Richard Neal

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, I rise in support of H.R. 2513. I commend Chairman Archer of the Committee on Ways and Means and the ranking member of the committee, Mr. Rangel, for bringing this important measure to the floor today. This bill would promote the international competitiveness of the U.S. financial services industry by conforming its tax treatment to that of all other U.S. industries, and even more significantly to that of foreign competitors operating throughout the world. Title I of this measure is intended to replace the provision of the Taxpayers Relief Act of 1997 vetoed by the President on August 11 that was designed to change the antideferral rules of subpart F of the Internal Code that discriminates against the U.S. financial services industry by requiring current taxation of active financing income by foreign affiliates of U.S. banks, securities firms, and insurance and finance companies. I am pleased that the Committee on Ways and Means has been able to bring some rationality to the international taxation of U.S. financial service firms. Financial service companies are real businesses that deserve a fair international tax regime every bit as much as U.S. manufacturers. This bill begins the process of treating the two equally. This bill is just a 1-year solution, but I hope it will form the basis of a permanent resolution of these issues. In order to pass a bill in such a short time period, Treasury had to restrict some classes of income so that the bill would not be susceptible to abuse. I hope that in the year to come the Treasury will study international operations of financial services firms and review some of the provisions that were excluded from this bill. Finally, I am concerned by the Treasury's insistence that securities firms and banks forfeit some of their foreign tax credits in order to qualify for this new income-deferral provision. Foreign tax credits and income deferral have always coexisted because each serves a different purpose. I believe that an effective foreign tax credit system is the U.S. industry's defense against international double taxation. I believe that foreign income taxes incurred in the conduct of an active business abroad should be credited in the United States. As we work towards a permanent income-deferral provision for financial services firms, I urge the Treasury to recognize the dealer exception from section 901(k) as a necessary and appropriate part of our tax system. I urge my colleagues to support H.R. 2531. The enactment of this measure will move us toward the goal of eliminating the inequitable treatment of the financial services industry under current laws and enhance the ability of a vital sector of our economy to compete in the global marketplace.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, I thank the gentleman for yielding me this time. Mr. Speaker, while I rise in support of the Internal Revenue Service Restructuring and Reform Act of 1997, I also want to temper my support with a couple of warnings. While this legislation would restructure the Internal Revenue Service to provide better oversight, greater continuity of leadership, improved access to expert advice from the private sector, and additional management flexibility, I also think that there are potential difficulties on the horizon. There has long been an agreement on the need for fundamental reform of the IRS, and I certainly commend the work of the National Commission on Restructuring the IRS. I support a majority of the recommendations made by the National Commission, and I am certainly pleased that further improvements have been made to the additional legislation introduced by the gentleman from Ohio [Mr. Portman] and the gentleman from Maryland [Mr. Cardin]. They have worked diligently to modify their original bills to reflect the concerns of many of us on the Committee on Ways and Means concerning governance. I believe that the Constitution requires that the IRS Commissioner be appointed, hired, and, if necessary, fired by the President. The legislation today before us keeps the President ultimately responsible for the actions of the IRS and the decisions of its Commissioner. The Department of Treasury would still have a role in the oversight and management of the IRS. A key component of the bill is taxpayer rights. These provisions will provide new protections and assistance to millions of taxpayers. I support the overall goals of this legislation. Let me relate two concerns. First, I am concerned about the authority given to a newly created oversight board. This oversight board has the authority to review and approve strategic plans of the IRS, and review and approve the Commissioner's plans for major reorganization. Under this bill, eight private sector individuals would have this authority. The bill is not clear on what happens to our tax administration system under these new board authorities if a consensus is not reached among the board members, or if the IRS Commissioner and Treasury Secretary disagree with the views of private sector individuals. Second, I am concerned about the provision in the shift of burden of proof. This bill provides for the burden of proof to be raised to the Secretary of the Treasury in any court proceeding with respect to factual issues if the taxpayer asserts a reasonable dispute with respect to the taxpayer's income liability. The shift in the burden of proof could result in unintended consequences. It could result in the IRS conducting more intrusive examinations, and the IRS issuing more subpoenas and more summonses to third parties in search of evidence. This provision could induce taxpayers simply not to keep records. Our tax system is voluntary, and we have an overall compliance rate of 85 percent, the envy of much of the industrialized world. The individual nonbusiness compliance rate is 97.5 percent. The individual business compliance rate is 70 percent, and the shift of burden of proof could indeed, if we are not careful, make it worse. Mr. Speaker, the IRS conducts more than 2 million audits each year, but only about 30,000 cases reach court annually. This provision could have more far-reaching consequences. It could help aggressive taxpayers avoid taxation. We should make it easier for taxpayers to deal with the IRS, but I do not think we should make it easier for taxpayers to evade taxes. This provision needs to be improved, because those who voluntarily comply with our tax system simply deserve more.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, I thank the gentleman from California [Mr. Matsui] for yielding me the time. Mr. Speaker, I rise in support of H.R. 2195, legislation to provide for the increased monitoring of products made with forced labor. The Committee on Ways and Means has made several improvements to the bill. This legislation provides certain measures to increase the ability of the U.S. Customs Service to identify, monitor, and interdict products made with forced labor that are headed for the United States market. It authorizes $2 million of appropriations for fiscal year 1999 for Customs to monitor and interdict products made with forced labor. This legislation also requires Customs to report within 1 year after the date of enactment on the extent of the use of forced labor in products destined for the U.S., the volume of products, and the progress made by Customs in identifying these products. Also, this legislation includes a sense of Congress that the President should determine whether any country with whom the United States has a memorandum of understanding on forced labor is frustrating implementation of the memorandum of understanding. If the President determines that the memorandum of understanding is not being implemented, it is the sense of Congress that the President should renegotiate a new memorandum of understanding. This legislation addresses all prison labor in China. The United States should not allow goods made by prison labor to be available in the United States market. This legislation also would provide Customs with the resources to detect and interdict prison goods. The United States should continue to be a leader on human rights issues. And by adopting this legislation, we are sending a strong message that products made by forced labor are not acceptable for sale in the United States. I realize the original focus of this bill and other bills that we will be debating today remain on China. However, it is important to let all countries know that we will not tolerate prison labor. We should not just enforce this standard for China. I urge support for this bill in order to eliminate products made by forced labor that are imported into the United States.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, it is with mixed emotions that I address this House today as Johnson's Bookstore, a landmark in Springfield for more than 100 years, announced that it will close its doors by the end of the year. Johnson's Bookstore, a family-run book shop located on Main Street in downtown Springfield, has long been a cultural and literary hub for children, students, and avid readers of all ages. Established in 1893 by brothers Henry and Clifton Johnson, this business has been run consistently by the Johnson family. Committed to the value that the written word has in civilized society, the third and fourth generations of Johnsons embodied Henry and Clifton's legacy by continuing to bring a large selection of quality books and stationary to western Massachusetts. In addition to the many new releases and best sellers featured in the store, Johnson's Bookstore has brought innovative programs and initiatives to Springfield. The second-hand bookstore at Johnson's was a staple to countless students and bookworms in the area. Johnson's continues to provide the forum for Springfield's native literary talent to shine. Esteemed authors, including Joseph Conrad, Dr. Seuss (Theodore Geisel), and Robert Frost, and other notable celebrities, including entertainer Whoopi Goldberg and the late Boston Pops conductor Arthur Fiedler have all thumbed through the shelves of Johnson's selections. They now know what those of us in Springfield have known for years; the charm, character and quality of a local, community-oriented bookstore like Johnson's is a treasure in today's modern society. Mr. Speaker, I rise today both as a Member of this House and as a frequent patron to say goodbye and thank you to Johnson's Bookstore. The legacy you have left in Springfield will last for generations, and you will certainly be missed.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, today Congressmen Houghton, English, and I are introducing legislation which would have a positive impact on small manufacturers. This legislation would increase the capital expenditure limitation for tax-exempt industrial development bonds [IDBs] from $10 to $20 million. Under current law, the issuance of tax-exempt industrial development bonds for qualified purposes is limited to $10 million. This limitation was set in 1978 and it needs to be increased to account for inflation. The $10 million limit in capital expenditure limits restricts the use of IDB's to provide businesses with affordable capital as part of local economic programs. Increasing the cap to $20 million would allow many small businesses to grow. This legislation would allow a larger number of small manufacturers in Massachusetts to use low cost, tax-exempt financing to expand their operations and add jobs. I urge my colleagues to show their support for small manufacturers by cosponsoring this legislation. Increasing the level of tax-exempt financing will result in capital expenditures that will create job growth.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, it is my honor to pay tribute today to the Springfield Business and Professional Women's Club as it celebrates its 80th anniversary and rich history of promoting the economic, intellectual, and social welfare of working women. I would like to take this opportunity both to congratulate the members of the club whose hard work and commitment has allowed this group to flourish, and to share some of the history of this club for others to enjoy. In 1917, 16 women from Springfield gathered at the local YWCA to organize and establish the club. As the original objective they created stated, ``the club would blend together women in the professions and businesswomen so that the standard of working women could be raised.'' Only 2 years later, delegates from Springfield traveled to St. Louis to join several hundred other women in the founding of the National Federation of Business and Professional Women's Clubs. Several Springfield women were officers in this first decade. Women from Springfield also traveled to Europe, this time to help establish the International Federation of Business and Professional Women's Clubs in 1930. The first treasurer of the international federation was Henrietta Harris of Springfield. Back in Springfield, the organization supplied several of the presidents of the New England Federation of Business and Professional Women's Clubs and later the Massachusetts Federation of Business and Professional Women's Clubs including Barbara Brown in the 1960's and Caroldine O'Hare in the 1990's. But the club did so very much more than provide leadership at the district, State, national, and international levels. In 1936, Amelia Earhardt came to speak to the club about her life as an aviator. Also, the club sponsored the Springfield Forums, bringing speakers on current topics to the public. In the seventies, they marched and rallied for the equal rights amendment on Beacon Hill just as earlier members marched and rallied to earn the right of women to vote. In the 1980's and early 1990's, the club, as part of the Massachusetts Federation, supported on Beacon Hill the Family and Medical Leave Act as well as bills to prevent and address domestic violence. On the local front, the club has been involved through their Harris- Bullman Fund, partly named for Henrietta Harris, first treasurer of the International Federation, with local charities and organizations. In the several past years, they gave to the Open Pantry, Camp Star-Camp Angelina, Grey House, and the Forest Park Zoological Society. Other past recipients have included the Children's Study Home and Rachel's Table. Also through their Jessie M. Bourne-Winifred Daly Scholarship Fund, the club gives scholarships to the nontraditional women student. These recipients are over the age of 21 and have either returned to college or are beginning college as a need to further their career or begin a new one. But not all of the activities have involved funds. For the past several years, the club has gathered good used working clothing and donated these clothes to the Corporation for Public Management which helps women on welfare or who were in prison get their first employment. The club helps by supplying the clothing and accessories. The club has also been part of the Women's Vote Project providing both funds and volunteer hours. They have helped with Channel 57 and Brightside Angels as well as other organizations. Not all of the clubs' efforts are serious. They also believe there should be fun and laughter. They have sponsored a Women's Night of Comedy for the last 4 years which has provided area women with a wonderful night. A fashion show helps to provide funds for the national federation's foundation and the local scholarship fund. This year, the club has donated $1,000 to the Hope Diamond Project and has sponsored a challenge which has led the club to contribute another $1,000. For several years, the club has had a candidate's night which has won them State recognition. Each year as the State federation gathers, one can expect that Springfield will receive several awards. The members are proud of their efforts in many areas. They look forward to each new club year as a challenge for the future and a chance to reflect on the past. They have resolved not to live on past triumphs but to keep achieving far into the next century. While they are proud that their predecessors help to establish both the national federation and international federation, the current members are looking forward to the day when equality for women will not be a dream but a reality and women will be paid the same as men. But they know that even then, they or their successors will continue to strive for the betterment of all working women.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, let me stand as a former teacher, former mayor of a large municipality, but most importantly, in this House today the lead Democratic sponsor of the individual retirement account. The notion of the individual retirement account was, with heavy emphasis on the middle term, retirement. That is what we are really discussing here. We spoke to the issue in the budget agreement about expanding individual retirement accounts for middle- class people. The point of this issue today is that this individual retirement account proposal has nothing to do with retirement. We are further diverting resources from the public schools, but overwhelmingly it is being done to the benefit of high-income Americans. Mr. Speaker, let me cite a couple of specific examples. The bill before us today would only benefit families with sufficient investment assets that would enable them to accumulate income on those assets over a long period of time. Families paying education expenses out of wage and salary income, however, would receive no or little benefit under this legislation. Families, again, with school-aged children would receive very little benefit. If a family currently had a child in a private school, that family would receive only a small benefit, if they could contribute $2,500 to an investment account after having paid the cost of private school tuition. The bill before us today has no real income limits. For many families, the tax benefit would be less, and I urge my colleagues to listen to this, $15 a year; $15 a year. Mr. Speaker, I support the Rangel substitute which is targeted to schools in need of assistance. I come from the State that gave America the concept of a public education. The Rangel substitute encourages greater private sector involvement, but most importantly, it provides additional resources for our public schools, of which I am also a product. It allows us to meet the pressing need of school construction and repair as well as equipment purchases and course development, and certainly teacher training. This alternative expands the education zone bond provisions included in the Taxpayer Relief Act. It also provides an interest-free source of capital for public schools that enter into partnerships with the private sector to improve those public schools with the greatest need. Let me close, Mr. Speaker, on the note on which I opened. The individual retirement account was constructed for the purpose of retirement. It was built for the purpose of speaking to our low national savings rate. The legislation here proposed by the majority has nothing to do with that concept.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, I rise today to pay tribute to a courageous group of women who have played an important role in shaping the future of women in the military. On October 18, 1997, the Women in Military Service Memorial was dedicated to the millions of courageous women who have served and continue to serve our country in the armed services. The dedication of this memorial is another page in American history that will give women in the military the recognition they have so longed deserved. This memorial is a reminder and representation of the invaluable service, sacrifice, and dedication women have given our country. Mount Holyoke College, the oldest continuing institution of higher education for women in the country, resides in my district and is very proud and grateful for the Women in Military Service Memorial. Joanne Creighton, president of Mount Holyoke College, wrote a letter to Brig. Gen. Wilma L. Vaught, who was responsible for the organization taking the lead to build the memorial, paying tribute to the Women in Military Service Memorial. Mr. Speaker, it is with great honor that I submit the letter written to Brigadier General Vaught from Joanne Creighton, president of Mount Holyoke College. As a women's college, we support activities that recognize women and women's varied contributions to the world. It is vital that the experiences of women be known and included as a visible part of history. The women's memorial, which honors and remembers the service, sacrifice, and achievement of the nearly 2 million American servicewomen who have defended America through our Nation's history, accomplishes all of these important tasks and is, therefore, a welcomed and much- needed addition to our Nation's heritage. Fittingly, it was 55 years ago this November 9, during World War II, that Mount Holyoke was part of the history which is about to be honored by the new memorial. From across the country, women came to Mount Holyoke's campus to receive the training they needed to serve the country. Along with our nearby sister institution Smith College, Mount Holyoke served as one of the very few training centers for women officers. It was a privilege to function during that historic time as a training site for the Women's Reserve of the Marine Corps and the Navy's WAVES [Women Accepted for Volunteer Emergency Service] program. WAVES, the young women in uniform living and learning at Mount Holyoke, studied such subjects as naval organization, personnel, and administration along with the Navy's etiquette, customs, and traditions. While in training for 5 weeks, WAVES lived in Rockefeller Hall--a campus residential hall that was renamed the U.S.S. Rockefeller--sleeping in double decker beds, eating the same meals as Mount Holyoke students here at the same time. Classes for WAVES were held on campus, drills were held on the athletic fields, and the women marched to meals and to classes wearing their dark blue uniforms. Reveille was at 6:15 a.m. for these women and the day included five recitations, two study periods, drill, athletic recreation, and an evening lecture. It was a rigorous indoctrination, as it was then called, for these women and we salute them today, just as we did many years ago. After completing their WAVES training, the women were commissioned and offered to active duty. During the 18 months the Navy occupied the U.S.S. Rockefeller approximately 2,500 officers were graduated and went out to duty throughout the United States. They played an important role in our American story and it is with deep gratitude for their efforts that we pay tribute to them and all the others who, in a range of roles, served the country. We join wholeheartedly in this first major memorial to U.S. military women and this celebration of a very important page in history. We also commend you for the success of the foundation, which you established in 1987, and which has overseen the design, development, and construction of this new structure, and the creation of the week-long commemoration of American servicewomen that will launch the women's memorial. Sincerely, Joanne Creighton. Mr. Speaker, the people of the 2d Congressional District in Massachusetts will be forever grateful for the invaluable service and dedication women in the military have provided in defense of the United States. This memorial is very welcome in our Nation's Capital and I, along with Mount Holyoke College, rise to congratulate all the women in the military for this milestone in American history.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, I rise today to recognize an outstanding teacher in Massachusetts' Second Congressional District, Roger Desrosiers. As a teacher at Millbury Jr./Sr. High School, Mr. Desrosiers challenges young minds in his classroom. This past summer, Mr. Desrosiers challenged teachers in Bosnia and Herzegovina to prepare their students for life in a democratic system. Mr. Desrosiers was part of a team of 20 American educators who traveled to Bosnia and Herzegovina as part of the CIVITAS Program, developed by the center for civic education. During the intensive 17 day program, Mr. Desrosiers provided teachers in Bosnia and Herzegovina with the tools to prepare their students and communities for competent and responsible citizenship in a democracy. He showed his Bosnian counterparts how to engage their students in elections and the political life of their communities. Mr. Desrosiers' effort and energy with teachers this summer will inaugurate a sense of community, cooperation, tolerance, and support for democracy and human rights in this war torn area. In this age when American children will grow up to lead on a global level, their education is of paramount importance. Quality teachers and schools ensure they will be prepared. Mr. Desrosiers meets this responsibility thoroughly. For him, teaching does not end at the last bell of the day. Teaching continues after school, on class trips to Washington, and even with other teachers in foreign countries. I am proud to introduce him to this House today, and ask you to join me in recognizing his accomplishment.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, it gives me great joy to extend my congratulations to a constituent of mine who was recently recognized by the National Conference of State Legislators as the ``longest continuously serving legislator in the United States of America.'' Anthony Scibelli, a friend, neighbor, and staple in the Springfield political arena, has for 47 years served his constituents in the 10th Hampden County district with dedication, commitment, and honor. Representative Scibelli's political career has been extensive. Tony began his life of public service in his native Springfield by serving for 12 years on the city council. In 1951, he began what has proven to be a successful career by becoming a State representative and member of the Massachusetts General Court. And over the years, as he has earned the title of ``Dean of the House,'' Anthony Scibelli has never forgotten where he has come from and the people who have elected him. Strongly committed to the concept of education for all, Scibelli's dedication is best embodied in the halls and classrooms of Springfield Technical Community College. As someone who has fought for opportunities for all, his devotion to this ideal has been enjoyed by every child and family who has ever swum in the Emerson Wight pool. A former chairman of the Ways and Means Committee, Representative Scibelli has been a vital participant in the State's legislative process. Anthony Scibelli currently serves on the Joint Ways and Means Committee, House Ways and Means Committee and Transportation Committee. He also proudly serves as a distinguished member of the Knights of Columbus, the Elks, the Eagles, the Sons of Italy, and the Longmeadow Country Club. While his memberships and affiliations describe some of his personal qualities, perhaps Anthony Scibelli can best be understood by reviewing his personal philosophy. As he says about himself, ``I never ignore or dismiss even the smallest request from people. Very simply put, I feel good about being in a position to help those who need it.'' Mr. Speaker, I wish to commend, my friend, Representative Anthony Scibelli, on this unique and well-deserved national designation and for the vital role he has assumed in Springfield. I am proud to join with the citizens of the second congressional district in offering a most heartfelt congratulations.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, I rise today to pay tribute to Merriam-Webster, Inc., who, today celebrates the 150th anniversary of the publication of its first dictionary. In the early 19th century, Noah Webster created the original work that laid the groundwork for the Merriam-Webster dictionaries of today. However, it was the initiative of two brothers, George and Charles Merriam, that established Merriam- Webster dictionaries as the standard. In 1831, George and Charles Merriam opened a printing and book selling operation in Springfield, MA. G. and C. Merriam Co., later renamed Merriam-Webster in 1982, inherited the Webster legacy by revising and updating Webster's dictionary after his death in 1843. From that day on, the two brothers continued to uphold Webster's integrity and style and incorporated Webster's mastery into their own editions. In keeping with the Webster tradition, the Merriam brothers selected Chauncey Goodrich, Webster's son-in-law and literary heir, and William Webster's son, to serve as editors of the first Merriam-Webster dictionary. President James K. Polk, several U.S. Senators, and many other prominent people regarded the first Merriam-Webster dictionary as a great resource for all. By 1850, it became a resource for students across the country and continues to be America's most trusted authority on the English language. Today, Merriam-Webster reference products are found in every office, home, and school. These products serve the global community and are acknowledged with much prestige. For the past 150 years Merriam-Webster, Inc., has maintained a staff that embodies character and standards formulated by Noah Webster and the Merriam brothers. This philosophy continues to be the driving force behind the company, which today boasts the largest group of lexicographers in North America. This knowledgeable and experienced staff has and will continue to ensure that the style, voice, and integrity of its founding fathers continues into the future. Mr. Speaker, I am proud and honored to have Merriam-Webster be a part of the Second Congressional District in Massachusetts. I ask my colleagues to join me today in congratulating Merriam-Webster, Inc., on the occasion of its 150th anniversary of its publicized dictionary.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, recently, Senators Moynihan, D'Amato, and Graham introduced legislation to repeal the provision in the Taxpayer Relief Act of 1997 which terminated the tax exempt status of TIAA-CREF, the Teacher's Insurance Annuity Association College Retirement Equities Fund. Today, along with Representatives Rangel, Matsui, Kennelly, Coyne, Lewis of Georgia, and Thurman, I am introducing companion legislation. This legislation would simply strike section 1042 of the Taxpayer Relief Act of 1997 which repeals the tax exempt status of TIAA-CREF and Mutual of America. This legislation would restore the tax exemption that TIAA-CREF has had since its establishment in 1918 by the Carnegie Foundation. TIAA-CREF provides retirement benefits exclusively for employees of U.S. colleges, universities, independent schools and other nonprofit educational and research organizations. TIAA-CREF serves nearly 2 million current and retired employees at over 6,000 institutions. This repeal also would restore the tax exemption for Mutual of America, which has served as pension administrator for welfare organizations for over 50 years and is modeled after TIAA-CREF. The repeal of TIAA-CREF's 79-year old tax exemption might cost the average retiree who receives a $12,000 annual pension about $600 in income and this is a 5-percent reduction in pension benefits. Future retirees currently paying into the system could face reductions as large as 10 to 15 percent. Many of these retirees are not wealthy and they include librarians, assistant professors, and teachers at community colleges. TIAA-CREF was established to insure that the Nation's college professors had adequate retirement. TIAA-CREF serves as a model for multiemployer pension plans. The creation of TIAA-CREF enabled teachers to save for retirement even if they moved from school to school. TIAA- CREF has always been well managed and sought to shield unsophisticated investors from too many choices and risks. Throughout its history, TIAA-CREF has maintained a well run pension fund with large reserves. The management of TIAA-CREF has focused on counseling and education. We should be awarding such plans, not punishing them by removing their tax-exempt status. I urge you to join me as an original cosponsor of this legislation.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, I rise today to honor a valuable Massachusetts State legislator, Senator Robert D. Wetmore. On September 28, 1997, colleagues, family, and friends will gather to toast Senator Wetmore's distinguished career in the Massachusetts General Court. Allow me to inaugurate this celebration early by introducing Senator Wetmore and his accomplishments to this House. Robert Wetmore dedicated his entire career toward serving others. Even before his 32 years in elected office, he committed himself to his colleagues as a head lineman for the Massachusetts Electric Co. and by presiding over the local union. In 1965, he first entered the Massachusetts General Court as a State representative. In addition to his participation on several standing committees, the combination of his innovativeness, foresight, and abilities, allowed him to steer several new initiatives. Among these are his participation on the Bicentennial Commission and the Special Commission on Bike Paths. His leadership in identifying the effects of growth patterns on the quality of life in the commonwealth placed him on the vanguard of proactive government by foreseeing issues and precluding problems. In 1977, Mr. Wetmore entered the Massachusetts senate. He would continue to serve the people of the Worcester, Hampton, Hampshire, and Franklin districts, and the institution, for 10 terms. Beyond chairing and vice-chairing several standing committees, he continued to identify new areas of specialization and organize committees to address these issues. Senator Wetmore subscribes to one of life's lessons that I hold dear to my own heart: It is not enough to leave a place the way you found it--you should leave it better. Were a person only to strive for this in private life, it would undoubtedly win other's trust and praise. When someone such as Robert Wetmore makes this his public mission in the General Court, everyone in the Commonwealth of Massachusetts reaps the benefits. As a lifelong Massachusetts resident, I too, owe Senator Wetmore a debt of gratitude. I ask all the Members of this House to join me in recognizing this dedicated public servant.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, over the last several years, the United States has led an effort in the Organization for Economic Cooperation and Development [OECD] to develop a binding and comprehensive agreement on investment. In May 1995, the OECD Ministers launched the negotiation of a Multilateral Agreement on Investment [MAI]. At the OECD ministerial meeting in May 1997, the OECD Ministers agreed to extend the negotiations until May 1998. Negotiating sessions are scheduled every 6 weeks beginning the week of September 15. Recently, Dr. Witherell, Director for Financial Fiscal and Enterprise Affairs of the OECD gave a speech entitled ``The Multilateral Agreement Investment (MAI) Negotiations: The State of Play and Implications for the Asia Pacific Region.'' Issues involved in the agreement are complex and time consuming. Dr. Witherell's speech presented a clear and objective analysis of the issues. I suggest that interested Members review extracts from Dr. Witherell's speech. His speech presented the issues of the MAI and discussed which issues need to be resolved in order to conclude a successful MAI. I request that a copy of extracts from Dr. Witherell's speech dated September 1, 1997, be printed in the Congressional Record. Extracts From MAI Speech by William Witherell, Sydney, September 1, 1997 One of the central objectives of the OECD since its creation in 1961 has been the development of a liberal environment for international investment. A very important step was taken at the OECD Ministerial meeting of May '95 when the governments of the 29 OECD Member countries' decided to commence negotiations on a Multilateral Agreement on Investment (the MAI). The private business sector was a strong advocate for developing a comprehensive legal framework for foreign direct investment which would consolidate and extend the present system of bilateral, regional and sectoral agreements. While the negotiations are between the OECD Member countries and the European Commission, the resulting agreement is to be a free standing treaty, open to any country willing and able to assume the obligations of the agreement.* --------------------------------------------------------------------------- *Footnotes appear at end of speech. --------------------------------------------------------------------------- The OECD Ministers initially targeted the completion of the negotiations for May of this year; but that proved to be too optimistic despite the strong commitment and political will of our Member countries and a very intensive schedule. The issues are complex and time-consuming; and some, especially those of a more ``political nature,'' might not be resolved until the liberalization commitments among the participating countries are fully agreed. So a modest extension of the timetable until next April has been set. This extra time will ensure that the result is indeed a high standard agreement with a satisfactory balance of commitments by all parties. Extra time also has opened up the possibility for non-OECD countries to be involved more closely. Indeed, some may even become founding members of the Agreement. We now have--in almost final form--the main building blocks of this Agreement. Of course, there remain a number of outstanding issues--the inclusion of a special clause for regional economic integration agreements such as the EU, the coverage of sub-national measures, the treatment of cultural measures, the issue of conflicting jurisdiction and the treatment of labor and environment matters, to name some. Some, especially the more politically sensitive ones, are likely to remain unsettled until the last minute. This is to be expected in such a negotiation. But the ground has been prepared for a successful outcome in the coming months. A satisfactory agreement for all concerned--including interested non-OECD countries--is clearly within our reach. What will the MAI look like? The MAI will be the first multilateral agreement to include disciplines in three key areas of investment rule-making: investment protection, investment liberalization and binding dispute settlement. As such, it is undoubtedly the most complex multilateral negotiation on investment ever undertaken. The MAI aims to provide a ``level playing field`` for international investors by eliminating distortions to investment flows and facilitating a more efficient allocation of capital. This will contribute to the ultimate objectives of economic growth and development. In the MAI contracting parties will undertake obligations aimed at reducing barriers and discriminatory treatment of FDI (investment liberalization) and increasing legal security for international investment and investors (investment protection). These obligations will be legally enforceable through provisions for settling disputes--including investor- to-state as well as state-to-state disputes. In all of these areas, the negotiators are seeking to incorporate high standards. The MAI will bind the Contracting Parties to a set of fundamental rules governing the treatment of MAI investors and investments. The non-discrimination principles of National Treatment and most-favored nation treatment (MFN) will be the norms for all phases of investment from the entry of the investor and its investments to the treatment of the investor and its investments after they are established. These central principles will assure foreign investors non- discriminatory access to a sector and equitable treatment after they are established. Some who are not familiar with the negotiations have misunderstood these provisions as requiring a wholesale dismantling of governmental regulations. The clearly is not the case. The MAI will not deprive national authorities of their sovereign right to promote economic development, a cleaner environment and other public policy goals. What the MAI will require is the provision of fair and non-discriminatory treatment of foreign investors, not deregulation. Aside from general exceptions or derogations, any measures of participating countries that do not conform to the MAI obligations will need to be notified as country-specific reservations when the countries adhere to the MAI. Early this year, the negotiators tabled their initial lists of country- specific reservations. The scope of these reservations is subject to negotiation with other parties to the agreement. Thus another crucial aspect of the negotiations, the liberalization of existing investment restrictions, has begun. In the end, the overall assessment that each country will make of the results of the negotiations will likely take account of both the rules of the Agreement and the liberalization commitments as reflected in the reservation lists. The OECD has made important contributions towards the policy objectives of protection and conservation of the environment and promoting sustainable development. Questions have been raised as to how the MAI will relate to these objectives. As noted above, the important positive role of foreign investment in promoting development is now widely recognized. Several approaches to addressing environmental policy concerns in the MAI are being examined and further proposals are likely as the debate continues. For examples, one provision under consideration would call upon governments not to lower environmental standards in an effort to attract foreign investment. Similar approaches are being considered for labor standards. It should be emphasized that nothing in the agreement would prevent participating countries from developing of maintaining effective measures for the protection of the environment or promoting sustainable development or improving labor standards. There is no convincing case, however, why such measures would need to discriminate against foreign investors. There is strong support for a provision that would associate with the agreement OECD's Guidelines for Multinational Enterprises, without changing their voluntary character. These Guidelines set international standards, which are non-binding, to encourage multinational enterprises to behave responsibly as good corporate citizens in the countries in which they operate. The cover corporate activities in a wide range of areas, including, inter alla, environment and employment and industrial relations. Most investment disputes that might arise under the MAI should be settled without recourse to formal procedures. Accordingly, the agreement provides for consultation arrangements to encourage amicable solutions. Nevertheless, the credibility of the MAI will require the binding arbitration of disputes between states, or between an investor and a participating government, be available to ensure effective recourse in the event of breach of the agreement. These provisions will be the ``teeth'' of the MAI. They will be one of the major innovations of the agreement because they go further than GATS (which has only state-to- state dispute settlement) and further than most bilateral treaties, which, unlike the MAI, deal only with established investment and not the conditions for entry and establishment. Why the MAI? The OECD countries have long recognized that foreign direct investments is central to the process of international economic integration--or globalisation--fueling development of advanced economies and developing countries alike. Foreign direct investment offers recipient countries the opportunity to upgrade productivity and competitiveness, benefit from the transfer of technical and managerial expertise, and promote integration into the international economy. And increased investment very often leads to increased trade, creating a powerful engine of prosperity. In recent years the critical role played by foreign direct investment has become more widely appreciated. In the new environment characterized by liberalization of trade and investment regimes and by privatization, regulatory reform and demonopolisation of domestic industries, the potential gains from inward investment are more likely to be realized than ever before. Foreign direct investment has been growing rapidly: over the past three years the global stock of foreign direct investment has doubled. Particularly welcome in 1996 was the dramatic increase by one third in the inflows to developing countries.\2\ The multilateral system lacks a comprehensive and coherent framework--or ``rules of the game''--for investment. We have come to the stage where international investment rules can begin to be multilateralised. From the perspective of international firms, fixed investment commitments are long term, and firms seek assurances that the investment regimes will not become more adverse over the period of these commitments. While market factors are the primary determinants of investment decisions, investors are seeking long term stability of rules and procedures, guarantees for entry and establishments, equal competitive opportunities and protection of existing investments. To become irreversible, commitments need to be locked in through binding international obligations enforceable by dispute settlement. From the perspective of governments, the global competition for capital in the coming years will be intense. Countries not providing sufficient assurances to investors will likely be charged higher risk premiums by the market. Moreover, governments recognize that the remaining investment restrictions and discriminatory treatment of foreign firms are a potential source of international friction, not the least because these are often barriers to market access. Such restrictive or discriminatory measures distort market- determined flows of capital and have a detrimental effect on economic growth and development. The greater the role of investment in the global economy, the more important it becomes to avoid, or have a framework to address such frictions. Such considerations led the governments of the OECD countries to conclude in 1995 that the time was ripe for establishing a system of rules to safeguard the future of international investment and to provide the legal protection that would encourage more investment between countries. After some sixteen meetings of the high level Negotiating Group over the past two years, the main elements of the MAI are now in place, and draft text or options for text are available for most outstanding issues. Some Implications for the Asia-Pacific Region Since the MAI negotiations are taking place between the twenty-nine OECD Member countries and the European Commission, successful conclusion of the MAI negotiations will mean that a major portion of the world's investment flows will be covered by a comprehensive framework of international rules of the game. Indeed, the vast bulk of FDI originates within OECD countries and is destined for other markets within the OECD area--some 85% of all outflows and almost 70% of inflows in recent years. But, a number of non-OECD countries are important hosts, and in some cases also home countries, for foreign investment. Among the top thirty host countries for foreign direct investment in the 1990's. \3\ are ranked seven of the non-OECD members of APEC: China, Malaysia, Singapore, Indonesia, Thailand, Hong Kong (China), and Chinese Taipei. While other regions are also significant, the role the MAI will come to play in the Asia-Pacific will be of critical importance. The member countries of APEC, for example, have accounted for about 50% of global foreign direct investment inflows thus far in the present decade. The non-OECD Asian economies as a group have also become an important source of outward investment. The share of these economies in world outflows has increased from almost nothing in 1981 to 12 per cent today. A striking fact is that, as a group, these economies invest more abroad than any single OECD economy except the United States. In view of this situation, it was decided that the MAI should be a free standing treaty, open to accession by interested non-OECD countries and on equal footing with OECD Members. Each country will be able to negotiate its terms of accession, i.e. its own schedule of reservations. Adhesion of all parties to the basic rules of the agreement will be essential, but different levels of economic development can be reflected in individual country reservations, which might, in some cases, include transition periods. The OECD is undertaking an unprecedented dialogue with non- OECD countries as the negotiations progress, focusing, in particular, on the growing number who appear to be interested in acceding to the MAI. The next meeting of the Negotiating Group in mid-September will represent a new stage in this respect. Four non-OECD economies--Argentina, Brazil, Hong Kong(China), and the Slovak Republic--will join the Negotiating Group as ``Observers'' for the first time. During the same week, a special session of the MAI Negotiating Group will bring together the negotiators from the OECD countries and senior investment policy officials from a number of interested non-OECD countries. This meeting could lead to further consultations at this level. It is hoped that these processes will facilitate some of these countries joining the MAI as founding Members, or soon after the agreement is put in place. \1\ The OECD Member countries are the following: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Korea, Luxembourg, Mexico, Norway, New Zealand, Netherlands, Poland, Portugal, Spain, Sweden, Switzerland, Turkey, United Kingdom, United States. \2\ UNCTAD Press Release: TAD/INF/2710, 10 July, 1997. \3\ ``Special Feature: Recent Trends in Foreign Direct Investment'' in Financial Market Trends. Vol. 76, OECD, Paris, June 1997.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, it is a privilege to me to have this opportunity to congratulate both the Roman Catholic diocese of Springfield and the parish of St. Michael's Cathedral in Springfield, MA on both their sesquicentennial celebration and September 28, 1997, rededication. This cathedral is a magnificent place of worship located proudly near the center of downtown Springfield. For over a century, St. Michael's has served a diverse body of parishioners and has catered overwhelmingly to the needs of its faith community. I would be honored to share with you some of the history of the parish of St. Michael's Cathedral. St. Michael's Church originally occupied a simple structure on Union Street in Springfield where a small group of people joined together to worship. Soon enough, this community of believers outgrew the edifice and orchestrated the purchase of land at the corner of State and Eliot Streets. In 1860, on the feast of St. Michael, the cornerstone of a new church was laid. Dedicated on Christmas morning in 1861, this church was eventually consecrated in 1866. In response to an ever growing parish family, the Diocese of Springfield was established in 1870. St. Michael's Church was at this time named the cathedral church of that new diocese. On the occasion of its centennial, at the brink of a second century of service, St. Michael's Cathedral underwent interior renovation. Further additions to the cathedral have been witnessed recently with the completion of the Bishop Marshall Center. This unique addition to the church complex provides a forum where the cathedral and the diocese can collaborate to plan increased service to its parishioners, members of the diocese, and the city as a whole. The Bishop Marshall Center is equipped with handicapped access meeting rooms, and contains the Holy Spirit Chapel from which the Sunday celebration of the Eucharist is televised. Just as it did 150 years ago, St. Michael's Catehdral continues to foster a true spirit of Christian fellowship within the greater Springfield area. The parish and its members have made invaluable contributions to both the diocese and the city. I am delighted to offer these remarks in honor of the cathedral and once again congratulate the parish of St. Michael's on its upcoming sesquicentennial and rededication.

Mr. NEAL

Mr. NEAL. Mr. Speaker, I rise today to recognize a leading civic organization in Massachusetts' Second Congressional District, the Springfield Business and Professional Women's Club. October 28, 1997, will mark the 80th anniversary of the club's founding. The club has a long history of contributing to Springfield through its civic participation, its sponsorship of speakers and events, as well as its scholarship. In October 1917, 16 women with a common desire to improve the positions of women in the work force gathered at the local YWCA. They founded a club with the original objective to ``blend together women in the professions and businesswomen so that the standard of working women could be raised.'' Two years later, delegates traveled to St. Louis to join several hundred other women in the founding of the National Federation of Business and Professional Women's Clubs. In its first decade, several Springfield members served as officers of the National Federation as well as traveling to Europe to help found the International Federation of Business and Professional Women's Clubs. The first treasurer of the International Federation was Henrietta Harris of Springfield. Throughout its history, the club has reached out to promote several charitable organizations. Through their Harris-Bullman Fund, they have been generous supporters of the Open Pantry, Camp Star-Camp Angelina, Grey House, and the Forest Park Zoological Society. Their Jessie M. Bourne--Winifred Daly Scholarship Fund provides nontraditional women students with a scholarship to either return to college or enroll for the first time. In addition, the club routinely collects good used work clothing to donate to women on welfare or who were in prison and are now seeking professional employment. Beyond these endeavors, the club has championed the role of women in our political system by donating funds and volunteer hours to the Women's Vote Project. Through their continuing Springfield Forums the club has welcomed distinguished guests, such as Amelia Earhart, to speak on current events and their experiences. On October 28, 1997, the club will celebrate its 80th anniversary. On this night, members will be joined by State officers of the Massachusetts Federation of Business and Professional Women, elected officials, and leaders of other women's organizations to highlight past accomplishments and the evolution of club activities. As an organization with a storied history, it is my hope that the club will use its past triumphs as a springboard for future successes. I ask my colleagues to join me in saluting the Springfield Business and Professional Women's Club on this milestone.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, it is a privilege for me to have this opportunity to congratulate both the Roman Catholic Diocese of Springfield and the Parish of the Nativity of the Blessed Virgin Mary in Willimansett, MA as they celebrate their 100th anniversary. Representing and serving the parishioners of this church is indeed an honor. The Nativity of the Blessed Virgin Mary has responded tremendously to the needs of its ever expanding faith community. Providing a strong foundation of Christian values for its spiritual community and offering a forum for Christian worship, this parish has generously given 100 years of devoted service to the residents of Willimansett and beyond. I am proud to share the history of this fine parish as I submit the following historical notes in the Congressional Record.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Chairman, will the gentleman yield?

Mr. NEAL of Massachusetts. I thank the gentleman from Rhode Island for yielding. I want to thank the gentleman from Ohio [Mr. Regula] for the manner over the years in which he has treated the Blackstone funding priorities. It has been very encouraging and he has been more than generous with his time as well as his support of this project. I know that since I represent the town of Blackstone that this really commemorates a remarkable part of the manufacturing history of America. I am delighted with his pronouncement today that he will support us on the Senate side when this legislation goes to conference.

Mr. NEAL of Massachusetts

Mr. NEAL of Massachusetts. Mr. Speaker, just a quick response to the gentleman from New Jersey. I have a quote here from the Boston Globe on June 19 of this year in which it suggests, `` `and graduate students include future doctors, lawyers and engineers,' he said. `We do not think it is appropriate to give people who are on the verge of becoming society's highest paid workers tax benefits that are not available to others.' '' The University of Massachusetts Medical School is at the other end of my district.

Mr. NEAL of Massachusetts. Mr. Speaker, that was very helpful. I thank the gentleman very much.

Mr. NEAL of Massachusetts. That is true. And on the House bill, it simply does not include permanent extension of employer-provided education either. We live in an atmosphere now and at a time when people are going to have to be continually called upon to upgrade their skills. There is nothing in the House bill that supports lifelong learning. Maybe the gentleman could explain to me the absence of this exclusion.

Mr. NEAL of Massachusetts. Their bill, the Republican bill, would treat as taxable income the tuition reduction of these students, and this could be as much as $25,000. It would result in an average tax increase on graduate students of $4,000. It is hard to believe we are taxing hard-working students who are serving the future needs of the Nation. In Massachusetts alone we have numerous graduate students who are making technological advances, and we should not reward their efforts with a tax increase.

Mr. NEAL of Massachusetts. Yes, they do. The proposals were not available to families with incomes in excess of $100,000, and they began to phase out at incomes over $80,000. Families with incomes over $100,000 paying tuition costs out of dividend and interest income are one of the few categories of taxpayers to receive more benefits under the Republican approach than under the Democratic approach.

Mr. NEAL of Massachusetts. No, it is my understanding that families will receive tax incentives provided by the Republican proposal for families paying tuition costs out of dividends and interest. There are no income limitations on the tax incentives provided by the Republicans.