Robert Packwood

Mr. PACKWOOD

Mr. PACKWOOD. I now ask that the Chair lay before the Senate the conference report to accompany H.R. 831, the self-employed health care deduction.

Mr. PACKWOOD. It is our intention to simply lay them aside. We will come back to them as soon as we are done with the conference report. We had suggested, although it has not been cleared I think on your side yet, a half an hour time limit on the conference report, 15 minutes equally divided, so that we would be back to it quite soon. Mr. WELLSTONE addressed the Chair.

Mr. PACKWOOD. That is correct.

Mr. PACKWOOD. I ask for the yeas and nays on the conference report.

Mr. PACKWOOD. I ask for the yeas and nays.

Mr. PACKWOOD. I think the Senate is very familiar with this bill. We have debated it thoroughly on the Senate floor. We have debated it in committee. The bill will allow self-employed individuals to deduct 25 percent of the cost of health insurance premiums this year and 30 percent starting next year. This bill makes the deduction permanent. We would like to raise the deduction even more. But this is the first time we have ever made it permanent. The reason this is so timely is people need to know this to prepare their tax returns. The deadline for filing 1994 tax returns is now only 2 weeks away. So I hope the Senate would not spend a lot of time on this bill. I think everyone understands the bill, and I would be prepared to vote on the conference report. Mr. KENNEDY addressed the Chair.

Mr. PACKWOOD. I would be happy to do that, Mr. President. What happened was this: We added this provision in the Senate Finance Committee without any hearings. From time to time, we pass things for which we do not know all the consequences. I do not think we know if this unfairly affects American citizens, or how it affect aliens or nonresidents that are living here. The House had on the floor a motion to instruct its conferees to not accept the expatriate tax provision. That instruction was accepted. So the House was proceeding as they were instructed. Chairman Archer and I agreed to have the Joint Tax Committee study the expatriate provision and report back to us by June 1. The Joint Tax Committee is instructed to study the does it adversely affect American citizens vis-a-vis aliens or illegal immigrants or legal immigrants. The report is due by June 1. After we review the report, any legislation that we consider will have an effective date of February 6 of this year. This is the same date as the amendment that was offered in the Finance Committee. Everyone is on notice--if and when the expatriate legislation becomes law, it will be effective February 6, 1995.

Mr. PACKWOOD. The Senator asks a very good question. At this point, we don't know who would be affected by the provision and who would not be. That is precisely the reason why it should not be considered today. The provision applies to citizens who renounce their citizenship. Maybe they have moved to another country for reasons that have nothing to do with tax avoidance purposes. They are subject to the tax. There is a possibility of double taxation. There is also the question of what happens to people who come to this country and never become citizens. They make a fortune here but they never become American citizens and they go back to their country of origin. Do they get a tax preferential treatment that an American citizen does not get? These are questions that ought to be answered and will be answered. If and when we pass a bill, that bill would be retroactive to February 6. But it would be unwise to act when we do not fully understand the consequences.

Mr. PACKWOOD. The revenue estimates have jumped around. The administration estimated its proposal would raise $2.2 billion. Joint Tax estimated it would only raise $1.7 billion. The proposal that was included in the Finance Committee bill was estimated to raise $1.359 billion. The $3.6 billion figure is a 10-year estimate of the Finance Committee proposal. We also asked Treasury how many people would be affected by the administration's proposal. They said, ``Well, between a dozen and two dozen.'' Now, Treasury is not sure about this number. This is the problem. We do not know who they are. We do not know if they are American citizens. We do not know if they are illegal immigrants or legal immigrants. We do not know if they are leaving for the purpose of marriage or other legitimate reasons or leaving not to pay taxes. I admit, I think we adopted this in haste, with no hearings, not fully understanding the consequences of the provision. I apologize for us having done it in this way.

Mr. PACKWOOD. Parliamentary inquiry, Mr. President. On this conference report, is this in order?

Mr. PACKWOOD. I object. Mr. KENNEDY and Mr. MOYNIHAN addressed the Chair.

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

Mr. PACKWOOD. I object.

Mr. PACKWOOD. Mr. President, my good friend from New York, I think he has yielded the floor, but I would like to congratulate him on what he said. And then recall--it is funny how time revolves--20 years ago on this Senate floor we were excoriating the Soviet Union for taxing their citizens who wanted to leave as a violation of the most fundamental human liberty. And they were practically confiscating the income of their people, mainly Jews, who wanted to leave because of repression. And we said that was terrible. We already have on the books now--it is existing law--a provision that says if an American citizen renounces his or her citizenship and leaves the country to avoid taxes, we can tax them for 10 years. That is the law now. What we did not know, I apologize to the Senate, when we acted in haste--I have made these mistakes before and I will probably make them again--when we acted in haste we probably did not understand the full consequences, or maybe just two or three. If a person comes to this country from Italy, from Poland, from Germany, from Hong Kong, and becomes a legal immigrant, works and is prosperous, and reaches a certain age and the tug of the old home country is strong and that person goes back home, since he or she has never become a U.S. citizen this bill does not touch that person. Those people are free to leave with all their millions or billions or whatever they have because they have never become U.S. citizens. Now you take exactly the same type of person who leaves Poland or Germany, comes here, becomes a citizen, and the tug of the old home country when they reach close to retirement is such that they leave-- they are taxed. We did not grasp that when we passed this. We did not know it. We did not know there was a statute on the books, when we passed this, that you are taxed for 10 years if you leave for tax reasons. What do you do about the thousands of Cubans, Cuba Libres who came here in the exodus of the 1960's to become American citizens, good citizens, in many cases prosperous citizens? And one day I think many of them would hope to return to a free Cuba. It is an understandable tug. They are now American citizens. They are not leaving to avoid taxes, they are leaving to go home. This bill would tax them. I do not think we intended that. We did not realize it. So all we are asking--I find it amazing this bill is being attacked and this provision is being attacked by the very same thing 20 years ago. We made a mistake. There is no harm in admitting that. Unfortunately, God has not endowed any of us with perfection, despite what some of us may think. And we need to review it and look at it and see where the errors are. I say again, for those people who now leave the country to avoid taxes, we can tax them for 10 years. So I am disappointed that the self-employed this weekend, when they are now meeting with their accountants--let us face it, most people do their taxes a week or two prior to April 15. I see one of my young staffers nodding who used to be a practicing tax lawyer. He said yes, this is the 2 weeks. They are not going to know what we are going to do. That is unfortunate, because now we will not get to vote cloture on this until Monday. I hope we would pass this Monday night--but I guess there is nothing else we can do. I yield the floor.

Mr. PACKWOOD

Mr. PACKWOOD. Mr. President, I want to take this opportunity today to speak in support of the Gorton emergency salvage amendment and in opposition to the substitute amendment proposed by the junior Senator from Washington. We have heard a lot of talk today about how these are the people's forests. These forests are a national treasure. We must maintain these forests for our future generations.We must not be allowed to destroy them. Mr. President, I could not agree more. But by maintaining the status quo--and by that I mean the continued lack of any management activity--we are doing just that. We are now destroying our forests as we sit idly by and do nothing. I do not believe the average citizen would approve of the state of deterioration of our forests. For example, the eastside forests of Oregon and Washington alone have lost 135,000 acres of forest to insects or disease. Another 543,000 acres are imperiled by insects and disease if not treated aggressively. These are Forest Service figures. And these figures do not include the threat of loss due to wildfire, which is an ever-increasing reality. Mr. President, in the first 3 months of 1995, four more Oregon mills have closed and two more have given their 60-day notice to employees. These are mills that rely on timber from Federal lands, and without that supply, they just can't make it. I could quote statistic after statistic about how many people are directly and indirectly affected by these closures. But these people are more than statistics. They are real people. They have families to feed and clothe. Kids to send to college. Car payments. House payments. Braces and medical bills. They are people like you and me who are being displaced from good jobs for no good or rational reason. In many cases the mill is the backbone of the community--if the mill closes, the entire town is affected. In many cases the Federal forest land that once provided raw material for these mills is literally within walking distance of the mill. These people have personally watched these forests get sick and die because of misguided Federal policy. They have urged Federal land management agencies, in vain, to do something about the deteriorating conditions. These are people who have fought the rampaging forest fires that creep ever closer to their homes and towns. These are frustrated people who don't understand why their government will not let them salvage dead and dying timber to keep their mills and the forests alive. And I share their frustration. The forest health problem in Oregon has reached a crisis state. There are hundreds of thousands of acres of dead and dying trees, surrounded by huge fuel loads on the forest floor, just waiting to be ignited. Congress can no longer stand idly by, fiddling while our forests burn. We are one errant match--or one random lightning strike--away from a catastrophic conflagration that would blacken hillsides in parts of my State for as far as the eye can see. We can remove this dead material, provide some small measure of hope to our timber families, and start returning or forests to their green and healthy state. Too many family-wage jobs have been clearcut and replanted with minimum-wage jobs. The time has come for an aggressive salvage program that will give our forests--and our people--hope. I believe the people of this country want vital, healthy forests. I strongly urge a vote to table this amendment. amendment no. 429

Mr. PACKWOOD

Mr. PACKWOOD. Mr. President, I ask unanimous consent that the Subcommittee on the Constitution, Federalism, and Property Rights of the Senate Committee on the Judiciary, be authorized to meet during a session of the Senate on Friday, March 24, 1995, at 9 a.m., in Senate Dirksen Room 226, on ``The 10th Amendment and the Conference of the States.''

Mr. PACKWOOD

Mr. PACKWOOD. Mr. President, I want to respond to my good friend from Maine. He and I have probably been on the same side of more issues than any other person in this Chamber. He mentioned Bob Johnson, the founder of Black Entertainment Television. Well, I met him. Despite the fact that he was a Princeton man and as qualified as anybody, his problem was access to capital. I do not know what I would have done as a banker 20 years ago if somebody came to me and said, listen, I have this idea for an all black entertainment channel. I do not know. It is interesting how he got the money. He could not get it from the banks. He went to John Malone of TCI. I think Malone is maybe one of the finest entrepreneurs in this country. Bob Johnson explained what he wanted to do. John Malone said, ``How much do you need?'' Bob said, ``$500,000.'' Malone said--and I thought this is where Bob Johnson was so humorous. He said, ``All right, I will put up $125,000, but I want 20 percent of your stock. I will loan you $375,000.'' Malone did not know that Johnson would have given him 80 percent of the stock. He got the $500,000 and he said to John Malone, ``I have not really been in a business. Do you have any advice? Malone said, ``Keep your expenses below your income.'' From that grew Black Entertainment Television. There is an interesting difference. Cable is more like the ethnic newspapers. Cable is narrowcasting. This is where a smart entrepreneur can say, I can make money on 5 or 6 percent of the audience, not 60 percent. As you skim through the channels now, whether it is education, discovery, or history, I doubt if any of them have 50 percent of the audience, but they have 5, 10, 20 percent. There is money to be made. The Senator put his finger, I think, on the most interesting issue here. No question, in my judgment, there is no discrimination in the sale of the broadcast property. If you have a radio station and you want to retire, you are going to sell to the highest bidder. One owner said, ``Even if you have blue skin and an eye in the center of your forehead, you will get it.'' The potential is limited to those who have the money to buy. Minorities, and maybe women to a lesser extent, did not have access. So now the question becomes this, and I do not know the answer. Because minorities have been discriminated against for centuries, and because women could never rise above--you remember the settlement with AT&T 15 years ago. There was a glass ceiling. You could be a Ph.D and be first in your class in all the schools, and there is a level beyond which you were not going to go. Because of the past discrimination and because of the past access to capital--the lack of it--we set up a preference program in an area where there has been proven discrimination, simply to say we want 5 percent women or 10 percent women to own, and we want 10 percent Asians and 5 percent this and 5 percent that. You just do it. I am not sure I know the answer. But clearly, that is the discussion we are going to have.

Mr. PACKWOOD. Mr. President, I yield such time as the Senator from Delaware may need.

Mr. PACKWOOD. Mr. President, I suggest the absence of a quorum. I ask that the time be charged equally.

Mr. PACKWOOD. I thank the Chair. Mr. President, ``Amici attenti.'' These are the opening words in the play ``Fiorello'' when Fiorello LaGuardia is first campaigning for Congress in 1916. The set--and I saw it first in New York--is a wonderful set. As he is campaigning, to give the sense of ethnic campaigning, he has a little box and they put it on the left of the stage. He stands up, and as he is speaking to Italian immigrants, he says, ``Amici attenti, Trieste must be free as we must be free.'' Trieste was then a port disputed between what is now Italy and what we used to call Yugoslavia. It was then part of the Austro-Hungarian Empire. Italy, of course, was allied on our side during World War I, and the Austro-Hungarian Empire was against us. And one of the big issues in American politics where there was ethnic campaigning--people of Italian ancestry--was the issue of Trieste. Many of us today would understand it in a different venue--Cyprus, those of Greek and Turkish ancestry; Jerusalem, those of Jewish and Moslem faith. The issues may change, but not the methods. It was interesting to watch ``Fiorello'' in New York because at the end of his little pitch to those of Italian ancestry, the box is simply moved to the other side of the stage, and he stands up and he is speaking to those of Jewish background in Yiddish, with whatever may have been at the time in 1916 appropriate for an appeal to that group. As I went to law school at New York University, that was all I needed, or anybody familiar with New York needed, to give the impression of ethnic campaigning. I saw the play produced at an Oregon high school some years later, and it was interesting the way the scene was done. They did the ``amici attenti,'' moved the box on the other side, and spoke in Yiddish. Then they moved it back, and there is the same type of interlude in Swedish. They moved it back again on the other side, and it was in Scottish. Afterward, I talked to the high school producer and asked him did he know he had added this. He said, yes, he had seen ``Fiorello.'' I asked, ``Why did you add it?'' He said, ``Because the students here are familiar with the Johnsons and the Eriksons and the MacGivers, but not the Giadellis, Bergers, or Cohens. And so, for this audience to give the impression of what ethnic campaigning was like, it had to be put in a form understandable to that audience. I thought to myself, we are all products of our environment and where we grew up. And we may see things in a different light and often at a different time. You may remember the difficulty that Ed Muskie had in 1972 when he used, or was alleged to have used, the word ``Canuck,'' a term of derogation, a term not to be used, and it hurt him in the campaign. Yet, you can go back not more than 60, 70 years to the musical ``Naughty Marietta'' and the captain, Captain Dick. Captain Dick's infantry was almost a free-booter in terms of this little private army, and in the Victor Herbert musical, ``Naughty Marietta,'' you recall the lines: Tramp, tramp, tramp now clear the roadway. Room, room, room the world is free. We are Planters and Canucks. Virginians and Kaintucks. Captain Dick's own infantry. There it was used as a term of geography, perhaps, but really used as a term for rural Americans. It does not matter if we are Canucks of French Canadian background or planters or Kaintucks. The times had changed and times do change. I remember well January or February 1942. My father was a lobbyist for the principal Oregon business group, now called Associated Oregon Industries, and then called Columbia Empire Industries. He used to go to the legislature. He was a house counsel for them, not outside. He attempted to explain to me in 1942 an incident that I could not grasp at the time. I grew up practically every day after school at the neighborhood YMCA--swimming, tumbling, basketball--and it was, indeed, a neighborhood youth center, and we had a number of boys, members of Japanese ancestry. One day they disappeared. Gone. My father attempted to explain the relocation. He attempted to explain these were American citizens--he was also a member of the American Civil Liberties Union, even though he was a business lobbyist--and the unfairness in what he thought was clearly an unconstitutional act, and surely the Supreme Court would strike it down. I remember him calling to my attention that we were not going to imprison any Americans whose names were Shultz or Heindrich of German ancestry, even though at the time German submarines were sinking ships 5 and 10 miles off our coast. It was a difference in the way we looked at ethnic backgrounds.

Mr. PACKWOOD. Exactly. We did not imprison any Giadellis or any DeAngelos; only those of Japanese ancestry. So as we look at things, our whole growing up and our whole background influence us. women and employment. I can understand the report. It is hard for me to grasp, in terms of my own employment practices. The women in my office are my chief of staff, my press secretary, my legislative director, my staff director, and chief counsel on the Finance Committee. All of the principal positions of leadership in my offices are held by women. All of my campaigns have been managed by women for the last four campaigns. On average, although we did this study 8 or 9 months ago, women made, on average, $10,000 more a year than men in the office. I once had a man--I do not know if he was facetious or not--who talked to me about affirmative action and the feeling that somehow men were not treated quite as equally. In my office, if I had to have a quota system, I would have to fire two or three women and probably lower the salaries of many others in order to reach some kind of equality. So, again, we are all products of our background. We all see things as we saw them when we grew up, and often people who grow up in a different era, or are treated differently, come at things in a different way. I think rather than being harsh with each other and judgmental, we are often better to be kind. One of the nicest eulogies I think I ever read was by Winston Churchill when Neville Chamberlain died. He died in about 1942. Chamberlain had been the Prime Minister of Great Britain. He had been really the head of the pacifists and had negotiated with Hitler for peace for our time. He had been proven utterly wrong, and had to resign almost in disgrace at the start of the war. Churchill, all during the thirties and during the ascendancy of Neville Chamberlain, said, ``Watch out for that man. This Hitler is evil. We are going to go to war. The pacifists are wrong. We should be arming, not disarming.'' Everything Chamberlain did, Churchill disagreed with, and Churchill was right. Churchill's wonderful eulogy is as follows: At the lychgate, we may all pass our own conduct and our own judgments under a searching review. It is not given to human beings happily for them for otherwise life would be intolerable, to foresee or to predict to any large extent the unfolding course of events. In one phase, men seem to have been right, in another, they seem to have been wrong. Then again, a few years later, when the prospective of time has lengthened, all stands in a different setting. There is a new proportion. There is another scale of values. History with its flickering lamp stumbles along the trail of the past, trying to reconstruct its scenes, to revive its echoes, and kindle with pale gleams the passion of former days. He goes on for another three or four paragraphs in his book and he concludes that, ``We do honor to one.'' Churchill would have had every right if he had wanted to say this man was wrong, but he did not. Now, Mr. President, with that background, let me come to this bill. The issue of this bill, de facto, is whether or not we are going to fund, for those who are self-employed, enough money so that they can deduct 25 percent in the first year and 30 percent thereafter of the cost of their health insurance premiums. There is no debate about that subject. There is barely any debate about the funding levels. We would all like it to be higher, but there is no debate about what we have done. And in the discussion of this bill, I think relatively little controversy, if any, would be generated about the purpose of the bill. But the bill became a flash point when it passed the House and part of the financing--we have continued it in the Senate--was the elimination of what are known as minority and women certificates at the Federal Communications Commission, whereby certificates of preference, in essence, are given to sellers or others of broadcast properties if they will sell them to minorities or to women. This brings us, really, to the issue--and it is interesting that in the Washington Post this morning there is a long story and in USA Today is the longest story I have ever seen for USA Today--four pages--on the issue of affirmative action. I thought it ironic that on the day we start this debate, those stories would be in two principal newspapers. It is doubly ironic that we start this debate on a bill that comes from the Finance Committee. We have jurisdiction of many things on this committee, but never in my wildest imagination would I have thought the first debate on one of the major issues to face this country would come out of this committee. But so be it. Like generals, you cannot choose where you want to fight. You fight where you have to. Let me discuss what the issues involved are and what we face, because I think in this bill and in this issue, whether or not we want to have preferences is really oblique. But what will come after this may be set by the tenor of the debate today. Take a look at the history of civil rights enforcement, and it really falls into three categories: individual discrimination, individual remedy, and then past discrimination, where the remedy was a group entitlement rather than just an individual remedy. The last is a situation is where you have no discrimination shown in the past at all, but you have group entitlements because you want to change the ratios of employment, or admittance to colleges, or whatever, but no showing of past discrimination. Those three--the first is individual discrimination and individual right; the second is past discrimination and group right, even though everybody in the group may not have been discriminated against. And the last is, where there is no evidence of discrimination. Take the first, individual discrimination. Suzy Goldberg is Jewish, and Suzy wants to buy a house in a housing development. The developers have a covenant that they cannot sell to Jews. Suzy sues and wins and gets the house, and Suzy gets damages. An individual wrong and an individual remedy. And that was what we thought we meant, I think, by civil rights and civil rights enforcement, that all people were to be judged on their individual merits and treated individually. Then we moved to a second phase. I remember this era because I was here. To digress for a moment, it is interesting, when we were debating the budget the other day, I mentioned a 1972 bill in which we were voting whether or not to give to President Nixon the power to cut the budget when it exceeded $250 billion. One of the younger staff members, one of our permanent staff members, came up and said to me, ``Senator, that was very interesting, but if we had term limits, would anybody know about that except some historian? I thought her point was well taken, perhaps because I am going to go back now in history. I am not sure, if we had term limits, that anybody would know. Anyway, we went through this first phase of individual remedies for individual discrimination--and Hubert Humphrey's wonderful comment is cited over and over on the 1964 Civil Rights Act. He said: I will start eating the pages, one after another, if there is any language which provides that an employer will have to hire on the basis of percentage or quota related to color. He was thinking individual remedy for individual discrimination. But the difficulty came when you started getting into a situation where you had businesses that simply had a history of discrimination. Women would not rise above a certain position. No blacks would be hired. And you had this 30, 40, or 50 years of discrimination. What do you do? How does one individual remedy solve an almost aggregated problem? So the Johnson administration--and my good friend, Senator Moynihan, the ranking member of the Finance Committee, is well familiar with this era. He was in the Kennedy administration in the Department of Labor and certainly is familiar with everything that went on as we got to the Office of Federal Contract Compliance and the effort to get employers and those who contract with the Government to do better at hiring minorities and women. But the administration, I think, correctly was afraid to actually set quotas. They did not want to use the word ``quotas.'' Therefore, business, on the other hand, was not quite sure what goal they were to hit. Ironically, it fell to a Republican administration to really address this--there had been a couple of court decisions, but the first set out a remedy that went way beyond any remedy to rectify discrimination to an individual person. It was called been here long enough to remember this, I am not sure if we had term limits, if anyone would know this. The Under Secretary of Labor was Larry Silberman. He was the author of the Philadelphia plan. He is now on the court of appeals. I knew him well. I was on the Labor and Public Welfare Committee and dealt with him then. More importantly, I got to know his wife, and she was my press secretary for several years in the 1970's. So it is a longstanding association. Larry Silberman, now Judge Silberman, was the author of the Philadelphia plan. In Philadelphia, in the building trades, they had a history of discrimination. Initially, we thought against blacks, but I recall, 20 years ago, Larry saying it was not against blacks, it was against anybody not related to somebody already in the trades. You hired your cousin or your uncle's nephew, or somebody like that. It was a closed show. But it was totally closed to blacks. So the administration came up with the Philadelphia plan. Larry Silberman, Under Secretary of Labor, now Judge Silberman on the court of appeals, was simply decreeing that, henceforth, the building trades would have to hire a certain number of minorities, and there had to be a timetable and a goal to be reached. And the problem was--and Larry Silberman said, in retrospect, and he set this forth in a wonderful Wall Street Journal article in 1977--he said that inevitably the goals and the timetables became quotas. How could you know if somebody was meeting the goal without counting? And the counting became quotas. And, finally, the employers, out of frustration and fear, started setting quotas. If there were 20 percent blacks in the area, you try to hire 20 percent blacks, if you can. I might quote one paragraph from that Wall Street Journal article that Larry Silberman wrote in 1977: I now realize that the distinction we saw between goals and timetables on the one hand, and unconstitutional quotas on the other, was not valid. Our use of numerical standards in pursuit of equal opportunity has led ineluctably to the very quotas, guaranteeing equal results, that we initially wished to avoid. So now we have gone from an individual remedy, for an individual act of discrimination, to a group entitlement and having to hire a certain percentage of minorities, even though many in the minority may have never suffered any individual discrimination in hiring. They never applied and had never been turned down. As Larry Silberman said, once the Philadelphia plan was adopted, we began to apply it nationwide like Johnny Appleseed, scattering it every place, and even starting to apply it where there was no evidence of discrimination. Just assuming that after 200 years there had been discrimination and therefore, Mr. or Ms. Employer, if you want to contract with the Federal Government, you better have so many percentages of different minorities. That brings us to the issue at hand. It is the issue of the Federal Communications Commission and the issuance of tax certificates. We are principally talking about sellers of broadcast properties receiving a tax credit when they sell to a minority. And the sellers are the ones that make, initially, the great profit. Here is an example: Let us say you bought a radio station for $1 million 10 years ago and you want to sell it now. It is now worth maybe $5 million. The FCC says if a person sells it to a minority, they need pay no taxes on the profits if, within 2 years, they reinvest them in a similar property. No capital gains, no nothing. So they have a $1 million station, they sell to a white person for $5 million, they have to pay taxes on $4 million. Sell to a minority, they have $4 million profit, and roll it into a similar profit and they pay no taxes. What brought this issue to a head was the so-called Viacom deal, and this was a big deal. This was a sale of about $2.4 billion and a deferral of taxes, $400 to $600 million of taxes. That is what caused this issue to come to a head. Here is the problem with the FCC tax certificate program. First, there is no history of discrimination in the sale of broadcast properties. If a person wants to sell their radio station, they will sell it to the highest bidder. One fellow said, ``I don't care if they have blue skin and an eye in the center of their forehead. If they have the most money, they get to buy the station.'' There is utterly no history of discrimination in the sale of properties. Yet the FCC wanted to ensure that minorities could get properties, and they had to hinge it on something, as they had no history of discrimination in the sale of these properties. So they came up with the idea of diversity broadcasting. It is not a new idea; it is a policy they have followed for years. But normally we would have thought of it as economic concentration. A person was not allowed to own two radio stations in the same town. They came up with a policy that said, ``You have to sell one.'' Involuntary conversion. You sold it, you got the tax certificate because the Government made you sell it. Pretty soon they said a person could not have a newspaper and television station in the same town, and they required the divesting of the involuntary diversions, and the tax certificates were used because they changed policy. It was almost as if they were thinking they did not want William Randolph Hearst to own the television station, radio station, and newspaper--almost an economic antitrust. The argument is people wanted diversity. In 1978, the FCC, Federal Communication Commission, started the policy of diversity; you sell to minorities and you want diverse voices owning television and radio so you could get a different kind of editorial opinion and a different kind of news. Here is where the interesting linchpin comes. It is a difference of opinion as to how one reads the studies. I have now read all the studies. I think I mistakenly had not read enough when it went through the Finance Committee. I thought initially that the studies proved that minority-owned radio stations and television stations programmed differently. I have now, I think, read all of the studies that were relied upon, and I will cite a few. One was done by Marilyn Fife in 1984, an associate professor at Michigan State University. It was a relatively modest study, of two local television stations in Detroit. One was owned by a minority and one not, and her conclusions were as follows: There was no significant difference between the stations as to news and coverage of international politics or issues. No significant difference existed regarding coverage of community events and human interest stories. No significant difference existed as to coverage of crime, accidents and fire. And there was no significant difference in the amount of time devoted to racially significant stories. In sum, she could find in that study no evidence that minorities programmed to minorities. She did another study in 1986. This time she studied four television stations, one in Corpus Christi which was owned by Hispanics; another one in Detroit--the minority owned station she had studied previously; one in Jackson, MS, that was black-owned; and a station in Bangor, ME, that was 100 percent black-owned, principally by 35 black professionals who were mostly from Chicago. What she discovered was interesting. In Corpus Christi, which is 48 percent Hispanic, this station owned by Hispanics attempted to broadcast marginally to Hispanics but they had difficulty getting advertising revenue, and they did the best they could. But she also discovered that there were other stations in Corpus Christi. These are radio stations owned by whites that were broadcasting to Hispanics--48 percent of the market. We can understand why. The Detroit study was no different than she had seen 2 years before. The two stations--one black-owned, one not--still broadcast similarly. In Jackson, MS, about 40 percent of the population is black. But the black owned-station did not program any differently than the other stations programmed. All of the stations were aware that there was a 40 percent black audience; it did not matter if they were owned by minorities or not. Then in Bangor, ME--the interesting one--Bangor has only about .2 percent black population. And although the station studied was totally owned by blacks, they said it was first and foremost a profit-oriented entity. The goal of the news management was to have It is understandable. Then we have the Trotter study in Boston in 1987. This study compared the types of news coverage by five newspapers and then three television stations and two radio stations, one white-owned and one black-owned. They discovered among the newspapers, initially, a tremendous diversity in the way the news was covered depending upon whether you were black-owned or not. But then look at the papers that were being studied. The Boston Globe and the Boston Herald were immense big dailies, not black-owned. The three black-owned papers were the Bay State Banner and the Boston Greater News, both published weekly; and the Roxbury Community News, published monthly. They, in essence, were ``narrow casting'' as can be done in the print. We still find all kinds of foreign language newspapers in this country, printed in this country, for a narrow population. Those three black-owned papers in Boston, two weeklies and a monthly, were programmed to some extent to a black audience. But we can do that in print; a person can do that. Say, if I have 5, 10 percent or 15 percent interest in this, I can make a little profit on it. But the two big papers, the Boston Globe and the Boston Herald that were in essence printing broadly for everybody, printed for the broad audience. Then regarding the radio stations studied in Boston--one white-owned and one black-owned--again what the Trotter study concluded was interesting. We should think of it in the context of our use of the words ``narrow'' and ``broad.'' What do we call the function of radio and television stations? We call it broadcasting. It is almost impossible to limit your signal to a particular segment--to broadcast it to a particular segment of the population. A person might get a particular segment to listen --broadcast country and western, or soul, or all news. Whoever likes that will listen. No way can a person shut out everybody else who might want to listen. What the Trotter study discovered on the broadcast properties was that they all broadcast ``broad'' whether they were owned by whites or owned by minorities. They all regarded themselves as part of the overall community. No significant difference. Then we get to the CRS study, the Congressional Research Service study, which admitted in itself it had some shortcomings. It was done in 1986, but it was done by sending out a questionnaire. It had, basically, sort of multiple choice and then check boxes as to what kind of programs are done, no personal interviews. All the stations did not respond, but it was a broad study. There is a question as to whether it was deep or not--it is hard to tell. From this study came the principal reliance of the courts, or the principal criticism by the courts, of the FCC's policy, because it finally came to the courts. And, in the Metro Broadcasting case, the Supreme Court, in a 5-to-4 decision--although it is interesting that 4 of the 5 in the majority are now gone and have been replaced by the other 4 that have been appointed since 1990--it relied upon, basically, the CRS study and said there is evidence that a minority-owned station programs more likely to a minority audience than would a nonminority-owned station. But in a blistering dissent when the same case was in a lower court, Judge Williams said as follows: Hispanic targeting is obviously more likely to be profitable in Miami than in Minneapolis. Thus, if specific minorities are more likely to own stations in areas where they are numerous (which seems likely), the difference in ``targeting'' that the Report hesitantly attributes to the owners' racial characteristics may be due simply to their rational responses to demand. This was the difficulty with the study. How do you tell if a station--if it is in a city that has a 30- or 40- or 50-percent Hispanic listening audience or a 25- or 35- or 40-percent black audience and is owned by a minority--programs a certain way because it is owned by a minority or programs that way because that is the audience there is to listen to it? And that is what the minority, both at the lower court and then 5 to 4, with Sandra Day O'Connor writing the dissent in the Supreme Court--that was the difficulty they found. And she says, ``First,'' in the dissent, ``the market shapes the programming to a tremendous extent. Second, station owners have only limited control over the content of programming. Third, the FCC had absolutely no factual basis for the nexus when it adopted the policies and has since established none to support its existence.'' In essence, she said there is no evidence to conclude that because minorities own a station they broadcast to minorities. Now, however you look at these two or three reports, where you could read them one way or the other, there are two glaring problems with them. One, the CRS, the biggest study, did not include television in its analysis. So you have no evidence. They just did not cover any television stations. And, while they included women, the report basically concludes that women-owned stations do not program specifically to women. So if your hope in giving a minority certificate to a seller who sells to women is to get whatever women's programming might be--whatever that is--you do not get it. It is no different than any other station that is owned by a man. So, in these multiple studies, you have this situation: Some arguable evidence--some--that a minority-owned station might program to minorities. But to me, the overwhelming evidence is that it depends upon the market that you are in, rather than the ownership. Second, as to women, there is no evidence that they program to women at all. In fact, again, I started this speech talking earlier about my experiences. In Oregon--I do not know if this is true in many other States--our second biggest market is Eugene, OR. I know what its population is. I do not know what the thrust or radius of the broadcasting market is, but I would guess 300,000; and Medford, OR, I guess would be our third biggest market, and I guess it would be 200,000. Each of the towns have the three network affiliates. In each of the towns, two of the network affiliates are owned by women. Ironically, in each of the towns, the affiliates are owned--I mean in Medford and Eugene--each of the affiliates are owned by the same woman. So in Eugene, OR, you have Carolyn Chambers owning a television station, going head to head with Patsy Smullin, who owns a television station. And in Medford, OR, the same two women own two stations, going head to head in competition. I defy you to go to Eugene, OR, and watch any of the stations and try to figure out from looking at what is on it whether it is owned by a man or a woman. You cannot. I understand why. These are two canny women. They are successful businesswomen. They understand their markets. So now you ask yourself--and this is where we are coming, now, down to the third issue. Remember, I said there are three types of remedies in the history of civil rights litigation. One is remedies for individual discrimination. Suzy Goldberg cannot buy the house. She is discriminated against. She sues, she wins, she gets the house and damages. That is one. Two, you have remedies based on a history of discrimination. Let us say it is in employment. A business has not hired blacks, or trade unions have not let minorities in for years, and you sue and your remedy is a class entitlement in which you say: We are going to require the business to hire so many women or promote so many women; or we are going to require the trade union to let in so many minorities until they reach a certain quota and we are going to give this preferential hiring right to any number of people in the class that has been discriminated against even though they individually have not been discriminated against, but you have a history of discrimination. And then the third type of remedy is in a situation where you have no history of discrimination. This is where the difficulty comes in Federal programs, and it is an interesting distinction that the Court makes. When the Court is reviewing discrimination on the part of State or local governments, or businesses or trade unions, there must be evidence of past discrimination before there can be a remedy of any kind. But if the Federal Government is imposing some kind of hiring preference or admittance preference or whatever, the Court does not require any showing of discrimination. They they are administrative or congressional fiat or findings; they do not require any finding of past discrimination. That brings you to the situation where we are now with the Federal Communications Commission, where you have no history of showing of past discrimination in the sale of broadcasting properties, and where at best the only justification for the minority tax certificates is the argument that minorities or women program differently, and you get diversity. As I say, the evidence on this is mixed. Is that a sufficient justification for setting aside part of the television and radio spectrum for women and minorities? Without getting into the argument as to whether it is or it is not, the question you ask yourself is: Do we want a Government policy that says we are going to attempt to help minorities or to help women where there is no evidence of discrimination? And in order to help them, we will give them a preference and, of necessity, as there is a limited amount of these properties, the preference will have to exclude somebody else who could have otherwise bought the station or might have otherwise bought the station. I want to tell you what I think is the danger of this policy. It is not so much a danger as to whether or not we want to have a policy of giving preference where there is no discrimination. What bothers me is that the Federal Government is first defining minority and deciding what voices it wants to hear in broadcasting. I will tell you one group that is not included that I would think would have a legitimate complaint. It is Americans of Arab ancestry. They do not count as a minority. They are Caucasian, so they do not count. I would wager that the average American watching television news today thinks of anybody of Arab ancestry as a terrorist--they are going to blow up the plane, blow up the World Trade Center, or assassinate our diplomats. It is totally unfair to the millions of Americans of Arab ancestry who are hard-working, decent Americans, who send their kids to school--but they do not count as a minority. They cannot get any tax preference for the purchase of a radio station or television station because the Federal Government has made its decision as to which voices will be allowed. And when any government has the right to make that decision, that is a danger to be frightened of. Most of us in the Senate can still remember the attacks that came before, during, and after Nazi Germany about the Jewish-owned press. The New York Times was singled out by the Fascists as supported by the Government. They were not, but it was the allegation: supported by the Government. It was a front for Franklin Roosevelt. That is the kind of fear I have, a fear of the consequences when governments begin to determine who is going to have the right to be the voice of the people. You think back in history. Again I come back to what in my mind amounts to discrimination against Americans of Arab ancestry. It is particularly ironic if you think back in history. When we were going through the Dark Ages and Western Christendom was going through the Dark Ages, we progressed through holding on to repositories of learning in a few monasteries for practically 1,000 years. You had these great Moslem centers of learning, and Jewish centers of learning. Ironically, almost all of them were in what is present-day Iraq. Here were the candles of learning and education which we kept burning. Western Christendom was almost on the brink of intellectual extinction. So times change. Were there periods in our history where we needed to have group entitlements to remedy past discrimination? I emphasize that again. Group entitlements to remedy evidence of past discrimination? Maybe. Maybe not. That was the Philadelphia plan. The Philadelphia plan, for all of its good intentions, when it set goals and timetables could not avoid quotas because there was no way to get there without counting. But I really want to ask a broader question--we do not need to answer it really today in this bill--as to whether or not we want group entitlements where there is no evidence of past discrimination. Not an iota. And we allow the group entitlements at the expense of others in different groups because of the Government decision that we want to prefer some people over others where there is no evidence of discrimination. So as we start this debate--I do not mean today--as we start it in this Congress and in this country, and it is coming in the years, I hope we begin this debate with understanding and not malice. I hope we can conduct this debate with gentleness rather than rancor. I hope we conclude this debate with love, charity, and the hope that all individuals of any race or ethnic background can finally achieve their rightful day in the Sun where they do not have to live in the shadow of the suspicion that they got there because of a preference. I wish that we had not had to come to this today or any other day. But we are here. So let us continue, as I hope, in spirit of fairness and let us make the decision as to whether or not this country wants to go down the path of group entitlements without any evidence of discrimination. I thank the Chair. Mr. MOYNIHAN addressed the Chair.

Mr. PACKWOOD. Mr. President, I yield as much time as the Senator may need.

Mr. PACKWOOD. Mr. President, I yield as much time to the Senator from Rhode Island as he may need.

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

Mr. PACKWOOD. Mr. President, I yield as much time to the Senator from Missouri as he may want.