Frank Murkowski

Mr. MURKOWSKI

Mr. MURKOWSKI. I thank the chairman for his remarks, and also thank the Senior Senator from Alaska for his support of this amendment. I will look forward to working with you to see that the Murkowski/Dole language is adopted in subsequent appropriation bills.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I rise to discuss a concurrent resolution expressing the sense of the Senate that the President of Taiwan, Li Teng-hui, be allowed to visit the United States. We submitted this concurrent resolution, Senate Concurrent Resolution 9, last week. We had 36 bipartisan cosponsors, some 11 or 12 Democrats, and 24 or 25 Republicans. Specifically, the concurrent resolution calls on President Clinton to allow President Li to come to the United States on a private visit, as opposed to an official state visit. An identical concurrent resolution, House Concurrent Resolution 33, has been submitted in the House by Congressmen Lantos, Solomon, and Torricelli. Why should we simply let the People's Republic of China, our friends in China, dictate to us who can visit our country? The current State Department policy of saying that allowing Li to visit would upset relations with the People's Republic of China offends the Senator from Alaska. I think Taiwan has made great strides toward achieving some of the goals that we have achieved in our democracy, such as ending martial law, free and fair elections, a vocal press, and in human rights great advancements have taken place. Taiwan is a friendly, democratic, stable, prosperous country and the 5th largest trading partner of the United States and the world's 13th, I might add. They buy twice as much from the United States as from the People's Republic of China. The largest foreign reserves per capita, and contribute to international causes. They are good international citizens. But the United States continues to give a cold shoulder to the leader of Taiwan. That leader, I might add, is going to run in a reelection effort. It is the first time they have had free and open elections. Last May, in Hawaii, the State Department refused to allow President Li to visit overnight while his plane refueled, and they indicated they would not allow a private visit. The rationale for that was that the President was going on to Central America and his plane had to land for refueling. I think it was the worst type of hospitality evidenced by the State Department in some time. We know that the People's Republic of China is going to bellow about everything we do regarding Taiwan-- United States pressures at the United Nations on human rights, World Trade Organization membership, and anything we do for Taiwan is raised as an issue by the People's Republic of China. But, in the end, they will make the same calculation about when to risk offending us on the U.S. market. I think that the precedent exists for President Li to visit the United States. Consider for a moment, Mr. President, that we have welcomed other unofficial leaders to the United States, such as Dalai Lama, who called on Vice President Gore--over the objections of the People's Republic of China. Yasser considered a terrorist. Gerry Adams has been granted numerous visas over British objections. In each case, the administration made direct choices to allow a visit to advance America's goals. Li's visit would do the same thing. United States-ROC Economic Counsel Conference will hold a meeting in Anchorage, AK. Visiting there would not be a political statement. We are almost another country, in the sense that we are a little out there in the western northern part of the hemisphere, if you will. What they are asking for here is for Li to visit his alma mater, Cornell University in New York. They would like him to come up in the spring and give an address to the students and faculty. I call on the administration to allow these events. I remind my colleagues, as we address the friction between Taiwan and China, that there are two organizations--one, the mainland People's Republic of China, and one in Taiwan. They meet regularly and discuss hijackings and commercial and trade activities--everything but politics. Chinese business men and women are probably the best in the world. They recognize that it is necessary that they maintain a dialog, and now we are seeing the opening up of some of the southern ports of China with direct shipment of goods originating in Taiwan. They will not have to go through Hong Kong anymore. So as we look at a stagnant relationship with Taiwan, clearly there is a dialog developing between Taiwan and the People's Republic of China. It is time that we allowed President Li to visit this country. Mr. President, that concludes my remarks. I see my friend from Illinois on the floor seeking recognition. I had the pleasure of accompanying him on a recent trip to North Korea and to China, as well. I am sure he has some observations. I yield the floor. Mr. SIMON addressed the Chair.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I would like to speak very briefly on two points, one involving the framework agreement between North Korea, and the other a resolution pending to allow President Li to visit the United States. It is my understanding that the occupant of the chair, Senator Thomas, also wishes to speak briefly on the matter of President Li's visit to the United States. I would be willing to relieve him from the chair for the period of time for his statement. If I may proceed, Mr. President, one of the issues I want to bring to the attention of my colleagues that is rather disturbing is associated with the United States and North Korea agreed-to framework on nuclear issues. There is an agreement that has been entered into by the United States directly with the Government of North Korea. As the President will recall, the framework agreement was signed on October 21 and we have so far had some four senatorial committee hearings covering various aspects of the framework agreement. The Foreign Relations Committee has addressed it. The Energy Committee has addressed it. The Armed Services Committee has addressed it, and the Intelligence Committee has addressed it. In the agreed-to framework, the administration has stressed consistently North Korea's adherence to the terms of that agreement. But I share two specifics with my colleagues concerning recent articles that cast some doubt on North Korea's good faith. First, North Korea is conducting vigorous military exercises at this time. In a March 6 Defense News report, it says: North Korea is conducting its most vigorous winter military exercise in recent years, an event that the U.S. and South Korean officials here attribute, in part, to the U.S. shipments of heavy oil authorized under the October 1994 nuclear package deal with Pyongyang. Having been in Pyongyang with my colleague, the Senator from Illinois, I think we both find this rather distressing and inconsistent. I remind my colleagues that the story is referring to the 50,000 tons of oil that was paid for with $4.7 million in Department of Defense emergency funds. Although not intended, the provision of heavy oil to North Korea has the perverse effect of strengthening North Korea's 1- million-man military machine. The story states: This year's exercises are significant because of the increased air sorties and a surge in the number of armored, mechanized and artillery corps practicing joint warfare operations. I further point out in the March 6 Defense News the following: Although U.S. oil is not used directly to fuel military maneuvers, the influx of heavy oil into the country has allowed North Korea to divert other types of fuel reserves from domestic to military use. We were assured, Mr. President, by the administration that this would not happen. Well, it has happened. What is our response? Well, the United States response is to cancel our winter ``team spirit'' military exercises with South Korea. I find that very inconsistent. What are we following it up with? The preparation to send 100,000 tons of additional oil in October, without safeguards. The second report is that North Korea is not fully cooperating with the International Atomic Energy Agency. The March 2 Nucleonics Week reported: Pyongyang categorically refuses to allow the IAEA to reconstruct the history of fissile materials production at its Yongbyong complex. The report of Nucleonics Week points out that Pyongyang's refusal to grant access could cause irreparable damage. The North Korean position is that the IAEA will have access to the inside of the reprocessing plant on or after a 5-year period. But IAEA officials report that access to the inside of the plant before then is paramount. The IAEA doesn't know right now what is going on inside the plant, if there is any plutonium separation, or if there are any materials being moved around. The second story illustrates the problems with the agreed-to framework. We should have had a broader agreement that addressed other issues of concern--such as North Korea Army activities; should have demanded access to the two suspected wastesites, complete and total access to past, current, and future nuclear activities--something we demand from all other nations that are a party to the nuclear proliferation agreement. We asked South Africa to come clean and they did, but the North Koreans have not. We have left the North Koreans, in the opinion of the Senator from Alaska, with too many cards in their hands. I have sponsored two specific resolutions, one that is being taken up by the Foreign Relations Committee next week, requiring that we show progress on the framework agreement, and one that was accepted last week on the defense appropriations stating that no further funding could take place without the administration coming to Congress for approval.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I thank the Chair. I shall not take that time.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I would like to announce for the information of the Senate and the public that an oversight hearing has been Resources. The hearing will take place Wednesday, March 22, 1995, at 9:30 a.m. in room SD-366 of the Dirksen Senate Office Building in Washington, DC. The purpose of this hearing is to review the findings of a report prepared for the Committee on the cleanup of the Hanford Nuclear Reservation. Those wishing to submit written statements should write to the Committee on Energy and Natural Resources, U.S. Senate, Washington, DC 20510. For further information, please call David Garman at (202) 224- 7933 or Judy Brown at (202) 224-7556. subcommittee on forests and public lands management Mr. CRAIG, Mr. President, I would like to announce for the information of the public that a hearing has been scheduled before the Subcommittee on Forests and Public Lands Management to receive testimony on S. 506, the Mining Law Reform Act of 1995. The hearing will take place Thursday, March 30, 1995, at 9:30 am in room SD-366 of the Dirksen Senate Office Building in Washington, DC. Those wishing to testify or who wish to submit written testimony statements should write to the Committee on Energy and Natural Resources, U.S. Senate, Washington, DC 20510. For further information, please call Michael Flannigan at (202) 224-6170. subcommittee on forest and public lands management Mr. CRAIG, Mr. President, I would like to announce for the information of the public that a hearing has been scheduled before the Subcommittee on Forests and Public Lands Management to receive testimony for a general oversight on the Forest Service land management planning process. The hearing will take place Wednesday, April 5, 1995, at 9:30 am in room SD-366 of the Dirksen Senate Office Building in Washington, DC. Those wishing to testify or who wish to submit written testimony statements should write to the Committee on Energy and Natural Resources, U.S. Senate, Washington, DC 20510. For further information, please call Mark Rey at (202) 224-2878.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I am pleased to introduce a bill to amend the Alaska Native Claims Settlement Act of 1971. This legislation is noncontroversial and fully supported by the Alaska Federation of Natives. The bill was passed by the House of Representatives last Congress. The Senate Energy Committee held hearings and approved a similar bill. Unfortunately, it did not pass the full Senate last year because of an issue unrelated to this legislation. The enactment of the Alaska Native Claim Settlement Act [ANCSA] was a landmark event in Alaska's history. The land grants and compensation provided to Alaska Natives under ANCSA was unprecedented and has proven to be a successful alternative to the reservation system in the lower 48 States. ANCSA created business corporations based on existing Alaska Native communities and the corporations are responsible for investing and managing assets provided under ANCSA for the benefit of the all- Native shareholders. ANCSA created a system that allows Alaska Natives to become self-sufficient. While I am happy to say that the system created under ANCSA is working, there are some changes that are sometimes necessary to make sure the intent of ANCSA is carried out. This bill corrects existing technical problems with ANCSA and the Alaska National Interest Lands Conservation Act [ANILCA]. An identical bill was introduced in the House by my colleague from Alaska. The legislation is designed to resolve specific problems, for example one section of the bill will make it possible for the Caswell and Montana Creek Native groups to receive lands approved by a February 1976 agreement and finally fulfill their land entitlement under ANCSA. Another provision would allow Chugach Native Corp. to select a specific tract of land at the edge of their own current boundaries. Included in this bill there are eight technical amendments to resolve specific issues. Another section would make certain veterans from the Vietnam era eligible for land allotments under ANCSA. Mr. President, it is my hope that the committee which last year agreed that all of these items were noncontroversial will retain their spirit of cooperation so that this legislation will be able to move early in this session.

Mr. MURKOWSKI

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

Mr. MURKOWSKI. Mr. President, yesterday, Senator Craig and I, and a number of our colleagues introduced the 1995 mining law reform bill. Mr. President, during the last several years, members and staff of the Committee on Energy and Natural Resources have spent thousands of hours debating, staffing, and pontificating reform of the 1872 mining law. During the 101st, 102d, and 103d Congresses, legislation to reform the 1872 mining law has been introduced, debated, and actively pursued. Last year, Congress came within striking distance of enacting comprehensive legislation. Unfortunately, negotiations on a final bill broke down during conference consideration and Senate and House leadership made the decision to pull the plug on reform in the 103d. Mr. President, I rise today to join with Senator Craig and others to begin the debate on mining law reform in the 104th Congress. I've thought long and hard about reforming the 1872 mining law. What effect will reform have on the mining industry? Will the legislation cost jobs? What impact will reform have on exploration and development in the United States? Will the environmental community support mining law reform? The bottom line is this: The voters sent a clear message to Congress in the November elections. No more delay, no more gridlock; get on with the Nation's business. The debate over mining law reform has been around longer than many of us in the Senate. Everyone agrees there should be reform, the question is what kind of reform? We need to protect the environment, but we also have a responsibility to encourage exploration and development in the United States, not only for the hardrock mining industry, but for all of our natural resource based industries. We should not drive these industries off shore. During the last 12 years we've seen the oil and gas industry lose approximately 500,000 jobs in the United States. I do not want to see this happen to the hardrock mining industry. The legislation we are introducing today is real reform. It is comprehensive reform that addresses every substantive issue raised during the past several years of debate. patents Critics argue that patenting must be eliminated because individuals can patent/purchase land for $2.50 per acre and that some of these patented lands can be used for nonmining uses--ski cabins or fishing lodges. The Craig-Murkowski bill specifically requires miners to pay fair market value for the surface of mineral-bearing lands and includes a provision requiring all patented land to be used for good faith mining purposes. If the Secretary of the Interior discovers patented land being used for any purpose other than conducting good faith mineral activities, the Secretary is required to serve notice to the owner of the patent to stop nonmining activities. If the owner does not comply with the Secretary's notice, the State in which the patented land is located will have the opportunity to take title to the patented estate. If the State does not want the land, title and interest in the estate will revert to the Federal Government. royalty Critics argue that individuals are allowed to extract minerals from the Federal estate without paying a royalty to the Federal Government. The Craig-Murkowski bill requires miners to pay a 3-percent net proceeds royalty. The royalty is modeled on the Nevada net proceeds on mines tax, a well-established program which--like the mining taxes of many of the western States--collects substantial revenues at a very modest administrative cost. In 1993 Nevada collected $34 million in net proceeds taxes at an administrative cost of less than two-tenths of 1 percent. The bill shares royalty revenues with the States. One-third of the royalties will be distributed to the States from which production comes, one-third to individual State abandoned mine funds, and one- third to the U.S. Treasury. Why a net royalty for hardrock mining and a gross royalty for oil and gas? It's simple, oil and gas come out of the ground in a condition almost ready for market. Impurities are then extracted from the oil and gas. Gold, silver, copper, and other hardrock minerals come out of the ground as raw ore in the form of rock-like material. Before a gold bar can be produced, several steps must be taken that add value to the product. Crushing; separating rock from the mineral; beneficiating to remove foreign materials; producing a concentrate; and smelting. In short, an operator must take several steps to get hardrock minerals ready for the market. The theory that the oil and gas industry is similar to the hardrock mining industry is just not true. reclamation Critics argue that the hardrock mining industry needs Federal reclamation standards. In 1979, in a study authorized by the Surface Mine Control and Reclamation Act [SMCRA]--the COSMAR study--the National Academy of Sciences concluded that uniform Federal reclamation standards--like those in SMCRA--were not appropriate for hardrock mining. Furthermore, in January 1995, the Western Governors' Association [WGA] released a position paper on mining law reform in the 104th Congress. The WGA specifically requested that ``Reclamation on federal and non-federal lands should be conducted at the state level, through existing state abandoned mine programs where possible, rather than creating new duplicative federal reclamation programs.'' In other words, please don't create uniform Federal reclamation standards. In 1995, every State with substantial areas of Federal lands open to mineral location under the general mining laws has adopted substantive reclamation standards for hardrock mining. State standards are tailored to the environment of the States where the mining will occur. Disturbances created by mining on Federal lands must be reclaimed, but the standards found in State reclamation law should provide the substantive requirements of every reclamation program. The Craig- Murkowski bill recognizes that State reclamation standards, along with applicable Federal and State environmental requirements, are adequate to prevent unnecessary and undue degradation. reclamation During last year's House-Senate conference, over my objection, language was included in the chairman's mark which gave the Secretary of the Interior authority to regulate control over western water resources. The Craig-Murkowski bill does not. I repeat, this bill does not include any provisions which threaten to upset the historical vesting control over western water resources in the Western States. The Western Governors' Association has made it clear that they don't want the Federal Government involved in the regulation of western water rights. suitability Critics argue that the Secretary of the Interior should be allowed to make a suitability determination related to each mining proposal on Federal lands. The Craig-Murkowski bill does not include a suitability provision because the provision is unnecessary and redundant. Federal lands are already required to go through a suitability test. Lands open to mineral entry have gone or will go through the Department of the Interior resource management process. If people are not satisfied with the Bureau of Land Management's Land Management Program, Congress should change BLM, not insert suitability language in a mining law bill. In addition, all mining plans of operation on Federal land undergo analysis under the National Environmental Policy Act [NEPA] either in the form of an environmental assessment or a full environmental impact statement. Finally, any lands with special characteristics can be withdrawn from entry under the mining law pursuant to section 204 of the Federal Land Policy and Management Act of 1976 [FLPMA]. Mr. President, again, as I stated earlier, this legislation is comprehensive reform. I say to the environmental community and the mining industry, if you truly want reform, this is the year. If we fail to enact reform this year it will not be through lack of effort. I will pursue comprehensive reform starting with a hearing this month to consider the legislation we introduce today. I urge my colleagues to support the bill.

Mr. MURKOWSKI. The Senator from Alaska is pleased to modify.

Mr. MURKOWSKI. Mr. President, I ask that the pending amendment be set aside until I complete my speech.

Mr. MURKOWSKI. Mr. President, I ask unanimous consent that I may speak for up to 10 minutes, as if in morning business.

Mr. MURKOWSKI

Mr. MURKOWSKI. Finally, Mr. President, I would like to enter into the Record a response to the Secretary of the Interior with regard to his comments regarding the Craig-Murkowski bill. He indicates a criticism, stating: This law would do nothing to resolve the most glaring shortcomings of existing 1872 mining law. As a rebuttal, I say the Secretary's position is either based on lack of knowledge or it is simply a falsehood, because the Secretary ignores the fact that the bill requires paying a fair market value for the surface estate of patented lands and using patented lands for good faith mining purposes. If a miner uses the patented land for non-mining purposes the land transfers to the State in which the patented land is located or reverts to the Federal Government. In addition, the bill imposes a 3-percent net proceeds royalty on minerals produced and prevents unnecessary or undue degradation of surface lands. This is not a do-nothing approach, Mr. President. Further criticism, he states: public-owned hardrock minerals like gold, silver and platinum for peanuts. Again, the Secretary is wrong, Mr. President. The bill requires a payment of fair market value determined by the Bureau of Land Management appraisal methods for the surface of estate patented land. The bill requires a payment of 3-percent net proceeds royalty on the production of minerals from public lands. The bill also requires a one- time payment fee of $25 per claim and a $100 annual maintenance fee per claim. The amount of money generated by the fair market value net royalty and location and maintenance fees is not peanuts. Mr. President, another criticism from the Secretary: It is actually a step backward from existing law on a number of points such as the level of environmental protection that is now possible, and the amount of holding fee claimants would pay per acre. That is absolutely incorrect, Mr. President. The Craig-Murkowski bill does not diminish environmental protection in any respect whatever. In fact, the legislation assures compliance with all major Federal environmental laws--including those governing air, water, solid and hazardous waste, endangered species, historic preservation, safety and health, toxic substances and others--and applicable State reclamation laws. The environmental standard set by the Federal Land Policy and Management Act of 1976--prevention of unnecessary or undue degradation of public lands--is the standard adopted to the Craig-Murkowski bill, and the one against which mining performance will be measured under our bill. The bill also contains $100 per claim maintenance fee for the first 5 years following enactment, but thereafter requires the payment of $100 fee for assessment work. The last criticism, Mr. President: It has a royalty that is likely to be a net loser to the taxpayers. Given the low royalty rate and the fact it is on net rather than gross proceeds, we believe it will cost more to administer than the Federal Treasury will receive. Another falsehood. It is totally absurd. A 3-percent net royalty, which is patterned after Nevada net proceeds on mine tax, is likely to generate more revenue to the Federal Treasury in the long run than a gross royalty of the same amount. Why? Because a gross royalty forces companies to mine the high-grade, low-production cost mineral ores first to recover the costs of mining. Once the reserves are mined the companies would be forced to prematurely abandon low-grade, high-cost reserves. Is this what we want? Second, the criticism of cost to administer the 3-percent net royalty is more of an indictment of Secretary Babbitt's own department than it is of the legislation. In 1993, the State of Nevada generated approximately $34 million in revenues from the net proceeds tax, at administrative cost of less than two-tenths of 1 percent. A study by Secretary Babbitt's own department indicates an 8-percent gross royalty would cost $11 million to administer in the first year alone, and result in a loss of 1,100 jobs in 3 years. The problem is not with the Craig-Murkowski bill. The problem is with Secretary Babbitt's bloated bean-counting bureaucracy at the Department of the Interior. Finally in conclusion, there is not one criticism of our bill levied by the Secretary that has any merit. The facts contradict all the charges made by Secretary Babbitt and his supporters in the House, and for me to even have to respond to these half truths, absurdities and distortions in order to ensure that the mining law reform process begins properly is simply an outrage. I resent having to take the time of my colleagues to set the record straight, but it is necessary to set the record straight. Finally, Mr. President, we have a criticism from our good friend, George Miller, on the House side. His criticism is that the mining industry will become rich, the taxpayers will receive virtually nothing for their riches, and the environment will be desecrated. This is the type of the-sky-is-falling exaggeration we have heard from the House under the leadership of George Miller for so long and it is absolutely an exaggeration. What Miller forgets is this: The mining companies will pay fair market value, royalties, maintenance fees and location fees and they also pay corporate income tax, and their employees will pay State and Federal income taxes. Materials, supplies, and equipment that their mines will use will cost millions of dollars and have to be made payable as a consequence of the prosperity of the people here in the United States. All this means is more economic activity. Second, the entire Nation will benefit from mineral production and from the stimulation mining gives the economy, and finally the environment will remain protected by every single conceivable environmental law that Mr. Miller and his colleagues could think to impose on an industry to make public land use more difficult and put the U.S. mining industry more at disadvantage in competing in global markets. As a consequence, Mr. President, I think it is fair to let my colleagues reflect on not only is this administration critical of the mining industry as it exists in this Nation today, they are critical of the timber industry as it exists today, critical of the oil and gas industry, the grazing industry. It is hard to find one single natural resource industry that this administration supports. As a consequence, we are exporting our dollars and losing our jobs. As chairman of the Energy Committee, I intend to hold hearings on these matters to try and reduce our dependence on imports by stimulating our own resource industry. I thank the President for the time allocated to me. the mining law reform act of 1995

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, the amendment that I offer today is attached to H.R. 889, Department of Defense supplemental appropriations bill. Specifically, the amendment, which I offer on behalf of myself and the majority leader, Senator Dole, requires that funds to be used under this act for implementation of the framework agreement, which was dated October 21, between the United States and the Democratic People's Republic of Korea--that is North Korea--must be specifically appropriated for that purpose. What the amendment would prohibit in the future is the following: It would prohibit using emergency provisions to implement provisions of the agreed framework with North Korea; second, it would prohibit using reprogrammed funds to implement the provisions of the agreed framework with North Korea. Mr. President, I feel the amendment is necessary because as my colleagues will recall a number of Members joined Senator Dole and myself in adding similar restrictive language in the last Congress to the foreign aid appropriations bill and defense appropriations bill. Although both of those measures passed overwhelmingly, they were stripped at the conference on assurances from the administration that the United States was not preparing to give aid to North Korea. However, since signing of the agreed framework, the administration has already seen fit to use $4.7 million in emergency Department of Defense funds to pay for the provision of heavy oil for the benefit of the Democratic People's Republic of Korea. Further, the administration has asked for $10 million in reprogrammed Department of Energy funds to pay for the treatment of spent fuel in North Korea associated with their existing nuclear reactors. I have recently learned that the administration is prepared to ask for an additional $5.4 million of State Department funds to pay for startup costs of an international consortium known as KEDO. Many of us were dismayed that the administration chose to use emergency funds to pay for the provision of heavy oil--essentially giving foreign aid to North Korea without congressional authorization, and despite all the restrictions in law prohibiting any assistance to the DPRK. The administration lawyers downtown found the only provision they could to get around congressional approval. future. The amendment prevents the administration from going around Congress again to find additional funds to assist North Korea. If the administration is firmly convinced that such expenditures are in the national security interests of the United States, then the administration should first come up and ask for specific appropriations for that purpose. The overall cost of the provision of the two light-water reactors and hundreds of thousands of tons of interim energy to the North Koreans is going to cost billions of dollars. The light-water reactors alone are estimated to cost over $4 billion. The administration has testified to committees of jurisdiction that the U.S. portion of the costs of implementing the agreed framework will be in the ``tens of millions of dollars.'' The President's fiscal year 1996 budget requests $22 million specifically for the Korean Energy Development Organization, which is KEDO. I am informed that the Department of Energy will seek to use fiscal year 1996 funds to support spent fuel related activities in North Korea. Mr. President, I intend to offer this amendment to all subsequent appropriations bills, if necessary. Mr. President, at this time, I would also like to call my colleagues' attention to an event scheduled for tonight that will likely have far reaching implications for whether the agreed framework with North Korea will be successful. Tonight, something called KEDO is supposed to kick off with a cocktail party in New York. Some of my colleagues might be wondering what KEDO is and why is the administration seeking $27 million for its activities. KEDO, the Korean Energy Development Organization, is the international consortium the administration pledged to put together under the agreed framework. The agreed framework calls on the United States ``to organize under its leadership an international consortium to finance and supply'' the light water reactor project in North Korea. As I mentioned, this light water project is expected to cost at least $4 billion. Further, the United States ``representing the consortium, will make arrangements to offset the energy foregone due to the freeze'' of the existing North Korean nuclear power program. In other words, we are expected to arrange to give North Korea free oil. Fifty thousand tons were delivered on January 21. One hundred thousand tons are scheduled to be delivered by October 21, 1995. Every year thereafter North Korea is expected to receive 500,000 tons until the light water reactor project is complete. In addition to these substantial commitments, North Korea is demanding that the United States pay for about $1 billion worth of projects to upgrade the electrical grid to make the light water reactor project worthwhile. It is still unclear whether North Korean demands will be met. If the United States agreed to put together the international consortium, who agreed to pick up all the bills? That is where the accountability gets cloudy. So far, only the United States has actually signed any checks. First, the Department of Defense used nearly $5 million in Defense Department emergency funds to purchase the first trench of oil. Then, the Department of Energy successfully sought $10 million in reprogrammed funds for treatment of spent fuel from the graphite moderated reactors in North Korea. Now, additional funds are being sought from the Department of State--and none of the really expensive projects has even started. The South Korean Government has repeatedly said it will play the central role in the international consortium in financing the light water reactor project. But, the South Koreans have wisely added that this can only occur if North Korea agrees to accept South Korean reactors and if North Korea engages in substantive dialog with the South. The Japanese Government has also said it will play an appropriate role. But, the Japanese have been quick to add that their role is dependent on having widespread participation in KEDO, including a United States financial role. I often remind my friends in Japan that we spend $2 billion per year to keep 37,000 American troops on the Korean Peninsula. To this Senator that is a big contribution. Ambassador Robert Gallucci, the lead U.S. negotiator of the agreed framework, has indicated that 20 nations are expected to attend the inauguration of KEDO, but he admitted that not all of the countries will actually join KEDO. In fact, the only additional contributions announced thus far are from New Zealand and Australia. The test for KEDO--and the State Department--is whether KEDO is anything more than a convenient multinational cover for what could become a costly and dangerous U.S. obligation. The North Korea nuclear situation should certainly be a multilateral and a regional issue. I have always felt that South Korea and Japan should have been original signatories to the agreed framework. I believe that the ASEAN nations should all contribute. I firmly believe that China should be playing a significant financial role given China's historical role in aiding North Korea. Has the United States simply taken over that aid role from China? But the most disturbing aspect of KEDO for this Senator is that if KEDO fails to solicit the necessary funds, President Clinton has already committed the United States to fulfilling the terms of the agreed framework. On October 20, President Clinton sent a letter to Kim Jong Il, the new leader of North Korea, pledging to use the full powers of his office to provide the light water reactor project and interim fuel from the United States if other means fail. I ask that a copy of President Clinton's letter of assurance be submitted for the record. The President acknowledged that his pledge was subject to ``the approval of the U.S. Congress,'' but no Member of Congress that I know was briefed on the contents of this letter before it was sent. This Senator continues to believe that if the President must come to Congress to seek funds for this multibillion-dollar deal, after having ignored Congress in agreeing to the terms and conditions of the agreed framework, then Congress has the right to reexamine the conditions attached to that appropriation. I will continue to insist that North Korea allow immediate inspection of the two suspected nuclear waste sites that they have kept hidden from IAEA inspectors. In addition, other issues should be addressed. I strongly believe that North Korea must agree to joint recovery teams to search for the 8,177 service personnel still listed as MIA from the Korean war. Second, North Korea must agree to stop exporting ballistic missiles. Finally, North Korea must engage in meaningful dialog with South Korea. But these are issues to take up at another day. The purpose of my statement today is to urge my colleagues to remind the administration of the congressional role in implementing the agreed framework and to call your attention to the inauguration of KEDO. Thank you, and I wish the Chair a good day. I have no further statement, Mr. President. I believe that both sides have looked at this, and I defer to my colleague, the senior Senator from Alaska [Mr. Stevens].

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

Mr. MURKOWSKI. Mr. President, I ask unanimous consent that the pending amendment be set aside so that I may offer an amendment.

Mr. MURKOWSKI. Mr. President, I send an amendment to the desk and ask for its immediate consideration.

Mr. MURKOWSKI. Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I am pleased to be joined by Senators Breaux, Gorton, Stevens, Cochran, and Campbell in introducing the Reforestation Tax Act of 1995. This legislation will encourage investment in and sound management of privately owned forest land. Mr. President, our forests serve as the foundation of a multibillion dollar forest products industry. From lumber and construction materials to pulp and paper, timber provides a wide range of products that are essential to modern living. At the same time, our forests provide wildlife habitat, maintain watershed, and are used for a broad range of recreational activities, including fishing, hunting, hiking, and camping. One of the challenges facing this country is ensuring that we have enough forests to meet our wildlife habitat and watershed needs as well as sustaining a reliable supply of timber for forest products. As harvest levels on public lands decline, we need to encourage private foresters to invest in and properly maintain their stock of trees. Yet there is strong evidence that private and public tree replanting is declining. According to the U.S. Forest Service tree replanting and direct seeding has been steadily declining. Between 1980 and 1988, annual private tree planting increased from 1.76 million acres per year to 2.96 million acres per year. However, in every year since 1988, private tree replantings have continuously declined, reaching barely 2.04 million acres in 1993--one-third lower than in 1988. The decline in private reforestation reflects the reality that this is a very long-term, high-risk business. Trees can take anywhere from 25 to 75 years to grow to maturity, depending on the type of tree and regional weather and soil conditions. The key to success is good management which is costly. And fire and disease can wipe out acres of trees at any time during the long growing period. The legislation we are introducing today will boost private investment in forests and aid in the cost of maintaining these forests. Our legislation has four components: Partial elimination of the tax on inflationary gains. The gain from the sale of private timber would be reduced by 3 percent for each year the timber is owned, up to a maximum reduction of 50 percent of the gain. This should protect long-term investors in forest land from being taxed on inflationary gains. Doubling the reforestation tax credit. The current reforestation tax credit has been significantly eroded by inflation because it has not been increased in 15 years. Our bill doubles the amount of reforestation expenditures eligible for the credit--from $10,000 to $20,000--and indexes this amount for future inflation. Amortization of reforestation expenses. The current law special 7- year amortization for up to $10,000 of forestation expenses also has not kept up with inflation since it was enacted in 1980. Our legislation increases this amount to $20,000 and indexes it for future inflation. In addition, it reduces the amortization period to 5 years. Passive loss rules. Treasury regulations seriously discourage private forester from employing sound forest management practices. Our bill revises the regulations by providing that private foresters, like most other business entrepreneurs, can prove that they are materially participating in the forestry business. Mr. President, there can be no doubt that passage of this legislation is a key to the preservation and expansion of investment in this vital natural resources. It has been endorsed by conservation, environmental and forestry organizations including the American Forest and Paper Association, the National Association of State Foresters, the Wilderness Society and the Natural Resources Defense Council. I urge my colleagues to join us in this effort to encourage long-term investment in private forest land and cosponsor this important legislation. I ask unanimous consent that the text of the bill and a list of the organizations supporting this legislation be included in the Record.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I am introducing today, on behalf of myself and 35 colleagues, a resolution calling on President Clinton to allow his excellency Lee Teng-hui, President of the Republic of China on Taiwan, to come to the United States for a private visit. A nearly identical resolution is also being introduced today by my colleagues in the House of Representatives, Congressmen Lantos, Solomon, and Torricelli. This is not the first time this issue has come before this body. The last Congress spoke very clearly on the question of a visit by President Lee. The Senate approved unanimously a resolution offered by myself and Senator Robb calling on the administration to make several changes to United States-Taiwan policy, including allowing President Lee to visit the United States. Then, under Senator Brown's leadership, the Senate agreed by a vote of 94-0 to amend United States immigration laws to add a provision specifically welcoming the leader of the Taiwanese people to enter the United States at any time to discuss issues of mutual concern. This amendment was eventually adopted by the Congress and signed into law. Unfortunately, up to now, the Clinton Administration has chosen to ignore Congress and yield to the People's Republic of China on this issue. In the last several months, various State Department officials have indicated in public forums that they do not intend to allow President Lee to make a private visit. Mr. President, this State Department policy allows the People's Republic of China to dictate who can and cannot enter the United States--and that offends this Senator and many others. For many years, Congress and the executive branch have prodded the people of Taiwan to make greater strides toward democracy. Taiwan has responded: Over the last decade, Taiwan has ended martial law, allowed the development of a free and vigorous press, and legalized opposition political parties. Last December, people throughout Taiwan went to the polls in a free and fair election, which was vigorously contested by all parties. I remind my colleagues that Taiwan is the world's 13th largest trading partner and the United States' 5th largest trading partner. With $17 billion in United States exports to Taiwan in 1994, it purchased twice as many United States products as the People's Republic of China. It holds the world's largest foreign reserves. Taiwan is also friendly, democratic, stable, and prosperous. Its human rights record has steadily improved. Yet, rather than rewarding Taiwan for these great strides, it remains the policy of the Clinton administration to deny entry into the United States to the democratic leader of Asia's oldest republic; in effect, treating Taiwan like an international pariah. Many of us were outraged last May when the administration refused to allow President Lee to overnight in Hawaii en route to a presidential inauguration in Central America. While we are aware of the need to maintain a productive relationship with the People's Republic of China, there is no defensible argument for allowing Communist bureaucrats in Beijing to block a private visit to the United States by the elected leader of the Taiwanese people. President Lee, a Ph.D. graduate of Cornell University in New York, has expressed a desire to visit his alma mater. In addition, President Lee has been invited to attend the annual USA-ROC Economic Council Conference in Anchorage, AK. Other Senators and Representatives have invited him to visit their respective States. It would be entirely appropriate to allow one or more of these private visits. The attached resolution demonstrates the support of the new Congress for democracy movements around the world and our commitment to increased economic ties and people-to-people contacts between the American people and the people of Taiwan. If the administration continues to ignore the voice of Congress, it may be necessary to move further legislation amending United States immigration laws or reopening the 1979 Taiwan Relations Act in order to facilitate these changes. I urge the administration to reconsider its current position on a visit by President Lee. Certainly, there is ample precedent for allowing a private visit. After all, the administration has PLO, attend a White House ceremony. Gerry Adams, head of Sinn Fein, the political wing of the Irish Republican Army, has been granted travel visas. Tibet's exile leader, the Dalai Lama, called on Vice President Gore over the strong objections of the People's Republic of China. Each of these men represent unofficial entities with which the United States does not have official ties. Similarly, in each case, other countries with whom we maintain diplomatic relations objected. yet, the administration rightly chose to allow visits to advance other policy goals. A similar rationale should be applied to President Lee.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I would like to reflect on what I consider a reality. It seems to me that we have managed to do it again. We have put off taking the medicine necessary to correct the accumulated deficits that we have been running because we have again refused to impose a balanced budget mandate in our Constitution. Let me just reflect a little bit on how this body seems to work with unsolvable problems. We all remember the extended debate on base closures, the fact that we could never agree whose base would be closed. So we finally consented to bring about the creation of a commission staffed by knowledgeable people who would independently evaluate priorities of base closures. The Commission would examine all relevant evidence presented by the individual military services and then make specific recommendations on a package. Congress would then be given the opportunity to vote up or down on that package. We saw what happened to that Commission yesterday. We voted unanimously to extend the Commission because it has worked. It worked simply because the other alternatives did not work. I am kind of a bottom-line person, Mr. President. It seems to me that we have attempted to address our deficits by statute in the past. You remember back in 1985, we had Gramm-Rudman I. And it was our conviction that this would bring about control of runaway spending and it would bring about an end to the continued deficits. Under Gramm-Rudman I, we were going to have a zero deficit by 1991, at least we were supposed to. Then we had Gramm-Rudman II in 1987. That was supposed to bring about a zero deficit by 1993. It did not work. Then we had the 1990 budget agreement and that was supposed to bring about the decline of the deficits. Under that agreement, the deficit was supposed to be $83 billion. In reality, the deficit for 1995 is more than 100 percent higher--$205 billion. If we look at our short history relative to trying to correct this matter since 1985, one has to come to the conclusion that statutes do not worked. I was somewhat amused by the editorial in the Washington Post this morning which suggested that amending the Constitution was the wrong way to do it; we have the capability to do it and, therefore, we should do it. But the fact remains, Mr. President, we did not do it then and we have not done it now. It simply is not going to be addressed. I think the attitude of the American people is that we simply do not have the self-discipline to reduce spending, we do not have the self- discipline to reduce the rate of growth of entitlements, we have simply left the entitlements on automatic pilot. I reached the conclusion some time ago--and this is the basis for my support of the balanced budget amendment--that since nothing else has worked, this obviously would bring about a mandate to the Congress, and that mandate would be self-discipline. There is one other factor that I think is important, and that is how the American people are going to view this. Social Security has been mentioned, but it would seem to me that the people of retirement age that are dependent on Social Security, and those who are about to be, have a conscious awareness of the realities associated with the monetary system of this country. We can look at Mexico and see what happened--too much debt. I do not know, Mr. President, if you have observed what is happening in Canada, but 29.6 percent--29.6 percent--of the Canadian budget is interest on their debt. That is nearly one-third. We are running deficits each year, Mr. President, but the difficulty with it is that the interest on the accumulated debt now is more than the deficit. So the reality of this action, or lack of action taken by this body is really one that has to be addressed. Mr. President, I think we have a situation where we have to recognize we do not have the self-discipline to eliminate the deficit. Our monetary system, as we know it, is very much at stake. We should have given the American people, through their State legislatures, the opportunity to decide whether the Constitution should be amended. It takes 38 States to amend the Constitution. There would have been a great debate. I think by not giving the American people the opportunity to be heard on this matter, we have done a great disservice to them and to ourselves, and we have not corrected the problem that has been addressed in this body over the last several weeks. I think that is, indeed, unfortunate. I thank the Chair. introduction of S. 496 are located in today's Record under ``Statements on Introduced Bills and Joint Resolutions.'')

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I believe morning business was to expire at 1. I ask unanimous consent that morning business be extended until 2 p.m., under the same arrangement that was initiated for the previous morning business schedule.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I am pleased to pay tribute today to two eminent Alaskans, Tom and Gania Trotter, on the occasion of their retirement after many years of dedicated service to higher education in America, but most recently in their roles as president and associate to the president for development at Alaska Pacific University. F. Thomas Trotter is a native of Los Angeles, CA. After serving in the U.S. Army Air Corps in World War II, he attended Occidental College and received his Ph.D. from Boston University. He served in numerous ministerial and faculty roles, and was elected to be the first dean of the School of Theology at Claremont College. In 1973, Dr. Trotter became general secretary of the Board of Higher Education and Ministry of the United Methodist Church. In this post, he gave oversight to 128 colleges and universities related to the denomination. During his administration, significant international programs were established including a United States-Japan consortium and the establishment of a new university in Zimbabwe. He has been the director of several businesses, including the Third National Bank of Nashville, is the recipient of 10 honorary degrees, and is a trustee of Dillard University. Dr. Trotter is the author of ``Jesus and The Historian'' and ``Loving God With One's Mind.'' Gania Demaree Trotter, a native of Anaheim, CA, is also a graduate of Occidental College and received an M.A. in Student Personnel Administration from Columbia University. A gifted musician, Mrs. Trotter was a choral director in California schools and churches and a member of the Robert Shaw Collegiate Chorale. She was director of development for the Blair School of Music of Vanderbilt University and is an experienced higher education administrator. Dr. Trotter began his service to Alaska Pacific University as a trustee in 1974, and in 1987, he was selected as its eighth president. He worked diligently to improve curriculum design and financial growth. He introduced new undergraduate and graduate programs and thawed the ice curtain when he forged an agreement between APU and Far Eastern University in Vladivostok, Russia. The Carr Gottstein academic building, which has been a wonderful addition to the campus, was designed and constructed under President Trotter's careful oversight. During his tenure, Alaska Pacific University has been recognized in several national publications for its academic excellence. Gania Trotter has supported the university and its mission with energy and grace both in development and community awareness. She has cultivated important relationships which will benefit the university and its students for many years to come. Mrs. Trotter has further distinguished herself in Alaska through her creative enthusiasm and civic involvement, most notably in the symphony, opera, and Catholic social services. Tonight in Anchorage, several hundred friends and colleagues will gather to honor Tom and Gania for their years of selfless dedication to the education of Americans, a gift that will last for generations. I join many others in offering my sincere gratitude and best wishes to both of them.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I would like to announce for the information of the Senate and the public that an oversight hearing has been scheduled before the full Committee on Energy and Natural Resources on domestic petroleum production and international supply. The hearing will take place on Wednesday, March 8 at 9:30 a.m. in room SD-366 of the Dirksen Senate Office Building in Washington, DC. Those wishing to testify or who wish to submit written statements should write to the Committee on Energy and Natural Resources, U.S. Senate, Washington, DC 20510. For further information, please call Howard Useem or Judy Brown at (202) 224-6567.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I have previously announced a hearing scheduled before the full Committee on Energy and Natural Resources on Thursday, March 2, 1995, at 9:30 a.m., in room SD-366 of the Dirksen Senate Office Building in Washington, DC, for the purpose of receiving testimony regarding S. 433, the Electric Consumers and Environmental Protection Act of 1995, and S. 167, the Nuclear Waste Policy Act of 1995. I would like to announce that the committee will also consider S. 429, the Independent Spent Nuclear Fuel Storage Act of 1995 and S. 473, the Nuclear Energy Policy Act of 1995. Those wishing to testify or who wish to submit written statements should write to the Committee on Energy and Natural Resources, U.S. Senate, Washington, DC 20510. For further information, please call Karen Hunsicker at (202) 224-3543. subcommittee on forests and public land management

Mr. MURKOWSKI

Mr. MURKOWSKI. I thank the Chair and wish the President a good afternoon. Mr. President, I know it is late and much has been said about the balanced budget amendment before this body. I am going to say some more. In 4 days, debate on the constitutional amendment to balance the budget will come to a close and finally we will cast our vote determining the fate of this historic amendment. We spent the entire month of February debating this amendment, and during this debate, we have considered and weighed the role the judiciary may play in interpreting and enforcing the amendment. We have considered how the amendment will affect benefit programs that have been created by statute, including Social Security. And we have debated the voting rules of the House and Senate with regard to waiving the balanced budget requirement. Throughout the debate, I believe the Senate has lived up to its reputation as the world's greatest and deliberative body. We have examined in fine detail all of the nuances and interpretations of the language of the amendment and have sought to allow all sides of the issue to be aired and debated. The distinguished chairman of the Judiciary Committee, Senator Hatch, who was just on the floor--I am sorry he cannot hear these words of praise, but I mean them genuinely--has been a superb advocate for this amendment. He, along with our colleague on the other side, Senator Simon, are to be commended for their diligence and commitment in leading the Senate throughout this debate. The distinguished senior Senator from West Virginia, Senator Byrd, is to be commended for his extraordinary work in leading opposition to the amendment. Senator Byrd first entered the Senate the year before my State of Alaska joined the Union. When he entered the Senate in 1958, his colleagues on this floor at that time included the illustrious Senators John Kennedy, Everett Dirksen, Lyndon Johnson, and William Fulbright, to name just four. Senator Byrd's determination and commitment throughout this debate will long be remembered by Members as well as historians of the U.S. Senate. But let us delve into our deficit history for just a moment. After listening and participating in this debate for the last month, I am convinced of one thing, both the proponents and opponents of the constitutional amendment believe that we cannot sustain the economic prosperity of this Nation if we continue indefinitely to run these extraordinary deficits. Our differences are solely about the means necessary to end the deficits, not the end in itself. The opponents of the amendment believe we need not amend the organic document covering this Nation, namely the Constitution, in order to balance the budget. This Senator believes that nothing short of amending the Constitution will change our addiction to spending and living beyond our means. In reaching this conclusion I rely simply on history. I would suggest to you, Mr. President, we simply do not have the self-discipline. You remember the extended debates on military base closings--how can we close bases in our own States? We agonized, we went on and on and on. Obviously, we could support the closure of a base in another State, but not in our own States. So we reached the conclusion the only way we could do it is to leave the entire matter up to a qualified board and they would select and reprioritize, and then we would be left with the responsibility of simply voting up or down on the package--and it worked. That is really about where we are on this issue. We have tried to cut spending, we have tried to increase revenue, and we continually run deficits to the point where we have to acknowledge that nothing else works. This will mandate a balanced budget over a period of time. Let us look at history. For more than one-third of a century, 34 out of the last 35 years, our Government has run a continuous and unending string of deficits. If you and I did that, our checks would be bouncing all over the place. What have we done? We have simply added to the deficit. We go through a curious process around here called a budget. We get our revenues and we get our expenses. They do not balance. So everything else we need we get by adding to the deficit. Even if we adopt this amendment next week, it is almost a certainty, a near certainty at least, that the unending string of deficits are going to continue for a while, into the year 2000 or thereabouts. If we adopt the amendment, however, we will surely be forced to lower the deficits in the next 5 years below the currently projected levels, and virtually everybody agrees on that. But the reality that must be faced is that by the end of this century--and that is less than 5 years from now--the United States will have run a deficit for four decades. We have become hooked on it. Four decades of deficits, and the result is that today our national debt is more than $4.8 trillion. I do not know of any person who can really imagine what $4.8 trillion really is, but let me try to put it into perspective. A $4.8 trillion debt means that every man, woman and child in America owes Uncle Sam $18,400. A family of four owes $74,800. If we do not begin to turn things around, the national debt will then jump to nearly $6.7 trillion in 5 years--if we do not begin to turn it around. In 5 years it will jump from $4.8 trillion to $6.7 trillion. That would mean that every man, woman and child in America would owe Uncle Sam $24,170 instead of $18,700. And the family of four would move up and owe almost $97,000. We have not been blind to these deficits. We have debated them. Historians will note for the last 10 years Congress and the President have sought to find solutions. We have sought to find remedies to the deficits. We have passed statutes. We have passed reconciliation bills and sequestration provisions, all in the name of getting our deficit to zero. On three occasions over the past 10 years, legislators on both sides of the aisle have sat down with the President and hammered out so-called solutions to solve the deficit, and on every single occasion the promise of a zero deficit has simply evaporated away because we in Congress have never had the political courage to do the one thing that would bring down the deficit, and that is to reduce spending. Yes, we have voted to raise taxes on more than one occasion, but we have never, ever cut, frozen, or capped spending. We have to do one or the other. It is just that simple. Some would suggest if we do not cut spending, we do not raise revenues, there is some other alternative. Some have suggested, given enough attorneys to study the problem, there might be another alternative. But I can tell you--not as an attorney but as a former banker--there is not any other alternative. You do one of those two things, you cut spending or you increase revenues. We have never faced up to the challenge of runaway entitlements which today account for 55 percent of Federal spending and will grow to 59 percent by the end of this century. Quite the contrary, we have generally placed entitlement spending simply off limits in all the budget deals that have been negotiated over the past 10 years. And we all know why. It is simply that we do not have the self-discipline to make those cuts. What we do not consider, however, is the result; that if we do not face up to this obligation, getting this under control, our monetary system as we know it today will ultimately collapse. There is absolutely no question about it. That is a pretty big order when you recognize you have to have a healthy economy, you have to have a sound of our society. I have many letters from my State of Alaska, people expressing concern over cuts and what these cuts might mean to programs. Obviously, through the block grants giving the States more responsibility, we can make the process more efficient. We can take out the fat that results from administering these programs from the Federal Government and give that responsibility to the States, and they can do it much better. But the point is that in order to meet those social obligations we have to have a healthy economy, one based on sound fiscal principles and a dictate of a balanced budget. Mr. President, I know we have not had many charts around here in the last week or so, so I am going to spring three charts with one for dessert for good measure at the end. These three charts record the history of our ``get-tough" budget agreements over the past 10 years. The first chart shows the promises and the reality of Gramm-Rudman I, which we adopted in 1985. As you can see, Gramm-Rudman I was supposed to bring us to a zero deficit--down at the bottom--a zero deficit over a 6-year period starting in 1986 and ending in 1991. From a projected high of $172 billion, which is where we were in 1986, the deficit was supposed to come down by $36 billion each year. But in reality by 1991, instead of a zero deficit we were at a record $269 billion deficit. That is our first effort. It did not work because we did not cut real spending. The commitment was there, the will was there, it looked good on a piece of paper and looked good on a chart at the time we adopted it, but it did not happen because we did not have the commitment to make the real cuts. So then we made the second promise to the American people, and this is the second chart, and it shows the revision which we made to Gramm- Rudman in 1987. Why did we make the revision? We simply had to because the original version was not working. In that year, we revised the original targets, changed the targets. New targets are up now, and this time we promised again a zero deficit by 1993. Promises are cheap around here, Mr. President. Quite frankly, this was a more astounding failure than the original Gramm-Rudman. It was not the fault of Senator Gramm or former Senator Rudman but of Congress which simply found enough ways to get around the law that when the deficit was supposed to be $100 billion in 1990, it turned out to be more than double to $221 billion. Of course, by 1990, it was clear that none of the targets would even be remotely met. So at that time, we will all recall, President Bush entered into a summit agreement, broke his no-tax pledge--some people say that cost him the election--and the American public was again led to believe that we were finally getting a handle on the deficit. So what we have done here now is we have simply switched this thing around. When we needed to change the targets because Gramm-Rudman was not working, we went back to another budget deal. And what did we accomplish? Absolutely nothing. I had the privilege of being down at the White House at the time, or shortly thereafter when President Bush made the decision on the tax increase, broke his no-tax pledge. He was absolutely convinced that he would get support from our friends across the aisle, the Democrats, if he went halfway on a modest tax increase. He believed that was the only way he could get support for cuts in Government spending, and he genuinely believed that. There is absolutely no doubt in my mind. But it did not happen. It did not happen again, and it probably cost him that election. Well, let us move to the third chart now because it is a progression of where we are. The third chart again shows how the deficit was supposed to come down, supposed to come down, as a result of the 1990 agreement. What this chart shows is that by this year, this year, the budget deficit was expected to be only $83 billion. Does that sound familiar, $83 billion in 1995? In fact, as the chart shows, the actual deficit is $109 billion higher at $192 billion. Now, that is the progression. That is where we have come. What these charts show is that there is no reason for the public to put its trust in the congressional ability to come up with a budget plan that will eliminate the deficit. We have done it. We have looked at the charts. We have seen the results. The results are quite the contrary. In the 10 years since we enacted the first Gramm-Rudman law, spending increased more than 53 percent, from $990 billion to more than $1.5 trillion. Interest payments increased more than 70 percent from $136 to $235 billion, and the national debt more than doubled from $2.1 to more than $4.8 trillion. We are not kidding the American public. They have seen this charade. They have observed accumulated debt has gone up to $4.8 trillion, and they are fed up. They say enough is enough. What is even more discouraging, Mr. President, is that this administration which opposes this amendment and which, 2 years ago, was able to get our friends across the aisle to go along with the largest tax increase in history, in my opinion, has completely abandoned the goal of bringing the deficit under control. During the month that we have debated this amendment, the administration has submitted its fiscal year 1996 budget. Its latest budget shows an unending stream of rising deficits and debt, and I do not find a solution, not a solution is recommended, not a single word about how to reshape entitlements is contained in the President's budget. Instead, what the President now recommends is an increase, an increase of about 24 percent in Federal spending between now and the year 2000--an increase of 24 percent. How does the President propose to pay for increased spending? It is very easy, Mr. President. The President of the United States proposes to pay for increased spending by adding to the debt. That is how we got $4.8 trillion accumulated debt. His deficit spending adds nearly $1 trillion of additional debt on top of our $4.8 trillion. That brings us up to $5.8, almost $6 trillion. And the only category of Federal spending that he proposes to cut that is identifiable is again our defense budget. In fact, if you exclude defense spending from President Clinton's budget, actual Federal spending will increase 37 percent by the year 2000. Quite frankly, the budget presented by the President provides the best evidence that the only way we are going to balance the Federal budget, the only way, Mr. President, is to add a constitutional amendment requiring that the Federal budget be balanced. It is a process of deduction. We have tried all the other alternatives. They have not worked. We have not tried this. It will work. If the balanced budget amendment was now a part of our Constitution, the President currently would be in violation of his oath of office, if he submitted a budget that looked anything remotely like the budget he sent us 3 weeks ago. Now, Mr. President, the question has been asked, well, are we broke? The answer is yes, this country is broke. We are dead broke, and I will tell you why. We simply can no longer labor under the assumption that it is business as usual in Washington; that we assume every year we can run deficits, each year a deficit. That means we spend more than we generate in revenues, so each year we are running a deficit of $150 to $250 or $350 billion. Now, this all adds up, and this debt has today brought us to the point where for the very first time in our history, we are now forced to borrow from the credit markets for the sole purpose of paying interest on the debt. Now, it may surprise some people to know that over the next 10 years, we would be running a surplus in the Federal budget in every year if we did not have to pay $200 to $400 billion annual interest on that debt that has resulted in our chronic inability to bring revenue and spending into balance. This is the dessert chart, Mr. President, that I promised you, the chart of last resort. This chart shows the devastating state of the Federal budget over the next 10 years. It shows that in every year between 1995 and the year 2000, every single one, all Government borrowing, all of it, Mr. President, all of our borrowing is for the single purpose of paying interest on that debt. If you look at the bottom line, you will see what happens to that debt. That debt is increasing from $4.6 trillion, 4.9, 5.2, 5.6, 5.9, 6.3, 6.7, 7.0, 7.4, 7.8, $8.2 trillion. And do you know why, Mr. accumulated debt is more than our debt each year. That is why we are broke, Mr. President. We are broke. We could finance defense spending, Medicare, Social Security, all other Government functions over this period and still accumulate a surplus of $360 billion if we were not saddled by this extraordinary debt that is going to go from $4.6 billion in 1994 to $8.2 trillion in the year 2004. As the chart shows, in 1994 our deficit was $203 billion, precisely the amount of interest we had to pay. In other words, our entire deficit in 1994 consisted of interest on that debt. Without that debt service burden, we would not have had to auction a single Treasury note or bond in the market. In 1995, we would be running a surplus of $59 billion, if we did not have to service the debt. Instead, as the chart shows, our $176 billion deficit results directly from the fact that our interest costs are $235 billion. The same holds true in every year through the year 2004. So if you look at this chart long enough, you will recognize the reality that, if we do not take this action now, this is what we can expect. Only it might get worse because these interest costs are based on current forecasts. Current forecasts suggest a little volatility can be unsettling. I can remember the prime rate in this country in December of 1980, 20.5 percent. These rates are somewhere between 6 percent and 7.5 percent. So you can imagine what would happen. And it could happen again, Mr. President, and it would throw this chart higher than this roof. So I contend we are broke. We are borrowing just to cover our interest costs. We are subject to the shifting winds of international investment which flow from economic policies that may change in Bonn or London, or an earthquake in Japan, all of which have a direct effect on what the U.S. Government has to pay to service this unending sea of debt. Can you imagine just for a moment what would happen if the owners of our debt, the holders of those Treasury bills--of which 18 percent of the total balance of this $4.8 trillion is held by foreigners--decided to call it in, call it in, just $300 billion or $500 billion on our debt? How would we pay the owners? We could not, Mr. President, unless we inflated our dollar to the point that what $1 buys today would actually be worth 50 cents or less. That is what happens. We are close to it. Mr. President, this is a warning signal of what can happen when debt gets out of hand. We have seen it as late as the last few weeks with our neighbors to the south in Mexico. I would not attempt, of course, to even compare our two economies. Ours is far healthier, better based, stronger than Mexico, and there is no comparison between the importance and the stability of the dollar and the peso on the world currency market. But I would also note that Mexico's crisis is a crisis of investor confidence. The result of that crisis is that Mexico this week had to pay 45 percent interest on the rollover of a small portion of its international debt. Why did it have to pay 45 percent? Because the risk was so great. Do you know what investment does? It goes after the highest return and the least risk. And the calculation was that Mexico was a high risk and, to get the dollars, they had to pay a higher rate of return. Mr. President, it is not just happening in the south; it is happening in the north. Take a good look at Canada. Our neighbors in Canada are the most heavily taxed people in the Western Hemisphere. Do you know what they are paying for interest on their national debt? Twenty percent of the total budget of Canada is interest on their accumulated debt. Canada runs a health care system, a national health care system, that is an absolute, unmitigated disaster. It is a Government-run health care system. There is no control from the standpoint of having an inducement to reduce costs if you are a Canadian citizen because there is no direct benefit of such reduction to you. You can go in today, go in tomorrow, and on and on. We must learn from what is happening around us. The only way to get out from under this sea of red ink is to adopt the balanced budget amendment. And I think putting a simplistic and realistic acknowledgment that we have tried everything else and it does not work is the proof in the pudding. The public knows that no family or business can survive for long when, year in and year out, the principal of its debt grows, and all of its borrowing is dedicated to pay off the debt holders. That is where we are going. So, Mr. President, when future generations look back on the decisions we made in this last decade of the 20th century, I know they will appreciate the wisdom of the people and the Congress in adding the balanced budget amendment to the Constitution because it is the only viable choice we have. For this amendment stands for the proposition that future generations are entitled to economic freedom, unburdened by financial debts of past generations. It is our responsibility to end the practice of sending unpaid bills on to our children and our grandchildren. That is a principle that belongs in the Constitution, in the same sense freedom of speech and press belongs in the Constitution. So let us make no more excuses, Mr. President. Let us not use the excuse that we have to know where the cuts are before we can vote for this amendment. That is simply a copout for inaction. We have seen enough copouts. We cannot continue this spending. We are either going to have to take in more revenue or make the cuts. The public understands that. And the public will be watching each of our votes. We will have to stand up and be counted on this one. What the public does not understand is why this body, this Senate, is not moving in the manner in which the House of Representatives did in passing the balanced budget amendment. So I urge my colleagues to reflect on a very simple reality as evidenced by the charts. We have tried everything else. It has not worked. It is getting late in the game. And if we do not do it now, it may be simply too late forever for our monetary system as we know it today. I thank the Chair for its indulgence. I wish my colleagues a good day. Mr. WARNER addressed the Chair.