Daniel Moynihan

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, I would like to thank my friend from Florida for making a very explicit point, which the chairman made, which is that, if inadvertently you omitted consideration of a whole possible class of potential taxpayers which we did not deal with, we ought to--in shorthand I think we refer to it as green card issue. The review that is going to come up and which will, whatever we do, be retroactive to February 6, whatever the budget may produce, may produce more revenue than we otherwise would have done in the bill before us. And I think the committee was unanimous that it should indeed go for deficit reduction, in the final vote on the amendment by the distinguished Senator from New Jersey--which stood alone--just not to deal with other matters but simply to reduce deficits. I yield the floor. I thank the Chair. Mr. BRADLEY addressed the Chair.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, with much sorrow, I would like to tell the Members of the Senate of a horrible loss. On Sunday, February 26, 1995, Matthew Eli Puccio, a young gentleman from New York City, was involved in a terrible accident that took his life. Matthew shall be remembered fondly by his parents, teachers, and friends as a young man of exceptional character and kindness. His departure is felt by us all. Matthew's mother, Carol L. Ziegler, recently sent to me a short paper that Matthew had written for a school journalism assignment. In this paper, he discusses term limits and his personal opposition to the issue. I believe that many of my colleagues in both Houses of Congress will find Matthew Puccio's paper of interest, and I ask that the text be printed in the Record. The text follows: Over the past few years, some politicians, primarily Republicans, have proposed term limits be set for Members of Congress. Term limit means that a Member of Congress can be elected only a certain number of times. To be exact, since 1990, 23 million people in 16 States have voted for this law to be passed. Most of these people in 16 States have voted for this law to be passed. Most of these people want term limits to increase electoral competition. They want change every now and then. If this law were actually passed, it would be a mistake. What if a Member of Congress is doing a good job? Take New York Senator, Patrick Moynihan, for example. He has just been elected to his third term and is doing a great job in office. Why should they be pulled from office at risk of being replaced by someone who would do less of a job? In this case, what is the need for change? On the other hand, if a Member of Congress is doing a bad job and wants to run again, he could always be voted out. Setting term limits also takes away a politician's constitutional rights. Why shouldn't he or she be allowed to run for office as much as they want, with the intention of helping their country? If they are not elected, they are not elected, but they should have the chance. On the flip side, this also takes away the people's constitutional rights. Why shouldn't the people be allowed to have who they want in Congress, regardless of how long he has been in office? More specifically, term limits violate the Bill of Rights which list the freedoms of the people. Term limits may seem like an easy answer but it is just unfair. Elections are the people's choice. Anyone should be allowed to be in Congress for as long as they want, as long as they are doing a good job, and the people want to vote them in.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, during the past year, NYNEX, a major telecommunications company headquartered in New York State, has sponsored a series of ``Agenda For Growth'' conferences on the future of the economy of the State. Keynoting the last of this series was Dr. John Brademas, president emeritus of New York University, who before joining the university in 1981, served for 22 years in the U.S. House of Representatives. Cosponsors with NYNEX of the February 15, 1995, meeting were the Business Council of New York State, Inc., Commerce and Industry, Inc. I believe many of my colleagues in both Houses of Congress will find Dr. Brademas' analysis of interest, and I ask that the text of his remarks be printed in the Record. The remarks follow: Agenda for Growth: NYNEX Conference on the Future of the New York State Economy I am honored to have been asked to open this conference on ``The Future of the New York Economy,'' and I congratulate Dick Jalkut, President and Group Executive of NYNEX Telecommunications, on the contribution the ``Agenda for Growth'' series represents to understanding important issues facing our city and region. At the outset, let me note that I have served on the Board of Directors of NYNEX since 1991 and have greatly enjoyed the opportunity to work with Dick and the other outstanding leaders of NYNEX. Today, I'll speak to you from the perspective of someone who served twenty-two years as a Member of Congress, from Indiana; for eleven years, as President of the nation's largest private university, New York University; and as a former chairman of the Board of the Federal Reserve Bank of New York. Among other current responsibilities, I'm serving as chairman, by appointment of President Clinton, of the President's Committee on the Arts and the Humanities and also chair the National Endowment for Democracy. So from this general background, I want to join you in considering prospects for the future of New York City and the surrounding area and ways of strengthening our economy in the years ahead. As we all know, the economic recovery of the metropolitan region has lagged that of the entire nation. We know, too, that recent changes in political leadership at the city, state, and national levels have added a new dimension of uncertainty to the economic outlook for New York. How, in this context, do we nurture the unique strengths of the metropolitan region and nourish its preeminent role in the international marketplace? How, as it were, do we develop an agenda for prosperity? To respond to these questions, we must first understand the dynamic that drives the New York economy and then consider the challenges that require our efforts. The participants in this conference will offer many insights. Let me offer some initial observations. Point number one. New York's economic future lies in fundamental changes in the international economy. Technological advances propelling us into the 21st century are redefining the competitive landscape of the entire world. National borders and political ideologies no longer determine patterns of global trade and the movement of capital. We have entered an era characterized by a combination of intense competition and interdependence. Two of President Clinton's actions this month dramatically underscore what Secretary of the Treasury Robert Rubin has described as the ``interconnectedness'' of the world economy: the Mexican rescue package and sanctions on China. This changing structure of the international economy profoundly affects the life of major cities like New York. Why? The dispersal of economic activity around the globe has created a corresponding need for organizational coordination in a few key sites. So cities are increasingly taking on a strategic role as highly concentrated command centers for operations that are worldwide. Not surprisingly, cities have concomitantly become critical locations for finance and specialized services. All these functions have influenced immeasurably both international economic activity and urban development. One result is the emergence of ``the global city,'' with New York a primary example. The scope and character of the New York area economy are more and more defined by its role in the world marketplace. Beyond understanding New York's place on the international stage, we must appreciate a second fundamental factor. The principal reason for the strength of the New York region in the world economy is that it is the center for the creation and sophisticated application of intellectual capital. For during the past century, the New York economy has evolved from one dependent on manufacturing to one based on a concentration of Fortune 500 headquarters, corporate R&D facilities, advanced business services in finance, law, advertising and management and the world's leading cultural institutions and media firms. Indispensable to all these activities is what I'm calling ``intellectual capital''--the individuals and industries that develop new products and services, apply technology in innovative ways, generate new marketing concepts and techniques, design new fashions, create new forms of music and art and produce the information and entertainment that are distributed across the nation and the world. Indeed, as several recent news accounts have noted, the richness of its intellectual capital sector makes New York an incubator for a host of new multimedia start-ups which thrive on the vibrance of the arts--painters, musicians, writers, filmmakers--and provides innovative content for communications, advertising and publishing conglomerates headquartered in the region--Time Warner, Sony, Hearst, Viacom, Bertelsman, ABC, CBS and NBC. As the New York area also offers comprehensive venture capital and financial services, the remaining resources essential to creative development are right here. And New York's intellectual capital sector is more and more the primary pulse of the region's strength. The performance of individual facets of the sector may fluctuate over time but taken as a whole, the intellectual capital sector will be the lead generator of income and employment for the future of this region. We must, therefore, nurture this unique resource so that the New York metropolitan area can respond to change with state-of-the-art capabilities. We cannot afford to cede fields of specialization over time to our national and international rival cities. As we meet today in a hotel close to Times Square, I observe that tourism--New York style--also depends on intellectual capital. Business travelers come to New York in search of the ideas and specializes information most easily obtained through face-to-face contact. Other visitors come for the city's cultural life, its restaurants and retail stores. Walk just a few blocks from here and you can see how New York City blends culture, entertainment and tourism in new and creative ways. Leading entertainment companies, like Disney, Viacom and Virgin Records, are revitalizing historic theaters on 42nd Street. This development has been made possible, in part, through the impressive work of the Times Square Business Improvement District which has made the entire theater district attractive to visitors from around the world. As a former university president, I cannot fail to add that New York City's intellectual capital is in large measure the product of the presence of a rich mixture of colleges, universities and research institutes. More than 100 institutions of higher education are located here, situated in all parts of the city. Unlike so many cities where one or two colleges and universities dominate, New York is home to nearly every type of educational institution: theological seminaries, two- and four-year colleges and health care centers and research universities of international distinction. Indeed, what helps make New York so special is that the students who attend college and professional schools in New York City often settle here and replenish our intellectual capital. Our colleges and universities are magnets that draw people to New York who then launch their careers here, providing a new stream of talent for both the private and non-profit sectors. I must make another point. The intellectual capital sector encompasses not only the world's largest corporations and financial institutions but also the small companies and manufacturing firms that pioneer customized products and services. Recent studies have underscored the importance of nimble, skilled small businesses as a significant part of the job creation process in the New York area. How then can we strengthen our base for the years ahead, to assure that we retain both our role as a global city and our investment in intellectual capital? Here are a few suggestions. First, we must recognize that we're fashioning an agenda for growth at a time of major political change, and as you and I know, decisions at every level of government have an impact on the economy. New leadership in both the United States Senate and House of Representatives, a substantial number of members wholly new to the legislative process, shifting committee jurisdictions and, above all, a President and Congress sharply divided by party mean a set of forces that may take Federal policy in directions that depart radically from the past. Similarly, this year, we have had a change of party in the Governor's office in New York State, and last year, in the Mayor's office in City Hall. The Congressional Budget Office estimates that reductions in Federal grants to New York State in the Republican ``Contract With America'' would total $26.4 billion a year. Such cuts would affect every aspect of life in the city, from transportation to education, and particularly health care, which accounts for over 12% of employment and wages in the metropolitan region. From Albany, Governor Pataki wants to reduce state aid to the city by $158 million for the City University of New York, $128 million for the MTA and nearly $2 billion from Medicaid and welfare. From City Hall, Mayor Giuliani announced yesterday $600 million in cuts in city agencies. Clearly a concern that underlies all discussion of spending cuts--Federal, state or local--is the impact on the poor in the city. Although the widening gap between rich and poor in New York City is not the subject of this conference, I believe that effectively addressing this complex issue is essential to the long-term social stability and economic health of our city and region. A second item on our agenda for growth: We must not only sustain but substantially improve the infrastructure that supports New York's economy and its reservoir of intellectual capital. By infrastructure, I mean information. The Port Authority of New York and New Jersey, under the sagacious leadership of Stanley Brezenoff, undertook major improvements in the region's airports. We must continue these efforts while dramatically enhancing ground access to our airports. Indeed the regional public authorities should start planning the transportation systems necessary for the next century. While making better use of the existing transportation infrastructure, we must also link inner-city residents to jobs in outlying areas and find ways of connecting suburban communities directly to downtown Manhattan. The other element of infrastructure indispensable to intellectual capital is telecommunications. Put simply, the metropolitan area can function as a global city only with a telecommunications capability second to none. For there is a synergistic relationship between unending demands for ever more sophisticated services and the push for breakthrough technology and systems to meet those demands. Driven by data and communication requirements for managing international operations from corporate headquarters and conducting complex financial transactions around the world, New York has emerged as the central nervous system for the global network of the most advanced information technology anywhere. New York City resembles a giant switchboard: Electronic messages are constantly flowing in, through and out of the city's office towers and stock exchanges. Modern telecommunications systems have enhanced the city's capacity to put information to work, converting ideas and data into new products and services that are distributed electronically around the world. Indeed, New York is the leading source of content for books, magazines, newspapers, radio, television and eventually for the Internet. Within just one mile of this motel are the headquarters of the nation's largest television and radio networks, leading publishing companies and major sources of cable television programs. As the global market for information and entertainment expands, New York's communications industry will become even more important. Only last week, MTV, a division of Viacom, headquartered just four blocks from here, announced the launch of a music television channel in South Africa, the first American broadcaster to establish a network in South Africa since the new, post-apartheid government opened the state-controlled airwaves to private enterprise. New York is--literally--spanning the world! Let me turn from physical infrastructure to the foundation of New York's intellectual capital sector--people. New York City has a larger number and wider diversity of brilliant, talented, motivated men and women than any other urban area in the world. It is this intellectual firepower that in large part makes New York New York and is so attractive to international business. Two forces are critical to invigorating the environment necessary for constant renewal of our creativity and expertise: education and the arts. Let me elaborate. The employment requirements of the New York metropolitan region are increasingly characterized by the sophisticated, cosmopolitan nature of the intellectual capital sector. I have earlier spoken of the crucial role our post- secondary educational institutions play in luring people here for their studies and careers. Yet no challenge is greater for New York City than to reaffirm the priority of good elementary and secondary schools. The public school system is nevertheless being asked to do much more with substantially less. As Robert Berne, Dean of NYU's Robert F. Wagner Graduate School of Public Service, has warned, the proposed freeze in state aid to New York City schools represents a substantial cut in funding because our school population is increasing by approximately 20,000 students every year. And Mayor Giuliani's announcement yesterday that the deepest reductions in his budget will fall on the City's public schools only intensifies the problem. Without a strong school system, we will not be able to produce a skilled workforce, one able to compete in today's job market. As entry-level jobs demand higher technical skills, we must design our high school programs to meet the requirements for employment in the 21st century. In addition to education, other components crucial to the creative milieu that defines New York are arts and other cultural institutions. The arts are a $9 billion industry in this region, an essential asset to tourism which in turns generates $20 billion of regional economic activity. The Metropolitan Museum of Art, for example, is the city's single largest tourist attraction, with 4.6 million visitors annually, nearly one million of whom are from outside the country. As a recent report, The Arts As An Industry, issued by the Port Authority of New York and New Jersey, stated: ``The arts and the people who create, present, and market them are a critical competitive advantage that New York and its suburbs have over our national and international competitors for survival in the next century . . . But . . . the most important role the arts play in the life of the region is not related to its economy but to its very sense of itself.'' I speak to this matter with particular interest as Chairman of the President's Committee on the Arts and the Humanities, and I express serious concern about the uncertain future of Federal support for the arts, the humanities and museums. Proposed budget cuts would have a deeply damaging impact nationwide, for the arts, humanities and museums are vital to the economy of every state and every local community. Non- profit arts institutions alone generate $36 billion in economic activity annually. They support 1.3 million jobs and generate $3.4 billion in Federal tax revenues. Investment in the arts and the humanities is good business. Support for the National Endowments for the Arts and the Humanities is so small--only $.64 per person a year for each Endowment--yet it is indispensable seed money. Every Federal dollar leverages an average of $11 more from private, state and local sources, and without Federal support, there is no serious prospect that private funds will fill the resulting gap or that state and local governments will be able to do so. And what would be the impact of threatened cuts on New York City where culture is an integral part of our tourist industry? Now in defining the context for ``an agenda of growth'' for the New York Area, I have made two assertions: (1) New York's future is linked to the international economy; and (2) Our unique source of strength is intellectual capital. I must add a third factor: (3) We must more aggressively encourage communication and cooperation between and among the business sector; our educational institutions, especially higher education; and government at every level. The prevailing political winds can set a new course for the relationship between government and business. The profit- making sector and our colleges and universities can find new ways of working with one another. Indeed, it is awareness of the importance of such cross- cutting relationships that caused the Carnegie Corporation of New York to make a grant to New York University to organize this year a series of three colloquia on science, technology and government. Scientists and engineers, business executives and government leaders will join scholars from New York University, other area universities and the New York Academy of Sciences to take part in sessions on three major topics-- biotechnology, telecommunications and science and environmental journalism. Experts from New York, New Jersey and Connecticut as well as city, state and Federal officials will discuss the implications for the tri-state economy of advances in science and technology and of decisions by public policy-makers. Let me conclude this analysis by suggesting some questions for this distinguished panel to consider. It is, in my view, imperative that the business community, along with civic and community groups, be involved in shaping the agenda for the economic growth of the city. In doing so, there will be difficult choices among competing priorities. Let me illustrate. First, sustaining the infrastructure of the New York City region will require large-scale public investments. Which ones? Here's an example: Should we renovate Yankee Stadium, improve access to the airports or expand the Jacob Javits Convention Center? A still broader question here: How to link our economic development strategy for job creation to our investments in infrastructure? Second, we must support the institutions that nourish our base of intellectual capital. How? To meet the demands of a changing economy, we must modernize our public schools. What is the role of the business sector here? Of our colleges and universities? Again, can our institutions of higher education forge connections with business and industry to the advantage of both? Can, for example, the city's medical schools collaborate more closely with the region's pharmaceutical firms to build a stronger biotech industry? I have spoken of the arts, one of New York's greatest assets. How can we assure financial support, both public and private, of our cultural institutions in ways that reflect their importance to our economic future? What initiatives, public and private, are necessary to attract and retain artists, writers and the entrepreneurs of New York's emerging multimedia industry? Third, can we explore opportunities for more public-private partnerships? Their success in renewing Union Square, Bryant Park and downtown Brooklyn demonstrates that the quality of life in New York can be enhanced if business and government work together. How can we stimulate jobs and economic development in low income communities and invent more effective approaches to the delivery of public services? We all know that privatization is now in fashion but we must ask exactly what government functions should be privatized and the effect of privatization on the delivery of services. We know, too, that government tax, spending and regulatory policies will continue to influence the agenda for the economic growth of New York. The entire range of issues that affect the economy--and society generally--is, of course, in a democracy, the stuff of politics. Now I have not today attempted to be exhaustive in my comments, but instructive. I complex society like ours, there are roles for both private and public sectors. And if I have said anything useful, it is to stimulate more communication and cooperation between the two. The rapidity of scientific and technological change imposes new burdens on leaders of business to remain competitive and on government policy-makers to serve the pubic interest. For all these reasons, I applaud NYNEX for bringing together these distinguished leaders from various fields to discuss the future of our region. I conclude with the words of that great conservative, Edmund Burke: ``The public interest requires doing today those things that men [today, he would add, ``and women''!] of intelligence and goodwill would wish, five or ten years hence, had been done.''

Mr. MOYNIHAN

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

Mr. MOYNIHAN. Mr. President, I yield back our remaining time.

Mr. MOYNIHAN

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

Mr. MOYNIHAN

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

Mr. MOYNIHAN. Mr. President, might I begin by--once again, not the first time and not for the last--expressing my great admiration for the clarity, openness, and wisdom with which the Senator from Oregon, the distinguished chairman of our committee, has spoken. I have nothing of the depth or breadth of his observations to offer myself today. But I would make just a very few comments, some of which might resonate with the chairman. He mentions that I was in the Kennedy administration. I was, in fact, Assistant Secretary of Labor for policy planning in the Kennedy and Johnson administrations. I was present at the creation, if you could say, when Vice President Johnson went down Pennsylvania Avenue, and left this Chamber. He had two principal activities in the Federal Government, not many, after rather enormous energy was given to assignments: The space committee, which was mostly interested in whether--the great issue at the time--that would we build the supersonic transport. All the major transport planes in this country had been begun as military models. They had gotten bigger and faster and so forth. Finally, they came along with the supersonic. It could get you anywhere in no time at all but with only a platoon of marines. And was it really worth it? The Defense Department said we will turn it over to civilian manufacture, if they want to. In the end, as you know, we decided not to and the Europeans decided to do so. Vice President Johnson would concentrate on that, and have meetings all Saturday and Sunday. But mostly he was concerned with a Department of Labor subject of the employment of minorities in units. He threw himself into that effort. I can remember walking into Secretary of Labor, Arthur Goldberg's office one morning and there on Steve Schulman's desk were three pink slips saying ``Call Camel.'' He was in Afghanistan, the Vice President at that point, in that celebrated effort in which he took a camel driver, and gave him a truck and ruined the man's life. They did not have any spare parts for the trucks but with camels you could go. But he was thinking of this mission and all. When he became President and was dealing, he was confronting, and you were very sensitive. If I can say to the Senator that Judge Silverman, commenting on the Philadelphia plan, pointed out that they discovered that the absence of other groups in those building trade unions was not a matter of discrimination against as discrimination for. There has been a great deal of literature, apocalyptic, grandiose, about the nature of the labor movement and what it would do for the world, transformation, and so forth. But still the most demanding text was written out of the University of Wisconsin in the 1920's by Selig Perlman, called the ``A Theory of the Labor Movement,'' in which he broke the hearts of a whole generation of progressives by saying the labor movement arises from the perception of the jobs. There are only some jobs for plumbers in this town, and it would be very careful who gets to do the plumbing, trying to restrict it to your circle because the economic opportunity was scarce. That was published, ``A Theory of the Labor Movement,'' in 1928. But it also became clear as we began these efforts that we were dealing with issues of caste in American life, then very real, but also class. Particularly in the Labor Department they had been able to understand the class issues; that these merged in many circumstances. There is in the current issue of The New Republic an article by Richard Kahlenberg called ``Class, Not Race.'' It proposes a distinction which is real. But I do not think an exclusive consideration of either one gets you into a lot of difficulty. But he points out. He said: In Lyndon Johnson's June 1965 address to Howard University in which the concept of affirmative action was first unveiled did not ignore class. In a speech drafted by Moynihan, Johnson spoke of the aftermath of caste discrimination which had the effect of class disadvantage. That was the first assertion of affirmative action as a Presidential policy. The speech was given in June 1965, and on September 24, Executive Order 11246, part one, nondiscrimination in Government employment. This was directed to discrimination and nondiscrimination in employment by Government contractors and subcontractors, addressing yourself to the old refrain ``no Irish need apply'' phenomenon. We provided that the Federal contractor had to agree to take affirmative action to ensure that applicants are employed and that employees are treated during employment without regard to their race, creed, color or national origin. That is the first use of affirmative action. In 1967, I had departed then but all work was done in the Labor Department--very important, the Labor Department--in 1967, the Executive Order 11246 was amended to apply to gender discrimination as well, by President Johnson. And then again in 1969--and peripatetically I am back, I am in the White House--President Nixon went further in Executive Order 11478 to speak basically to quantitative measures: The head of each executive department and agency in the United States Government shall establish and maintain an affirmative action program of equal employment opportunity within his jurisdiction, in accordance with the policy set forth in section 1, to assure that recruitment activities reach all sources of job candidates. At this point, not to sound too theoretical, we are getting behavior of organizations. Two phenomena took place. One is that Federal executives seeking to bolster the legitimacy and widen the support for these affirmative action programs included successively new groups identified in one form or another, thinking that this would widen support--Native Americans, an obvious example. But I remember, in the 1970's, running into a list that had been compiled in the Department of Health, Education and Welfare which on one line in a list of categories had the category Maylays and Aleuts. It is a little hard to be clear what exactly the relationship between Maylays and Aleuts was, but somebody had it in their head. We will deal more effectively, with the kind of openness of mind and heart that the Senator has spoken of, if we are aware that we are not alone in this matter. Ethnic divisions are the primary source of division in the world today, class division having turned out to be much less powerful--not absent but much less powerful. The problem is, as the Senator has referred, once you list 10 groups, you have excluded 110 groups. So then you go to 11 and then you will go to 12. But you never reach a point where there is nobody that has not been excluded, and indeed our affirmative action programs today on behalf of minorities cover about 75 percent of the population. The second point to make, if I may--and I am sure the distinguished Presiding Officer would recognize this--it is invariably, inexorably the pattern of bureaucratic behavior--I know it is a bad word but it is a reality--to seek to quantify. They will say count up and then we will know. It is Weberian uniformity. I have got to be able to say I have the same standards you have and let us measure by these same standards which will turn out to be quantitative. Let us see who has done the better job. I think if we demystify a lot of this, we will do a better job in handling it, with the openness that the Senator talks about, because let us not have any illusion about the problems of equality in the United States. There are very real problems of equality. The Senator from Oregon nodded agreement at this point. They are enduring problems and a democracy inevitably and properly addresses them, and does so in settings of great emotion because the one basic fact is that we are a Nation defined by credo rather than by territory and blood, and the credo of equality is very powerful in the United States. In the end, you have to be very sensitive to perceptions that it is not being equally applied, and that is one of the things we are going to deal with here. If my friend would permit, however, I would like to address the more pedestrian but yet more urgent matter before us which is the restatement of the 25-percent tax deduction for the health insurance expenses of the self-employed, which is the measure before us today. Authority for this tax deduction expired at the end of 1993. The health care reform legislation reported by the Finance Committee last year would have reinstated it on a timely basis, but obviously we did not get that legislation passed. Thus, we have a situation where the filing deadline for the 1994 tax year is fast approaching and the self- employed are left with no health insurance deduction. It is imperative that we act promptly on this legislation so that more than 3 million self-employed individuals across this country can file their 1994 tax return by the April 17 filing deadline. We must act quickly, and I am confident we will. Of course, reinstating the deduction costs revenue. In order to avoid increasing the deficit, we must offset its cost with other provisions. And I was concerned, with colleagues on both sides of the aisle, that we have decided to pay for the health insurance deduction with a provision that has a long history and is controversial, as the chairman observed. I refer to section 1071 of the Internal Revenue Code which authorizes the Federal Communications Commission to provide tax deferral to sellers of broadcast properties when such sales effectuate FCC policies, including sales to minority purchasers to foster program diversity. This bill would retroactively repeal section 1071 so that even those transactions which had been negotiated in reliance on section 1071 could not go forward. One thing is clear as we consider this bill--there were other ways to pay for the reinstatement of the deduction. Mr. President, many assertions have been made about the FCC tax certificate program, some justified, some not. I, and many of my colleagues, recognize that valid questions have been raised about the way that section 1071 is currently being administered. But, before we act on this bill, we should be clear that other options were available, short of outright repeal on a retroactive basis. I proposed an amendment in the Finance Committee that would have paid for the health insurance deduction at an increased level of 30 percent, avoid the issue of retroactivity, and provided a moratorium of up to 2 years on the FCC's issuance of tax certificates. During the moratorium period, no FCC tax certificates would be issued and applications for tax certificates would not be processed by the FCC. The Administration is undertaking a comprehensive review of all Federal affirmative action programs. The moratorium would have provided adequate time for the Congress to take a careful look at section 1071, consider any recommendations from the administration, and make changes in an orderly way. Section 1071 was enacted more than 50 years ago, in 1943, and its application to sales of broadcast properties to minority purchasers has been in place for 17 years, since 1978. It is only reasonable to expend more than a few weeks when making significant changes to the provision. Unfortunately, the necessity of acting quickly on the extension of the self-employed deliberation. The amendment that I offered in the Finance Committee to this legislation would have eliminated the retroactive aspect of the repeal of section 1071. Our colleagues in the other body, and more recently the Senate Finance Committee, have voted to repeal section 1071 on a retroactive basis--that is, retroactive to January 17 of this year, the date on which the Chairman of the Ways and Means Committee issued a press release raising concerns about the provision. The best information we have is that there are at least 19 transactions that were negotiated in reliance on the existence of section 1071 and had FCC tax certificate applications pending on January 17. In many of these cases, the parties had signed definitive purchase agreements, subject only to issuance of an FCC tax certificate, filed applications for FCC tax certificates, and expended hundreds of thousands--in some cases, millions--of dollars in negotiation costs. All done in reliance on an FCC policy that had been in place for 17 years and had been expressly reaffirmed by Congress in each annual appropriations bill for the FCC since 1987, most recently in appropriations legislation passed in August 1994. Businesses cannot plan, cannot negotiate, and cannot compete on a fair basis under the threat of this kind of retroactive reversal of the law. The critical issues are adequate notice and justified reliance. Many of us believe that the affected parties justifiably relied on the law in effect when they entered into their transactions, and that the notice they received was not adequate. This kind of retroactive legislating should not be done. I regret that it is in this bill, but the time has now run out for alternatives if we are to get the self- employed health insurance deduction reinstated within a reasonable period before tax returns for 1994 must be filed. Mr. President, we could have addressed the need to extend the self- employed health insurance deduction in a timely manner without retroactively repealing the Minority Broadcast Tax Preference Program. We must act promptly to reinstate the 25 percent tax deduction for the health insurance expenses of the self-employed. And, we will. I regret, however, that my colleagues did not accept the amendment I offered in the Finance Committee which would have allowed us to review this provision more carefully, correct what must be fixed and retain what has clearly worked for so many years. Mr. President, I see the Senator from Maine has been on the floor. I think he wishes to address this. I yield the floor. Mr. COHEN addressed the Chair.

Mr. MOYNIHAN. Or Giadelli.

Mr. MOYNIHAN. Mr. President, I do believe the distinguished chairman of the committee wishes to speak first.

Mr. MOYNIHAN. Mr. President, I am happy to yield such time as indicated to my distinguished friend from North Dakota.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, I rise once again to join the Greek American community as they celebrate the 174th anniversary of the beginning of their revolution for independence from under the yoke of the Ottoman Empire. I and 47 of my colleagues in the Senate jointed together to commemorate this historic event by cosponsoring Senate Resolution 79, a resolution commemorating March 25, 1994, as Greek Independence Day: A National Day of Celebration of Greek and American Democracy. From their first settlement in the 18th century in St. Augustine, FL, to one of the largest Greek communities in America, Astoria, NY, the Greek people have been an influential segment of American society. Their history, culture, language, religion, and of course native culinary artistry, have enriched all of America. Greece has contributed great things in the areas of arts, education, medicine, and philosophy, but no contribution was more precious than that of democracy. Born in Athens during the age of Pericles and nurtured in the United States, the principles of democracy are now being practiced throughout the world. This new wave of democracy, would never have come to fruition had it not been for Hellenistic political thought. We will always be indebted to Greece for giving us this most precious gift.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, in the spirit of bipartisan harmony I would like to yield 5 minutes, or such time as he requires, to the distinguished senior Senator from Missouri.

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

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

Mr. MOYNIHAN. Mr. President, I most emphatically wish to state the debt in which we all find ourselves to the Senator from Illinois for her powerful and persuasive statement; her first on this particular subject, but not, I dare think and hope, her last. We will continue now with this debate. Mr. President, I yield 5 minutes to my friend and colleague, the senior Senator from Montana.

Mr. MOYNIHAN. Mr. President, I know I speak for the distinguished for his incisive remarks. I am pleased to see on the floor our colleague from the Committee on Finance, the distinguished Senator from Illinois. I yield her 10 minutes, as she evidently desires, but in fact as much time as she requires for her statement, which I look forward to.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, the Senator from Vermont would like 10 minutes to discuss and discourse on what was the once and possibly future national pastime. I yield those 10 minutes to the Senator.

Mr. MOYNIHAN

Mr. MOYNIHAN. Mr. President, I am happy to yield 10 minutes off the bill to the Senator from North Dakota.

Mr. MOYNIHAN. Mr. President, I ask my friend from North Dakota how much time he would like?

Mr. MOYNIHAN

Mr. MOYNIHAN. Will the distinguished and revered Senator yield for a question?

Mr. MOYNIHAN. I thank the Senator.

Mr. MOYNIHAN. Would he happen to know that in the 1988 text of ``American Constitutional Law,'' which Professor Tribe wrote, he stated that separate enrollment was probably unconstitutional?

Mr. MOYNIHAN. If the Senator will yield for a question, I am sure the Senator would agree that when the Court decides, we will abide by the decision. That is the great fact of the American Government.

Mr. MOYNIHAN. Mr. President, for the second time in less than 1 month, the Senate is confronted with a proposal to alter our constitutional system in the name of fiscal responsibility. On March 2, the Senate declined to adopt a balanced budget amendment to the Constitution. Today, we are considering a proposal which, although not drafted as an amendment to the Constitution, nonetheless has important and far-reaching constitutional implications. The separate enrollment bill would have Congress surrender fundamental constitutional prerogatives to the Executive. I hope the Senate will recognize the constitutional and practical defects of this proposal, and I hope we will again have the wisdom to say no. Just as importantly, I would hope the Senate would consider the practical consequences of this radical proposal. I would have the temerity to suggest that the White House pay heed as well. In 1986, on the occasion of the bicentennial of the U.S. Constitution, I had the honor to deliver a lecture at the Smithsonian Institution entitled, ```The New Science of Politics' and the Old Art of Governing.'' I take the liberty of repeating the opening passages. Anyone who has studied American government or taken some part in its affairs will often have asked: ``How goes the science of the thing?'' As we approach the bicentennial of the Constitution, which is not to say our Independence, but our form of government, leafing through ``The Federalist Papers,'' pondering the unexampled endurance of the Constitutional arrangements put in place in those years, we are reminded of the role the ``new science of politics,'' as the founders liked to call it, played in devising those arrangements. It appears to me that the significance of this bicentennial is predicated on the extent to which the perception is widened that the government of the United States was not fashioned out of ``self-evident truths,'' but rather was the work of scholar-statesmen who had studied hard, learned much, and believed they had come upon some principles-- uniformities--in human behavior which made possible the reintroduction of republican government nearly two millennia after Caesar had ended the experiment. We may doubt that the bicentennial discussion will attain to anything like the level of discourse two centuries ago. We are short on Madisons and Hamiltons and Jays. But it is possible to hope that we may acquire a more general understanding of what it was those men were discoursing about. Else all will be lost to fireworks and faith healing. The argument was whether government could be founded on scientific principles; those who said it could be, won. At the risk of reproach from persons more learned than I, let me state in summary the intellectual dilemma of that time. The victors in the Revolution could agree that no one wanted another monarchy in line with the long melancholy succession since Caesar. Yet given what Madison termed ``the fugitive and turbulent existence of * * * ancient republics,'' who could dare to suggest that a modern republic could hope for anything better? Madison could. And why? Because study had produced new knowledge, which could now be put to use. To cite Martin Diamond: ``This great new claim rested upon a new and aggressively more `realistic' idea of human nature. Ancient and medieval thought and practice were said to have failed disastrously by clinging to illusions regarding how men ought to be. Instead, the new science would take man as he actually is, would accept as primary in his nature the self-interestedness and passion displayed by all men everywhere and, precisely on that basis, would work out decent political solutions.'' This was a declaration of intellectual independence equal in audacity to anything done in 1776. Until then, with but a few exceptions, the whole of political thought turned on ways to inculcate virtue in a small class that would govern. But, wrote Madison, ``if men were angels, no government would be necessary.'' Alas, we would have to work with the material at hand. Not pretty, but something far more important: predictable. Thus, men could be relied upon to be selfish; nay, rapacious. Very well: ``Ambition must be made to counteract ambition.'' Whereupon we derive the central principle of the Constitution, the various devices which in Madison's formulation, offset ``by opposite and rival interests, the defect of better motives.'' The lecture thereupon considered the development of what seemed to me to be the ``defining failure of the Reagan era * * * that of political economy.'' Specifically, the accumulation in a brief span of a huge national debt, much at variance with any peacetime period in our then two-century experience. That debt has continued to grow, largely the result of compound interest, and is the presumed motivating factor behind the legislation before us now. Even as it was the concern that led to the proposed balanced budget amendment to the Constitution, which we dealt with recently. In point of fact, that era is behind us. In 1993, the Congress enacted the Omnibus Budget Reconciliation Act which provided for deficit reduction over a 5-year period of some $500 billion--the largest deficit reduction measure in the half-century since the deficit was reduced following the end of World War II. Such was the size of the program cuts and--yes--tax increases provided in the 1993 legislation that interest dropping off dramatically. The result was lower debt service and a cumulative deficit reduction of near to $600 billion. Citizens who might wonder at this will recall how many individuals, their neighbors, themselves perhaps, refinanced their mortgages following the 1993 legislation and the sharp drop in interest rates. That affected our costs as well--our costs, their costs, the costs of Government. In consequence of this, Mr. President, we have in fact returned to a primary surplus in this year's budget. A primary surplus or primary deficit is defined as the difference between revenues and outlays for purposes other than debt service. I pointed this out on February 8 in the course of the debate on the balanced budget, to wit: Spending on Government programs is less than taxes for the first time since the 1960's. May I repeat that. Spending on Government programs is less than taxes for the first time since the 1960's. Not a bad performance. But how did it come about? Given the critical issue that confronts us, I will be candid with the Senate. More, perhaps, than is usual; more, perhaps, than is prudent. In 1993, I was chairman of the Senate Finance Committee. The task of raising taxes by a quarter of a trillion dollars, and the lion's share of an equal amount in spending cuts, thus fell to our committees and to its chairman. How did we do it? We did it the way the Framers of the American Constitution envisioned. We made accommodations that made up for the defect of better motives. Item. Gasoline and diesel fuel taxes were raised 4.3 cents per gallon. Offset. Airlines were given a 2-year exemption from the increased tax. We also took away the tax benefits previously accorded exporters of raw timber. Item. The business meal tax deduction was reduced from 80 percent to 50 percent. Offset. Restaurant owners were given a tax credit for the FICA tax they are required to pay on their employees' tips. I could go on at some length. But there must be a point where prudence intervenes. I simply make a point known to every experienced legislator in the Congress. Compromise and trade-offs are the key. And now I make the further point. If these exchanges cannot be sealed in legislation--all or nothing--the accommodations will be vastly more difficult, if not indeed impossible to reach. The chairman will say to a Senator: ``If you will go along with this provision not much to your liking, we will be able to get you another provision that will in some measure make up for what you legitimately consider a loss.'' But what if the other Senator knows that his or her provision will end up as a separate item of legislation which could very well be vetoed? Answer. There would be no deal. Which is to say, no deficit reduction. Even as we have shown that we are capable of deficit reduction, and only have to keep at it for another 5 years or so to erase the legacy of the 1980's. Those are the practical considerations. But now to the constitutional ones, which are scarcely impractical. The Framers were well aware of the importance of the power of the purse, and accordingly made the conscious decision to vest this power in the branch of government closest to the people: Congress. In Federalist No. 58, James Madison wrote: This power over the purse may, in fact, be regarded as the most complete and effectual weapon with which any constitution can arm the immediate representatives of the people, for obtaining a redress of every grievance, and for carrying into effect every just and salutary measure. According to Madison's notes of the Constitutional Convention of 1787, Roger Sherman of Connecticut said that: In making laws regard should be had to the sense of the people who are bound by them and it is more probable that a single man should mistake or betray this sense than the legislature. Thus, article I, section 9 of our Constitution plainly states: No money shall be drawn from the Treasury but in consequence of appropriations made by law. In a brilliant article on the power of the purse in the Georgia Law Review in 1986, Judge Abner J. Mikva, then of the U.S. Court of Appeals for the District of Columbia Circuit, now counsel to President Clinton, wrote . . . if we wish to live in a pluralistic and free society, we will strive to ensure that Congress retains exclusive control of the nation's purse. Only in that event will the delicate balance of our constitutional structure be preserved. I do hope Judge Mikva has not forgotten his paper. The line-item veto legislation before us would disturb--profoundly disturb--that delicate balance. It would have us deviate from the explicit procedures for passage and enactment, or veto, of legislation, set forth in detail in article I, section 7, which states: Every Bill which shall have passed the House of Representatives and the Senate, shall, before it becomes a Law, be presented to the President of the United States; If he approve he shall sign it, but if not he shall return it, with his Objections to that House in which it shall have originated, who shall enter the Objections at large on their Journal, and proceed to reconsider it. If after such Reconsideration two thirds of that House shall agree to pass the Bill, it shall be sent, together with the Objections, to the other House, by which it shall likewise be reconsidered, and if approved by two thirds of that House, it shall become a Law. The Supreme Court has referred to this part of article I, section 7 as ``a single, finely wrought and exhaustively considered procedure.'' There is nothing ambiguous about it, nor is there any uncertainty about why the Framers vested the power of the purse in Congress. Why, then, are we now giving serious consideration to measures that would radically alter our constitutional procedures? The line-item veto is not a new idea. President Ulysses S. Grant first proposed it in 1873. In 1876, Representative Charles James Faulkner of West Virginia introduced an amendment to the Constitution to provide for a line-item veto. Some 150 line-item veto bills have been introduced in the interim, but Congress has never seen fit to adopt any of them. Today we are told that circumstances, including the failure of the balanced budget amendment, have given the line-item veto a new urgency. It is argued that we need this because congressional spending and the national debt are out of control--precisely the same rationale offered by proponents of the balanced budget amendment. And mistaken for the same reasons. We ought to be asking ourselves how and when these deficits were created, and whether they are permanent features of our governmental operations, or merely temporary. After a month of debate on the balanced budget amendment, I would hope the Senate knows the answers to these questions. The point has been made over and over again on this floor by the Senator from New York, and by the distinguished Senators from West Virginia and Maryland, our revered Senator Robert C. Byrd and Senator Paul Sarbanes. Insofar as the national debt is a problem in our fiscal affairs, it is a problem that was created--in some measure intentionally--during the 1980's, the single decade of the 1980's. I do not wish to belabor this point. The facts have been well documented by David Stockman, President Reagan's Budget Director, by the journalist and historian Haynes Johnson, and others. It ought to be considered well-settled by now. The debt accumulated during the Reagan era was an historical anomaly. Again, were it not for the interest on the deficits created during those years, the Federal budget would be in balance today. If we recognize this, we will realize there is no need for the legislation before us. Even if there were a need for a line-item veto, the separate enrollment legislation is surely unconstitutional. It would require the enrolling clerks to dismantle bills passed by the House and Senate before the bills are presented to the President, as provided by the Constitution. You do not need to be a constitutional scholar, or even a lawyer, to recognize that this procedure would violate the Constitution. The presentment clause in article I, section 7 requires ``every Bill which shall have passed the House of Representatives and the Senate'' to ``be presented to the President'' before it becomes a law. Under this provision of must be the same bill passed by Congress--not a series of smaller bills created by the enrolling clerks, or ``billettes,'' as they have been called by our learned colleague from West Virginia. The separate enrollment proposal would delegate to the House and Senate enrolling clerks a legislative function explicitly assigned to Congress by article I: deciding what bills say. The Association of the Bar of the City of New York recently produced an exhaustive analysis of the constitutionality of the line-item veto. The association's report was written by David P. Felsher and edited by Daniel J. Capra, who is chairman of the association's committee on Federal legislation. The report finds that under either ``enhanced rescission'' or ``separate enrollment,'' the President would in effect be authorized to restructure legislation after its passage by Congress. This is unconstitutional because it is the province of Congress and Congress alone, to determine the contents of bills; the sole power of the President under the article I, section 7 is to sign or veto legislation. According to the association's analysis, ``it is irrelevant whether the itemization needed to implement the line-item veto is effectuated by the President or the enrollment clerk in Congress.'' I might add that this opinion is shared by other prominent constitutional scholars, including Prof. Michael J. Gerhardt of Cornell Law School, who has written me to say that the ``separate enrollment'' legislation is unconstitutional because it . . . effectively enables the President to make affirmative budgetary choices that the Framers definitely did not want him to make. These scholars have concluded that ``separate enrollment'' is unconstitutional because the Supreme Court has been scrupulous in requiring strict adherence to the legislative procedures set forth in Article I. In INS versus Chadha in 1983, the Court struck down a statutory provision that permitted one House of Congress to exercise a ``legislative veto.'' Chief Justice Burger wrote that the requirements of article I, and I quote: . . . were intended to erect enduring checks on each Branch and to protect the people from the improvident exercise of power by mandating certain prescribed steps. To preserve those checks, and maintain the separation of powers, the carefully defined limits on the power of each Branch must not be eroded. And there I end the passage from Chief Justice Burger. Three years later, in Bowsher versus Synar, the Court invalidated the provision in the Gramm-Rudman-Hollings deficit control law giving the Comptroller General of the United States authority to execute spending reductions under the act. The Court held that this violated the separation of powers because it vested an executive branch function in a legislative branch official. ``Underlying both decisions,'' according to a Congressional Research Service analysis, ``was the premise * * * that `the powers delegated to the three branches are functionally identifiable,' distinct, and definable.'' I should add that a second en bloc vote on the itemized mini-bills would not cure the constitutional defects of this proposal. I refer of course to an amendment offered to this legislation yesterday. A second en bloc vote on the itemized mini-bills would not cure the constitutional defect of this proposal. We vote on one bill at a time in the U.S. Senate. Professor Gerhardt of Cornell has said that a separate vote would have to be taken on each of those bills in order to satisfy Article I. If we wish to enact legislation in which we passed a bill for each item of the kind now put together in an appropriations bill, that would be perfectly constitutional. It would require us to pass perhaps 10,000 bills a year, which we could do, but it would be constitutional. What you cannot do is pass 10,000 bills with one vote. Clearly, the great weight of authority indicates that ``separate enrollment'' is unconstitutional. Yet even if it is not, it is still a bad idea. Its proponents argue that 43 Governors have used this power to great effect in the States. This argument demands closer scrutiny. Recall that a similar claim was made during our debate on the balanced budget amendment: that balanced budget requirements have enforced fiscal discipline in the States. But word eventually got out that this was not quite true: States also have capital budgets which are not required to be balanced which are, by definition, financed by debt, even as they return benefits over time. Claims about the effectiveness of the line-item veto in the States may be equally misleading. The late, beloved Prof. Aaron Wildavsky of the University of California at Berkeley wrote in 1985, with characteristic insight, that much of the ``savings'' attributed to use of the line-item veto in the States may be illusory. He cited the experience of Pennsylvania, where one study found that spending bills were deliberately inflated in order to compensate for expected item vetoes, or simply to serve political ends. Thus it does not necessarily follow that X million dollars are ``saved'' merely because a Governor line-item vetoes that amount. They were not meant to be enacted in the first place. Dr. Louis Fisher of the Congressional Research Service and Prof. Neal Devins of the Marshall-Wythe School of Law at William and Mary concur in Wildavsky's assessment, writing that ``[g]ubernatorial reductions may merely cancel spending that the legislature added because the governor possessed item veto authority.'' Fisher and Devins conclude that `` * * * the availability of an item veto allows legislators to shift more of the responsibility for the fiscal process to the Executive,'' instead of keeping it in the Congress where it belongs and where, in 1993, we showed we could exercise such responsibility. If I may say, Mr. President, without meaning in any way to be partisan, every vote for the 1993 $600 billion deficit reduction measure came from this side of the aisle. The distinguished chairman of the Appropriations Committee, Senator Hatfield, testified along the same lines before the Judiciary Committee in 1984 of his experience with the line-item veto when he was Governor of Oregon: We also know that the legislators in States which have the line-item veto routinely ``pad'' their budgets, and that was my experience, with projects which they expect, or even want their Governors to veto. It is a wonderful way for a Democrat-controlled legislature, that I had, to put a Republican Governor on the spot: Let him be the one to line-item these issues that were either politically popular, or very emotional. There is no reason to think these problems would be avoided at the Federal level if we adopt the line-item veto. If the state experience is any indication, the line-item veto might even create more difficulty in the Federal budget process. This has been our science of politics, this has been our experience of politics. The substitute amendment before us will not impose discipline on Congress. Nor will it erase the national debt. It is very likely unconstitutional. It will undoubtedly be litigated, and the courts will have to decide. I have great confidence that they will decide the measure before us is unconstitutional and the entire exercise will have been for nothing. I hope the Senate will say no to separate enrollment. I hope the Senate will decline this invitation to relinquish important constitutional prerogatives to the executive branch. It was why the American Government came into being, Mr. President, in response to what we saw as the abuses in fiscal matters of the executive branch in Great Britain. Mr. President, I ask unanimous consent that the letter from Prof. Michael J. Gerhardt of Cornell Law School and the report of the Association of the Bar of the City of New York, of which Daniel J. Capra is chair, be printed in the Record.