amendments be dispensed with.

Mr. MOYNIHAN. Mr. President, I send to the desk an amendment on behalf of the Senator from Massachusetts [Mr. Kerry], and another for Mr. Harkin, and ask for their immediate consideration.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, I ask unanimous consent that the reading of the amendments, en bloc, be dispensed with.