Ben Nelson

Mr. NELSON

Mr. NELSON. I thank the Senator for yielding. New sensors are being developed at the University of North Florida which use polymer membrane and dye combinations to create analytical sensors based on photo induced charge movements. These sensors can be combined into relatively inexpensive easily produced families of sensors which will be able to respond to a range of targeted analytes appropriate to a particular area of risk or interest. This makes possible and readily usable real time field-based sample preparation and analysis--it will process data and deliver it via wireless communication to create real time models of sensor responses and measurements which are combined in GIS applications and other decision making tools to enable real time highly effective responses. The applications of this approach are highly varied, and include: a wide range of environmental monitoring strategies; early warning applications to protect food, water, and other systems from bioterrorism attacks; and monitoring of industrial processes.

Mr. NELSON. I thank the Senator for yielding. CSTARS is of critical importance to the state of Florida and will make a strong contribution to the Southern Command mission, including drug interdiction, civil defense, and natural disaster mitigation. The core fiscal year 2003 objectives are to complete Phase II of the station infrastructure and operational capabilities and initiate prototype use by the U.S. Southern Command and the National Imagery and Mapping Agency NIMA. Funds would be used to ensure direct down linking with satellite orbiting systems, such as SPOT2, 4 and 5, ENVISAT, ADEOS-II, LANDSAT and TERRA/AQUA. The program is authorized is authorized in the Senate fiscal year 2003 Defense Authorization bill and report and is funded at a level of $2.5 million in the House fiscal year 2003 Defense Appropriations bill and report. I request support for a funding level at a minimum of $2.5 million for this critical program in the conference negotiations. Funding reductions below that level will cause delays in the program and delay the benefits to SOUTHCOM and NIMA.

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. Mr. President, I ask my colleague from West Virginia if I might have 2 minutes.

Mr. NELSON of Nebraska. Thank you, Mr. President. I thank Senator Rockefeller. Back in the early nineties when I tried to balance our budget as Governor and had a difficult time doing it, the Federal Government reduced its share and increased ours. Today, the Federal Government is not having the same difficulty the State of Nebraska is having in terms of revenue. For only the second time in history, Nebraska's revenues are less this year than they were last year. If we are trying to talk about who is going to do what during difficult times and how this partnership is going to work, I think it is a little inconsistent to say the Federal Government doesn't reduce its share. It does. If it reduces it, it can increase it; and it does in the ordinary course of events. What we are saying is, this is an unusual set of events--not a temporary downturn, although we think it is but it is an unusual set of events where the Federal Government continues to have growing income and the States are having a reduction in their income. It is a recognition that this partnership, which was created by the Federal Government with the States, is one that needs to work as a partnership where the two partners can work together to make this program work. That is what it is. Certainly, I am not suggesting the Federal Government take over the entire partnership, take it over as a stand-alone program at the Federal Government level. But I think it is interesting to say that somehow the Federal Government's share should not increase when, in fact, from time to time it has increased, as well as from time to time it has decreased. I think it is important to recognize that the program is about people. It is not about giving money to the States, it is about recognizing the importance of the program to the people--the faces of people who are elderly, working parents, usually single parents who are struggling to get out of the welfare system, who currently have transitional benefits in Medicaid, who could in fact lose those benefits and lose their capacity to be able to work. It seems to me we have to be able to look beyond what is being suggested here. I thank the Chair.

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. Madam President, how much time was yielded?

Mr. NELSON of Nebraska. Thank you, Madam President, and I thank my colleague from West Virginia. I have never been to Dicky Flatt's and I hope my good friend from Texas will take me to Dicky Flatt's one of these days because it is, obviously, quite a place. I imagine the folks in Dicky Flatt's, though, will be interested in what came from the supplemental--$22.9 million to upgrade port surveillance and vessel tracking capability in the ports in Port Arthur, TX, Houston, and New York City, NY, and $12.6 million to the Pantex Plant in Texas for increased safeguards and security needs. The point is, folks in Dicky Flatt's or Elm Creek, NB, or other small communities and/or locations around the country, understand why some spending is necessary. They understand also that when you have a Federal program that is put together, as the Medicaid Program has been, that both parties have some responsibility to make sure it is viable so when times get difficult, one partner doesn't say to the other partner: Good luck, I hope you are able to make it. Because now we have an opportunity to say this is our program together, at the Federal level and at the State level; we have an interest in seeing that the people who are the most vulnerable in our society are appropriately served; that the nursing homes do not cease to be able to provide services or that childcare provisions are not eliminated, which are transitional benefits to get, in many cases, single parents off welfare and into the workforce. So as we think about offsets, I think it is important that we recognize that one person's offset is another person's idea of eliminating or destroying or in some way obstructing getting something accomplished. What we have to do is make sure offsets are, in fact, included wherever we can possibly include them. But one of the reasons emergency spending issues and funding issues have not generally required offsets is because it is very difficult to be able to match it at the time. We cannot wait on this and we cannot fight out every offset people would like to talk about. That is why emergency disaster relief, in this case emergency spending--to go to our States for our share of the program for a period of time--just simply provides the opportunity to continue something and it has to be done immediately and the process then, I take it, is there for them. We only seem to talk about offsets when it is convenient, or where we do talk about it and they are appropriate, it is when there is enough time to be able to put them together and get them accomplished. The economic stimulus plan, when this was a part of it last year, did not have an offset. There was not a lot of discussion about offsets at that time. Unfortunately, this particular provision did not get included in the stimulus package that was passed earlier this year, although it should have been. If it had been, it would not have involved an offset. It seems to me we have the opportunity to move forward as a partner with our States and to be able to assist them in very important policy matters and programs that I think will benefit the people of our country and will benefit our economy. That is why this was included earlier in the economic stimulus package. There was a recognition it was part of the economic stimulus. I hope we will today recognize it, not only as the right thing and fair thing to do with our partners, the States, but also recognize that this has been considered part of the economic stimulus package. I ask unanimous consent an article by Judith Graham entitled ``States' Budgetary Shortfalls Deepen'' be printed in the Record, and I yield the floor.

Mr. NELSON of Nebraska. I thank my colleague from West Virginia. He has done such an able job in this challenge of finding a way to make the partnership between the States and the Federal Government on the Medicaid Program work in difficult times. I respect a great deal my friend and colleague from Texas, who makes a very important point about spending in the Senate. If we were only talking about spending, then I think that argument might stand, but what we are really looking at is a partnership that was created between the Federal Government and the States and it is called the Medicaid Program, a joint partnership. The Federal Government underfunded it because it said we will have a match and our match will vary based on our particular situation as well as the situation of the States. I remember as Governor of Nebraska when the Federal budget was being balanced and the Federal match was reduced. At the State level, my particular portion had to increase. So the Federal Government balanced its budget on the basis of my budget and at the expense at times of my budget. Now we are looking at a situation in reverse. We have the States being challenged by growing red ink, and the Senator's comment about a budget of 40 States with deficits of somewhere around $40 billion, in a news article in the Chicago Tribune this morning, it was pointed out that the gap in those States may be about $58 billion rather than $40 billion. The point is, this is a partnership, a federally mandated program partially funded under the idea that the State would have a responsibility and the Federal Government would have a responsibility. This is not about giving away money, this is about stopping the reduction in the Federal match for a period of 18 months and increasing it for a period of 18 months. It is not giving away money, it is assisting our partners in the process they are going through as they make difficult choices. It has been suggested that this will keep them from making difficult choices. They have already cut education funding. They have already cut funding in many other programs. The cutting has only begun. We are hopeful that the cutting in the area of Medicaid and/or in social services will not cause the gains that have been made in having people go from welfare reform to work reverse themselves and start a spiral downward where the gains made can be lost. All we are saying to the Federal Government is, do not reduce our portion right now and require, then, the States to make that choice about increasing theirs, which they cannot do; or cutting eligibility for Medicaid and causing, most likely, a downward spiral as they face the Medicaid uncertainties. In addition to recognizing this is a responsibility we created--I was not here, but collectively the Federal Government created this under this Federal program--I think we have a responsibility. We are facing that responsibility. Yes, we are having some difficult times, but we need to share the difficult times together rather than stand on the sideline and say it is up to the States to make the difficult choices and see them make choices that will have adverse, and maybe in some cases draconian, results at the State level. I understand the importance of trying to develop offsets. How can anyone ever be against offsets? Let me state a few things that have flown in the face of asking for offsets--except where maybe you are not interested in seeing the program move forward. We passed yesterday the supplemental at a $28.9 billion total cost, $2 billion offset. A few of the things included $14.4 billion for defense--no one argues with that--or $6.7 billion for homeland security. How can anyone argue with that? Or $5.5 billion for New York, how can anyone argue with that? No request for specific offset for New York, no specific offset for homeland security, for defense. Or $1 billion for Pell grants, $417 million for veterans medical care, and $400 million for improvements to State and local election procedures, we all know how important those are. Or $205 million for Amtrak, we also know how important that is. But $2 billion worth of offset to $28.9 billion worth of budget. I am not saying these are not important any more than anyone else is. I am suggesting that while they are important, so is this. I yield the floor.

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. I suggest the absence of a quorum.

Mr. NELSON of Nebraska. Mr. President, the distinguished Senator from New Hampshire raised a number of very important questions regarding this FMAP proposal to expand the support that the Federal Government is providing to the States as part of the partnership that has existed for many years. I think it would be very difficult to go back and tell our partners that we are unable to or we should not increase the amount of the Federal match because we did not follow the procedures that some people in the Senate believed we ought to follow. Inside baseball is not going to make those friends who are on the outside experiencing some major financial challenges very happy. They may not be very happy at all with that kind of an explanation. I think it is important to remember how the Medicaid Program developed, as well as some of the social benefits programs that are also included as part of this bill. If the Chair remembers--and I know he does as a former Governor from Georgia--this was a big part of his budget. He probably was surprised, as I was, on the day we took office and put our budgets together to find out what a big piece of the pie this Medicaid Program amounted to as part of the budget. If the Chair remembers what happened, as I am sure he does, as do all former Governors, and I believe all of our colleagues do, this came about because of a Federal mandate. The Federal Government said we are going to have a Federal Medicaid Program and the States are going to be parties to it and the Federal Government is going to decide how much the Federal Government contributes to it, and the Federal Government is always going to be able to raise or lower the amount of the Federal match on the basis of a formula that has been established. The States, as the junior partners, have to go along with whatever the Federal Government proposes. It was a mandate--not an unfunded mandate but an underfunded Federal mandate. The States generally made innovative challenges, but I know the distinguished former Governor of Georgia will recall when States came to the Federal Government and said, we would like to make some changes to the program, you had to get a waiver and come back to Washington and ask, will you please allow us to make these innovative changes that our distinguished colleague from the Northeast was talking about that have been made in some areas. Many proposed innovative changes were denied. It has been essentially a Federal program where the States have been the junior partner. In this situation, all we are saying is, instead of reducing the amount of the Federal match over the next 19 months, as it has been scheduled to be reduced in various States, we are going to hold that constant. In addition, we are going to add 1 percent to the State in the Federal match, so for 18 months we will help the States so they do not have to take away benefits from the most needy and most vulnerable in our society today. It is recognizing we have a partnership. This was part of the stimulus package worked on this last year. It just did not survive into the ultimate stimulus package that was passed earlier this year. Last year and this year, when the stimulus package was being discussed, there was little talk about offsets. Now, when it is convenient to talk of offsets, in getting in a direction the way this is heading, we talk of assets. There is not anyone in this body not in favor of offsets, unless the whole discussion of offsets is designed to set this off the tracks so we can get it passed. It seems to me what we have to do is recognize how the program began, how it works, and what assistance this plan we are proposing today--how it will help the States and why it is necessary to help the States deal with our citizens, citizens of the United States of America who happen to reside in the various States. It seems to me we do have a responsibility, that we can meet that responsibility, and, yes, I would love to have offsets, but I want to make sure the search for offsets is not what gets this off the track. I yield the floor and suggest the absence of a quorum.

Mr. NELSON of Nebraska. Madam President, the proposal that is before the body today, to enhance the partnership between the Federal Government and the States with regard to Medicaid and with regard to welfare reform and social services that are so critical to the most vulnerable in our society, is a very important piece of legislation. It merits our total support, not because it is just about money but because it is about doing the right thing to continue the gains and not see a spiral downwards back to welfare for those who have been able to make it to the workforce. It is for those who are teetering on the brink who would, if their eligibility for Medicaid were taken away, be unable to support themselves and/or their families. It is for the seniors who need, so much today, the kind of support the Medicaid Program provides when they are in nursing homes. So it is about people. That is what it is truly about. It is about doing the right thing. It is continuing the relationship and the partnership that has been developed between our Governors, our State legislatures, and our Federal Government. It is an important partnership that must be maintained. It is also important that we recognize it is a temporary fix. It is not a permanent solution. No one is expecting that kind of a permanent solution today, given the temporary, and hopefully only temporary, nature of the downturn in the economy. But it is essential we do something soon because of the plight of the States and the experience they have in terms of not being able to meet all of their obligations as they move forward on these programs. The truth of the matter is, we can work together with the States as we have in the past. Many of our colleagues here, as you know, are former Governors. You may be able to take us out of the Governor's office, but you cannot take the experiences we have gained in that position away from us simply because we have changed our titles or we have new responsibilities. It is important, also, that we recognize that the States, in making these tough decisions, will have to make them on the basis of how they balance their budgets because all but a handful have to balance their budgets and can't have deficit spending. So they either balance their budgets with major cuts or with tax hikes or with a combination. In any event, most of the States have made the cuts they believe they can make, up until this point, without affecting Medicaid. But as their budgets continue to flow with red ink, now they are looking at these social programs for the necessary cuts. They have cut education. They have cut many of the other essential programs. Now they are faced with cutting this program. So if we wait until they have made the cuts, there will be the casualties of those who are not able to have the benefits--the elderly, the young people, those who in our society today are reliant on the availability of these programs. We have asked people to work their way out of welfare, to join the workforce. We have created at the State level, with welfare reform at the Federal level, the opportunity for people to transition out of the levels of poverty and welfare, with the opportunity to join the workforce. We have done it with transitional benefits that are comprised of child care, some Medicaid continuing coverage, so these individuals and their families have the capacity to leave the welfare rolls to join the workforce. If we pull back on these and other programs like it, they will teeter, and it is very likely that they will fall back into the welfare situation. While already experiencing higher unemployment levels than we have experienced over the last 10 years, we see that the growing population of Medicaid is putting more pressure on Medicaid expenditures at the State level. I remember looking at the growth of Medicaid and the opportunities that were there to try to reform it and to make it so it worked not to create incentives for unemployment but opportunities for employment and incentives for joining the workforce. But when you see it today and you see the growth in this program, you recognize that something must be done in order to stem that growing tide. The truth is, we can and we should do this. There will be some who will say we don't have an obligation, a further obligation to the States. But it is not about just from one government to another; it is about to the people of the United States who have the need for these very important benefits. Those are the people we need to be supporting. In supporting them, we work through the States in our partnership. That is the opportunity we have. I hope if there are some who have a different, opposing point of view, they will come down to the floor and explain why they don't think we ought to support this Federal Medicaid assistance program on a temporary basis to permit the States to continue to support the kinds of programs that are important to the most vulnerable of our population. I hope they will come to the Chamber so we have the opportunity for a full debate and so, if there are opposing views, we will be able to respond to them rather than speak to an empty Chamber. That is not what this should be about. If there is to be spirited debate, I hope we will have that begin in the near future. I yield the floor.

Mr. NELSON of Nebraska. Madam President, I ask unanimous consent the order for the quorum call be rescinded.

Mr. NELSON of Nebraska. Madam President, the National Governors Association has written a letter, dated July 24--very current--to the minority and majority leaders of the Senate strongly urging support for the Rockefeller-Collins-Nelson-Smith compromise. I ask unanimous consent to print it in the Record.

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. Mr. President, I rise today to join my colleagues and good friends, Senator Collins and Senator Rockefeller, in discussing this issue, and to urge the support of our colleagues as we strengthen the partnership that exists between the States and the Federal Government as it relates to the Medicaid Program and social services. With the Presiding Officer having led the National Governors Association, and having served as a Governor with the Presiding Officer in the National Governors Association, I feel perhaps a little bit like I am preaching to the choir. On the other hand, I think it is important that we continue to point out the challenges facing the States today which will put in doubt the continuing relationship of providing the kinds of benefits necessary for Medicaid and for social services. There is, in fact, a partnership. It has been a partnership--a partnership where all the parties have responsibility and all the parties have an opportunity to help the most vulnerable among our society and our population. But as my colleagues have pointed out, States today are experiencing the necessity of making cuts in spending for important social services as well as for education and for a number of other programs. The current economic indicators suggest it could be years before revenue levels return to what they were in the late 1990s. It will continue, therefore, to be a herculean challenge for the States to maintain a semblance of the services they were able to provide only a few years ago. As is the case in any economic downturn, now is the time when people need the services most. Senator Collins and Senator Rockefeller have indicated the importance of this particular legislation to their home States. I ask for the opportunity and the courtesy to be able to do the same. In my home State of Nebraska, unemployment levels are at their highest mark in 15 years. For only the second time in history, Nebraska will collect less revenue this year than it did last year. When those two figures are put together, it should be abundantly clear that the budget is being pressed on both sides, and eventually something will break. In Nebraska, cuts have already been made to child care programs, rural development, and other essential services. A tax increase has been passed by the legislature. These measures might relieve the strain for today and tomorrow. But next year there will be more tough choices and even fewer options. Many of those options will likely involve cuts to Medicaid unless we act to provide fiscal relief. According to the National Governors Association, Medicaid spending has been a particular struggle for States since expenditures have risen an average of 12 percent over the past 2 years while State revenues rose to a total of 5 percent--where they even increased, let alone where they decreased. Medicaid spending has been driven by increases in health care costs generally. For example, Medicaid costs for prescription drugs have increased by 18 percent annually over the past 3 years. It has also been increased by the recession-related increases in the number of people who have become eligible for Medicaid due to the downturn in the economy. This continues to grow worse. As we look for a solution for Medicare and the prescription drug benefit that we want to see provided to our seniors and to those who have the need as part of the Medicare Program, we know what the increase in cost has done to the average citizen. This program has felt the same impact. To date, most States have been able to reduce Medicaid spending without cutting back eligibility significantly. Mr. President, 28 States have failed to budget enough funds for Medicaid this year, and nearly all States have implemented Medicaid cost-containment measures, such as reducing some benefits, increasing beneficiary cost-sharing, or cutting or delaying payment to providers. But as fiscal pressures continue to mount, many States are likely to consider substantial reductions in Medicaid eligibility that would leave hundreds of thousands more children, families, and seniors uninsured. Medicaid, as you know, is often the second largest share of State budgets after education, and States have already exhausted the traditional budget balancing tools, such as tapping reserve funds and using one-time measures, such as using tobacco settlement funds or forward-funding spending programs, as well as Medicaid spending cuts unrelated to eligibility. But the States need help. It is important that we help the States today because part of the partnership we have established with the States is welfare reform. To the extent they are now faced with making cuts that will reverse the success we have had in welfare reform, it would be a tremendous shame to sit by and not do what we can to help avoid that sort of result. As you know, Medicaid, as well as the eligibility requirements and transitional benefits in social services, have helped transition people from welfare to work. I think it would be a tremendous disservice if we saw the absence and the withdrawal of those programs reverse the trend, where people go from work back to welfare because they lose their child support care and other valuable programs that have helped in the transition. For the past several months, we have been working together, Senator Collins and I--and we have been so pleased to have been joined by Senator Rockefeller in bringing about this coalition--to craft a measure to help States through this period of fiscal crisis. During the journey to bring our measure to the floor, it has gone through some changes, but, more importantly, it has become even more of a consensus measure along the way. As Senator Collins indicated, it has the support of the National Governors Association, with the letter today supporting it. And these are members of all political parties, a tripartite group, where they are now supporting it and truly recognize how important it is we work as quickly as we can to provide this support to the States. The Rockefeller-Collins-Nelson amendment will provide $9 billion, as has been mentioned. It is a temporary measure that will provide enough help, over the next 18 months, to ensure that low-income families, children, seniors, and persons with disabilities most affected by the economic downturn will get the health care as well as the other services they need. It will also help to provide financial resources for various hospitals, clinics, nursing homes, doctors, and other providers that offer such services. It is clear this amendment is, by no means, perfect. But it is a consensus amendment, and it is a step in the right direction, on a temporary basis, to help the States through these difficult times and, moreover, to help the residents and the citizens of the States get through this. So I urge my colleagues to adopt this amendment and take this step to avert, at least in part, potentially damaging cuts to Medicaid, as well as to other social service programs. I hope, as the list of supporters is included in the Record, numerous senior groups and other groups interested in the outcome of the Medicaid Program and social services--that that list will show there is strong support, not only among the States but by those who are equally interested in the outcome for seniors and for others, and that that support will encourage and bring about the support of others of our colleagues, so this amendment can be adopted. It appears we are going to need the requisite 60 votes for this to be adopted. We hope people will support it. Mr. President, I yield the floor.

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. I thank my distinguished colleague from Michigan for exchanging positions for a moment so I have an opportunity to make a statement about the importance of having disaster relief in the soonest possible timeframe. Over the last several years in developing a farm policy, we have gone from virtually no help to a new farm program that is designed to help get agriculture on its feet, but it is designed to do that in a time when we would expect normal conditions. It is not designed to take care of disaster situations we are facing today for the livestock industry in particular. If we are not able to step forward at this time, take care of this situation, and provide hope for the livestock industry in our country, particularly those that are experiencing severe drought, as in the case of Nebraska and the Midwestern States, many of those farmers and ranchers are going to divest themselves of their herds. They are going to cut down the size of their herds. They are going to sell off their breeding stock to survive under these terrible conditions. They are not going to be able to rebuild those herds overnight. It will take years to rebuild. There is no coverage in the Crop Insurance Program for parched pastures that today will not sustain the grazing of our cattle. There is no support in the farm bill for those farmers and ranchers who are experiencing the losses on the livestock side. For those in this body who are looking for offsets, which is important in the Senate, they are looking for money. To go after the farm bill and the funding for building agriculture and take that money now to support the livestock industry is not the way to go. What we need to do is recognize that this is an emergency situation like other emergencies and it is a disaster that must, in fact, be addressed right now. Many of the people who voted for the last four or five disaster programs without requiring any kind of an offset are today saying: If we do it today, we have to find an offset. It is because today we have a farm bill, and they found the source of dollars. That is the only reason I think they are looking at that program. Robbing Peter to pay Paul at the present time will mean that both Peter and Paul will not make it. What we need to do is face this as a reality so that the farmers in Nebraska and the farmers all across our country, those who are selling their livestock, will know there is help on the way; that they can be sustained; that they are not going to have to sell off their herds. As we look at this downward spiral, the spinoff problems are consequential. In addition to having smaller herds, there will be less cattle to eat corn. In a bumper crop year, there will be more corn, and therefore that will depress the price of corn. This is not a situation without consequences to those outside interests. It will harm the smaller communities that depend on agricultural income for their very existence. We must, in fact, act now and not make this a partisan or political football to kick back and forth. We must, in fact, step forward now and recognize the urgency of this situation and not hold the farmers and ranchers of the livestock industry hostage while others are playing partisan politics. I thank the Senators from Minnesota and other colleagues who are looking forward to having an emergency aid package, recognizing this disaster at the soonest possible time. I yield the floor. I thank the Chair.

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. Mr. President, I rise to express my support for the accounting reform bill and the underlying goals of the legislation. I wholeheartedly endorse the principles expressed in this bill to root out corruption in our accounting industry. The need for this bill is enormous. The accounting scandals that have rocked this Nation over the past nine months have shaken Americans' faith in our free market system. We simply cannot allow this attack at the bedrock of our economic system to pass unanswered. Those who have propagated corporate greed, those who have engaged in unethical business practices, and those who have willingly and knowingly turned a blind eye must be punished. Moreover, we need to assure all Americans that they can and should have faith in American business. The loss of confidence caused by a lack of accountability has caused nearly as much damage as the economic impact of these surfacing scandals. The perpetrators of these scandals are certainly in the forefront of our minds as we have debated this legislation. But, in the end, this bill is not about those who have violated the trusts of their employees and shareholders. This bill is really about those employees and shareholders who have been violated, it's about average Americans who are now being penalized and disadvantaged because of the corporate greed of a privileged few. And it is about those honest accountants whose integrity and profession have been scarred by a few dishonest individuals. I need look no further than my home State of Nebraska to see the human aspect of these fraudulent accounting practices. Before it merged with Houston Natural Gas in 1985, InterNorth, the forerunner of Enron, was based in Omaha. In the year following the merger, the newly named Enron relocated to Houston, but it still had roots in Nebraska as well as thousands of InterNorth retirees. Those retirees and employees have seen their lives turned upside down by the accounting trickery perpetrated by those at the top. Many have seen their retirement accounts evaporate while others have lost their jobs. Not only has their trust been violated by the actions of Enron executives, they also have to witness the apparent disinterest of the accountants who were obliged to ensure honesty and integrity in bookkeeping. With the livelihoods and savings of tens of thousands on the line, a handful of accountants failed to do their duty. When I was governor of Nebraska, we had a period of upswing in the distribution of dangerous drugs. In response, we stiffened penalties in our omnibus crime legislation. The same principle applies here. When there is an upswing in criminal and unethical behavior, we have to get tough. Corporate greed is a scourge on Americans and those who are participating in it should be paying the price. This legislation will ensure they do pay a price commiserate with the pain they have inflicted upon the American people. I'd like to thank my colleague Senator Sarbanes for his tireless work on this bill. His efforts to crack down on unethical accounting practices are greatly appreciated. I urge all of my colleagues to join me in supporting this bill. Through this legislation, we can move away from the failures of the past, begin to restore investor confidence, help return to our strong economy and prove that a few bad seeds cannot bring down our great Nation.

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. Madam President, Nebraska is a state that has long been known for its great college football teams. However, with a second consecutive trip to the College World Series, the Nebraska Cornhuskers baseball team is on its way to establishing a tradition of excellence just as strong as their counterparts on the gridiron. While I am certain that my disappointment at the Huskers early exit from the tournament this year is shared by many of my fellow Nebraskans, we should remember that this team has given us many things of which to be proud. First, it seems as though the Huskers have set a record for record setting this year. Second baseman Will Bolt set or tied 7 career school records. Outfielder Daniel Bruce set a dubious record by being hit by a pitch 26 times this season and the team set a record with 95 Husker hitters plunked this season. Catcher Jed Morris set or tied 3 school records and became only the second Husker to be named the Big 12 Player of the Year. Seven players also received recognition for their academic accomplishments, applying the dedication they learned on the field to the classroom. Record numbers of fans came out to support the Huskers this year and season ticket sales soared 400 percent as the new Hawks Field at Haymarket Park in Lincoln opened. However, all of these achievements would not be possible without teamwork. The diverse Husker team, with players from 15 different states, worked together to produce an impressive 47-21 season. These accomplishments give us reason to be proud of our Huskers. And while the College World Series may not have turned out how we had wished, we can all look forward to next year and hope the Husker baseball team continues its winning ways.

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. Madam President, few childhood experiences span the generation gap as successfully as Kool-Aid. Many of today's business leaders started down the road to financial success by standing at a folding table in their front yard selling one-cent cups of refreshing Kool-Aid. While the business of Kool-Aid now spans front yards around the globe, I am pleased to say that the very first Kool-Aid entrepreneur was a Nebraskan. Edward Perkins had a curious young mind and at age 11 he began experimenting; transforming the back of his father's mercantile store in Hendley, NE, into a flavor factory. The early experience he gained would come in handy 27 years later in Hastings, NE, when Perkins created Kool-Aid. The delicious drink was a hit and quickly became a household name. The story of Kool-Aid is the perfect illustration of the value of perseverance. Perkins was dedicated to his business and worked hard as an innovator for many years before finally creating the drink that would make him famous, and Hastings, famous. Hastings celebrates Kool-Aid days with the world's largest Kool-Aid stand every August. They also show their Nebraskan hospitality by serving Kool-Aid at rest stops throughout Nebraska. There are currently 22 flavors of Kool-Aid and it is no wonder that the current best seller, Tropical Punch, has a Husker red color glow to it. For all these reasons and many more I am proud that Kool-Aid is the official State soft drink of Nebraska and wish it a very happy 75th birthday.

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. I thank the Senator from Connecticut, who has played such a key role in bringing this important bill to the floor. I also thank the Senator from Maine for raising the profile of this issue in the Senate. It is my understanding as well that the group life industry is experiencing difficulties in obtaining reinsurance. I understand, for example, that one group life insurer covered four corporate groups in the World Trade Center, with over $150 million in losses. All but $6 million was paid by reinsurance. Had that insurer not had reinsurance, its financial security would have been severely compromised. It is not unusual for group life insurance losses to be 96 percent covered by reinsurers. Now, however, the catastrophic reinsurance market has changed. For those companies that use reinsurance, I understand that premiums have skyrocketed with 10- to 13-fold increases and, in many instances, reinsurance may not be available at all. Much of the reinsurance that is being written excludes acts of terrorism and biological, nuclear and chemical claims. And, while reinsurers are either declining to pay for certain claims or simply not offering reinsurance for certain occurrences, the group life insurers are not allowed by their State insurance commissioners to have the same exclusions. And so I ask the distinguished ranking member of the Senate Banking Committee, does the bill that we are currently debating address the problems being faced by group life insurers?

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. I thank my colleague from Connecticut for putting together, with the assistance of a lot of folks, a bill that I think can help take off some of the pressure.

Mr. NELSON of Nebraska. Mr. President, what I am concerned about is if we adopt the current amendment to the underlying bill, while there is a temptation to try to control rates, it is absolutely antithetical to try to control rates at a time when we are not going to control the issuance of the coverage. We get the odd effect of not saying you must write it--and I hope we never get to the point of saying you must write this insurance, this line of coverage, that we never get to the point where that has to be required--but at the same time, if we say the rates are controlled, this market I do not think will continue to respond or have the opportunity to respond as if we passed the underlying bill without this amendment. I respect a great deal my colleague from Florida, my namesake, who has had similar experience to mine. But my experience has been different. That is, if we try to control the rates, if we try to create a quasi-Federal rate control structure for a very short period of time, or for a long period of time, we will not enhance the availability of insurance, we will get just the opposite result. Therefore, I hope as we look at this amendment today--and it pains me to take issue with my friend from Florida, but I must in fact say this--it will not enhance the availability of insurance, in my opinion and from my experience, but it will in fact deter the growth of the market. It will help reduce the availability of the coverage and not enhance it, as does the underlying bill as it is right now. Whereas it may be amended by other amendments, and I intend to offer one that in fact will enhance the availability of more terrorist coverage in the commercial lines in those areas that are currently being so adversely affected and impacted by the absence of this backstop, it is about jobs, it is about the economy, less so about insurance. Mr. President, I yield the remainder of my time to the distinguished Senator from Connecticut.

Mr. NELSON of Nebraska. I thank my colleague for a very able job, putting together a bill with the assistance of a lot of individuals who have had a lot of experience dealing with these issues. S. 2600 is a bill that I think can help bring some balance to the whole area that we today recognize as being imbalanced because of the events of September 11. The effects on our economy, our society, and our national psyche can never be overstated. They have adversely impacted the Nation's sense of security and stability, and our lives have been permanently changed in so many different ways that we could not have anticipated. One cannot overstate the effects upon the families who lost their loved ones or those affected in other ways by the actions of the small number of terrorists, terrorists sworn to the destruction of the American way of life and for all that we stand. There is not any way to return to the days before September 11, nor can we return the stability of our lives simply on the basis of economic decisions we make today. But I think we can begin the process of slowing down the impact, the adverse impact on our economy. Congress can now act to help stimulate the weak economy and further avoid the negative consequences with this Federal backup, this ``backstop'' for catastrophic losses resulting from acts of terrorism in the future. By enacting this legislation, I think we can in fact see a turnaround in our commercial real estate market, mortgage lenders, the construction industry, and other segments of our economy. This is a jobs bill, pure and simple, to make certain that our economy will in fact respond appropriately and positively rather than be adversely affected by the continuing lack of availability and a growing lack of availability of the property and casualty and workers' compensation coverages that are so important to the future of our economy. We must in fact respond to that. I have learned firsthand the necessity of insurance in the commercial world. As a former insurance regulator, as someone who has been involved in the insurance business, or the field of insurance regulation, virtually all of my working life, with the exception of my public service as Governor and here in the Senate, this is not so much about----

Mr. NELSON of Nebraska

Mr. NELSON of Nebraska. Madam President, this morning I would like to talk about a very important issue that is affecting the States and the budgets at the State level. While the national economy may be recovering from the recession, State budgets will take another 12 or 18 months to recover. Just last month, the National Governors Association and National Association of State Budget Officers found that over 40 States are facing an aggregate budget shortfall of $40 billion to $50 billion. In my home State of Nebraska, the latest numbers show the highest unemployment level in 15 years. Tax receipts this year will be less than the previous year for only the second time in the history of the State. The State is cutting child care, rural development, and other essential services. Raising taxes to build up the budget cap and cutting aid to local governments will result in higher property taxes. Many States face the same challenges as Nebraska. This is the appropriate time for some help to come from Washington. Part of the blame that can be assessed for States that are hurting can be laid at the feet of Congress. A few months ago, this body passed--and the President signed into law--a bill to stimulate the economy and help workers. It wasn't a perfect bill. But then there are very few. But the economy was hurting, and it was, in fact, time to act. But there were unintended consequences of that bill. Not only did the economic stimulus bill fail to provide State fiscal relief in certain areas, but by making some changes to Federal tax law, the bill unintentionally added to revenue shortfalls. This means that we, in effect, cut State tax revenue streams. This, in turn, has put at risk programs such as medical assistance to the most vulnerable individuals in this country. I am concerned about the crunch that the States are facing. As a former Governor, I know how hard it is to balance a State's budget. And every State has to balance its budget. The most important thing is that we recognize that this shortfall will continue, and it will affect the most vulnerable among us. This supplemental appropriations bill that is being considered--and other bills will be coming up in the area of appropriations--is an important opportunity to do something helpful. My good friend, Senator Susan Collins, from Maine, will be speaking shortly as well on the Collins-Nelson proposal that would provide a temporary 1-percent increase in the Federal Medicaid matching rate. In Washington, we require that the States deal with Medicaid and that they provide the services, and we offer some assistance. It is an underfunded Federal mandate. At the present time, if we increase the amount of State funding to a temporary 1-percent increase, we will assist the States in being able to deal with the challenges in their budgets. At the same time, this bill will also permit them to continue to provide in the short term for the rising demand in social services from the economic downturn. The bill would provide approximately $8.9 billion in total fiscal relief to the States, which would allow them to expand--not contract-- Medicaid and other health and social services. States have worked very hard in order to be able to help people go from welfare to work. It is very important for us to help them continue that because if they are unable to continue, and they pull back on the Medicaid funding and they are not able to provide the social services, you could very easily have States returning to the process of bringing people from the workplace back into welfare. That is counterproductive. It works in the opposite direction. That is why we, in fact, must move forward and assist the States at this very important time. The National Governors Association has embraced much of what we have proposed, and so have other organizations. And a number of cosponsors in our own body have stepped forward and said that this is the right thing to do, it is the right time to do it, and it is the right way to approach it. The health care of Americans is part of our responsibility and our interest. We must, in fact, help the States so we do not end up with the tough choices that the States are having to make, involving reducing Medicaid benefits to those among our most neediest in our midst. According to the National Governors Association, Medicaid spending has been a particular struggle for States since expenditures have risen by an average of 12 percent over the last 2 years, while the State's revenues rose a total of 5 percent, as in the State of Nebraska. It appears that the revenues are flat. Medicaid spending has been driven by high increases in health care costs nationwide, particularly the cost of prescription drugs, an issue that we are going to be facing to move forward to help our seniors deal with the high cost of prescription drugs as part of Medicare. These same pressures on the health care system and on our citizens are affecting the Medicaid population as well. States have exhausted the usual ways of balancing their budgets. And so, given the projection of continued deficits, this means that we must, in fact, step up to the plate at this time and help our States work through this partnership that we have with Medicaid, where the States have a matching obligation with the Federal Government, with our budget. I hope we will be able to do that. In closing, as a former Governor, I can say, having worked with this program, that it is an essential program. But it is a partnership with the Federal Government. Now is an opportunity for the Federal Government to do its share in assisting the States in dealing with this very important problem. I urge my colleagues to join with Senator Collins and myself in this effort to show the States that Congress is not indifferent to their budget problems, and we will step in and provide meaningful assistance at a time when Governors need it most. Madam President, I believe my time is about to expire, so I yield the floor.

Mr. NELSON of Nebraska. Madam President, I suggest the absence of a quorum.

Mr. NELSON of Nebraska. Madam President, the State of Nebraska's tax receipts, for the first time--maybe only the second time in history-- are below what they have been in the past. We have had downturns in the economy previously, and the tax revenues may have been down, but they would continue to be greater than the previous year. That is no longer the case. You actually do have a downturn in the economy--much of it related to the difficulties in agriculture. But when you see unemployment moving up to the highest level in 15 years, together with tax receipts going down, it doesn't take a mathematician to figure out what will, in fact, continue to happen in the future. When we require, at the Federal level, certain programs and do not provide all the funding, all we are really doing is underfunding a mandate to the States. Maybe it is an important mandate that we are requiring, but it is also important to not be inconsistent here, to try to further reform welfare with legislation that is going to be coming before this body in a short period of time and, at the same time, as we try to have a higher requirement for work, and what have you, to improve the income level of people going from welfare to the workforce. We have to make sure we are consistent and we don't require that on the one hand and not make it impossible when it comes to funding on the other hand. I thank my colleague from Maine for a very articulate and passionate expression of why it is important that we do this. I hope I have responded to her question.

Mr. NELSON of Nebraska. I have another question, if I might ask the Senator from Maine, who so very eloquently expressed the concerns and so diplomatically suggested that we need some help in finding the true mechanism to get this legislation through. What, in the Senator's opinion, might happen to the efforts we made collectively as partners with the States for welfare reform and getting people off the welfare rolls and into the workforce? What might happen to that?