Ron Paul

Mr. PAUL

Mr. PAUL. Mr. Speaker, I would like to offer my congratulations to thirteen young men and women from Fayette County who will this weekend be honored by the Fayette County 4-H club in my district. Being awarded the Gold Star will be Michelle Cernoch; Ashley Dittert, and Vickie Sanders. Receiving the Silver Star, Bradley Klesel and Billie Jo Murphy. The ``I Dare You'' award will go to Heather Woelfel and Shayne Markwardt. The ``Outstanding Junior'' Award will be presented to Jenifer Klesel, Melanie Cernoch and Kelly Orsak. And finally, the ``Outstanding Sub Junior'' award will be presented to Adam Mayer, Jodie Kristynick and Brandon Otto. These fine young people should be commended for their dedication to the fine principles of 4-H. I know I speak for all the constituents of the 14th District when I offer them congratulations and best wishes for continued success.

Mr. PAUL

Mr. PAUL. Mr. Chairman, I am sorry that under the rule my amendment to the Labor-HHS-Education Appropriations bill is not permitted. This simple amendment forbids the Department of Health and Human Services from spending any funds to implement those sections of the Health Insurance Portability and Accountability Act of 1996 authorizing the establishment of a ``standard unique health care identifier'' for all Americans. This identifier would then be used to create a national database containing the medical history of all Americans. Establishment of such an identifier would allow federal bureaucrats to track every citizen's medical history from cradle to grave. Furthermore, it is possible that every medical professional, hospital, and Health Maintenance Organization (HMO) in the country would be able to access an individual citizen's record simply by entering the patient's identifier into the national database. My amendment was drafted to ensure that the administration cannot take any steps toward developing or implementing a medical ID. This approach is necessary because if the administration is allowed to work on developing a medical ID it is likely to attempt to implement the ID on at least a ``trial'' basis. I would remind my colleagues of our experience with national testing. In 1997 Congress forbade the Department of Education from implementing a national test, however it allowed work toward developing national tests. The administration has used this ``development loophole'' to defy congressional intent by taking steps toward implementation of a national test. It seems clear that only a complete ban forbidding any work on health identifiers will stop all work toward implementation. Allowing the federal government to establish a National Health ID not only threatens privacy but also will undermine effective health care. As an OB/GYN with more than 30 years experience in private practice, I know better than most the importance of preserving the sanctity of the physician-patient relationship. Oftentimes, effective treatment depends on a patient's ability to place absolute trust in his or her doctor. What will happen to that trust when patients know that any and all information given their doctor will be placed in a data base accessible by anyone who knows the patient's ``unique personal identifier?'' I ask my colleagues, how comfortable would you be confiding any emotional problem, or even an embarrassing physical problem like impotence, to your doctor if you knew that this information could be easily accessed by friend, foe, possible employers, coworkers, HMOs, and government agents? Mr. Chairman, the Clinton administration has even come out in favor of allowing law enforcement officials access to health care information, in complete disregard of the fifth amendment. It is bitterly ironic that the same administration that has proven so inventive at protecting its privacy has so little respect for physician-patient confidentiality. My amendment forbids the federal government from creating federal IDs for doctors and employers as well as for individuals. Contrary to the claims of some, federal-ID numbers for doctors and employers threaten American liberty every bit as much as individual medical IDs. The National Provider ID will force physicians who use technologies such as e-mail in their practices to record all health care transactions with the government. This will allow the government to track and monitor the treatment of all patients under that doctor's care. Government agents may pull up the medical records of a patient with no more justification than a suspicion the provider is involved in fraudulent activity unrelated to that patient's care! The National Standard Employer Identifier will require employers to record employees' private health transactions in a database. This will allow coworkers, hackers, government agents and other unscrupulous persons to access the health transactions of every employee in a company simply by typing the company's identifier into their PC! Many of my colleagues admit that the American people have good reason to fear a government-mandated health ID card, but they will claim such problems can be ``fixed'' by additional legislation restricting the use of the identifier and forbidding all but certain designated persons to access those records. This argument has two flaws. First of all, history has shown that attempts to protect the privacy of information collected by, or at the command, of the government are ineffective at protecting citizens from the prying eyes of government officials. I ask my colleagues to think of the numerous cases of IRS abuses that were brought to our attention in the past few months, the history of abuse of FBI files, and the case of a Medicaid clerk in Maryland who accessed a computerized database and sold patient names to an HMO. These are just some of many examples that show that the only effective way to protect privacy is to forbid the government from assigning a unique number to any citizen. Even the process by which the National Identifier is being developed shows disdain for the rights of the American people. The National Committee on Vital and Health Statistics, which is developing the national identifier, attempted to keep important documents hidden from the public in violation of federal law. In fact, one of the members of the NCVHS panel working on the medical ID chastised his colleagues for developing the medical ID ``in an aura of secrecy.'' Last September, NCVHS proposed guidelines for the development of the medical ID. Those guidelines required that all pre-decisional documents ``should be kept in strict confidence and not be shared or discussed,'' This is a direct violation of the Federal Advisory Committee Act, which requires all working documents to be made public. Although NCVHS, succumbing to public pressure and possible legal action against it, recently indicated it will make its pre-decisional documents available in compliance with federal law, I hope my colleagues on the Rules Committee agree that the NCVHS attempt to evade the will of Congress and keep its work secret does not bode well for any future attempts to protect the medical ID from abuse by government officials. The most important reason, legislation ``protecting'' the unique health identifier is insufficient is that the federal government lacks any constitutional authority to force citizens to adopt a universal health identifier, regardless of any attached ``privacy protections.'' Any federal action that oversteps constitutional limitations violates liberty for it ratifies the principle that the federal government, not the Constitution, is the ultimate arbitrator of its own jurisdiction over the people. The only effective protection of the rights of citizens is for Congress and the American people to follow Thomas Jefferson's advice and ``bind (the federal government) down with the chains of the Constitution.'' For those who claim that this amendment would interfere with the plans to ``simplify'' and ``streamline'' the health care system, under the Constitution, the rights of people should never take a backseat to the convenience of the government or politically powerful industries like HMOs. Mr. Chairman, all I ask is that Congress by given the change to correct the mistake made in 1996 when they authorized the National Health ID as part of the Kennedy-Kasebaum bill. The federal government has no authority to endanger the privacy of personal medical information by forcing all citizens to adopt a uniform health identifier for use in a national data base. A uniform health ID endangers the constitutional liberties, threatens the doctor-patient relationships, and could allow federal officials access to deeply personal medical information. There can be no justification for risking the rights of private citizens. I therefore urge the Rules Committee to take the first step toward protecting Americans from a medical ID by ruling my amendment to the Labor-HHS-Education Appropriations bill in order.

Mr. PAUL

Mr. PAUL. Mr. Speaker, the Hays County 4-H will hold their annual dinner, dance and auction on Saturday, October 10, 1998. This is a very important event Mr. Speaker, as it recognizes 90 years of 4-H in Texas. For those of us who were raised on farms and who represent agricultural communities it is well known how important an organization 4-H truly is. Head, Hand, Hearts and Health, these are the ``4-H's'' and they are truly indicative of what this organization is all about. One of the primary missions that this organization undertakes is agricultural education. Earlier this year I introduced a bill which would exempt the sale of livestock by those involved in educational activities such as FFA and 4-H from federal income taxation. By making young men and women who participate in these activities hire a group of tax accountants and attorneys we are sending the wrong message. Young people who sell livestock at county fairs and the like should be rewarded for taking self initiative and allowed to keep the money they've earned to help pay for their education or to re-invest in other animals to raise. My bill would eliminate the current policy of forcing these youngsters to visit the tax man. Mr. Speaker, I want to commend the young people of Hays County's 4-H, as well as their parents and sponsors, for continuing the fine traditions of this truly great organization.

Mr. PAUL

Mr. PAUL. Mr. Speaker, the Fayette County 4-H will hold their annual banquet on Sunday, October 11, 1998. This is a very important event Mr. Speaker, as it recognizes 90 years of 4-H in Texas. For those of us who were raised on farms and who represent agricultural communities it is well known how important an organization 4-H truly is. Head, Hand, Hearts and Health, these are the ``4-H's'' and they are truly indicative of what this organization is all about. One of the primary missions that this organization undertakes is agricultural education. Earlier this year I introduced a bill which would exempt the sale of livestock by those involved in educational activities such as FFA and 4-H from federal income taxation. By making young men and women who participate in these activities hire a group of tax accountants and attorneys we are sending the wrong message. Young people who sell livestock at county fairs and the like should be rewarded for taking self initiative and allowed to keep the money they've earned to help pay for their education or to re-invest in other animals to raise. My bill would eliminate the current policy of forcing these youngsters to visit the tax man. Mr. Speaker, I want to commend the young people of Fayette County's 4-H, as well as their parents and sponsors, for continuing the fine traditions of this truly great organization.

Mr. PAUL

Mr. PAUL. Mr. Chairman, moments ago, HR 4570 was described as a ``delicate balance'' not to be disturbed by votes against either the resolution or the rule. In fact, the primary justification presented for passage of the bill was the ``brilliance'' with which a compromise securing the necessary number of votes was ``engineered.'' Statements such as these are an unfortunate commentary on the state of affairs in the nation's capital insofar as they represent not advancement of sound policy principles but rather a seriously flawed process by which federal government ``favors'' are distributed in a means which assures everyone gets a little something if they vote to give enough other districts a little something too. This is not the procedure by which Congress should be deciding matters of federal land disposition and acquisition. In fact, there appears to be no Constitutional authority for most of what HR 4570 proposes to do. Particularly frustrating is that in my attempt to return authority to the State of Texas for a water project located in the 14th District, I introduced HR 2161, The Palmetto Bend Title Transfer Project. Return of such authority comports with my Constitutional notion that local control is preferred to unlimited federal authority to dictate from Washington, the means by which a water project in Edna, Texas will be managed. I understand that certain Members of Congress may disagree with the notion of the proper and limited role of the federal government. The point here, however, is that the ``political process'' embracing the so-called ``high virtue of compromise'' means that in order for one to vote for less federal authority one must, at the same time, in this bill, vote for more. Political schizophrenia was never more rampant. One would have to vote to authorize the transfer of 377,000 acres of public land in Utah to the federal government (at taxpayer expense of $50 million for Utah's public schools) in order to return Lake Texana to the State of Texas.Two unrelated issues; two opposite philosophies as to the proper role of the federal government-- a policy at odds with itself (unless, of course, compromise is one's ultimate end). HR 2161 merely facilitates the early payment of the construction costs (discounted, of course, by the amount of interest no longer due as a consequence of early payment) and transfers title of the Palmetto Bend Project to the Texas state authorities. Both the LNRA and TWDB concur that an early buy-out and title transfer is extremely beneficial to the economical and operational well-being of the project as well as the Lake Texana water users. The Texas Legislature and Governor George W. Bush have both formally supported the early payment and title transfer. In fact, even the residents of Highland Lakes in Travis County who initially expressed a concern as to the effects of the title transfer on the Colorado River Basin, came to support the legislation. This bill will save Lake Texana water users as much as one million dollars per year as well as providing an immediate infusion of $43 million dollars to the national treasury. Additionally, all liability associated with this water project are, under my legislation, assumed by the state of Texas thus further relieving the financial burden of the federal government. Texas has already demonstrated sound management of this resource. Recreational use of the lake has been well-provided under Texas state management to include provision of a marina, pavilion, playground, and boating docks, all funded without federal money. Additionally, a woodland bird sanctuary and wildlife viewing area will also be established upon transfer with the assistance of the Texas Parks and Wildlife Department and several environmental organizations. Members of Congress must not be put in the position of having to support a massive federal land grab to secure for the residents of Texas more local control over their water supply. For these reasons, while I remain committed to the return of Lake Texana to Texas State authorities, I must reluctantly and necessarily oppose HR 4570.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, understand this legislation came before the committee on Friday, one legislative day prior to today. There has been no committee report filed, and it was brought up under suspension. And I believe this legislation is very serious legislation. It is not a casual piece of legislation condemning a leader in another country that is doing less than honorable things. I see this piece of legislation as essentially being a declaration of virtual war. It is giving the President tremendous powers to pursue war efforts against a sovereign Nation. It should not be done casually. I think it is another example of a flawed foreign policy that we have followed for a good many decades. For instance, at the beginning of this legislation it is cited as one of the reasons why we must do something. It says on September 22, 1980, Iraq invaded Iran starting an 8-year war in which Iraq employed chemical weapons against Iranian troops, very serious problems. We should condemn that. But the whole problem is we were Iraq's ally at that time, giving him military assistance, giving him funds and giving him technology for chemical weapons. So here we are now deciding that we have to virtually declare war against this individual. It is not like he is the only hoodlum out there. I could give my colleagues a list of 15 or 20. I do not like the leadership of China. Why do we not do something about China? I do not like the leadership of Sudan. But all of a sudden we have to decide what we are going to give this President to pursue getting rid of Saddam Hussein. Just a few months ago, or last November, we passed a resolution, and the resolution was H.R. 137. It sounded very general and very benign, and it talked about the atrocities caused by Saddam Hussein, and we asked to condemn and also to set up a U.N. commission to study this and give the U.N. authority to pursue arrests and convict and try Saddam Hussein. So this is not something we are doing for the interests of the United States. We are doing this under the interests of the United Nations, but we are the spokesperson for them. Not too long ago, a few years back, in 1980s, in our efforts to bring peace and democracy to the world we assisted the freedom fighters of Afghanistan, and in our infinite wisdom we gave money, technology and training to Bin Laden, and now, this very year, we have declared that Bin Laden was responsible for the bombing in Africa. So what is our response, because we allow our President to pursue war too easily? What was the President's response? Some even say that it might have been for other reasons than for national security reasons. So he goes off and bombs Afghanistan, and he goes off and bombs Sudan, and now the record shows that very likely the pharmaceutical plant in Sudan was precisely that, a pharmaceutical plant. So I say we should stop and think for a minute before we pursue and give the President more authority to follow a policy that to me is quite dangerous. This to me is equivalent to declaring war and allowing the President to pursue this. Another complaint listed on this legislation: in February 1988 Iraq forcibly relocated Kurdish civilians from their homes. Terrible thing to do, and they probably did; there is no doubt about it. But what did we do after the Persian Gulf war? We encouraged the Kurdish people to stand up and fight against Saddam Hussein, and they did, and we forgot about them, and they were killed by the tens of thousands. There is no reason for them to trust us. There is no reason for the Sudanese people to believe and trust in us, in what we do when we rain bombs on their country and they have done nothing to the United States. The people of Iraq certainly have not done anything to the United States, and we certainly can find leaders around the world that have not done equally bad things. I think we should stop and think about this. Just today it was announced that the Turks are lined up on the Syrian border. What for? To go in there and kill the Kurds because they do not like the Kurds. I think that is terrible. But what are we doing about it? Who are the Turks? They are our allies, they are our friends. They get military assistance. The American people are paying the Turks to keep their military up. So we are responsible for that. This policy makes no sense. Some day we have to think about the security of United States. We spend this money. We spent nearly $100 million bombing nobody and everybody for who knows what reason last week. At the same time our military forces are under trained and lack equipment, and we are wasting money all around the world trying to get more people, see how many people we can get to hate us. Some day we have to stop and say why are we pursuing this. Why do we not have a policy that says that we should, as a Congress, defend the United States, protect us, have a strong military, but not to police the world in this endless adventure of trying to be everything to everybody. We have been on both sides of every conflict since World War II. Even not too long ago they were talking about bombing in Kosovo. As a matter of fact, that is still a serious discussion. But a few months ago they said, well, we are not quite sure who the good guys are, maybe we ought to bomb both sides. It makes no sense. Why do we not become friends to both sides? There are people around the world that we deal with that are equally repulsive to Saddam Hussein, and I believe very sincerely that the founders of this country were on the right track when they said stay out of entangling alliances. And we should trade with people; we would get along with them better. We have pursued this type of policy in Cuba for 40 years, and it has served Castro well. Why do we not go down and get rid of Castro? Where do we get this authority to kill a dictator? We do not have that authority, and to do it under one day of hearings, mark it up, bring it up the next day under suspension; I do not understand why anybody could vote for this just on the nature of it. We should not be doing this. We should stop and think about it and try to figure out a much better way. I, for instance, am on a bill to trade with Cuba. Oh, how horrible, we should not trade with Cuba, they are a bunch of Commies down there. But we should be selling them rice and we should be selling them our crops. We should not be bombing these people. As my colleagues know, at the end of this bill I think we get a hint as to why we do not go to Rwanda for humanitarian reasons. Now there is some atrocities. Why do we not clean that mess up? Because I believe very sincerely that there is another element tied into this, and I think it has something to do with money, and I think it has something to do with oil. The oil interests need the oil in Iraq, and he does not, Saddam Hussein does not, comply with the people of the west. So he has to go. But also at the end of this legislation it tells us something about what might be going on. It is they are asking to set up and check into the funds that Saddam Hussein owes to the west. Who is owed? They do not owe me any money. But I will bet my colleagues there is a lot of banks in New York who are owed a lot of money, and this is one of the goals, to set up and make sure Saddam Hussein pays his bills. All I do is ask my colleagues to think about it, urge them to go slowly. Nothing is so pressing that we should give the President this much authority to go to war. Under the appropriations it is endless, it is open, endless, and here we are concerned about saving Social Security. Any amount of money spent on this bill comes out of Social Security. Yes, there was yelling and screaming about a tax cut. Oh, it is coming out of Social Security. Well, this money is not appropriated, and it is such sums as necessary for military and economic benefits. After we get rid of one thug, we are going to have it in. I hope we make a better choice than we did with Bin Laden. I mean he was our close ally. Please think twice, slow up, vote against this bill. We do not need this. Mr. Speaker, I reserve the balance of my time.

Mr. PAUL. Mr. Speaker, how much time do I have remaining?

Mr. PAUL. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, the gentleman from Indiana makes some very good points indicating that he is not convinced that this is workable. So back to the practicality of the bill. Even though one might argue there is a lot of good intentions here, even a Member that is supporting the bill is very uncertain whether it is workable. In some ways, even if it is workable, it is going to be working against us and working against the United States and working against the taxpayers of this country. But I would also like to challenge the statement that this does not change policy, because on section 3, it says it should be the policy of the United States to seek to remove the regime headed by Saddam Hussein from power in Iraq and promote the emergence of a democratic government to replace that regime. That sounds pretty clear to me. As a matter of fact, I think it sounds so clear that it contradicts U.S. law. How do you remove somebody without killing them? Is it just because we do not use our own CIA to bump them off that we are not morally and legally responsible? We will be. So we are talking about killing Saddam Hussein, a ruthless dictator. But how many ruthless dictators do we have? We have plenty. So how many more should we go after? So the real question is, why at this particular time, why would we give our President more authority to wage war? He has way too much authority already if the President can drop bombs when he pleases. This of course has occurred not only in this administration but in the administrations of the 1980s as well where bombs were dropped to make some points. But generally speaking, the points are not well made. They usually come back to haunt us. This is more or less what has happened. This is part of a policy that we have been following for quite a few decades. Yet, the problems continue to emerge. We can hardly be sympathetic to the Kurds who are being punished by the Iraqis at the same time we are paying the Turks to do the same thing to the Kurds. So there is something awful inconsistent about this. There is nothing wrong with a policy of trying to maintain friendship with people, trying to trade with people and influence them that way rather than saying, if you do not do exactly as we tell you, we are going to bomb you. This is a policy we have been following for way too long. It costs a lot of money. It costs a lot of respect for law because, technically, it is not legal. Waging war should only occur when the Congress and the people decide this. But to casually give more and more authority to the President to do this and encourage him to bump off dictators is a dangerous precedent to set. I think there is no doubt in my mind what is best for the United States. We should not pass this resolution. If there need to be more efforts made, do it some other way. But, obviously, this is not a good way to do it. It is sacrificing the principle of law. It is sacrificing the Constitution. It is sacrificing the practicalities of even the people who are supporting it are not quite sure it is going to work. So I would say give serious consideration to not supporting this bill. We need a ``no'' vote on this. Mr. Speaker, I reserve the balance of my time.

Mr. PAUL. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, the gentleman from California makes a very good point, that sometimes we get involved in these battles and we never fight to complete victory. He argues the case for pursuing it and always winning and take out the dictator that we are opposing. There is some merit to that argument, but there is also a very good reason why that does not happen and will not happen. It is because when we fight a war for non-national security reasons, when it is limited to protecting oil or some other interest, then there is a limitation, there is no wanting to expand it. When we fight a war for national security reasons, we declare the war, the people join, they are willing to support it financially, they volunteer to go into the military, and they fight to win. But we have not done that since World War II, precisely because we have this namby- pamby foreign policy of being everything to everybody and we do not even defend our national security adequately enough. The gentleman from California makes a good point also. He is concerned that somebody like Saddam Hussein may attack us with weapons of mass destruction. He is precisely right. I am concerned about that too. But I would say that our exposure is about 100 times greater because of our policy. Why is it that the terrorists want to go after Americans? Because we are always dropping bombs on people and telling people what to do; because we are the policemen. We pretend to be the arbitrator of every argument in the world, even those that have existed for 1,000 years. It is a failed, flawed policy. So I would say I have exactly the same concerns, but I think the policy that we follow has generated this problem, and it will continue. Mr. Speaker, let me just close by talking a little bit about this authorization. It says, there are to be authorized appropriations, such sums as may be necessary to reimburse the applicable appropriation funds. This is what the money is to go for: Defense articles, defense services, military education, and training. Sounds like getting ready for the Bay of Pigs. That is exactly what we did. And then we backed off, we were not doing it for the right reason, and of course we have solidified for 40 years the dictatorship in Cuba. So do my colleagues think our policy over the last 10 years has actually helped to weaken Saddam Hussein? Every time he comes out of it stronger. And then those who say, ``Well, we should march in,'' we should all question. Those of us here in the Congress who are so anxious to take out this dictator, they should be willing to march themselves, or send their children and send their grandchildren. Is it worth that? No, no, we would not want to do that, we have to keep our troops safe, safe from harm, but we will just pay somebody to do it. We will pay somebody to do it and we will make wild promises. Promise the Kurds something. They will take care of Saddam Hussein. And sure enough, the promises never come through.

Mr. PAUL. I yield to the gentleman from California.

Mr. PAUL. Mr. Speaker, reclaiming my time, I think it would be absolutely proper to do that, as long as it came out of the gentleman's wallet and we did not extract it from somebody in this country, a taxpayer at the point of a gun and say, look, bin Laden is a great guy. I want more of your money. That is what we did in the 1980s. That is what the Congress did. They went to the taxpayers, they put a gun to their head, and said, you pay up, because we think bin Laden is a freedom fighter.

Mr. PAUL. Mr. Speaker, I request the time in opposition.

Mr. PAUL. Mr. Speaker, I would like to inquire whether or not either gentleman is opposed to the bill.

Mr. PAUL. Mr. Speaker, again reclaiming my time, the policy is flawed. The policy is flawed. I think the conclusions we have today are logical. I do not think they lack logic. I think that if one decides that we are fighting for our national security reasons, we never stop short of victory. So this would go along with the gentleman's argument that we stopped too soon in Iraq. But we were not there for national security reasons. They were not about to invade us, and they are not about to invade us. The only way we should fear an invasion by these hoodlums is if we incite them to terrorism. We should consider this a very serious piece of legislation. This is a vote for virtual war and giving more power to the President. It has an open-ended appropriation, and if we spend one nickel on it, we are going to take it out of Social Security, the way the budget works around here. Mr. Speaker, I yield back the balance of my time.

Mr. PAUL. Mr. Speaker, on that I demand the yeas and nays.

Mr. PAUL

Mr. PAUL. Mr. Speaker, the Federal Reserve orchestrated bailout of the hedge fund Long-Term Capital Management LP raises serious policy questions. At one point, the notional value of the Cayman Island- registered fund's derivatives totalled about $1.2 trillion. We should look seriously at this issue because of the taxpayer-backed liability concerns raised by the involvement of an agency with the full faith and credit of the U.S. government. The state of Michigan has taken a constructive first step regarding the public policy concerns of derivatives. I urge us to consider the wisdom of the State Representative Greg Kaza as we debate this issue. Statement of Hon. Greg Kaza, Michigan State Representative, Adjunct Professor of Finance, Walsh College Derivatives are financial instruments broadly defined as any contract or convertible security that changes in value in concert with a related or underlying security, fixed-income instrument, future or other instrument, currency or index; or that obtains much of its value from price movements in a related or underlying instrument; or an option, swap, warrant, or debt instrument with one or more options embedded in or attached to it, the value of which contract or security is determined in whole or in part by the price of one or more underlying instruments or markets. Although derivatives are a relatively recent development in financial markets, their use by corporations, pension and mutual funds, financial institutions, governments and those involved in money management are clearly ascendant, according to the Federal Reserve and other federal agencies. The issue is not whether the government should ban or in some way restrict the prudent use of derivatives to hedge risk. Rather, the issue is one of disclosure, i.e., how best to provide increased transparency as our complex international financial system enters the 21st Century. Three years ago I addressed the very same issue in Michigan by authoring state legislation that provided increased transparency by requiring units of government to disclose their derivative holdings to the public. Government units have to make investment decisions regarding the money they receive or retain; unfortunately, investment practices and decisions can sometimes lead to significant losses when taxdollars are unwisely invested in derivatives. Orange County in California and Independence Township in Oakland County, Michigan are both examples of government units that experienced significant losses as a result of the imprudent use of derivatives. Initially, some of my colleagues wondered whether a ban or restriction on the use of derivatives would be preferable. But committee testimony soon convinced them that derivatives, although complex, are used by many institutions, including government pension funds, to prudently hedge risk. Our five- bill package required public disclosure of derivative holdings by government units. The legislation garnered bi- partisan sponsorship and support, and ultimately became state law. A related issue that we discussed privately at the time was whether the potential for moral hazard created by federal deposit insurance means private financial institutions should be required to disclose their derivative holdings in the interest of transparency. You are now likely to contemplate this issue yourselves given events surrounding the hedge fund in question, Long-Term Capital Management; and the potential for systemic risk posed by any future episode that might involve the imprudent use of derivatives and excessive amounts of leverage.

Mr. PAUL

Mr. PAUL. Mr. Speaker, the world financial markets have been in chaos now for nearly a year and a half. The problem surrounding long-term capital investment is only one more item to add to the list. The entire process represents the unwinding of speculative investments encouraged by years of easy credit. By the way, Long Term Credit Management is not even an American corporation. It is registered in the Cayman Islands, I am sure for tax purposes. The mess we are witnessing in the world today was a predictable event. Artificially low interest rates and easy credit causes malinvestment, overcapacity, excessive borrowing and uncontrolled speculation. We have had now for 27 years a world saturated with fiat currencies and not one has had a definable unit of account. There have been no restraints on the world monetary managers to expand their money supplies, fix short-term interest rates or deliberately debase their currencies. Although. Short-term benefits were enjoyed, it is clear now they were not worth the resulting chaos. We need not look for the cause which puts the dollar, our economy and our financial markets at risk. The previous boom supported by the illusion of wealth coming from money creation is the cause of current world events, and it guarantees further unwinding of the speculative orgy of the past decades. This cannot be prevented. All that we can hope for is to not prolong the agony, as our monetary and fiscal policies did in the U.S. in the 1930s and as they are currently doing in Japan and elsewhere in the world. More Federal Reserve fixing of interest rates and credit expansion can hardly solve our problems when this has been precisely the cause of the mess in which we currently find ourselves. Price fixing of interest rates contradicts the basic tenets of capitalism. Let it no more be said that today's mess with financial markets is a result of capitalism's shortcomings. Nothing is further from the truth. Allowing the market to operate even under today's dangerous conditions is still the best option for dealing with hedge fund's gambling mistakes, both current and future. A Federal Reserve orchestrated and arm-twisting bailout of LTCM associated with less than a coincidentally announced credit expansion only puts long-term pressure on the dollar. All Americans suffer when the dollar is debased. Congress's responsibility is to the dollar and not foreign currencies, not foreign economies or international hedge funds which get in over their heads. No amount of regulation could have prevented or in the future prevent the inevitable mistakes made in an economy that is misled by rigged interest rates or a money supply dictated by central planners in a fiat money system. Hedge fund operations, because they are international in scope, are impossible to regulate and for the current ongoing crisis it is too late anyway. Credit conditions that allow a company with less than $1 billion in capital to buy $100 billion worth of stock with borrowed money and manage $1.2 trillion worth of derivatives is about as classic an example as one could ever find of speculative excess brought on by easy credit. As long as capital is thought to come from a computer at the Federal Reserve and not from savings, the financial problems the world faces today will persist. Our problems today should not be used to justify a worldwide central bank, as has been proposed. What we need is sound money without the central planning efforts of a Federal Reserve system fixing interest rates and regulating the money supply. Let us give freedom a chance.

Mr. PAUL

Mr. PAUL. Mr. Speaker, today, the House is asked to vote to approve H.R. 2621, a fast-track procedure under which international agreements might be approved as far into the future as October 1, 2005. The ``fast track'' procedure requires the President to submit draft international agreements, implementing legislation, and a statement of administrative action for congressional approval. Amendments to the legislation in Congress are not permitted once the bill is introduced and committee and floor action votes may consist only of ``yes'' or ``no'' votes on any potential agreement as it is introduced. The fast-track procedure bill, in addition to creating an extra- constitutional procedure by which international agreements become ratified, sets general international economic policy objectives, re- authorizes ``Trade Adjustment Assistance'' welfare for workers who lose their jobs and for businesses which fail, and creates a new permanent position of Chief Agriculture Negotiator within the office of the United States Trade representative. The bill would reestablish the President's extra-constitutional ``executive authority'' to negotiate ``side agreements'' such as those dealing with environmental and labor issues. Lastly, the bill ``pays'' the government's ``cost'' of free trade by increasing taxes on a number of businesses which recently benefitted by a favorable judgment in federal tax court. The Constitution clearly allows for international agreements and clearly specifies the means by which they are to be accomplished. Treaties, quite clearly are to be negotiated by the President with advice and consent of the Senate and can only become effective upon being ratified by a two-thirds majority of the Senate. The Constitution, however, does not expressly confer authority to make international agreements other than by treaties and, of course, the tenth amendment specifies that ``powers not delegated to the United States by the Constitution nor prohibited by it to the States, are reserved to the States, respectively, or to the people.'' To ignore or allow the one branch of the federal government to delegate it's powers to others destroys the liberty-protecting ability inherent to the Constitutional separation of powers. Congress does have, amongst its enumerated powers, regulation of commerce with foreign nations. Imposing import tariffs, quotas, and embargoes, however economically detrimental to the macro economy of the United States, are, at least, amongst powers delegated to Congress by Article I of the Constitution. Regulating commerce, of course, refers to enacting domestic laws which effect voluntary exchanges between trading partners who happen to be citizens of different governments. International agreements between the governments of those trading partners cannot be construed to escape the stringent treaty ratification process established by the document's framers just by suggesting Congress has the power to enact domestic regulation regarding foreign commerce. If this were an allowable justification for bypassing the constitutionally-mandated treaty process, Article I Congressional powers would almost completely undermine the necessity for the Constitutionally-mandated treaty process. Treaties regarding everything from international monetary policy to military policy would suddenly become ``ripe'' for the ``treaty-making'' power of the President and Congress. Instead, a bright line process exists whereby entering into agreements with foreign nations under which the U.S. government will do ``X'' if the government of Ruritania does ``Y'' must be understood to constitute an international agreement and, as such, require the more restrictive treaty process. Moreover, because international courts regard ``treaties'' and ``agreements'' as equally binding on signatory governments, a stronger case is made that they must be made subject to the same constitutional process. Insofar as H.R. 2621 ignores the lake of a congressional role in the international treaty process and instead attempts to make Congress an integral part of a procedure for which it lacks any constitutional authority, this bill can be opposed on constitutional grounds alone. Even if the procedure advocated by the bill were able to survive what should always be the Congressman's initial threshold of constitutionality, the bill contains provisions which will likely continue our country down the ugly path of internationally-engineered, ``managed trade'' rather than that of free trade. As explained by economist Murray N. Rothbard: [G]enuine free trade doesn't require a treaty (or its deformed cousin, a `trade agreement'; NAFTA is called an agreement so it can avoid the constitutional requirement of approval by two-thirds of the Senate). If the establishment truly wants free trade, all it has to do is to repeal our numerous tariffs, import quotas, anti-dumping laws, and other American-imposed restrictions of free trade. No foreign policy or foreign maneuvering is necessary. In truth, the bipartisan establishment's fanfare of ``free trade'' fosters the opposite of genuine freedom of exchange. Whereas genuine free traders examine free markets from the perspective of the consumer (each individual), the mercantilist examines trade from the perspective of the power elite; in other words, from the perspective of the big business in concert with big government. Genuine free traders consider exports a means of paying for imports, in the same way that goods in general are produced in order to be sold to consumers. But the mercantilists want to privilege the government business elite at the expense of all consumers, be they domestic or foreign. Fast track is merely a procedure under which the United States can more quickly integrate and cartelize government in order to entrench the interventionist mixed economy. In Europe, this process culminated in the Maastricht Treaty, the attempt to impose a single currency and central bank and force relatively free economies to ratchet up their regulatory and welfare states. In the United States, it has instead taken the form of transferring legislative and judicial authority from states and localities and to the executive branch of the federal government. Thus, agreements negotiated under fast track authority (like NAFTA) are, in essence, the same alluring means by which the socialist Eurocrats have tried to get Europeans to surrender to the super-statism of the European community. And just as Brussels has forced low-tax European countries to raise their taxes to the European average or to expand their respective welfare states in the name of ``fairness,'' a ``level playing field,'' and ``upward harmonization,'' so too will the international trade governors and commissions be empowered to ``upwardly harmonize,'' internationalize, and otherwise usurp laws of American state governments. The harmonization language in last year's FDA reform bill constitutes a perfect example. Harmonization language in this bill has the Health and Human Services Secretary negotiating multilateral and bilateral international agreements to unify regulations in this country with those of others. The bill removes from the state governments the right to exercise their police powers under the tenth amendment to the constitution and, at the same time, creates or corporatist power elite board of directors to review medical devices and drugs for approval. This board, of course, is to be made up of ``objective'' industry experts appointed by national governments. Instead of the ``national'' variety, known as the Interstate Commerce Act of 1887 (enacted for the ``good reason'' of protecting railroad consumers from exploitative railroad freight rates, only to be staffed by railroad attorneys who then used their positions to line the pockets of their respective railroads), we now have the same sham imposed upon worldwide consumers on an international scale soon to be staffed by heads of multilateral pharmaceutical corporations. Lastly, critics of the bill convincingly argue that language within H.R. 2621 regarding ``Foreign Investment'' would establish new rights for foreign investors and corporations and new obligations for the United States. H.R. 2621 attempts to eliminate artificial or trade- distorting barriers to trade-related foreign investment by reducing or eliminating exceptions to the principle of national treatment; free the transfer of funds relating to investments; reduce or eliminate performance requirements and other unreasonable barriers to the establishment and operation of investments; seeks to establish standards for expropriation and compensation for expropriation, consistent with United States legal principles and practice; and provide meaningful procedures for resolving investment disputes. It is argued that H.R. 2621 will congressionally activate the nearly completed Multilateral Agreement on Investment which covers 29 countries and forbids countries from regulating investment or capital flows and would establish new rights for foreign investors and corporations and new obligations for the United States. The MAI requires governments to pay investors for any action that directly or indirectly has an equivalent effect of expropriation. The MAI would be enforceable through international tribunals similar to those of the World Trade Organization without the due process protections of the United States. Because H.R. 2621 enacts an unconstitutional foreign policy procedure, furthers our nation down the internationally-managed (rather than free trade) path, sets general international economic policy objectives, re-authorizes ``Trade Adjustment Assistance'' welfare for workers who lose their jobs and for businesses which fail, potentially undermines U.S. sovereignty through MAI, and preserves the President's executive authority to negotiate ``side agreements.'' As such, I must oppose the bill.

Mr. PAUL

Mr. PAUL. Mr. Speaker, Mr. Speaker, I would like to call the attention of fellow colleagues to the issue of three things that have happened in the last couple of days. Today it was recorded in our newspapers and it was a consequence of a meeting held last night having to do with a company that went bankrupt, Long-Term Capital Management. I believe this has a lot of significance and is something that we in the Congress should not ignore. This is a hedge fund. Their capitalization is less than $100 billion, but, through the derivatives markets, they were able to buy and speculate in over $1 trillion worth of securities, part of the financial bubble that I have expressed concern about over the past several months. But last night an emergency meeting was called by the Federal Reserve Bank of New York. It was not called by the banks and the security firms that were standing to lose the money, but the Federal Reserve Bank of New York called an emergency meeting late last night. Some of the members of this meeting, the attendees, came back from Europe just to attend this meeting because it was of such a serious nature. They put together a package of $3.5 billion to bail out this company. Yesterday also Greenspan announced that he would lower interest rates. I do not think this was an accident or not coincidental. It was coincidental that at this very same time they were meeting this crisis, Greenspan had to announce that, yes indeed, he would inflate our currency, he would expand the money supply, he would increase the credit, he would lower interest rates. At least that is what the markets interpreted his statement to mean. And the stock market responded favorably by going up 257 points. On September 18th, the New York Times, and this is the third time that that has come about in the last several weeks, the New York Times editorialized about why we needed a worldwide Federal Reserve system to bail out the countries involved in this financial crisis. Yesterday, on the very same day, there was another op-ed piece in the New York Times by Jeffrey Garten, calling again for a worldwide central bank, that is, a worldwide Federal Reserve system to bail out the ailing economies of the world. The argument might go, yes, indeed, the financial condition of the world is rather severe and we should do something. But the financial condition of the world is in trouble because we have allowed our Federal Reserve System, in deep secrecy, to create credit out of thin air and contribute to the bubble that exists. Where else could the credit come from for a company like Long-Term Capital Management? Where could they get this credit, other than having it created and encouraged by a monetary system engineered by our own Federal Reserve System? We will have to do something about what is happening in the world today, but the danger that I see is that the movement is toward this worldwide Federal Reserve System or worldwide central bank. It is more of the same problem. If we have a fiat monetary system, not only in the United States but throughout the world, which has created the financial bubble, what makes anybody think that creating more credit out of thin air will solve these problems? It will make the problems much worse. We need to have a revamping of the monetary system, but certainly it cannot be saved, it cannot be improved, by more paper money out of thin air, and that is what the Federal Reserve System is doing. I would like to remind my colleagues that when the Federal Reserve talks about lowering interest rates, like Mr. Greenspan announced yesterday, or alluded to, this means that the Federal Reserve will create new credit. Where do they get new credit and new money? They get it out of thin air. This, of course, will lower interest rates in the short run and this will give a boost to a few people in trouble and it will bail out certain individuals. When we create credit to bail out other currencies or other economies, yes, this tends to help. But the burden eventually falls on the American taxpayer, and it will fall on the value of the dollar. Already we have seen some signs that the dollar is not quite as strong as it should be if we are the haven of last resort as foreign capital comes into the United States. The dollar in relationship to the Swiss frank has been down 10 percent in the last two months. In a basket of currencies, 15 currencies by J.P. Morgan, it is down 5 percent in one month. So when we go this next step of saying, yes, we must bail out the system by creating new dollars, it means that we are attacking the value of the money. When we do this, we steal the value of the money from the people who already hold dollars. If we have an international Federal Reserve System that is permitted to do this without legislation and out of the realms of the legislative bodies around the world, it means that they can steal the value of the strong currencies. So literally an international central bank could undermine the value of the dollar without permission by the U.S. Congress, without an appropriation, but the penalty will fall on the American people by having a devalued dollar. This is a very dangerous way to go, but the movement is on. As I mentioned, it has already been written up in the New York Times. George Soros not too long ago, last week, came before the Committee on Banking and Financial Services making the same argument. What does he happen to be? A hedge fund operator, the same business as Long-Term Capital Management, coming to us and saying, ``Oh, what you better do is protect the system.'' Well, I do not think the American people can afford it. We do have a financial bubble, but financial bubbles are caused by the creation of new credit from central banks. Under a sound monetary system you have a commodity standard of money where politicians lose total control. Politicians do not have control and they do not instill trust into the paper money system. But we go one step further. The Congress has reneged on its responsibility and has not maintained the responsibility of maintaining value in the dollar. It has turned it over to a very secretive body, the Federal Reserve System, that has no responsibility to the U.S. Congress. So I argue for the case of watching out for the dollar and argue for sound money, and not to allow this to progress any further.

Mr. PAUL

Mr. PAUL. Madam Chairman, I appreciate the opportunity to express my reservations about H.R. 3248, the Dollars to the Classroom Act. I take a back seat to no one in my opposition to Federal control of education. Unlike some of this bills most vocal supporters, I have consistently voted against all appropriations for the Department of Education. In fact, when I was serving in the House in 1979, I opposed the creation of the Education Department. I applaud the work Mr. Pitts and others have done to force Congress to debate the best means of returning power over education to the states, local communities and primarily parents. However, although H.R. 3248 takes a step toward shrinking the Federal bureaucracy by repealing several education programs, its long-term effect will likely be to strengthen the Federal Government's control over education by increasing Federal spending. Therefore, Congress should reject this bill. If H.R. 3248 did not increase Federal expenditures, my support would be unenthusiastic at best as the system of block grants established by this bill continue the unconstitutional practice of taking money from taxpayers and redistributing it to other states. The Federal Government lacks constitutional authority to carry out this type of redistribution between states and taxpayers, regardless of whether the monies are redistributed through Federal programs or through grants. There is no ``block grant exception'' to the principles of federalism embodied in the United States Constitution. The requirement that the states certify that 95% of Federal monies are spent ``in the classroom,'' (a term not defined in the act) and report to the Congress how they are using those monies to improve student performance imposes an unacceptable level of Federal management on the states. States are sovereign entities, not administrative units of the Federal Government, and should not have to account to the Federal Government for their management of educational programs. For all its flaws, the original version of H.R. 3248 at least restored some measure of state control of education because it placed no restrictions on a state's use of funds. It was, thus, a pure block grant. However, this bill does not even give states that level of discretion as H.R. 3248 has been amended to restrict the uses to which a state can apply its block grants. Under the revised version of H.R. 3248, states can only spend their block grant money on one or more of the programs supposedly repealed by the Federal Government! In fact, this bill is merely one more example of ``mandate federalism'' where states are given flexibility to determine how best to fulfill goals set by Congress. Granting states the authority to select a particular form of federal management of education may be an improvement over the current system, but it is hardly a restoration of state and local control over education! The federal government's power to treat state governments as their administrative subordinates stems from an abuse of Congress' taxing- and-spending power. Submitting to federal control is the only way state and local officials can recapture any part of the monies the federal government has illegitimately taken from a state's citizens. Of course, this is also the only way state officials can tax citizens of other states to support their education programs. It is the rare official who can afford not to bow to federal dictates in exchange for federal funding! As long as the federal government controls education dollars, states and local schools will obey federal mandates; the core problem is not that federal monies are given with the inevitable strings attached, the real problem is the existence of federal taxation and funding. Since federal spending is the root of federal control, by increasing federal spending this bill lays the groundwork for future Congresses to fasten more and more mandates on the states. Because state and even local officials, not federal bureaucrats, will be carrying out these mandates, this system could complete the transformation of the state governments into mere agents of the federal government. Madam Chairman, those who doubt the likelihood of the above scenario should remember that the Education Committee could not even pass the initial block grant without ``giving in'' to the temptation to limit state autonomy in the use of education funds because ``Congress cannot trust the states to do the right thing!'' Given that this Congress cannot pass a clean block grant, who can doubt that some future Congress will decide that the States need federal ``leadership'' to ensure they use their block grants in the correct manner, or that states should be forced to use at least a certain percentage of their block grant funds on a few ``vital'' programs. I would also ask those of my colleagues who claim that block grant will lead to future reductions in expenditures how likely is this will occur when Congress had to increase expenditures in order to originally implement the block grant programs? Furthermore, by increasing the flow of federal money to state and local educrats, rather than directly increasing parental control over education through education tax credits and tax cuts, the effect will be to make state and local officials even less responsive to parents. I wish to remind my colleagues that many state and local education officials support the same programs as the federal educrats. The officials responsible for the genital exams of junior high school girls in Pennsylvania should not be rewarded with more federal taxpayers' dollars to spend as they wish. It will be claimed that this bill does not increase spending, it merely funds education spending at the current level by adding an adjustment to inflation to the monies appropriated for education programs in Fiscal Year 1999. However, predicting the rate of inflation is a tricky business. If, as is very likely, inflation is less than the amount dictated by this bill, the result will be an increase in education spending in real dollar terms. Still, that is beside the point, any spending increase, whether real or nominal, ought to be opposed. CBO reports that H.R. 3248 provides ``additional authorization of ``9.5B.'' Madam Chairman, while I applaud the attempt by the drafters of this bill to attempt to reduce the federal education bureaucracy, the fact is the Dollars to the Classroom Act represents the latest attempt of this Congress to avoid addressing philosophical and constitutional questions of the role of the Federal and State Governments by means of adjustments in management in the name of devolution. Devolution is said to be a return to state's rights since it decentralized the management of federal program; this is a new 1990's definition of the original concept of federalism and is a poor substitute for the original, constitutional definition of federalism. Rather than shifting responsibility for the management of federal funds, Congress should defund all unconstitutional programs and dramatically cut taxes imposed upon the American people, thus enabling American families to devote more of their resources to education. I have introduced a bill, the Family Education Freedom Act (H.R. 1816) to provide parents with a $3,000 per child tax credit for education expenses. This bill directly empowers parents, not bureaucrats or state officials, to control education and is the most important education reform idea introduced in this Congress. In conclusion, the Dollars to the Classroom Act may repeal some unconstitutional education programs but it continues the federal government's equally unconstitutional taking of funds from the America people for the purpose of returning them in the form of monies for education only if a state obeys federal mandates. While this may be closer to the constitutional systems, it also lays the groundwork for future federal power grabs by increasing federal spending. Rather than continue to increase spending while pretending to restore federalism, Congress should take action to restore parents to the rightful place as the ``bosses'' of America's education system.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I am a physician, I am a parent and I am a grandparent, and I am convinced that drugs are a very, very serious problem in this country, not only the illegal ones, but the legal ones as well. Just last year, 106,000 people died from the legal use of drugs. We are drug dependent, on the illegal drugs and on the legal tranquilizers. That is a major problem. But I have also concluded that the war on drugs is a failed war and that we should be doing something else. I might point out that the argument for the use of marijuana in medicine is not for pain. To say that it has not relieved pain is not what this is about. Marijuana has been used by cancer patients who have been receiving chemotherapy who have intractable nausea. It is the only thing they have found that has allowed them to eat, and so many cancer patients die from malnutrition. The same is true about an AIDS patient. So this is a debate on compassion, as well as legality. But the way we are going about this is wrong. I am rather surprised in our side of the aisle that champions limited government and States' rights, that they use the FDA's ability to regulate nicotine as an excuse and the legal loophole for the Federal Government to be involved in marijuana. I might remind them that 80 years ago when this country decided that we should not have alcohol, they did not come to the Congress and ask for a law. They asked for a constitutional amendment realizing the Congress had no authority to regulate alcohol. Today we have forgotten about that. Many of my colleagues might not know or remember that the first attack on the medicinal use of marijuana occurred under the hero of the left, F.D.R., in 1937. Prior to 1937, marijuana was used medicinally, and it was used with only local control. The Federal controls on illicit drugs has not worked and it is not working when it comes to marijuana. Once again, we have States saying, just allow the physician the option to give some of these people some marijuana. Possibly it will help. I think the jury is still out about how useful it is. But for us to close it down and say one cannot, and deny some comfort to a dying patient, I do not think this is very compassionate one way or the other. The war on drugs has been going on now for several decades. We have spent over $200 billion. There is no evidence to show that there is less drug usage in this country. I have a program designed, which I cannot present here, that will change our policy and attack the drugs in a much different way.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I appreciate the opportunity to express my opposition to S. 2206, which reauthorizes the Head Start program, as well as the Community Services Block Grant program and the Low Income Housing Energy Assistance Program (LIHEAP). While the goals of Head Start and the Community Services Block Grant program are certainly noble, the means these programs use to accomplish these goals (confiscating monies from one group of citizens and sending them to another group of citizens in the form of federal funding for Washington-controlled programs) are immoral and ineffective. There is no constitutional authority for Congress to fund any programs concerning child-rearing or education. Under the constitutional system, these matters are left solely in the hands of private citizens, local government, and the individual states. In fact, the founders of this country would be horrified by one of the premises underlying this type of federal program: that communities and private individuals are unwilling and unable to meet the special needs of low-income children without intervention by the federal government. The truth is that the American people can and will meet the educational and other needs of all children if Congress gives them the freedom to do so by eliminating the oppressive tax burden fostered on Americans to fund the welfare-warfare state. When the federal government becomes involved in funding a program such as Head Start, it should at least respect local autonomy by refraining from interfering with the ability of local communities to fashion a program that suits their needs. After all, federal funding does not change the fact that those who work with a group of children on a daily basis are the best qualified to design a program that effectively serves those children. Therefore, I must strongly object to the provisions in S. 2206 that requires the majority of Head Start classroom teachers to have an Associate or Bachelors degree in early childhood education by 2003. This provision may raise costs and/or cause some good Head Start teachers to lose their positions simply because they lack the credentials a Washington-based ``expert'' decided they needed to serve as a Head Start instructor. Mr. Speaker, if programs such as Head Start where controlled by private charities, their staffers would not have to worry about diverting valuable resources away from their mission to fulfill the whims of Congress. I am also disappointed that S. 2206 does not contain the language passed by the House Committee on Education and the Workforce freeing Head Start construction from the wasteful requirements of the Davis- Bacon Act. Davis-Bacon not only drives up construction costs, it effectively ensures that small construction firms, many of which are minority-owned, cannot compete for federal construction contracts. Repealing Davis-Bacon requirement for Head Start construction would open up new opportunities for small construction companies and free up millions of taxpayers dollars that could be used to better America's children. Congress should also reject S. 2206 because it reauthorizes the Low Income Heating and Energy Program (LIHEAP). LIHEAP is an unconstitutional transfer program which has outlived its usefulness. LIHEAP was instituted in order to help low-income people deal with the high prices resulting from the energy crisis of the late seventies. However, since then, home heating prices have declined by 51.6% residential electricity prices have declined by 25% and residential natural gas prices have declined by 32.7%. Furthermore, the people of Texas are sending approximately $43 million more taxpayer dollars to Washington for LIHEAP than they are receiving in LIHEAP funds. There is no moral or constitutional justification for taking money from Texans, who could use those funds for state and local programs to provide low- income Texans with relief from oppressive heat, to benefit people in other states. Another provision in S. 2206 that should be of concern to believers in a free society is the provision making ``faith-based organizations'' eligible for federal funds under the Community Services Block Grant program. While I have little doubt that the services offered by churches and other religious institutions can be more effective in producing social services than many secular programs, I am concerned that allowing faith-based organizations' access to federal taxpayer dollars may change those organizations into lobbyists who will compromise their core beliefs rather than risk alienating members of Congress and thus losing their federal funds. Thus, allowing faith- based organizations to receive federal funds may undermine future attempts to reduce federal control over social services, undermine America's tradition of non-establishment of religion, and weaken the religious and moral component of the programs of ``faith-based providers.'' It would be a tragedy for America if religious organizations weakened the spiritual aspects that made their service programs effective in order to receive federal lucre. Since S. 2206 furthers the federal government's unconstitutional role of controlling early childhood education by increasing federal micro- management of the Head Start program, furthers government intrusions into religious institutions and redistributes income from Texans to citizens of other states through the LIHEAP program, I must oppose this bill. I urge my colleagues to oppose this bill and instead join me in defunding all unconstitutional programs and cutting taxes so the American people may create social service programs that best meet the needs of low-income children and families in their communities. Mr. CASTLE, Mr. Speaker, I rise today in strong support of the substitute to S. 2206, the Human Services Authorization ACt of 1998, offered by Chairman Goodiling. I am pleased to state that this substitute represent a very balanced view of many long hours of negotiations and thorough evaluations of the needs of some of the countries neediest citizens. In particular, I want to focus my comments today on the Head Start provisions of the legislation. The Subcommittee on Early Childhood, Youth, and Families heard from a number of witnesses on ways to strengthen existing Head Start operations to bring better quality, more accountability and more results. Today, we are combining that input and taking several very important steps for our nation's children by implementing a better, stronger, and more focused program. As you are aware, the substitute does not contain the more controversial provisions, including those on parent certificates, construction, and establishment of paternity. I believe the exclusion of these provisions leaves us with a stronger and more united bill and commend the Chairman for his acknowledgment of such. One of the keys to this reform, that we on the Education Committee identified immediately, is the need to toughen the education components of the program. So, what we have done is clarify those educational components of Head Start. The purpose of Head Start is to promote school readiness. Make no mistake about it, this program was named deliberately--these kids need a ``head start'' in life. The new performance standards are measures in the substitute will enable us to ensure that students are learning, so that we can meet the needs of children where we haven't been able to in the past. In addition monies will be available for advancement in the quality of Head Start. Specifically, much needed funds will be put toward teacher training and recruiting college educated teachers. The majority of Head Start teachers will now have a college degree in early childhood development. I, personally, think this is essential. We need to provide strong resources and strong teachers that have an intimate knowledge of child development to assist families through some of the most difficult and vital childhood years. Finally the substitute also cover areas that we are the Federal level have missed by providing a separate portion of funds directly to local grantees. Knowing the priorities and diverse needs of their individual communities, the local programs can use these funds to attend to individual children with concerns not addressed by other parts of the legislation. Mr. Speaker, I have attempted only to highlight the strengths of the substitute in this brief synopsis, but I want to give my full endorsement for the entirety of the legislation being put forth today. With the fiscal constraints we are faced with in the Nation today, I believe it is essential to strengthen accountability and results and produce quality programs that ensure children's welfare is being promoted, and I feel comfortable and confident that this bill helps us do so. I urge my colleagues to join me in support the Goodling substitute to the Human Services Authorization Act of 1998.

Mr. PAUL

Mr. PAUL. Mr. Speaker, on Sunday, September 13 I will have the distinct pleasure of being the keynote speaker at the opening ceremonies for POW/MIA Recognition week in Matagorda County, Texas. This event will be sponsored by Matagorda County Veterans Services as a part of POW/MIA Recognition Week. Mr. Speaker, as a United States Air Force veteran I am well aware of the sacrifices which brave young men are required to make during times of war. Perhaps no better example of these sacrifices can be found than those endured by Prisoners of War and those Missing In Action. From ``Hanoi Hilton'' to ``Saving Private Ryan'' we have seen the dramatic horrors that war brings, but behind the stories, beyond the silver screen, there are real Private Ryan's who never do make it home. And there are families broken, lives affected and communities touched, by the real sacrifices of the real heroes who fight America's wars. I believe that no young man or woman has ever entered the military hoping to face combat, but most answer the call because they believe in the liberties which our nation was founded upon, and they see our nation as a beacon of liberty. It is to these young people that I wish to bring honor and it is to those who have become Missing, or are held Prisoner, to whom I believe this nation must pledge ongoing fealty. Specifically, I would like to memorialize U.S. Army Sergeant Joe Parks, from Matagorda County, who died while in captivity in Vietnam. Mr. Speaker, our nation has suffered a great burden as a result of the wars of this century, in some instances it has nearly been torn apart by these wars, but none have suffered more than those who are missing, and their families, many of whom still hope against hope that they will one day return, either to resume lives or to be granted a proper burial. Our nation still has some 93,000 individuals who are unaccounted for, some of whom are believed to be POW's even now during a time of relative peace. Mr. Speaker, I believe we owe it to these men, and to their families, to get a full accounting for every person which this nation has sent abroad. I believe we owe it to our nation to bring each and every one of them home. With the opening of archives from the former Soviet Union we have seen evidence of how young American servicemen were allowed to become political chess pieces for a totalitarian regime. It is due to the efforts of groups such as Matagorda County Veterans Services that we can honestly say ``You Are Not Forgotten'' to those who have sacrificed so much. And it is critical that we keep these memories forever etched in our minds so that we might also recall the mantra ``never again.'' Never again should Americans be forced to face the brutalities of war, such as those faced in Prisoner of War camps, and never again should we allow brave Americans to go missing in action.

Mr. PAUL

Mr. PAUL. Mr. Speaker, the largest of all bubbles is now bursting. This is a worldwide phenomenon starting originally in Japan 9 years ago, spreading to East Asia last year, and now significantly affecting U.S. markets. All financial bubbles are currency driven. When central banks generously create credit out of thin air speculation, debt, and malinvestment result. Early on the stimulative effect is welcomed and applauded as the boom part of the cycle progresses. But illusions of wealth brought about by artificial wealth creation end when the predictable correction arrives. Then we see the panic and disappointment as wealth is wiped off the books. These events only occur when governments and central banks are given arbitrary authority to create money and credit out of thin air. Paper money systems are notoriously unstable; and the longer they last, the more vulnerable they are to sudden and sharp downturns. All countries of the world have participated in this massive inflationary bubble with the dollar leading the way. Being a political and economic powerhouse, U.S. policy and the dollar has had a major influence throughout the world and, in many ways, has been the engine of inflation driving world financial markets for years. But economic law dictates that adjustments will be made for all the bad investment decisions based on erroneous information about interest rates, the money supply, and savings. The current system eventually promotes overcapacity and debt that cannot be sustained. The result is a slump, a recession, or even a depression. When the government makes an effort to prevent a swift, sharp correction, the agony of liquidation is prolonged and deepened. This is what is happening in Japan and other Asian countries today. We made the same mistake in the 1930s. A crisis brought on by monetary inflation cannot be aborted by more monetary inflation or the IMF bailouts favored by the American taxpayer. It may at times delay the inevitable, but eventually, the market will demand liquidation of the malinvestment, excessive debt, and correction of speculative high prices as we have seen in the financial markets. All this could have been prevented by a sound monetary system, one without a central bank that has monopoly power over money and credit and pursues central economic planning. My concern is profound. The retirement and savings of millions of Americans are jeopardized. Economic growth could be reversed sharply and quickly as it already has in the Asian countries. Budget numbers will need to be sharply revised. The Federal Reserve hints at lower interest rates which means more easy credit. This may be construed as a positive for the market, but it only perpetuates a flawed monetary system. Protecting the dollar is our job here in the Congress, and we are not paying much attention. Although turmoil elsewhere in the world has given a recent boost to the dollar, signs are appearing that the dollar, unbacked by anything of real value, is vulnerable. Setting a standard for the dollar with real value behind it can restore trust to the system and will become crucial in solving our problems, soon to become more apparent. The sooner we understand the nature of the problem and start serious discussions on how to restore soundness to our money the sooner we can secure the savings, investments, and retirements of all Americans.

Mr. PAUL

Mr. PAUL. Mr. Chairman, I appreciate the opportunity to express my opposition to H.R. 3892, the English Language Fluency Act. Although I supported the bill when it was marked-up before the Education and Workforce Committee, after having an opportunity to study the Congressional Budget Office (CBO)'s scoring of H.R. 3892, I realized that I must oppose this bill because it increases expenditures for bilingual education. Thus, this bill actually increases the Federal Government's role in education. I originally supported this bill primarily because of the provisions voiding compliance agreements between the Department of Education and local school districts. Contrary to what the name implies, compliance agreements are the means by which the Federal Government has forced 288 schools to adapt the model of bilingual education favored by the Federal bureaucrats in complete disregard of the wishes of the people in those communities. The English Language Fluency Act also improves current law by changing the formula by which schools receive Federal bilingual funds from a competitive to a formula grant. Competitive grants are a fancy term for forcing States and localities to conform to Federal dictates before the Federal Government returns to them some of the moneys unjustly taken from the American people. Formula grants allow States and localities greater flexibility in designing their own education programs and thus are preferable to competitive grants. Although H.R. 3892 takes some small steps forward toward restoring local control of education, it takes a giant step backward by extending bilingual education programs for three years beyond the current authorization and according to CBO this will increase Federal spending by $719 million! Mr. Chairman, it is time that Congress realized that increasing Federal funding is utterly incompatible with increasing local control. The primary reason State and local governments submit to Federal dictates in areas such as bilingual education is because the Federal Government bribes States with moneys illegitimately taken from the American people to confer to Federal dictates. Since he who pays the piper calls the tune, any measures to take more moneys from the American people and give it to Federal educrats reduces parental control by enhancing the Federal stranglehold on education. Only by defunding the Federal bureaucracy can State, local and parental control be restored. In order to restore parental control of education I have introduced the Family Education Freedom Act (H.R. 1816), which provides parents with a $3,000 per child tax credit to pay for elementary and secondary education expenses. This bill places parents back in charge and is thus the most effective education reform bill introduced in this Congress. Mr. Chairman, despite having some commendable features, such as eliminating consent decrees, the English Language Fluency Act, H.R. 3892, is not worthy of support because it authorizes increasing the Federal Government's control over education dollars. I therefore call on my colleagues to reject this legislation and instead work for constitutional education reform by returning money and control over education to America's parents through legislation such as the Family Education Freedom Act.